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Vargas v. FMI, Inc.

California Court of Appeals, Second District, Third Division

January 23, 2015

JOSE VARGAS, Plaintiff and Appellant,
FMI, INC., et al., Defendants and Respondents.


APPEALS from judgments of the Superior Court of Los Angeles County, No. BC459827 Joseph R. Kalin, Judge.

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Law Offices of Bernardo De La Torre, Bernardo De La Torre and Ronald A. Martinetti for Plaintiff and Appellant.

Wood, Smith, Henning & Berman, David F. Wood and Steven L. Rodriguez for Defendants and Respondents.



Jose Vargas (Vargas or plaintiff) and Luis Felipe Villalobos (Villalobos) were a two-man team driving a tractor-trailer across the country. Villalobos was driving and Vargas was in the sleeper berth when the tractor-trailer rolled over, injuring Vargas. Vargas sued FMI, Inc. (FMI) (the motor carrier and trailer owner), Eves Express, Inc. (Eves) (the tractor owner), Eswin Suchite (Suchite) (Eves’s principal), and Villalobos (the driver), for negligence. The trial court granted summary judgment for FMI and Eves, concluding as a matter of law that neither was vicariously liable for Villalobos’s alleged negligence.

Vargas appeals, contending that: (1) as a federally licensed motor carrier, FMI owed him a nondelegable duty of care and is vicariously liable for Villalobos’s negligence; and (2) Eves is vicariously liable for Villalobos’s negligence under Vehicle Code section 17150 (vehicle owner is liable for negligence of permissive user). FMI and Eves respond that: (1) under Privette v. Superior Court (1993) 5 Cal.4th 689 [21 Cal.Rptr.2d 72, 854 P.2d 721] (Privette), a hirer (FMI) is not vicariously liable for the negligence of a person (Villalobos) hired by an independent contractor (Eves); and (2) Eves is not vicariously liable for the negligence of Villalobos under the Graves Amendment, 49 United States Code section 30106(a).

We reverse. Privette and its progeny have never been applied to a case like the present one, where the basis for vicarious liability is alleged to be a “franchise granted by public authority” (Rest. 2d Torts, § 428)—here, a federal motor carrier’s license.[1] Moreover, federal law requires motor carriers using leased vehicles to “have control of and be responsible for” such vehicles (49 U.S.C. § 14102(a)(4)) in order to “protect the public from the tortious conduct of the often judgment-proof truck lessor operators” (AmeriGas Propane, L.P v. Landstar Ranger, Inc. (2010) 184 Cal.App.4th 981, 994 [109 Cal.Rptr.3d 686]).

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Finally, defendants have not established as a matter of undisputed fact that the tractor’s owner is entitled to the protection of the so-called Graves Amendment, 49 United States Code section 30106(a), which shields owners of leased vehicles “engaged in the trade or business of renting or leasing motor vehicles” from vicarious liability for the alleged negligence of their lessee’s drivers. Accordingly, the trial court erred in granting defendants’ motion for summary judgment.


I. The Tractor/Trailer Accident

FMI is a federally licensed motor carrier that operates a shipping distribution center in San Pedro, California. It arranges transportation of goods for its customers by hiring contractors, sometimes called “owner/operators, ” who lease their tractors and drivers to FMI. Eves, owned by Suchite, is one such owner/operator.

In January 2010, FMI was retained to deliver cargo from California to New Jersey. FMI selected Eves’s tractor and two of Eves’s drivers, plaintiff and Villalobos, to make the trip. Plaintiff and Villalobos drove the tractor to FMI’s yard in San Pedro, California, connected the tractor to a trailer, and then departed for New Jersey.

About four hours into the drive, while plaintiff was asleep in the tractor’s sleeping berth, Villalobos lost control of the tractor-trailer. The vehicle hit a center divider and rolled over, injuring plaintiff.

