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Michigan Supreme Court 

Lansing, Michigan 48909 

C hief Justice Justices 

Maura D. Corrigan	 Michael F. Cavanagh 

Elizabeth A. Weaver 

Marilyn Kelly 

Clifford W. Taylor Opinion Robert P. Young, Jr. 

Stephen J. Markman 

FILED JULY 23, 2002
 

ALFONSO E. ROGERS, Personal Representative


of the Estate of Daimon Ja’Von Rogers,


Deceased,
 

Plaintiff-Appellee,
 

v	 No. 118766
 

J. B. HUNT TRANSPORT, INC.,
 

Defendant-Appellant
 

and
 

WESLEY HOWARD CRENSHAW,
 

Defendant.
 

BEFORE THE ENTIRE COURT
 

WEAVER, J.
 

In this wrongful death action, we address whether a
 

default entered against an employee that conclusively
 

determined the employee’s negligence for the purpose of the
 

employee’s personal liability is also a proper foundation for
 

an order holding his employer vicariously liable. The Court
 
of Appeals held that it was, thereby extending the effect of
 

the default to the employer and precluding the employer from
 

contesting its vicarious liability. We reverse the decision
 

of the Court of Appeals and remand to the circuit court. 


I
 

This action arises from an automobile accident that
 

occurred in the early afternoon on June 17, 1996. The
 

decedent, Daimon Rogers, was killed when his vehicle left the
 

roadway and struck a tractor-trailer rig parked on the north
 

shoulder of the westbound I-96 expressway in Eaton County,
 

Michigan. It is undisputed that defendant-appellant J. B.
 

Hunt owned the tractor-trailer and that defendant Wesley
 

Crenshaw had been operating the tractor-trailer in the course
 

of his employment with J. B. Hunt. 


J. B. Hunt terminated Crenshaw’s employment in July 1996.
 

Subsequently, on July 23, 1996, the personal representative of
 

Daimon Rogers’ estate filed a complaint against Crenshaw and
 

J. B. Hunt. It alleged Crenshaw was negligent and that his
 

negligence was a proximate cause of Daimon Rogers’ crash and
 

death. It also alleged J. B. Hunt’s vicarious liability.
 

J. B. Hunt filed an answer on its own behalf denying
 

Crenshaw’s negligence and causation. However, Crenshaw failed
 

to personally file an answer or appear in response to two
 

summonses. On March 20, 1997, the Eaton Circuit Court issued
 

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a third summons and an order permitting alternative service of
 

process by publication and by service on codefendant, J. B.
 

Hunt. Thereafter, J. B. Hunt’s attorney purported to file an
 

answer on behalf of Crenshaw.
 

Crenshaw repeatedly failed to appear for depositions over
 

a fourteen-month period. On August 6, 1998, plaintiff
 

obtained an order of default pursuant to MCR 2.313(B) and (D)
 

against Crenshaw. During the hearing on plaintiff’s motion
 

for the default of Crenshaw, J. B. Hunt’s attorney moved to
 

withdraw as counsel of record for Crenshaw. The trial court
 

granted both motions. J. B. Hunt did not object to the entry
 

of the order of default.
 

On December 15, 1998, plaintiff moved for partial summary
 

disposition regarding the liability of J. B. Hunt. Plaintiff
 

argued that the default that was entered against defendant
 

Crenshaw settled the question of J. B. Hunt’s liability and,
 

therefore, J. B. Hunt could not contest the issues of
 

negligence and causation at trial. Plaintiff also argued that
 

J. B. Hunt was precluded from presenting the affirmative
 

defense of comparative negligence. The circuit court granted
 

plaintiff’s motion in part, concluding that J. B. Hunt was
 

vicariously liable for the negligence of Crenshaw and could
 

not contest at trial the issues of negligence and proximate
 

cause. However, the trial court also denied the motion in
 

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part, concluding that J. B. Hunt could raise the defense of
 

the decedent’s comparative negligence and whether his
 

comparative negligence was a proximate cause of the accident.
 

