Parsons v. Malpass CV-98-102-JD 03/19/99

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE

Gardner W. Parsons, Jr., et al.

v. Civil No. 98-102-JD

Charles U. Malpass, et al.

O R D E R

The plaintiffs, Gardner Parsons, Jr., and his wife, Mary

Parsons, brought this personal injury action against the

defendants, Charles Malpass, Vernon Malpass, and Second Hand Rose

Vehicle ("Second Hand Rose"), asserting claims of negligence and

loss of consortium. Before the court is the motion of defendants

Vernon Malpass and Second Hand Rose seeking dismissal of counts

three through ten (document no. 15).

Background1

On November 28, 1997, Gardner Parsons was operating a motor

vehicle owned by his wife, Mary, on Route 1 in North Hampton, New

Hampshire. Charles was operating a 1995 Mercedes wagon purchased

1The motion to dismiss before the court addresses claims against defendants Vernon Malpass and Second Hand Rose Vehicle predicated upon the their liability for the actions of Charles Malpass. The background section therefore discusses at length the relationship between the parties. To avoid confusion the court hereinafter refers to the Malpasses by their first names. by his wife, Ann, on Hobbs Road and was turning onto Route 1 when

his automobile collided with the Parsons' automobile.2

The automobile that Charles was operating at the time of the

accident bore Second Hand Rose dealership plates. Vernon owns

Second Hand Rose Vehicle, an unincorporated used car dealership

located in Delaware. He began the enterprise in July, 1996, in

part with funds loaned to him by Ann. The loan is outstanding,

not evidenced by any notes, and is interest free. Evidence

indicates that repayment is expected, although unscheduled.

Charles had just dropped off Jay Megan, a family friend, at

Megan's home, and was on his way either to a liguor store to pick

up some champagne for an engagement party or to his home.3 Megan

had purchased an automobile from Ann some months prior to the

accident. Charles facilitated this but did not receive any

compensation for his actions.

Although the automobile Charles was driving was purchased by

Charles's wife in April 1997, it was not registered in any state.

Charles testified that he had delayed registering the car because

2The record is inconsistent as to whether Ann actually purchased the car herself or whether she had the car purchased for her by Charles. In any event the Retail Certificate of Sale identifies her as the purchaser of the automobile and her status as purchaser is corroborated by testimony in the record.

31he record contains conflicting evidence on Charles's destination.

2 it had mechanical problems.4 After failed attempts to repair it,

Charles contacted his brother and inquired whether Vernon might

be able to sell the vehicle if Charles and Ann were unsatisfied

with it. The record indicates that at the time of the accident

Charles and Ann were still unsure whether they would keep the

vehicle, although they were preparing to bring the vehicle to

Delaware to sell it through Second Hand Rose should they decide

not to keep it. Vernon indicated that he would be willing to try

to sell the vehicle and that he might have success as his store

is on a busy highway, but that it might prove difficult to sell a

1995 Mercedes as he generally sells older cars. In any event,

neither Vernon nor Second Hand Rose would earn a profit from the

transaction.

Both Charles and Vernon state that Charles was not an

employee or partner of Second Hand Rose. However, on occasion he

assisted Vernon with financial accounts, helping Vernon set up

financial books when Second Hand Rose initially opened. On five

or six dates, when Charles was living in New Hampshire and

visited Vernon in Delaware, if Vernon did not have time to spend

at home with Charles, Charles would drop by Second Hand Rose and

4Ihere is evidence that at one point Charles had attempted to register the car in Maryland but was unsuccessful as the application was not completed in full.

3 assist him by updating some automobile accounts and by driving

Vernon to acguire vehicles for Second Hand Roses's inventories.5

In addition, he gave Vernon advice on filling out titles for

automobiles. He was never paid for his services and Vernon

characterized the assistance as a favor to a brother.

Charles was also given power of attorney to purchase

automobiles for Second Hand Rose if he should come across a

favorable deal. Vernon and Charles had an agreement whereby

Charles would "keep an eye out" for good automobile deals. If

Charles found one and purchased the automobile, Vernon agreed to

reimburse him, although Charles understood that confirmation with

Vernon was necessary.6 To this end, Vernon sent him books on

automobile values. There was never any written or formal

agreement between Vernon and Charles regarding this arrangement

besides the power of attorney, which is not in the record.