II. The Complaint

Plaintiff filed a complaint in April 2011 alleging a single cause of action for negligence against FMI, Eves, Suchite, and Villalobos, among others. The complaint alleges as follows:

“9. On January 20, 2010, Plaintiff Jose Vargas was a passenger in the cab of a tractor-trailer driven by Defendant Luis Felipe Villalobos. Plaintiff was lawfully in the cab and was asleep when Defendant Villalobos apparently nodded off and lost control of the truck which swayed out of its lane and smashed into the center median (in violation of Vehicle Code section 21658(a)—unsafe lane change.) At the time of the crash, Defendant had been driving east on Interstate 40 in San Bernardino carrying a load of garments to New Jersey. Plaintiff is informed and believes that Defendants FMI, Inc. and Summit Logistics International are experienced providers of integrated logistics and freight forwarding services for the national garment industry.

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“10. Plaintiff is informed and believes that Defendant FMI, Inc.... was operating the vehicle under a public franchise and was subject to regulations enacted for the protection of the public (such as Plaintiff Vargas). All Defendants, including FMI, Inc. and Eves Express, Inc. were under a nondelegable duty to Plaintiff (and other members of the public) and so were liable for the negligence of Defendant Villalobos in seriously injuring Plaintiff (who has to date over $50, 000 in medical bills).

“11. Plaintiff is further informed and believes and upon that basis alleges that all Defendants were engaged in interstate commerce and were regulated by statute and that they were each vicariously responsible for Defendant Villalobos’s negligence under regulations and written lease agreements and/or under the doctrine of placard liability.[2] Moreover, Plaintiff is informed and believes that Defendant Eves Express, Inc. and Eswin Saul Suchite (as well as other Defendants) failed to properly train, monitor, and supervise Defendant Villalobos and that had he been properly trained and monitored he would not have fallen asleep at the wheel of the truck and rolled it over.

“12. Defendants and each of them had a duty whether common law or statutory not to injure Plaintiff and they breached that duty by the careless and negligent acts set forth in paragraphs 9 through 11. Defendants[] and each of their breaches caused direct harm to the Plaintiff including loss of income and other damages that shall be proven up at trial or added by amendment upon leave of Court.”

III. Defendants’ Motion for Summary Judgment

FMI and Eves filed a motion for summary judgment in July 2012. They asserted that plaintiff was an independent contractor, not an employee, of FMI and Eves. As such, neither FMI nor Eves owed plaintiff a duty to provide a safe workplace. They contended: “FMI and Eves Express implicitly delegated all workplace safety responsibilities and tort liability to Plaintiff, an independent contractor, with regard to workplace safety issues. Under California law (SeaBright Ins. Co. v. U.S. Airways[, Inc. (2011) 52 Cal.4th 590 [129 Cal.Rptr.3d 601, 258 P.3d 737].]), this delegation is implicit and presumed in contracts entered into between hirers (FMI and Eves Express) and independent contractors (Plaintiff).... As a result of the implied and presumed

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delegation of workplace safety recognized under SeaBright Ins. Co. v. U.S. Airways, supra, FMI and Eves Express owed no duty of care to Plaintiff. Therefore, Plaintiff cannot prove a prima facie case of Negligence against FMI and Eves Express, and FMI and Eves Express are entitled to judgment as a matter of law.”

Plaintiff opposed the summary judgment motion. He admitted that he was an independent contractor of FMI and Eves, but contended that his negligence claim against FMI was properly analyzed under the “nondelegable duty” doctrine. Under that doctrine, because FMI is a federal motor carrier regulated by the Department of Transportation and state law, it cannot delegate its responsibility to the public by characterizing its drivers as independent contractors. Accordingly, FMI is liable to members of the public for the negligence of its drivers, including Villalobos. Plaintiff also contended that Eves was liable for Villalobos’s negligence pursuant to Vehicle Code section 17150 because Villalobos was a permissive user of Eves’s truck.

In opposition to the motion, plaintiff submitted FMI’s responses to requests for admissions, in which FMI admitted that the Motor Vehicle Lease Agreement between it and Suchite incorporated language required by federal regulation (49 C.F.R. § 376.12 (2014)), and further admitted that it operated pursuant to a Contract Carrier Permit issued to it by the U.S. Department of Transportation (Federal Motor Carrier Safety Administration), DOT No. 1125882. Further, in response to discovery, FMI produced a “Motor Carrier Identification Report” that identified it as an Interstate Carrier Authorized For Hire. In the most recent calendar year, it owned 184 truck tractors and 506 trailers, “trip leased” 165 truck tractors, and employed or contracted with 349 drivers for interstate and intrastate trips. FMI carried a Motor Carrier Policy of Insurance for Public Liability, with limits of $2,000,000 per accident. FMI admitted that it was a “motor carrier of property” as defined in Vehicle Code section 34601.