The Court of Appeals affirmed, citing “compelling policy
 

consideration[s]” involving vicarious liability. 244 Mich App
 

600, 610; 624 NW2d 532 (2001). Specifically, the panel
 

stated, “[e]mployers are held vicariously liable not because
 

of their ability to control their employees’ conduct, but
 

because they stand to profit from their employees’ conduct.”
 

Id. at 610-611. With this, the panel discarded the linchpin
 

justifying vicarious liability between an employer and an
 

employee—that the employee committed an act producing a claim
 

in the scope of employment. The panel’s reasoning suggests
 

that if the employer financially profits from an employee’s
 

activities, the employer is vicariously liable not only for
 

everything the employee does within the scope of employment,
 

but also to all acts tangentially related to that employment
 

or occurring outside the scope of employment, even if they
 

occurred after the employee leaves the employment. We granted
 

leave to appeal because the panel’s suggestion that an
 

employer may be vicariously liable not only for employees’
 

torts committed within the scope of employment, but also for
 

wrongful conduct outside the scope of employment is worthy of
 

review.
 

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II
 

The law regarding respondeat superior and, in particular,
 

how the entry of a default against an employee affects the
 

liability of an employer where the employer’s sole source of
 

liability is vicarious are questions of law. We review
 

questions of law de novo. Kelly v Builders Square, Inc, 465
 

Mich 29, 34; 632 NW2d 912 (2001). The grant of a motion for
 

summary disposition is also reviewed de novo. MacDonald v
 

PKT, Inc, 464 Mich 322, 332; 628 NW2d 33 (2001).
 

III
 

In addressing this issue as posed by the Court of
 

Appeals, it is important to clarify why the courts have
 

imposed liability on those who were not the actors, but merely
 

the masters of the actors. The reason is that “a master is
 

responsible for the wrongful acts of his servant committed
 

while performing some duty within the scope of his
 

employment.” Murphy v Kuhartz, 244 Mich 54, 56; 221 NW 143
 

(1982). An employer is not vicariously liable for acts
 

committed by its employees outside the scope of employment,
 

because the employee is not acting for the employer or under
 

the employer’s control. For example, it is well established
 

that an employee’s negligence committed while on a frolic or
 

detour, Drobnicki v Packard Motor Car Co, 212 Mich 133; 180 NW
 

459 (1920), or after hours, Eberle Brewing Co v Briscoe Motor
 

5
 
Co, 194 Mich 140; 160 NW 440 (1916), is not imputed to the
 

employer. In addition, even where an employee is working,
 

vicarious liability is not without its limits. For example,
 

we have held that “there is no liability on the part of an
 

employer for torts intentionally or recklessly committed by an
 

employee beyond the scope of his master’s business.” Bradley
 

v Stevens, 329 Mich 556, 562; 46 NW2d 382 (1951). 


Likewise, respondeat superior or vicarious liability
 

principles do not support imposing liability on J. B. Hunt in
 

the present case merely on the basis of Crenshaw’s default.
 

When Crenshaw failed to participate in this litigation, he was
 

not acting within the scope of employment. Rather, Crenshaw
 

was acting on behalf of himself only in regard to the
 

litigation. In fact, his procedural failures were committed
 

when he was a former employee of J. B. Hunt. Because his
 

nonparticipation was not in the course of his employment with
 

J. B. Hunt, extending liability to J. B. Hunt for Crenshaw’s
 

nonparticipation is beyond the scope of vicarious liability.
 

In this regard, we emphasize that the basis of vicarious
 

liability is not merely that an employer typically has a
 

greater ability to pay than an employee. As a leading
 

treatise on American tort law explains, additional rationales
 

for vicarious liability for acts of agents within the scope of
 

employment include providing an incentive for employers to
 

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attempt to reduce tortious conduct by their employees and the
 

fair distribution of risk associated with activity
 

characteristic of a business or other entity. See Dobbs,
 

Torts, § 334, pp 908-910. Risks typically associated with
 

operating trucks may fairly be said to be characteristic of J.
 