5Charles was listed on Second Hand Rose's insurance policy as an "owner, employee, or relative who will operate owned autos," Pis.' Opp., Ex. 0 at 4. Elsewhere in the policy Vernon states that Second Hand Rose had one full time employee and one part time employee, although it does not identify the part time employee. Vernon denies having any employees beyond himself, although the record indicates he received help from friends who would assist him in repairing automobiles, all for no compensation. Neither Vernon nor Second Hand Rose has ever filed any tax or benefits documents for any alleged employees.

6Charles characterized himself as an authorized representative of Second Hand Rose in his statement to an insurance company. Pis.' Opp., Ex. M at 1, and he signed his name as such. Pis.' Ex. I at 4.

4 The record indicates that Charles did not make any purchases

for Vernon or Second Hand Rose, with one possible exception. At

one point in time Charles called Vernon, asked him if he could

sell a Chevrolet Caprice station wagon, and when Vernon stated

that he could, Charles and his son drove it to Wilmington,

Delaware, and left it for Vernon at the Wilmington airport. The

record is ambiguous as to the origin of the automobile because

Vernon could not recall with absolute certainty whether it was an

automobile already owned by the family or not, although he

believed it was. Nor could Vernon recall whether there were

dealer plates on the automobile. It is therefore unclear whether

Charles purchased the Caprice.

Second Hand Rose had been issued six dealer plates by the

State of Delaware. Vernon did not have a use for six dealer

plates and therefore permitted Charles to use them if he needed

them. He anticipated that they would be used to acguire vehicles

for Second Hand Rose. When Charles came to Delaware he would

occasionally take a dealer plate. Vernon never reguested that

the plates be returned and never reguested that he be notified if

Charles used the plates. Vernon never refused to give Charles

permission to use the plates.

Charles had one or two in his possession at the time of the

5 accident, including the plate on the car involved in accident.

Charles had a history of using the dealer plates on various

automobiles, including another Mercedes station wagon owned by

his wife and a Mercedes coupe. Although Vernon authorized

Charles to use the plates, Vernon was generally unaware of

Charles's use of the plates, and was unaware that the plates were

on the car at the time of the accident.

On February 25, 1998, the plaintiffs filed this action

asserting ten counts. Counts one and two, not contested here,

assert that defendant Charles is liable for negligence in the

accident and resulting loss of consortium. Counts three through

ten assert the liability of Vernon individually. Second Hand

Rose, Vernon Malpass d/b/a Second Hand Rose, and Vernon Malpass

and Charles Malpass, d/b/a Second Hand Rose, for Charles's

alleged negligence and resulting loss of consortium. Defendants

Vernon and Second Hand Rose move to dismiss the claims against

them, asserting a lack of agency or employment relationship and

contesting whether the trip at issue was within the scope of such

a relationship.

Discussion

A. Standard of Review

Although the defendants move to dismiss counts three through

6 ten of the complaint without specifying in their motion the

Federal Rule of Civil Procedure pursuant to which they move, in

their reply to the plaintiffs' objection the defendants

characterize their motion as a Rule 12(b)(6) motion. However,

the defendants have attached numerous exhibits and their motion

is premised upon the evidence in the record, repeatedly citing to

depositions or interrogatories.

"Rule 1 2 (b) provides that a court shall convert a motion to

dismiss for failure to state a claim into one for summary

judgment if 'matters outside the pleadings are presented to and

not excluded by the court.'" C.B. Trucking, Inc. v. Waste

Management, Inc.,

(1st Cir. 1998) (guoting Fed.

R. Civ. P. 12(b)(6)). The First Circuit "employ[s] a functional

approach to the conversion process."

"Accordingly, [it] has

not reguired a district court to give express notice of

its intention to convert if the surrounding circumstances

effectively place the parties on notice that the court has the

option of treating the motion as a motion for summary judgment

and the parties have been given 'reasonable opportunity to

present all material made pertinent to such a motion by Rule

56.'" I d . (guoting Rodriguez v. Fullerton Tires Corp.,

(1st Cir. 1997) ) .

Under the circumstances of this case the court will convert

7 the defendants' motion to one for summary judgment. They have

supplied additional documentary materials, their arguments are

replete with citation to exhibits and are premised upon evidence

therein, and they have been allowed the opportunity to file

additional reply memoranda. Moreover, the plaintiffs' objection

expressly identified the issue of conversion for the defendants

and notified them that their motion had to be treated as one for

summary judgment because of the defendants' inclusion of

supporting evidentiary materials. Indeed, the defendants' notice

of the likelihood of conversion is indicated by their reply to

the plaintiffs' opposition where they stated "[e]ven if the court

treats this motion as one for summary judgment, the Plaintiffs,

in responding to a motion for summary judgment, have the burden

of setting forth specific facts demonstrating that there is a

genuine issue for trial." Reply at 3.

