Client Alert: Even When the Workday is Over, Employers Can Be Liable for Employees’ Motor Vehicle Accidents

Many California employers would be shocked to learn that they can be liable for an accident involving an employee that occurs when the workday is over and the employee is running personal errands. However, that is exactly what the California Court of Appeal held in Moradi v. Marsh USA, Inc. (No. B239859, filed September 17, 2013.)

Shortly after 5:00 p.m. on April 15, 2010, defendant Judy Bamberger left her office at Marsh in downtown Los Angeles and drove towards her Woodland Hills home. Ms. Bamberger planned to stop for frozen yogurt and go to yoga class on her way home. While making a left turn into the yogurt shop parking lot, Ms. Bamberger collided with the plaintiff, Majid Moradi, who was riding his motorcycle in the opposite direction. Mr. Moradi sued both Ms. Bamberger and Marsh for his injuries. Marsh won a motion for summary judgment on the grounds that at the time of the accident Ms. Bamberger was “neither at work, nor working, nor pursuing any task on behalf of her employer, but was pursuing personal interests.” Plaintiff appealed and the Second Appellate District ruled that the trip home – including the stops for yogurt and yoga – were within the course and scope of Ms. Bamberger’s employment and that Marsh could be liable for the accident.

The court noted that while respondeat superior holds that an employer is liable for an employee’s negligence occurring in the course and scope of employment because the organization is better able to insure or redistribute the risk, there is a long standing “going and coming rule” that employees are not within the course and scope during their daily commute (citing, Lobo v. Tamco (2010) 182 Cal.App.4th 297, 301). However, there is an exception to the “going and coming rule” that a commute is part of the course and scope when an employee uses the vehicle during business hours for the benefit of the employer, referred to as the “required vehicle exception.”

As the Moradi court explained, Ms. Bamberger frequently used her car during the work day to drive to presentations and meetings with clients. On the day of the accident she had used her car to take coworkers to a company-sponsored program and she was planning to drive to another out of office meeting the next morning. As such, Marsh could be liable for incidents occurring during Ms. Bamberger’s commute. The Moradi court held that the stops for yoga and yogurt were not an unforeseeable and substantial departure from the commute so as to extinguish Marsh’s liability. In so holding, it extended the decision in Lazar v. Thermal Equipment Corp. (1983) 148 Cal.App.3d 458, which held that an employer is liable for an employee’s conduct while driving a company car unless that conduct is so unusual and startling that it would seem unfair to attribute it to the employer, even while on a personal errand.

Although the Moradi decision extends the Lazar rational to personal vehicles, it is vague enough to leave several lingering questions. For instance, how often does an employee have to drive for the benefit of an employee for the required vehicle exception to apply? What sort of stop would be considered so unforeseeable as to extinguish liability for the commute? The Lazar case states that “a decision to stop at a party, or a bar, or to begin a vacation, might not have been foreseeable…” but Moradi also cites to a 1944 case in which the California Supreme Court held that an employee stopping at a bar for a sandwich and beer while making collections visits to customers did not constitute a substantial deviation from his employment activities. [Loper v. Morrison (1944) 23 Cal.2d 600.] While there has been a shift in the societal acceptance of drinking since the 1940s, it is unclear what the court would have done if Ms. Bamberger were leaving a session of martinis and dancing instead of proceeding to yogurt and yoga.

It is possible that the Moradi decision will be further appealed to the California Supreme Court, but until it is overturned or limited, employers should be mindful of their exposure.

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