B. Hunt’s business activities. However, an employee’s refusal
 

to participate in litigation is not a characteristic risk of
 

operating a trucking business. Accordingly, such
 

nonparticipation is not something that an employer can
 

reasonably be expected to deter or fairly be expected to
 

absorb as a cost of doing business. 


Here Crenshaw was not, in his capacity as a litigant,
 

acting for J. B. Hunt. To bind an employer to the actions of
 

a party who was not acting within the scope of employment at
 

the time those actions occur, violates the central tenet of
 

vicarious liability that a master’s liability is derivative of
 

the servant’s. In sum, the rationales that support the
 

imposition of vicarious liability on a master also support
 

limiting such liability to conduct that occurs within the
 

scope of employment. Id., p 910. By misapplying the policies
 

underpinning vicarious liability, the Court of Appeals panel
 

in this case took the doctrine too far.
 

Moreover, the Court of Appeals approach is contrary to
 

longstanding legal principles related to the effect of a
 

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default. As a sanction for Crenshaw’s failure to cooperate
 

with the discovery process, the trial court entered an order
 

of default against him. It is well settled under the law that
 

this default operates as an admission of Crenshaw’s
 

negligence. However, a traditional rule of default provides
 

that the default of one party is not an admission of liability
 

on the part of a nondefaulting coparty. Allstate Ins Co v
 

Hayes, 442 Mich 56, 73; 499 NW2d 743 (1993). Thus, the
 

default entered against Crenshaw does not establish any
 

liability on the part of J. B. Hunt.
 

While the doctrine of vicarious liability allocates the
 

risk of an employee’s negligent acts occurring during the
 

course of employment on the employer, we cannot agree that
 

this rule justifies the extension of the effect of a default
 

to a codefendant. Default is a punitive measure, appropriate
 

in defined circumstances, the threat of which encourages the
 

cooperation of parties to a suit. Our court rules governing
 

the entry of defaults and default judgments are narrowly
 

designed to sanction an uncooperative party. Nowhere in the
 

rules is it contemplated that a cooperating party can be
 

sanctioned for a coparty’s procedural shortcomings.1
 

1 MCR 2.313(D)(1)(a) provides that “just” sanctions are


appropriate where a party fails to appear for depositions


after being served proper notice. MCR 2.313(B)(2)(c) provides


for “rendering a judgment by default against the disobedient


party.”
 

8
 
 

Obviously, J. B. Hunt could not force its former employee,
 

Crenshaw, to participate in discovery. Indeed, it has never
 

been contended that J. B. Hunt controlled Crenshaw’s
 

litigation activity or participated in misconduct that
 

produced Crenshaw’s default. Therefore, the goal of forcing
 

defendants to properly cooperate with litigation would not be
 

reasonably furthered by extending the consequences of the
 

default to J. B. Hunt. As recognized by Stillwell v City of
 

Wheeling, 210 W Va 599, 606; 558 SE2d 598 (2001), penalizing
 

a party that has no control over a co-party’s default would
 

“have no deterrent effect.”
 

Our decision is informed by our court system’s preference
 

for disposition of issues on their merits. North v Dep’t of
 

Mental Health, 427 Mich 659, 662; 397 NW2d 793 (1986)
 

(addressing this preference in the context of a dismissal with
 

prejudice). For this reason, defaults and default judgments
 

are not favored in the law. Wood v Detroit Automobile Inter-


Ins Exch, 413 Mich 573, 586; 321 NW2d 653 (1982). In this
 

regard, it is important to emphasize that the entry of a
 

default against Crenshaw does not establish that he was
 

actually negligent in connection with the accident underlying
 

this case. Rather, the entry of the default bars him from
 

contesting the issue of his negligence because of his failure
 

to properly participate in the litigation. Unlike Crenshaw,
 

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J. B. Hunt has participated in the litigation. Thus, there is
 

nothing inconsistent in allowing J. B. Hunt to contest the
 

alleged negligence of Crenshaw even though Crenshaw himself
 

would not be allowed to do so in light of the default entered
 

against him. 