The role of summary judgment is "to pierce the boilerplate

of the pleadings and assay the parties' proof in order to

determine whether trial is actually reguired." Snow v.

Harnischfeger Corp.,

(1st Cir. 1993) (guoting

Wynne v. Tufts Univ. Sch. of Med . ,

(1st Cir.

1992)). The court may only grant a motion for summary judgment

where the "pleadings, depositions, answers to interrogatories,

and admissions on file, together with the affidavits, if any. show that there is no genuine issue as to any material fact and

that the moving party is entitled to a judgment as a matter of

law." Fed. R. Civ. P. 56(c). The parties seeking summary

judgment bear the initial burden of establishing the lack of a

genuine issue of material fact. See Celotex Corp. v. Catrett,

(1986); Quintero de Quintero v. Aponte-Rogue,

(1st Cir. 1992). The court must view the

entire record in the light most favorable to the plaintiffs,

"'indulging all reasonable inferences in [their] favor.'"

Mesnick v. General Elec. Co . ,

(1st Cir. 1991)

(guoting Griqqs-Rvan v. Smith,

(1st Cir.

1990)). However, once the defendants have submitted a properly

supported motion for summary judgment, the plaintiffs "may not

rest upon mere allegation or denials of [their] pleading, but

must set forth specific facts showing that there is a genuine

issue for trial." Anderson v. Liberty Lobby, Inc.,

(1986) (citing Fed. R. Civ. P. 56(e)).

The defendants have premised their motion on their

contention that: (1) Charles was neither an agent nor an

employee of Vernon, nor of Second Hand Rose; and (2) even if he

was an agent or employee, he was not acting within the scope of

his agency or employment relationship at the time of the

accident. In their objection, the plaintiffs assert four grounds upon which Charles can allegedly be found to be an agent of

Vernon and/or Second Hand Rose. They contend that there are

genuine issues of material fact as to whether Charles was a

partner, joint venturer, employee or general agent of Vernon

and/or Second Hand Rose. They further contend that genuine

issues of material fact exist as to whether Charles was acting

within the scope of the agency or employment relationship at the

time of the accident.

In addressing the parties' arguments, the court first

resolves the issue of whether there is a genuine issue of

material fact regarding the existence of an agency relationship,

be it in the form of a partnership, a joint venture, an

employment relationship, or a general agency relationship. The

court considers the arguments seriatim. See infra, sections B,

C, and D. The court then addresses the issue of whether Charles

was acting within the scope of such an agency relationship at the

time of the accident. See infra, section E.

As a preliminary issue, however, the court notes thatthe

parties fail to address the issue of what law. New Hampshire or

Delaware, they believe controls particular aspects of the case.

Although at times the parties cite New Hampshire and Delaware

law, without specifying which governs the issue presented,the

parties generally rely upon New Hampshire law. The court

10 accordingly applies New Hampshire law unless otherwise noted.

B. Partnership and Joint Venture

The plaintiffs argue that Second Hand Rose and Vernon can be

held liable based upon the alleged existence of a partnership or

a joint venture between Vernon and Charles and the agency

relationship resulting therefrom. The defendants fail to contest

Charles's status as a partner of Vernon's in Second Hand Rose or

as a joint venturer with Vernon, and supply no law or analysis on

the issue beyond their general agency and employee arguments.7

It is the burden of the movant to identify for the court

those issues upon which there are no genuine issues of material

fact and to demonstrate that they are entitled to summary

judgment. See Celotex Cor p ., 477 U.S. at 323. The court

therefore does not reach the issue of whether the record could

reasonably support an inference that Charles was a partner in

Second Hand Rose or involved in a joint venture to sell the

automobile. For the purposes of this order the court assumes

that such agency relationships existed. Liability may flow

therefrom if Charles could reasonably be found to have been

7Nor do the defendants raise any objection as to the breadth of the complaint and its ability to encompass allegations of a joint venture.

11 acting within the scope of such an agency relationship at the

time of the accident as discussed further in section E.

C. Employment

In Boissonnault v. Bristol Federated Church,

(1994) the New Hampshire Supreme Court discussed the

elements of an employment relationship under New Hampshire law.

