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IN Gerard Loftus, et al. v. Three Palms Crocker Park, LLC, et al., Appeal by Robert Sotka, 2023-Ohio-927, No. 111639, Court of Appeals of Ohio, Eighth District, Cuyahoga (March 23, 2023) An intoxicated person injured a passenger when he lost control of a vehicle at 120 miles per hour and crashed.
Robert Sotka appealed the district court’s grant of summary judgment in favor of his employer, Three Palms Crocker Park, LLC (“Three Palms”) and its insurer, State Auto Mutual Insurance Company (“State Auto”).
ACTUAL OVERVIEW
Plaintiff Gerard Loftus was seriously injured as a passenger in a single vehicle accident in which Sotka was the driver. Sotka was manager at the pizzeria restaurant Three Palms. Sotka had discussions with Loftus about possibly buying a restaurant with him.
Sotka left the restaurant at 5:15 p.m. and traveled over 60 miles to the Canoe Club to meet Loftus and a group of Loftus’ friends. At 10:15 p.m., Sotka was traveling at a speed of 120 mph. The car left the road and struck a guardrail, causing extensive damage. Sotka’s passenger, Loftus, suffered extensive and permanent injuries. Sotka was later convicted of the offenses of driving under the influence of alcohol or drugs – OVI, a first-degree misdemeanor, and vehicular assault, a fourth-degree felony in the Ottawa County Court of Common Pleas.
Loftus sued Sotka and Three Palms, Sotka’s employer. State Auto, which had issued Three Palms a business insurance policy, intervened in the lawsuit and sought a declaratory judgment action that it need not provide a defense or coverage because the accident that resulted in Loftus’ injuries was not covered by the policy because Sotka was not operating or conducting his business when he crashed his car and injured Loftus.
The district court granted summary judgment to both Three Palms and State Auto.
LAW AND ARGUMENT
An employer may be subject to answer superior liability for an employee’s accident when the employee acts within the scope of the employment. Conduct is within the scope of an officer’s employment if it is of the kind he is employed to perform, occurs substantially within the permissible limits of time and space, and is influenced, at least in part, by a purpose to serve the employer.
State Auto’s insurance policy provides liability coverage to Three Palms pursuant to Commercial General Liability Coverage (“CGL Policy”). The parties agreed that the CGL policy expressly excludes damages from motor vehicle accidents pursuant to the exclusion. The auto policy provides CGL coverage for damages that occur as a result of any person using any “non-owned automobile” in the course of business.
There was no dispute that Sotka was driving a non-owned car as defined in the Auto Endorsement. However, the automatic recommendation only provides cover while the non-owned car is used in Three Palms business.
The trial court determined that neither condition was present in the record and specifically found that there are no genuine issues of material fact that defendant Sotka was not within the course and scope of his employment with defendant Three Palms Crocker Park, LLC at the time of the subject accident.
The court noted that Sotka left the restaurant at 5:15 p.m., traveling a distance of over 60 miles and admitted that the purpose of his trip was to meet his friend and soon-to-be new business partner, Loftus. There was no evidence that Sotka went to Catawba for any business purpose to benefit Three Palms. Traveling 60 miles and socializing to conduct personal business unrelated to one’s employer cannot be considered in the service of Three Palms.
Given Sotka’s conduct overall, assuming he contacted employees and spoke to others about the general aspects of running a restaurant, these actions are merely incidental to the purpose of his evening: to associate with Loftus and further a personal business venture. In addition, the restaurant employees who were present on the night of the accident closed the restaurant without Sotka’s direction or input.
The record reflects that Sotka’s purpose in going to Catawba that night was to socialize and promote his own personal business opportunities. To claim that the accident occurred while Sotka was acting within the scope of his employment or in furtherance of Three Palms’ business was unbelievable.
Sotka committed the crimes of operating a vehicle while impaired, and vehicular assault, a felony. This behavior cannot fairly and reasonably be considered a common and natural incident or characteristic of the service to be provided, or a natural, direct and logical result of the pizzeria.
After spending an evening drinking and reviewing potential opportunities for a new and personal business with an acquaintance, and then (while intoxicated) starting a trip back at more than 120 miles per hour to take the acquaintance home or to the restaurant owned by Sotka’s employer, Sotka was convicted of a felony as a result of his driving and the plaintiff’s injuries. The conduct was clearly not part of Sotka’s employment as a manager of a pizzeria and therefore there was no coverage by the employer or the employer’s insurer.
(c) 2023 Barry Zalma & ClaimSchool, Inc.
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Barry Zalma, Esq., CFE, now limits his practice to serving as an insurance consultant specializing in insurance coverage, insurance claims management, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He practiced law in California for more than 44 years as an insurance coverage and claims attorney and more than 54 years in the insurance industry. He can be reached at http://www.zalma.com and zalma@zalma.com
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