ATS, INC. v. Beddingfield

Rule of Law:

Under the loaned-servant doctrine, a general employer is not vicariously liable for the negligent acts of its employee if, at the time of the specific act causing injury, the employee was acting in the business of and under the direction and control of a temporary employer.

Facts:

• ATS, Inc., an employee-leasing company, entered into a 'Personnel Payroll Service Agreement' with Mercer Trucking, Inc., which specified that Mercer Trucking would provide all 'work related instructions' to personnel.
• Under the agreement, Mercer Trucking retained the primary responsibility for hiring and firing its drivers, who were then formally placed on ATS's payroll.
• In May 1999, Erwin Mercer of Mercer Trucking interviewed, road-tested, and hired Roger Walker as a truck driver.
• Mercer informed Walker that although he was technically an employee of ATS, he would receive all his orders directly from Mercer.
• Walker signed an 'Acceptance of Employment' form acknowledging he was an ATS employee but would be under 'day-to-day supervision' from another party.
• On May 27, 1999, Walker telephoned Mercer for instructions after completing a delivery.
• Mercer directed Walker to drive to Chattanooga, Tennessee, for a possible freight pickup.
• While en route to Chattanooga as instructed by Mercer, Walker's truck collided with a minivan, killing all four occupants.
• At the time of the fatal accident, ATS had not yet received Walker's hiring paperwork and was unaware that Mercer Trucking had hired him.

Procedural Posture:

• The personal representatives of the four deceased victims ('the plaintiffs') filed wrongful-death actions against Walker, Mercer Trucking, and ATS in the Jefferson Circuit Court, a trial court in Alabama.
• ATS filed a motion for a summary judgment, which the trial court denied.
• The case proceeded to a jury trial, which was split into three phases.
• At the close of the plaintiffs' evidence and again at the close of all evidence in phase one, ATS moved for a judgment as a matter of law (JML), both of which the trial court denied.
• The jury returned a verdict finding Walker negligent and reckless and holding both ATS and Mercer Trucking vicariously liable.
• The jury awarded $9.5 million in compensatory damages and $15 million in punitive damages against the defendants, including ATS.
• The trial court entered a judgment on the jury's verdict.
• ATS filed a post-judgment motion for a JML or, alternatively, for a new trial, which the trial court denied.
• ATS, as appellant, filed a timely notice of appeal to the Supreme Court of Alabama.