New Hampshire has adopted "what is now referred to as the

totality of the circumstances test, reguiring consideration of

many factors, including the criteria set forth in Restatement

(Second) of Agency § 220 (1958)." I d . (guotations and citations

omitted). The Restatement identifies as relevant factors, among

other things: (1) the control exerted over the performance of

the services; (2) whether it is a distinct occupation or

business; (3) whether in the occupation the work is performed

under direct supervision or by a specialist; (4) the skill

reguired; (5) the instrumentalities provided; (6) the length of

time the person is employed for; (7) payment; and (8) whether the

parties believe they are forming a master servant relationship.

Restatement (Second) of Agency, § 220 (1958) .

Control, although no longer given the dispositive weight

courts once attributed to it, is still a factor central to the

determination of an employment relationship. In the case at hand

12 the record indicates that Vernon exercised very little control

over Charles. He had given Charles power of attorney and

authorized him to purchase automobiles for Second Hand Rose.

However, as is evident from Vernon's deposition, the

authorization was extremely informal:

I was just getting going, you know. I was trying to entertain something of maybe getting automobiles from up here that aren't available down there. I said look, you see older cars that you think I could use, buy them for me. I will reimburse you or whatever. Call me. I'll send you the money or whatever . . . .

Vernon D e p . at 78-79. Broad discretion was obviously conferred.

The record does not indicate that Vernon could direct Charles to

actively look for and acguire automobiles, or that he could tell

him how to look for automobiles. Indeed the evidence indicates

that the only control Vernon had over Charles was the power to

tell him not to purchase an automobile, as Charles testified at

his deposition that he had to obtain Vernon's approval before

using the power of attorney. See Charles Dep. Vol. II at 94.

Nor did Vernon supervise Charles's actions or lack thereof.

Charles's work on behalf of Second Hand Rose was sporadic at

best. He assisted Vernon when Second Hand Rose was first opened

and on occasions when he visited Vernon and Vernon did not have

leisure time to spend with him. Other than perhaps securing the

Caprice, the circumstances of which are ambiguous, the record

13 indicates that over Second Hand Rose's existence up to the date

of the accident Charles never exercised his authorization to

purchase automobiles for Second Hand Rose.8

The record indicates that the parties certainly did not

consider Charles an employee of Second Hand Rose. See Vernon

Interrogatories at 1, 8, 9. This is corroborated by the lack of

evidence that Charles was paid, received wages, or was otherwise

compensated for any labor he offered Vernon, and the lack of

control Vernon exercised over Charles.9

Nor does the record indicate that Vernon supplied Charles

with instruments necessary to secure automobiles such as would

support finding an employer/employee relationship. He did not

provide Charles with funds to purchase the automobiles. There is

no evidence that Vernon provided Charles with gas mileage or

lists of auctions or other such places to look for automobiles.

81he court also notes that Charles's labor valuing automobiles and their potential for resale and updating financial accounts is not unskilled labor such as would indicate an employment relationship. See Restatement (Second) of Agency, § 22 0 comment h.

9Given, inter alia, the facts of this case and Second Hand Rose's tendency to have various people stop by and assist Vernon, and the lack of any other documentation such as tax documents which could indicate employment, the statement on Second Hand Rose's insurance application that it had a part time employee does not, without more, create a genuine issue of material fact that Second Hand Rose employed Charles on a part time basis.

14 Vernon did occasionally mail car value booklets to Charles but

this, even considering Charles's power of attorney and his

listing as an occasional driver on the Second Hand Rose insurance

policy, hardly supplied Charles with the instrumentalities to

look for and purchase cars for Second Hand Rose or Vernon.

Regarding the potential instrumentality of the car, the

plaintiffs contend that there is a genuine issue of material fact

surrounding the ownership of the automobile involved in the

accident, and that this has bearing on whether an employment

relationship existed and whether Charles was acting within the

scope of it when the accident occurred. They rely upon evidence

that: (1) the automobile was unregistered with an open title at

the time of the accident; (2) the car bore Second Hand Rose

dealership plates; and (3) Vernon's automobile insurance

application for Second Hand Rose lists his brother, Charles, as

an owner, employee, or relative who could operate owned autos.

While the vehicle was unregistered with an open title at the

time of the accident, the Retail Certificate of Sale lists Ann as

the purchaser of the vehicle. There is no evidence nor

allegation that Ann was a partner, joint venturer or agent of any

kind of Vernon or Second Hand Rose. Vernon testified that the

car was purchased for Ann, and Charles testified that Ann was the

owner of the vehicle. Vernon stated that although he was asked

15 if he might be able to sell it as an eventuality if Charles and

Ann chose not to keep it, neither he nor Second Hand Rose were

the intended recipients of the automobile. Charles testified

similarly.

