Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca10-92-01286/USCOURTS-ca10-92-01286-0/pdf.json

Parties Involved:
Barbara Cappadona
Appellant
Allan Petrich
Appellee
Judith Petrich
Appellee

Document Text:

f FIL · D 

UNITED STATES COURT OF APPEALrnit.ed s,r~ ~~~ Appeals 

FOR THE TENTH CIRCUIT MAY 10 1993 

ALLAN PETRICH, JUDITH PETRICH, 

Plaintiffs-Appellees, 

v. 

BARBARA CAPPADONA, 

Defendant-Appellant. 

) 

) 

) 

) 

ROBERT L. HOECKER 

Clerk . 

) No. 92-1286 

) (D.C. No. 91-Z-535) 

) (D. Colo.) 

) 

) 

ORDER AND JUDGMENT* 

Before MOORE and BRORBY, Circuit Judges, and VAN BEBBER,** 

District Judge. 

**Honorable G. Thomas Van Bebber, District Judge, United States 

District Court for the District of Kansas, sitting by designation. 

After examining the briefs and appellate record, this panel 

has determined unanimously that oral argument would not materially 

assist the determination of this appeal. See Fed. R. App. P. 

34(a); 10th Cir. R. 34.1.9. 

submitted without oral argument. 

The case is therefore ordered 

Defendant-appellant Barbara Cappadona appeals from a $200,000 

judgment in favor of plaintiffs-appellees Allan and Judith 

* This order and judgment has no precedential value and shall 

not be cited, or used by any court within the Tenth Circuit, 

except for purposes of establishing the doctrines of the law of 

the case, res judicata, or collateral estoppel. 10th Cir. R. 

36.3. 

Appellate Case: 92-1286 Document: 010110110111 Date Filed: 05/10/1993 Page: 1 
Petrich. The issue on appeal is whether Ms. Cappadona was 

properly held liable as a participant in a joint enterprise for 

injuries sustained by the Petriches when a car rented in Ms. 

Cappadona's name and driven by her companion, Greg Pereire, 

collided with the Petriches' vehicle. We conclude Ms. Cappadona 

was properly held liable, and we affirm. 

The parties stipulated to the following facts. Ms. Cappadona 

and Mr. Pereire were boyfriend-girlfriend. In August 1989, Mr. 

Pereire asked Ms. Cappadona to go on a vacation, and offered to 

pay all their expenses. Prior to their departure, Mr. Pereire 

purchased $1,500 in traveler's checks and two airline tickets. 

When the parties arrived at the airport in Denver, Mr. Pereire 

attempted to rent a car but was unable to do so because he did not 

own a credit card. Ms. Cappadona ~greed to use her MasterCard for 

the rental, and Mr. Pereire agreed to pay her back for the rental 

fee in cash and traveler's checks. Although Mr. Pereire did not 

wish to purchase a physical damage waiver, Ms. Cappadona would not 

accept responsibility for the car without it. Ms. Cappadona did 

not want or expect to be respqnsible ~for any expenses, in 

accordance with her agreement with Mr. Pereire. 

Ms. Cappadona signed the rental agreement as the responsible 

party and listed Mr. Pereire as an additional driver. Within 

twenty-four hours of renting the car, Mr. Pereire reimbursed Ms. 

Cappadona for the estimated total cost of the rental. 

The parties agreed that Mr. Pereire would do most of the 

driving because Ms. Cappadona drove a great deal for her job and 

was grateful to have someone else drive. Mr. Pereire drove 

2 

Appellate Case: 92-1286 Document: 010110110111 Date Filed: 05/10/1993 Page: 2 
,. 

because he preferred to do so, and because he was familiar with 

Colorado. While Mr. Pereire was driving and Cappadona was dozing, 

he turned his head to talk to her and crossed the center of the 

road, colliding head-on with the Petriches' vehicle. 

The Petriches commenced this diversity action against Mr. 

Pereire and Ms. Cappadona. The parties filed cross motions for 

summary judgment. The court concluded that Ms. Cappadona was 

liable under the joint enterprise theory, and granted partial 

summary judgment against her. The parties stipulated to the 

amount of damages, and the Petriches moved to dismiss the claims 

against Mr. Pereire. 1 The court entered judgment in favor of the 

Petriches and dismissed the claims against Mr. Pereire without 

prejudice. 

