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Lacy v. Time Dispatch Services, Inc.

United States District Court, S.D. Indiana, Indianapolis Division

November 15, 2016

GREGORY LACY, Plaintiff,
v.
TIME DISPATCH SERVICES, INC., et al., Defendants. ZACHARY WRIGHT, Plaintiff,
v.
TIME DISPATCH SERVICES, INC., et al., Defendants. MISTIKAE ELIZABETH TIPTON, Plaintiff,
v.
PAUL T. MORRIS, et al., Defendants.

          ORDER ON DEFENDANT DLS'S MOTION FOR SUMMARY JUDGMENT

          LARRY J. McKINNEY, JUDGE.

         This matter comes before the Court on Defendant DLS Logistics, LLC's (“DLS”) three separate Motions for Summary Judgment on the claims of negligence brought against it by Plaintiffs Gregory Lacy, Zachary Wright, and Mistikae Elizabeth Tipton (collectively “Plaintiffs). Each of the Plaintiffs alleges negligence against DLS, Time Dispatch Service, Inc. (“TDS”), and Paul Morris, following an accident in which a vehicle driven by Morris allegedly resulted in injuries to each of the Plaintiffs.[1]

         For the reasons set forth below, the Court DENIES DLS's Motion for Summary Judgment.

         I. BACKGROUND

         A. RELATIONSHIP BETWEEN DLS AND TDS

         Thomas “Cecil” Dennis is the sole owner of DLS. Dennis Dep. 18:17-18. DLS is in the trucking business and facilitates the movement of goods through dispatching and labor if it utilizes its own trucks. Id. 41:8-17. TDS is a motor carrier similar to DLS, but rather than employ its own drivers or purchase trucks, it relies on contracted agents, like DLS, to solicit business under its United States Department of Transportation (“DOT”) authority. Dunn Dep. 26:14-23.

         On April 21, 2010, DLS and TDS signed an Agent Agreement wherein DLS acted as TDS's agent and solicited “interstate and intrastate shipments of property for transportation in interstate and intrastate commerce.” Dennis Dep. Pl.'s Ex. 26, ¶ 1 (hereinafter “Agent Agreement”). DLS was also responsible for “provid[ing] personnel, office space and telephone equipment, at it's [sic] expense sufficient to properly perform as Agent for Time Dispatch Services.” Id. ¶ 5. DLS also warranted that it would ensure compliance with the laws and regulations of the DOT. Id. In turn, TDS represented that it was a Licensed Broker authorized by the DOT, which authorized brokerage and carrier operations in interstate commerce. Id. TDS provided that it would “fully control and be responsible for all shipments handled under its authority. As any shipment is solicited by [DLS], the latter will inform Time Dispatch Services … of the origin and destination of said shipment and, if brokered, the identity of carrier to be utilized.” Id. ¶ 3. The Agent Agreement further provided that DLS would receive 85% of the gross revenue plus a 2% bonus minus Lessor pay as compensation for its service. Id. ¶ 12.

         In August 2011, DLS purchased a 1995 Freightliner Truck. Dennis Dep. 26:14-23. On September 2, 2011, Dennis signed a TDS Truck Application Contract Operating Agreement, which listed DLS as the contractor and TDS as the carrier. Dennis Dep. Pl.'s Ex. 28 (hereinafter “Operating Agreement”). TDS did not sign the Operating Agreement. Id.; Dennis Dep. 27:12-28:16. Nonetheless, TDS sent the hard license plate and the cab card to DLS, which Dennis interpreted as validating the Operating Agreement. Dennis Dep. 28:7-11. At Dennis' instruction, DLS employee Paul Morris placed the TDS stickers on the truck. Morris Depo. 127:2-128:21. The Operating Agreement states that “[TDS], a for-hire motor carrier, operating under authority issued by the Interstate Commerce Commission wishes to obtain transportation with equipment it does not own through an agreement with [DLS].” Operating Agreement. It further stated that DLS agreed “to use all necessary labor to transport, load, and unload on behalf of such other carriers as [TDS] may designate.” Id., ¶ 1. Under the Operating Agreement, DLS received 75% of the gross revenue of all loads. Id., ¶ 2. The Operating Agreement also stated that “[i]f an accident claim arises out of the driver's negligence the full responsibility of the claim with be [DLS]'s responsibility.” Id., ¶ 3.