Morever, the circumstances of this case undermine the import

of Charles's use of the Second Hand Rose plates. Evidence in the

record indicates that Charles used the plates on at least three

family cars, including the car involved in the accident. There

is no evidence nor allegation that these cars were owned by,

purchased for, sold through, or otherwise associated with Vernon

or Second Hand Rose beyond the use of the plates. Charles and

Ann therefore had a history of purchasing cars and operating them

with Second Hand Rose plates. Indeed, on the date of Charles's

deposition, Charles was using one of the plates on a white

Mercedes wagon that belonged to his wife.10 Vernon also

testified that Charles had the license plates, one or two at a

time, on an ongoing basis. Although Charles had standing

permission to use the plates "on any car," and the permission was

never refused, Vernon was unaware of the details of Charles's use

10Both of the first two cars that Charles used the plates on have since had their registrations expire and are now, therefore, unregistered as well. The record contains conflicting evidence as to whether they are still driven, although Charles's use of one of the automobiles, with Second Hand Rose plates, for transportation to his deposition, suggests that they are.

16 of the plates.

Nor did Vernon know that the vehicle in the accident bore

Second Hand Rose plates. He had never seen the car before, and

had had only one conversation about the car with Charles before

the accident. In that conversation Charles asked if Vernon could

sell the car in the event he and Ann decided not to keep it.

Nothing was said about the dealer plates:

[Vernon]: I wasn't aware that he was using the plate. I didn't tell him not to. I don't know. I had no idea whether the car that he bought, that Mercedes wagon, had plates on it or not when he purchased it or not. I don't know. I didn't ask him are you using the dealer plate on that car. I didn't. I never asked him that.

[Plaintiffs' Counsel]: I thought you told us before that he had permission to use the dealer plates on that car?

A. He had permission to use the plate on any car. It was never specifically said can I use it on this car. He just - you know, we had been family a lot of years. My dad was a dealer before us, so forth, like it's an everyday thing.

Vernon Dep. at 87-88. Nor is there any evidence that Vernon or

Second Hand Rose were ever reguested to reimburse Charles for the

purchase of the automobile, as their agreement reguired if

Charles bought the car for his brother or Second Hand Rose.

The plaintiffs also argue that Delaware law supports a

presumption that Second Hand Rose or Vernon were the owners of

the automobile, relying on Finkbiner v. Mullins,

,

17 613 (Del. Super. C t . 1987). However, they do not explain or

support their reliance on Delaware law for this issue. In any

event, any such presumption is thoroughly undermined by the facts

of this case and the parties' historical use of the plates.11

The plaintiffs similarly rely on Delaware Code Annotated

Title 21 section 2 1 2 4 (a) to establish ownership, which provides

that a dealer owning any vehicle reguired to be registered may

operate the vehicle on Delaware roads if the vehicle is used in

the dealer's business, for the personal pleasure of the dealer or

immediate family, or for testing or demonstrating such vehicles.

See Del. Code Ann. tit. 21 § 2124(a) (1998). The plaintiffs'

reliance on this statute is circular, however, as section

2 1 2 4 (a)'s relevance depends upon first establishing the dealer's

ownership of the vehicle, and the plaintiffs seek to use the

statute to establish that ownership.12

“ They also assert that a presumption of behavior in accordance with the law supports the conclusion of ownership of Vernon and/or Second Hand Rose. Again, this is undermined by the record and by Vernon's testimony as to his understanding of the law .

12In the alternative, the plaintiffs rely upon New Hampshire statutory law which provides that a dealer may not lend out its New Hampshire dealer plates, but the plates at issue in this case are not New Hampshire dealership plates. See RSA § 261:108 (1993). The plaintiffs' reliance on RSA § 261:111 (Supp. 1998), governing New Hampshire dealers and vehicles registered under a New Hampshire dealer's registration is similarly flawed.

18 Finally, the plaintiffs rely on Grimes v. Labreck,

(1967) for precedent that mere purchase of a car does not

establish ownership. However, the case is readily distinguish­

able. The purchaser testified that she had bought the car as a

matter of convenience for her son. Her son was making payments

on the car, the registration bore his initials, and he regularly

drove the car and had beneficial use of it.