As the facts are stipulated, our standard of review is de 

novo. Brown v. Palmer, 944 F.2d 732, 733 n.1 (10th Cir. 1991). 

Because this is a diversity case governed by Colorado law, we must 

ascertain and apply Colorado law such that we reach the same 

result that the Colorado courts would reach. Adams-Arapahoe Sch. 

Dist. No. 28-J v. GAF Cor:p., 959 F.2d 868, 870 (10th Cir. 1992). 

A joint enterprise 

is an undertaking to carry out a small number of acts or 

objectives, which is entered into by associates under 

such circumstances that all have an equal voice in 

directing the conduct of the enterprise. The law then 

considers that each is the agent or servant of the 

others, and that the act of any one within the scope of 

the enterprise is to be charged vicariously against the 

rest. 

1 Mr. Pereire, who was unrepresented, was served but never 

filed a response. He was not the subject of the motions for 

summary judgment. Aplt.'s App. at 24. 

3 

Appellate Case: 92-1286 Document: 010110110111 Date Filed: 05/10/1993 Page: 3 
Watson v. Regional Transp. Dist., 762 P.2d 133, 137 (Colo. 

1988) (quoting W. Keeton et al., Prosser and Keeton on the Law of 

Torts§ 72, at 517 (5th ed. 1984)). In Colorado, the negligence 

of an automobile driver may be imputed to a passenger under the 

joint enterprise theory where the driver and passenger unite in 

pursuit of a common purpose, and each person has a right to 

control the operation of the automobile in question. Bainbrich v. 

Wells, 476 P.2d 53, 54 (Colo. Ct. App. 1970), aff'd, 491 P.2d 976 

(Colo. 1971). Ms. Cappadona concedes that Mr. Pereire was 

negligent, and that they were pursuing a common purpose at the 

time they were involved in the accident. At issue is whether she 

had a right to control the operation of the rental car. 

The .right to control does not depend on the passenger's 

ability to actually drive the car or on his physically wresting 

the wheel from the driver. "'Rather, verbal admonition, 

suggestions or even outright commands are the usual methods 

whereby the co-owning passenger exercises his right to control.'" 

Watson, 762 P.2d at 137 (quoting Lasnetske v. Parres, 365 P.2d 

250, 254 (Colo. 1961), overruled on other grounds by Watson, 762 

P.2d 133). The right to control can be established by the 

rebuttable presumption that arises from owning or renting a 

vehicle. Moore v. Skiles, 274 P.2d 311, 313, 315 (Colo. 

1954) (overruled on other grounds by Watson, 762 P.2d 133). If no 

. such interest exists, it can be established by an express or 

implied agreement between the participants. 

Porter, 516 P.2d 656, 658 (Colo. Ct. App. 1973). 

4 

See Bilsten v. 

Appellate Case: 92-1286 Document: 010110110111 Date Filed: 05/10/1993 Page: 4 
Ms. Cappadona agrees that renting a vehicle creates a 

"proprietary financial interest" that gives rise to a presumption 

of a right of control. However, she maintains that under Bilsten, 

id., her agreement with Mr. Pereire rather than her agreement with 

the rental company determines who had a proprietary financial 

interest in the rental car. We disagree. 

In Bilsten, Hubert, an underage boy, secured the keys to his 

father's car and lent them to a friend, who was also underage and 

unlicensed. The friend drove the car and was involved in an 

accident. Id. at 657. In attempting to escape liability under 

the joint enterprise doctrine, Hubert argued that he had no right 

to control the vehicle because he obtained possession without his 

father's permission. Id. at 658. The court rejected this 

argument, holding that the right to control 

is a right existing between the parties to the joint 

venture by virtue of their express or implied agreement. 

Rights to control existing between a member of the joint 

venture and a third party are not relevant to a 

determination of the existence of the joint venture or 

as to rights of control as between participants in the 

joint venture. 