Our decision does not undercut the validity of default as
 

a sanction for discovery abuses. Contrary to the Court of
 

Appeals concerns, allowing J. B. Hunt to contest Crenshaw’s
 

negligence and causation does not render the punitive purposes
 

of the default meaningless. The default remains in force
 

against Crenshaw and forecloses his ability to present proofs
 

denying his own negligence.2 Potentially, plaintiff is
 

prejudiced to the extent that he cannot depose Crenshaw.
 

However, J. B. Hunt’s defense is similarly potentially
 

prejudiced by the absence of Crenshaw’s testimony. The
 

possible prejudicial consequences of a party’s failure to
 

appear and resultant default do not justify the extension of
 

the punitive effect the sanction to an appearing party or
 

denying that party the opportunity to present its defense. 


IV
 

We conclude that, where a party’s sole source of
 

liability is vicarious, a default entered against a coparty
 

2

 As Crenshaw’s alleged negligence has yet to be


litigated, we express no opinion on the merits of the


negligence or proximate cause issues.
 

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does not preclude the former from contesting its vicarious
 

liability. The decision of the Court of Appeals is reversed
 

and this matter remanded to the circuit court for further
 

proceedings consistent with this opinion.
 

CORRIGAN, C.J., and TAYLOR, YOUNG, and MARKMAN, JJ.,
 

concurred with WEAVER, J.
 

CAVANAGH, J., concurred in the result only.
 

11
 
___________________________________ 

v 

S T A T E O F M I C H I G A N
 

SUPREME COURT
 

ALFONSO E. ROGERS, personal


representative of the estate of


Daimon Ja'Von Rogers, deceased,
 

Plaintiff-Appellee,
 

No. 118766
 

J. B. HUNT TRANSPORT, INC.,
 

Defendant-Appellant,
 

and
 

WESLEY HOWARD CRENSHAW.
 

KELLY, J. (dissenting).
 

I disagree with the majority's narrow view of vicarious
 

liability. 


The Court of Appeals held, for legal and public policy
 

reasons, that it is proper to hold the employer, J. B. Hunt
 

Transport, Inc., liable for a tort that was established by
 

default. In doing so, it followed the law: 


Where several defendants are treated as one,


as in cases involving employers and employees, but


one defaults, the defaulter still has the benefit


of any contributory negligence established against


the plaintiff by the remaining defendant. Thus,


where vicarious liability is found, the court


should tell the jury that the defaulting employee


has been found negligent, and his negligence should
 
be compared to that of the plaintiff in determining


the defendants' liability. [57B Am Jur 2d,


Negligence, § 1276, p 174.]
 

I agree with the Court of Appeals, which used the default of
 

the driver, Wesley Crenshaw, to preclude Hunt from denying
 

liability for Crenshaw's negligence. 


The majority relies on the notion that Hunt's "control"
 

of Crenshaw at the time of the default is the key to whether
 

Hunt is liable. It assumes that the only time when liability
 

for Crenshaw's acts could attach was when Crenshaw was an
 

employee of Hunt.
 

Certainly, control is one of the considerations upon
 

which respondeat superior liability reposes. However, it is
 

not the only consideration. When the majority uses control as
 

its only consideration, it confuses liability arising from
 

respondeat superior with vicarious liability arising from
 

another doctrine, agency. 


The difference between the two is explained by 27 Am Jur
 

2d, Employment Relationship, § 460, pp 897-898:
 

Vicarious liability based on agency is
 

distinct from liability based on respondeat


superior in that the employer is not liable for the


acts of the employee under the former theory unless


the employee acted on behalf of or under the


authority of the employer and unless the employer


clearly approved of the wrongful conduct. 


