Opinion ID: 1713377
Heading Depth: 1
Heading Rank: 2

Heading: did the facts present a jury question?

Text: The test is: Could reasonable minds differ under these disputed facts, as to whether the actions of Arndt were a part of or incidental to the business of American Family Insurance Company. See: Rodgers v. Kemper Construction Co., 50 Cal.App.3d 608, 619, 124 Cal.Rptr. 143, 149 (1975): [W]here the question is one of vicarious liability, the inquiry should be whether the risk was one `that may fairly be regarded as typical of or broadly incidental' to the enterprise undertaken by the employer. [citation omitted]; Dudley v. Estate Life Ins. Co. of America, 220 Va. 343, 257 S.E.2d 871, 875 (1979): [A] principal is liable for the fraudulent and deceitful acts of his agents `committed as an incident to and during the performance of an act which is within the scope of the agent's authority.' [citation omitted]; Harris v. Trojan Fireworks Co., 120 Cal.App.3d 157, 163, 174 Cal.Rptr. 452, 456 (1981): [L]iability attaches where a nexus exists between the employment or the activity which results in an inquiry that is foreseeable... Foreseeable is here used in the sense that the employee's conduct is not so unusual or startling that it would seem unfair to include the loss resulting from it among the other costs of the employer's business. Thus, if reasonable minds could differ as to whether Arndt's conduct imputed liability to American Family under the tests set forth above, a jury question was presented and it would be improper for the trial court, or this court, to usurp that function. As mentioned by the majority, the Dudley court held that the plaintiffs' evidence raised fact questions for jury determination. 257 S.E.2d at 876. The insurance agent in Dudley made fraudulent misrepresentations to the insureds to procure personal gain. The insurer argued that since the fraud was committed solely for the agent's personal gain without benefit to the insurer, then the fraud was committed outside the scope of the agent's authority, and thus relieved the principal from liability. Id. at 874. The court was unpersuaded by this argument and stated: [W]e think plaintiffs' evidence was sufficient to raise a jury issue on the question whether [agent's] conduct was attributable to his principal. Estate Life [insurer] put [agent] in a position which enabled him, while apparently acting within his authority, to perpetrate the frauds upon [plaintiffs]. And on this evidence, we cannot say as a matter of law that plaintiffs had notice that [agent] was acting for his own purposes. [3] Id. at 876. Similarly, as a matter of law, can we rule that there was no nexus between Arndt's visit to the Leafgreen home on May 18, 1981, in his capacity as an American Family agent to review liability insurance and the subsequent theft on June 27, 1981? I think we cannot. From the Leafgreens' point of view, Arndt was clothed with all the authority of American Family Insurance Company necessary to sell its product. He cultivated a relationship with the Leafgreens over an extended period of time which in effect, lulled them into a false sense of security. Arndt's presence at the Leafgreen home, his learning of the existence of the box with cash, valuables, and important papers, and learning which room the box was stored in were all a part of or directly incidental to the business of American Family Insurance Company. Surely there exists a jury question under the Dudley rationale as to whether the Leafgreens had notice that Arndt was acting for his own purposes. It appears that Arndt's key knowledge that Leafgreens would be in Rapid City for an entire day resulted more from his personal friendship with Leafgreens than from his employer's business. Whether this friendship with Leafgreens arose from the business of American Family or vice versa is not clear from this limited record. Arndt's decision to engage others in the theft of these valuables was made during his employment with American Family, and so was the theft itself. The fact that Arndt damaged American Family at the same time by causing an insurance loss, is an important consideration but is not necessarily determinative. This summary analysis of these important questions leads me to conclude that reasonable minds could differ. Therefore, Leafgreens are entitled to have a jury determine these questions under proper instructions. We should reverse and remand to the trial court for a jury trial.