Here, the evidence indicates that the car was purchased by

or for Ann. There is no indication that any of Vernon's or

Second Hand Rose's funds were used to purchase or maintain the

vehicle. Unlike the registration in Grimes bearing the son's

initials, here, although the car is unregistered, there is no

evidence indicating that Vernon or Second Hand Rose did own the

vehicle beyond the use of the plates discussed above.

The court concludes on this record that the plaintiffs have

failed to establish the existence of a genuine issue of material

fact regarding the ownership of the automobile. Their reliance

on it to establish an employment relationship or to advance

issues relating to the scope of the relationship, addressed later

in section E, therefore fails.

In sum, the court concludes that there is no genuine issue

of material fact concerning whether Charles was an employee of

Vernon or Second Hand Rose. Therefore, vicarious liability may

19 not be predicated upon such a relationship.

D. Agency

In Carrier v. McLlarkv, the New Hampshire Supreme Court

discussed agency relationships under New Hampshire law. See

(1997). The issue is one of fact. See i d . "An

agency relationship is created when a principal gives authority

to another to act on his or her behalf . . . and the agent

consents to do so." I d . (citing Fleet Bank-N.H. v. Chain Constr.

Corp.,

(1993); 93 Clearing House, Inc. v.

Khourv,

(1980)). "The granting of authority

and consent to act need not be written, but 'may be implied from

the parties' conduct or other evidence of intent.'" I d . (guoting

93 Clearing House, Inc.,

).

On the record before the court, a reasonable juror could

find that an agency relationship existed between Vernon or Second

Hand Rose and Charles. Vernon reguested that Charles take note

of any older cars that Second Hand Rose might be interested in.

He gave him power of attorney to purchase such automobiles and

promised to reimburse him for any expenditures he made. In

return, the actions of Charles could support a reasonable

inference that he consented to such an agency relationship. He

accepted power of attorney, he represented to others that he was

20 an authorized representative of Second Hand Rose, he signed his

name as an authorized representative of Second Hand Rose, and he

accepted Second Hand Rose dealer plates which Vernon allowed him

to take in the event he came across any automobiles of interest.

In this case, vicarious liability may therefore be predicated

upon a general agency relationship.

E. Scope and Liability

As discussed above, the plaintiffs assert the liability of

Vernon and Second Hand Rose on the theory of an agency

relationship. The plaintiffs argue that there are genuine issues

of material fact regarding the existence of such an agency

relationship in the form of a partnership, a joint venture, an

employment relationship, or a general agency relationship. The

court concluded above that summary judgment is warranted only as

to the existence of an employment relationship. However, having

addressed the issue of whether the record could reasonably

support the existence of such agency relationships, the court

must now address ramifications of each relationship as regards

liability. Again, the parties all rely upon New Hampshire law.

In Miami Subs Corp. v. Murray Family Trust,

(1997), the New Hampshire Supreme Court addressed joint ventures

and partnerships under New Hampshire law:

21 A joint venture is an association of two or more persons formed to carry out a single business enterprise for profit. . . . [P]arties in a joint venture stand in the same relationship to each other as the partners in a partnership . . . and courts generally have applied the law of partnerships to joint ventures.

I d . at 508 (citations and guotations omitted). Therefore, the

New Hampshire Supreme Court "look[s] to relevant law on joint

ventures; general partnership law; and the Uniform Partnership

Act (UPA), RSA chapter 304-A, to guide" it in addressing issues

pertaining to joint ventures and partnerships.

New Hampshire has followed the Uniform Partnership Act. See

NH RSA § 304-A (1995). Section 304-A:9(I) provides that "[e]very

partner is an agent of the partnership for the purpose of its

business." Section 304-A:13 further provides that:

Where, by any wrongful act or omission of any partner acting in the ordinary course of the business of the partnership or with the authority of his co-partners, loss or injury is caused to any person . . . the partnership is liable therefor to the same extent as the partner so acting or omitting to act.

Delaware law is identical for present purposes. See Del. Code

Ann. tit. 6 §§ 1509, 1513 (1998) . In this case, therefore, a

partnership or joint venture could be the basis for liability if

Charles was "acting in the ordinary course of the business of the

partnership or with the authority of his co-partners . . . ."

Id.