The question in Bilsten was not whether Hubert had an 

ownership interest in the vehicle from which his right to control 

could be presumed, but rather whether he had a right to control by 

virtue of his agreement with his friend. Thus, we do not read 

Bilsten as holding that an agreement with a third party is 

irrelevant in determining whether one has a proprietary financial 

interest in a vehicle. Ms. Cappadona's legal status as lessee of 

the vehicle gave her a proprietary financial interest from which 

5 

Appellate Case: 92-1286 Document: 010110110111 Date Filed: 05/10/1993 Page: 5 
her right to control could be presumed. She has not argued that 

she rebutted this presumption. 

Ms . . Cappadona also contends that public policy considerations 

should preclude application of joint enterprise liability to her. 

In Watson, 762 P.2d at 138 (quoting Prosser and Keeton on the Law 

of Torts § 73, at 522) (citations omitted), the Colorado Supreme 

Court explained the public policy justification for 

rule imputing negligence to nonnegligent passengers: 

Earlier in the twentieth century the growing injury toll 

from traffic accidents prompted a search for financially 

responsible defendants. The search ultimately led to 

the employment of the doctrine of imputed negligence in 

motor vehicle cases, whereby liability was imposed on 

the defendant owner-passenger of a vehicle based upon 

the negligence of the driver, even though the ownerpassenger was free from negligence. The salient 

rationale underlying the doctrine, as it relates to 

defendant owner-passengers, is that since automobiles 

are expensive, the owner- is more likely to be able to 

pay any damages than the driver, who may be entirely 

impecunious; and that the owner is the obvious person to 

carry the necessary insurance to cover the risk, and so 

to distribute any losses among motorists as a class. 

Thus, ·the negligence of a driver was imputed to the 

defendant owner-passenger· to provide the injured party 

with a financially responsible source of recovery. 

the 

Although the Watson court concluded that imputing comparative 

negligence to an owner-passenger who is a plaintiff was contrary 

to these policy considerations, id. at 140, it made clear that 

imputing negligence to an owner-passenger who is a defendant is a 

distinct legal theory involving different legal and policy 

considerations. Id. at 137 n.7. The doctrine allowing imputation 

of negligence to an owner-passenger who is a defendant thus 

appears to have remained intact in Colorado. 

6 

Appellate Case: 92-1286 Document: 010110110111 Date Filed: 05/10/1993 Page: 6 
Ms. Cappadona argues that these policy considerations do not 

support imposition of liability on one such as herself who does 

not own a vehicle. The rule of imputed negligence was intended to 

extend liability to those who more likely will be able to pay 

damages. Id. at 138. As observed by the district court, Ms. 

Cappadona had the financial wherewithal to rent a car, as 

evidenced by her possession of a credit card. Aplt.'s App. at 

78. 2 This indicates that she is more likely able to pay damages 

and justifies extending liability to her. 

In any event, joint enterprise liability has been imposed on 

individuals who did not own the vehicle in question but who had a 

right of control. Bilsten, 516 P.2d at 658; Boyd v. Close, 257 P. 

1079, 1081 (Colo. 1927). Ownership is not a prerequisite for 

application of the joint enterprise doctrine. 

Ms. Cappadona also argues that public policy does not support 

imputing negligence to her because she lacked any financial 

interest in the vehicle. This argument is premised on her 

analysis of Bilsten as holding that her legal relationship with 

the rental company is irrelevant. We therefore reject it. 

The Petriches request attorney's fees because Ms. Cappadona 

failed to raise any legal arguments in support of her position. 

We disagree and deny the request. 

2 The district court noted that it had heard nothing about 

insurance companies or who would carry necessary insurance, but 

did not think the question was relevant. Aplt.'s App. at 78. 

7 

Appellate Case: 92-1286 Document: 010110110111 Date Filed: 05/10/1993 Page: 7 
The judgment of the United States District Court for the 

District of Colorado is AFFIRMED. The request for attorney's fees 

is DENIED. 

Entered for the Court 

John P. Moore 

Circuit Judge 

8 

Appellate Case: 92-1286 Document: 010110110111 Date Filed: 05/10/1993 Page: 8