The majority is using an agency theory to support vicarious
 

liability. Because Hunt had no control over Crenshaw when the
 

2
 
latter defaulted, the majority will not allow vicarious
 

liability to attach. 


Vicarious liability should be found in this case not on
 

the basis of agency, but on the basis of the doctrine of
 

respondeat superior. Holding the employer liable for the
 

underlying tort, even though its employee defaulted, would
 

satisfy vital policy interests, such as justice, convenience,
 

deterrence, social justice, and the ability to give the victim
 

an effective remedy. These approaches have been explained in
 

Am Jur 2d:
 

The modern basis for vicarious liability is


that, as a matter of public policy, an enterprise


or an activity should bear the risk of a tort--­

committed or resulting from omission---of those who,


in fact, carry on the enterprise, activity or


operation. It is a part of the cost of doing


business or carrying on various activities; and, in


modern society, in Western countries at least, the


cost is spread throughout industries or even the


public at large by use of liability insurance and


similar self-insurer devices---rather than being


borne by some hapless injury victim. Thus, the


doctrine has been developed and extended out of the


necessity of changing social and economic
 

conditions. [57B Am Jur 2d, Negligence, § 1753, pp


447-448.]
 

The authors of Torts, Prosser and Keeton, also assert
 

that vicarious liability is not a mere question of control,
 

and that other bases exist for it:
 

The losses caused by the torts of employees,


which as a practical matter are sure to occur in


the conduct of that employer's enterprise, are


placed upon that enterprise itself, as a required


cost of doing business. They are placed upon the
 

3
 
employer because, having engaged in an enterprise,


which will on the basis of all past experience


involve harm to others through the torts of the


employees, and sought to profit by it, it is just


that he, rather than the innocent injured plaintiff


should bear them; and because he is better able to


absorb them, and to distribute them, through
 

prices, rates or liability insurance, to the
 

public, and so to shift them to society, to the


community at large. [Prosser & Keeton, Torts (5th


ed), § 69, pp 500-501.]
 

Therefore, the majority errs by giving undue weight to
 

control. Had Crenshaw been held liable after a trial, Hunt
 

would have been liable for Crenshaw's negligence, even though
 

it has no control over what Crenshaw did, said, or admitted at
 

trial. This is because, on a respondeat superior theory, the
 

employer is normally liable for the employee's underlying
 

tort. 


There is another good reason to hold the employer liable
 

here. Default is considered to be a punitive measure, but it
 

is accepted in the law because it is needed to preserve a fair
 

tribunal, free of egregious discovery abuses. Despite this
 

need, the majority allows the employer a potential benefit
 

from the driver's default, the driver's absence from trial as
 

a major witness. 


Moreover, the policy reasons cited by the majority
 

support the use of the default against Hunt. As it points
 

out, the imposition of vicarious liability serves as an
 

incentive for employers to reduce tortious conduct and
 

4
 
promotes a fair distribution of risk. Trucking companies hire
 

drivers to traverse multiple states where they might become
 

involved in accidents. They must be held to know that a
 

lawsuit and the potential default of an out-of-state driver
 

are risks to be expected in their business.1 In balance, it
 

is better that Hunt not be allowed a potential benefit from
 

the absence of Crenshaw at trial. 


Finally, it should be noted that the imposition of
 

vicarious liability on Hunt would not render it defenseless at
 

trial. A default would establish negligence on the part of
 

Crenshaw, but it would not determine the extent of Hunt's
 

liability. Under the Court of Appeals decision, Hunt would
 

still be able to contest up to ninety-nine percent of its
 

liability at trial. 


Because I believe that the majority's analysis is too
 

restrictive a view of vicarious liability based on respondeat
 

superior, I dissent.
 

1In fact, it has happened before that a trucking


company's driver, resident in another state, became involved


in an accident and defaulted upon being sued. See, e.g., J B
 

Hunt Transport, Inc v Bentley, 207 Ga App 250; 427 SE2d 499
 

(1993). 


5