         Dennis testified that the Operating Agreement meant that DLS operated under TDS's DOT number and that TDS acted as the operating authority responsible for the load. Dennis Dep. 25:6-14. Dennis described TDS as a “silent partner banker, ” stating that TDS provided money up front along with insurance. Id. 40:24-41:7. In return, DLS provided dispatching services for the shipment, unless one of its trucks was assigned the task of delivering the shipment, as was the case the day of the accident, in which case it would also provide the driver and the vehicle. Id. 41:8-17.

         B. PAUL MORRIS' EMPLOYMENT WITH DLS

         Dennis hired Paul Morris to be a truck driver sometime in 2009. Morris Dep. 16:16-23. At all times, Morris considered himself to be a DLS employee whose duty was to drive DLS trucks. Id. 34:19-35:7; 58:5-11. Dennis paid Morris weekly in cash. Dennis Dep. 52:1-5. Morris worked directly for Dennis and would do whatever task Dennis required of him. Id. 35:17-22; Morris Dep. 34:19-35:7. Morris stated that he only answered to Dennis, who he considered one in the same with DLS. Morris Dep. 43:14-44:10. In addition to driving trucks, Morris repaired and performed maintenance on DLS equipment. Id. 49:5-10. Morris also stayed in DLS's trailer and kept an eye on the property. Id. 65:7-66:21. Dennis provided Morris a universal key that worked on most of the Freightliner trucks. Dennis Dep. 36:11-18. Morris stated that he “always had permission to drive [Dennis'] vehicles” and that he was unaware of any of the insurance issues with respect to the trucks on the lot. Morris Dep. 80:17-81:19. Morris believed that he had permission to drive all DLS trucks, including the Freightliner involved in the accident. Id. 76:5-16.

         TDS approved Morris as a driver until he failed a drug screening, which resulted in termination of his eligibility to drive for TDS. Id. 48:4-22; Dennis Dep. 119:8-120:12. TDS sent Morris a letter indicating that he was disqualified from driving for TDS. Morris Dep., Def.'s Ex. 25. The letter stated that “DOT regulations require [TDS] to immediately remove you from performing any DOT safety-sensitive duties, including, but not limited to, Commercial Driving Duties. This disqualification applies to performing any type of DOT safety-sensitive duties for any employer.” Id. The letter further admonished that, in order to resume his driving privileges, Morris would have to be evaluated by a Qualified Substance Abuse Professional. Id.

         Morris did not receive the letter from TDS, but was informed by Dennis that he could no longer drive for TDS. Morris Dep. 77:24-78:16. Even after receiving this information from Dennis, Morris believed he could still drive the TDS freight if so instructed by Cecil. Id. 78:17-25. Indeed, approximately four months after the failed drug test, and without approval from TDS or evaluation by a Qualified Substance Abuse Professional, Morris resumed hauling TDS freight with Dennis' permission. Id. 87:12-89:8. Dennis admitted that Morris, following the failed drug test and receipt of the TDS disqualification letter, had at least “pulled a few” TDS loads, although he could not recall how many. Dennis Dep. 14:5-18. Morris stated, “Whatever [Dennis] wanted me to haul, I'd haul it.” Morris Dep. 89:8. Morris only answered to Dennis and did not have contact with TDS with respect to the hauling of TDS freight. Id. 88:13-22; 89:9-90:8. Dennis believed that at all times Morris was acting within the course and scope of his employment with DLS. Dennis Dep. 171:54-172:3.

         Following Morris' termination by TDS, DLS reinstated its DOT operating authority and obtained insurance for a Volvo truck so that Morris could continue driving. Id. 34:4-9; 120:6-21. Dennis does not recall whether he disclosed Morris' failed drug test to the insurance company when he sought to insure the Volvo truck with Morris as the driver. I ...


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