Kirlin v. Halverson
758 N.W.2d 436, 2008 S.D. LEXIS 148, 2008 SD 107 (2008)
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Rule of Law:
An employer may be vicariously liable under respondeat superior for an employee's intentional torts if the act, though unauthorized, was not solely for the employee's personal interests and was foreseeable as typical or broadly incidental to the employment. Additionally, an employer may be directly liable for negligence if it had a duty to control an employee acting outside the scope of employment while on the employer's premises, or if it failed to provide reasonable supervision regarding known potential conflicts.
Facts:
- Kelly Cawthorne, his wife, and father were equal shareholders in PKJ, Inc., an HVAC business that had serviced the Empire Mall for approximately 15 years.
- By spring 2005, PKJ learned that the Empire Mall's owner, Macerich Corporation, had contracted with Carrier Commercial Services (Carrier) for HVAC maintenance, effectively ending PKJ's long-standing contract.
- On June 15, 2005, Kelly Cawthorne, while performing duct maintenance atop the Empire Mall, saw James Scott Kirlin, a Carrier employee, working on an HVAC unit.
- Kelly Cawthorne became incensed, confronted Kirlin, yelled obscenities at him, and batted away Kirlin's extended hand when Kirlin identified himself as a Carrier employee.
- Empire Mall operations manager, Tim Kelly, intervened, instructing Kelly Cawthorne to stay away from Kirlin and noting that Kirlin would be working at the mall for several more days.
- On June 16, 2005, Kelly Cawthorne assigned Kim Halverson, a long-time PKJ employee, to continue duct maintenance at the Empire Mall.
- James Scott Kirlin went into the penthouse atop the mall to retrieve air conditioning filters, having been told by Tim Kelly he was free to use PKJ's filters stored there.
- As Kirlin emerged from the penthouse with filters, Kim Halverson confronted him, stating Kirlin couldn't use "our filters," grabbed him, slammed him against the building, made offensive remarks, and continued to assault him, eventually knocking him unconscious after Kirlin attempted to defend himself.
Procedural Posture:
- James Scott Kirlin and Kristin Kirlin commenced a lawsuit in the South Dakota Second Judicial Circuit against Kim Halverson, Kelly Cawthorne, and PKJ, Inc. for personal injuries and loss of consortium.
- Defendants Kelly Cawthorne and PKJ, Inc. filed a motion for summary judgment on the theories of respondeat superior, civil conspiracy, and various forms of negligence.
- The circuit court entered a memorandum opinion granting summary judgment for Cawthorne and PKJ on all claims.
- The Kirlins appealed the circuit court's grant of summary judgment to the South Dakota Supreme Court.
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Issue:
Did the circuit court err in granting summary judgment to PKJ, Inc. and Kelly Cawthorne, precluding a jury from determining liability for Kim Halverson's assault under theories of respondeat superior, duty to control, and negligent supervision, and for civil conspiracy?
Opinions:
Majority - Gilbertson, Chief Justice
Yes, the circuit court erred in granting summary judgment to PKJ, Inc. on the claims of vicarious liability under respondeat superior, duty to control, and negligent supervision, finding that genuine issues of material fact remained for a jury to decide. However, the circuit court correctly granted summary judgment on the civil conspiracy claim and all individual claims against Kelly Cawthorne. The Court affirmed that an employer is vicariously liable for an employee's wrongful acts committed within the scope of employment, which includes acts 'closely connected' and 'fairly and reasonably incidental' to the job, even if improper. Applying a foreseeability test from Leafgreen and Restatement (Second) of Agency § 245, the Court found that an employee’s intentional use of force could be within the scope of employment if not solely motivated by personal interests, but also by a purpose to further the master’s business (however misguided), such as protecting property or discouraging competition. The Court determined that Halverson's confrontation with Kirlin could be viewed by a jury as having dual motivations—personal animosity and protecting PKJ’s perceived property or business interests—making the assault potentially foreseeable and thus within the scope of employment. Regarding direct negligence, the Court found that PKJ had a 'special relationship' with Halverson under Restatement (Second) of Torts § 317, imposing a duty to control his conduct while on the premises. This duty arose because PKJ knew of its ability to control Halverson (via discipline or termination) and the necessity to do so was foreseeable given Kelly Cawthorne's confrontation with Kirlin the prior day and PKJ’s failure to inform Halverson about the changed contract and Kirlin’s right to use items. Thus, a jury should decide if PKJ breached this duty. The Court affirmed summary judgment on negligent hiring and retention, finding Halverson’s background (one prior domestic conviction, dismissed assault charge, traffic violations) did not create a duty for PKJ to perform a background check or terminate him, especially given his minimal public contact and policy concerns about rehabilitation. Negligent training was also affirmed due to lack of evidence. Civil conspiracy was correctly dismissed because Kirlin provided only speculation, not factual evidence of an agreement. Finally, individual claims against Kelly Cawthorne were dismissed because his actions were as an agent of PKJ, the corporate employer.
Concurring - Meierhenry, Justice
Justice Meierhenry concurred with the majority's decision on all issues, particularly agreeing that genuine issues of material fact exist regarding vicarious liability that prevent summary judgment. The concurrence specifically pointed out that the 'foreseeability' test for scope of employment, as used by the majority, has been superseded in the Restatement (Third) of Agency § 7.07(2) (2006). This newer Restatement moves away from 'foreseeability' to avoid confusion with negligence foreseeability, instead focusing on whether an employee is 'performing work assigned by the employer or engaging in a course of conduct subject to the employer’s control,' and specifically not within scope if acting on an 'independent course of conduct not intended by the employee to serve any purpose of the employer.' Justice Meierhenry noted that this new approach, focusing on employee intention, is similar to the majority's discussion of employee intent in its respondeat superior analysis and suggested it could be considered in future cases.
Analysis:
This case significantly clarifies the parameters for employer liability for employee misconduct, particularly intentional torts like assault. It reinforces that an employee's act need not be explicitly authorized or even beneficial to the employer to fall within the 'scope of employment' for respondeat superior, focusing instead on whether it's broadly incidental or connected to the job, and not solely personally motivated. The decision also strengthens the legal framework for direct employer negligence through the duty to control and negligent supervision, especially when employers are aware of potential conflicts and fail to take reasonable preventative steps or provide adequate direction. This ruling emphasizes that factual ambiguities concerning an employee's motivations or an employer's knowledge and actions require jury determination, making summary judgment less appropriate in such complex scenarios, and potentially increasing the burden on employers to proactively manage workplace interactions and provide clear guidelines.