22 Similarly, a general agency relationship may be the basis

for vicarious liability. See Restatement (Second) of Agency,

§ 250, § 220 comment e; see also, Boucouvalas v. John Hancock

M u t . Life Ins. Co.,

(1939). Citing Boston v. B & M

Super Serv.,

(1941), the plaintiffs argue that

"the fact that [an action] was in part, or even mostly, for

purposes of social entertainment would not overcome the fact of

some agency." I d . (applying Maine law) ,13

Independent of the nature of the agency relationship,

whether it be a partnership or a general agency relationship, the

plaintiffs proffer only two grounds in support of their

contention that Charles's trip at the time of the accident was

within the scope of an agency relationship. First, the

plaintiffs assert that Charles had a "roving commission" to

search for used cars for Vernon. They contend that "[t]he bottom

line is very simply that, every time Charles left his house, he

was on the job for Second Hand Rose." Pis.' Opp. at 21. Second,

they assert that on the particular trip in guestion the passenger

in the vehicle was a potential purchaser of the automobile and

that it was being shown to him for that purpose.

13The plaintiffs rely upon Boston v. B & M Super Service,

, and the defendants do not contest its consistency with New Hampshire law.

23 In support of their first theory, the plaintiffs point to

the following evidence in the record: (1) Charles had ongoing

instructions to look for used cars as he traveled; (2) Vernon

gave Charles power of attorney and dealer plates; (3) Vernon sent

Charles booklets containing used car values. The plaintiffs rely

on two cases where liability was based on a theory of "roving

commissions," Easterlin v. Green,

(S.C. 1966),

and Cochran v. Michaels,

(W.Va. 1931) .

The evidence indicates that there was an open ended

authorization to purchase automobiles for Second Hand Rose.

However, with the exception of the ambiguous circumstances

surrounding the Caprice, nothing in the record indicates that

this was ever acted upon. Vernon states that Charles never

purchased any cars for Second Hand Rose. Nor could Vernon

remember whether Charles had ever used the power of attorney for

Second Hand Rose. Given the evidence that at most one car was

purchased for Second Hand Rose, a reasonable inference is that

the booklets were rarely, if ever, used for Second Hand Rose's

benefit either.

The plates had been used on at least three of Ann's and

Charles's automobiles. There is no evidence that either of the

first two cars were sold to Second Hand Rose or that they were

purchased with Second Hand Rose or Vernon in mind. Evidence

24 indicates that the third car bearing dealer plates, the one

involved in the accident in this case, had not been purchased for

Second Hand Rose but for Ann, and was possibly to be sold through

Second Hand Rose only if Ann decided she did not wish to keep it.

The record indicates that it had been driven with the plates by

Charles and Ann since its purchase in April until the date of the

accident in November, excepting the periods when it was off the

road for repairs, and there is nothing in the record that

indicates this use was to advance Second Hand Rose's interests.

Nor did Vernon know of its use or the use of the plates.

On the record before the court, it is evident that Charles

did not actively use the vehicle, the plates, the power of

attorney, or the booklets to advance the interests of Second Hand

Rose or any agreement to secure used automobiles. On this

record, therefore, these factors, while ostensibly intended to

facilitate Charles's acguisition of vehicles, do not operate so

as to create a reasonable inference that Charles was on a roving

commission turning every trip of his into an extension of an

agreement to help his brother or Second Hand Rose.

In Easterlin v. Green, the court was presented with a clear

employment relationship where the employee worked on the

dealership grounds during the day and took cars out at night to

show friends and acguaintances as prospective purchasers. See

25

. It was customary that the employee sold cars

at night. See i d . Indeed, this was an important part of the

employee's activity on behalf of his employer, see i d . at 476-77,

and the friends and acquaintances he met were "important to his

success as a used car salesman," i d . at 477. It was natural for

him to combine pleasure and business. See i d . Moreover, he had

a restricted driver's license that only allowed him to drive his

employer's vehicles for business purposes. On the night of the

accident in Easterlin the employee had taken the automobile out

to "prospect" and see how many sales he could make. See id at

474. The vehicle carried a dealer tag. See i d . His activities

followed his customary means of carrying on business for his

employer.

The second case relied upon by the plaintiffs is Cochran v.

Michaels. See

(W.Va. 1931) . Cochran is similarly

distinguishable as the driver of the dealer's automobile was

employed to sell used cars and he only had permission to drive

the car for the purpose of potential sales, although he was

allowed to transport friends because he gathered information for

potential sales through such friends and acquaintances. On the

occasion of the accident he was in the process of transporting

such acquaintances.