In their reply papers, FMI and Eves asserted that plaintiff was a co-driver, not a member of the “motoring public, ” and thus was not entitled to the protections of the nondelegable duty doctrine. Further, Eves asserted that Vehicle Code section 17150 was preempted by the federal Graves Amendment, 49 United States Code section 30106, which abolished vicarious liability for owners of leased vehicles in some circumstances.

The trial court granted defendants’ summary judgment motion. Its order said: “The issue before the court is whether defendants owed a legal duty to plaintiff. Plaintiff is a self-professed independent contractor as was the driver Luis Felipe Villalobos. A hir[er] cannot be held liable for injuries to an independent contractor. (Privette v. Superior Court[, supra, ] 5 Cal.4th 689.)

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In (SeaBright v. U.S. Airways[, supra, ] 52 Cal.4th 590) the Supreme Court extended Privette to service contracts, [holding] that the duty to provide a safe working environment is implicitly and presumptively delegated in all independent contractor agreements. Also see (Hooker v. Department of Transportation (2002) 27 Cal.4th 198 [115 Cal.Rptr.2d 853, 38 P.3d 1081])."

The trial court entered judgment for FMI on December 4, 2012, and for Eves on January 28, 2013. Vargas timely appealed.


A court may grant summary judgment only if there are no triable issues of material fact and the moving party is entitled to judgment as a matter of law. (Code Civ. Proc., § 437c, subd. (c).) A defendant moving for summary judgment must show that one or more elements of the plaintiff’s cause of action cannot be established or that there is a complete defense. (Id., subd. (p)(2).) The defendant can satisfy its burden by presenting evidence that negates an element of the cause of action or evidence that the plaintiff does not possess and cannot reasonably expect to obtain evidence needed to establish an essential element. (Miller v. Department of Corrections (2005) 36 Cal.4th 446, 460 [30 Cal.Rptr.3d 797, 115 P.3d 77] (Miller).) If the defendant meets this burden, the burden shifts to the plaintiff to present evidence creating a triable issue of material fact. (Code Civ. Proc., § 437c, subd. (p)(2).)

We review the trial court’s ruling on a summary judgment motion de novo, and liberally construe the evidence and resolve all doubts concerning the evidence in favor of the party opposing the motion. (Miller, supra, 26 Cal.4th at p. 460.) We must affirm a summary judgment if it is correct on any of the grounds asserted in the trial court, regardless of the trial court’s stated reasons. (Garrett v. Howmedica Osteonics Corp. (2013) 214 Cal.App.4th 173, 181 [153 Cal.Rptr.3d 693].)


FMI urges that under the California Supreme Court’s decisions in Privette, supra, 5 Cal.4th 689, Tverberg v. Fillner Construction, Inc. (2010) 49 Cal.4th 518 [110 Cal.Rptr.3d 665, 232 P.3d 656] (Tverberg), and SeaBright Ins. Co. v. U.S. Airways, Inc., supra, 52 Cal.4th 590 (SeaBright), an entity such as FMI (the “hirer”) that hires an independent contractor implicitly delegates to the independent contractor any tort law duty it owes the independent contractor or the independent contractor’s employees to ensure workplace safety. Accordingly, because Eves, Villalobos, and plaintiff were independent contractors, FMI did not owe them a duty to provide a safe workplace, and thus it cannot be liable for plaintiff’s injuries.

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Plaintiff disagrees. Although he concedes his independent contractor status, he contends that under established law, because FMI was operating under a public franchise (i.e., a federal motor carrier permit), it had a nondelegable duty to safely operate the trucks driven for its benefit. Accordingly, FMI is liable to plaintiff for the negligence of ...

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