The court finds the plaintiff's reliance on these cases

26 unpersuasive. Significantly, they are not New Hampshire law and

they are old cases. Moreover, in this case there is no

reasonable basis for concluding that an employment relationship

existed. Nor was there a custom of Charles to look for used

automobiles for Second Hand Rose given his history of securing

such automobiles for the business. Evidence indicates that the

only automobile actually transferred to Second Hand Rose by

Charles was the Caprice. The record cannot sustain a reasonable

inference that Charles harbored intentions of purchasing

automobiles on his travels, nor that his travels were incidental

to such purchasing. Given his general failure to purchase

vehicles for Second Hand Rose, Charles's activities securing

automobiles on behalf of Second Hand Rose, or lack there of,

could not be considered important to Second Hand Rose, Vernon, or

himself.

As discussed above, the plaintiffs also contend the record

supports a reasonable inference that on the particular journey

during which the accident occurred Charles was showing the car to

a prospective purchaser. The plaintiffs base this contention on

evidence that: (1) the car in the accident bore dealer plates;

(2) no one had title to the car; (3) the car was being driven by

someone identified on Vernon's insurance as an owner, employee or

relative who operated owned vehicles; and (4) a recent purchaser

27 of an old car of Ann's was a passenger in the vehicle.

Again, on these facts the record cannot support a reasonable

inference that Charles held the intention of interesting a

prospective purchaser when he embarked on the trip at issue.

Instead it indicates that Charles gave the passenger a ride home

because he was stranded without another means of returning.

Given the history of the use of the dealer plates in this case,

the fact that the car had the dealer plates on it does not

support a finding to the contrary. Nor, without more, does

evidence that the passenger had purchased an old car from Ann, or

that the car had an open title, support a finding that Charles

embarked on the trip to sell the car to a prospective purchaser.

Finally, the court guestions the materiality of the insurance

policy which identifies Charles as an owner, employee, or

relative of the owner of the automobile. Simply because he is

listed on Second Hand Rose's policy does not support a reasonable

inference that he was acting as its agent during the excursion at

issue. In any event, the court has already determined that there

is no genuine issue of material fact regarding employee status.

The insurance policy therefore might indicate that Charles was an

owner of Second Hand Rose or a relative of Vernon. The record

indicates Charles's familial relation to Vernon. Even assuming

Charles's ownership of Second Hand Rose, this fact would not,

28 under these circumstances, change the nature of the trip at

issue.

At first blush the court finds more troubling Charles's

statement to his insurer that he was "in the process of taking

[the car] back, taking it down to Delaware to to [sic] sell it."

Plfs.' Opp., Ex. N at 3. However, the record indicates that the

statement, in context, was in response to a broad guestion. In

his deposition Charles clarified the statement as meaning he

would take the car to Delaware sometime in early winter if Ann

and he decided to sell it. This interpretation is corroborated

by the lack of any evidence that he was on his way to Delaware at

the time of the accident. Nor do the plaintiffs assert this as a

basis for establishing his agency for the trip at issue.

Conclusion

In counts three through ten the plaintiffs assert the

liability of Vernon Malpass, individually; Second Hand Rose;

Vernon Malpass, d/b/a/ Second Hand Rose; and Charles Malpass and

Vernon Malpass, d/b/a/ Second Hand Rose. All of the claims are

predicated upon an agency relationship. See Compl. Counts III,

IV (Charles Malpass was agent of Defendant Vernon Malpass and

Vernon Malpass through his agents owed plaintiffs a duty of

reasonable care); Counts V, VI, (Charles Malpass was agent of

29 Second Hand Rose and Second Hand Rose through its agents owed

plaintiffs a duty of reasonable care); Counts VII, VIII (Charles

Malpass was agent of Vernon Malpass d/b/a Second Hand Rose and

Vernon Malpass d/b/a Second Hand Rose through their agents owed

duty to plaintiff); Counts IX and X (Charles Malpass was agent of

Vernon Malpass and Charles Malpass d/b/a Second Hand Rose and

through their agents they owed duty to plaintiffs). As the

plaintiff asserted counts against Vernon Malpass and Second Hand

Rose only upon the basis of agency and the court has concluded

that no reasonable juror could find that Charles Malpass's trip

on the date of the accident was within the scope of said agency,

the court grants the defendants' converted motion for summary

judgment on counts three through ten (document no. 15).

SO ORDERED.

Joseph A. DiClerico, Jr. District Judge

March 19, 1999

cc: David J. Berg, Esguire Donald E. Gardner, Esguire Douglas N. Steere, Esguire

30