Gadson v. ECO

THIS OPINION HAS NO PRECEDENTIAL
VALUE.  IT SHOULD NOT BE CITED OR RELIED ON AS PRECEDENT IN ANY PROCEEDING EXCEPT
AS PROVIDED BY RULE 239(d)(2), SCACR.

THE STATE OF SOUTH CAROLINA

In The Court of Appeals

Starr Gadson, by her Guardian ad Litem Kathy
Gadson,        Respondent,

v.

ECO Services of South Carolina, Inc. and Joseph Jenkins,       
Appellants.

Appeal From Jasper County

Paul M. Burch, Circuit Court Judge

Unpublished Opinion No. 2005-UP-130

Heard January 12, 2005 – Filed February
18, 2005

AFFIRMED IN PART AND REVERSED IN
PART

Deborah H. Sheffield, of Charleston, for Primary Appellant.

Joseph R. Weston, of Mt. Pleasant, for Secondary Appellant.

Daniel E. Henderson, of Ridgeland, for Respondent.

PER CURIAM:  ECO Services of South Carolina,
Inc. (ECO) and Joseph Jenkins, appeal from jury verdicts against them on Starr
Gadson’s claims for negligent entrustment.  We affirm as to Jenkins and reverse
as to ECO. 

FACTS

Jenkins worked for ECO, solid waste contractor
that services Beaufort, Jasper, and Hampton counties.  As a “helper,” Jenkins
used ECO’s trucks to go back for missed pickups.  On August 6, 1997, Jenkins
failed to return ECO’s truck at then end of the day to the Hilton Head office. 
Instead, he drove the truck to Hardeeville.  Gadson testified that she saw Jenkins
drive the truck to a friend’s house.  Jenkins’s cousin John Jenkins was riding
in the front of the truck and Gadson’s brother and another passenger were riding
in the back.  Gadson’s brother climbed out of the truck and went home. Gadson
and several other people climbed into the back of the truck and Jenkins drove
them to McDonald’s.  After they ate, Jenkins drove them to a store where John
bought a cigar and one or two wine coolers, which he shared with another passenger. 
Jenkins then drove them to the Purrysburg Landing, where they talked for about
an hour. 

When the group started back to Hardeeville, John
was driving the truck. [1]   He suddenly sped up to around
80 miles per hour and then lost control of the vehicle, resulting in the accident. 
Gadson and the other passengers in the back were thrown from the truck. 

Gadson, along with others injured in the accident,
brought suit alleging negligence and negligent entrustment against ECO, Jenkins,
and John. [2]   The case was tried to a jury. 
ECO and Jenkins were represented at trial, but Jenkins did not appear.  John
was not represented and did not appear at trial.  The jury returned a general
verdict against all three defendants.  The jury found, in special interrogatories,
as follows:  (1)ECO entrusted its vehicle to Jenkins; (2) ECO was negligent
in entrusting its vehicle to Jenkins; (3) ECO’s negligence proximately caused
the plaintiffs’ injuries; (4) John was the driver of the vehicle; (5) John’s
negligence proximately caused the plaintiffs’ injuries; (6) Jenkins was not
the driver of the vehicle; and (7) Jenkins was negligent in entrusting the vehicle
to John.  It awarded Gadson $50,000 in actual damages. 

ECO and Jenkins both requested and were granted
ten days to file post-trial motions.  In their motions, ECO and Jenkins asked
for JNOV and new trial based on alleged juror misconduct. [3]   The trial court initially dismissed both motions
finding they were untimely.  On remand from this court, the trial court considered
both motions on the merits, but denied them.  ECO and Jenkins appealed. 

STANDARD OF REVIEW

When reviewing the denial of a motion
for a directed verdict or JNOV, this court uses the same standard as the trial
court by viewing the evidence and all reasonable inferences in the light most
favorable to the nonmoving party.  Welch v. Epstein, 342 S.C. 279, 299,
536 S.E.2d 408, 418 (Ct. App. 2000).  The motion must be denied when the evidence
is susceptible of more than one inference.  Id. at 300, 536 S.E.2d at
418.  Neither this court nor the trial court has authority to decide credibility
issues or to resolve conflicts in the testimony or evidence.  Id.

LAW/ANALYSIS

ECO and Jenkins both argue the
trial court erred in denying their motions for directed verdict and JNOV on
Gadson’s claims for negligent entrustment. 

“The theory of negligent
entrustment provides:  ‘the owner or one in control of the vehicle and responsible
for its use who is negligent in entrusting it to another can be held liable
for such negligent entrustment.’” Am. Mut. Fire Ins. Co. v. Passmore,
275 S.C. 618, 622, 274 S.E.2d 416, 418 (1981) (quoting 19 A.L.R.3d 1175, 1192). 

The Restatement (Second)
of Torts § 308 (1965) [4] , provides
as follows:

It is negligence to permit a third
person to use a thing or to engage in an activity which is under the control
of the actor, if the actor knows or should know that such person intends or
is likely to use the thing or to conduct himself in the activity in such a manner
as to create an unreasonable risk of harm to others.

We will consider Gadson’s claims
against ECO first. 

It is undisputed that ECO owned
the truck involved in the accident.  ECO does dispute that Jenkins had authority
to be driving the truck on the night of the accident.  Lou Joseph Diaz, general
manager for ECO, testified that Jenkins had never taken the truck to Hardeeville
after work hours prior to the date of the accident.  However, one of the other
passengers injured in the truck contradicted this testimony when he said that
he had seen Ricky driving the truck around Hardeeville in the evenings for a
week before the accident. 

Jenkins was suspended twice early
in 1997 for unexcused absences from work.  Additionally, a note in Jenkins’s
personnel file indicated that Jenkins was terminated for unauthorized use of
a company vehicle on July 11, 1997—three weeks before the accident occurred. 
When confronted, Diaz testified that the date on the note was probably a typographical
error by the personnel office in Charleston.  He further testified that the
note was probably intended to reflect that Jenkins was fired on August 7, 1997
as a result of the accident, and that Jenkins had not been disciplined in July
of 1997.  Diaz noted that this could be confirmed by the personnel office; however,
the ECO employee who inserted the note into the file was never called to testify. 
Hector Calderon, human resource director at ECO, testified that ECO never fired
Jenkins in July of 1997.  He stated ECO’s payroll records showed Jenkins was
working for the company during that time.  We agree with ECO that the only reasonable
conclusion is that the notation that Jenkins was terminated on July 11, 1997
is a typographical error.  See Hopson v. Clary, 321 S.C. 312,
314, 468 S.E.2d 305, 307 (Ct. App. 1996) (stating that although we are bound
to review the record in a light most favorable to respondents, we “cannot ignore
facts unfavorable to that party.”)  However, even if we accept the notation
as evidence ECO had previously terminated Jenkins for unauthorized use of a
vehicle, we find the record does not support the jury’s finding of negligent
entrustment against ECO.

Gadson asserts that the evidence
proves ECO knew that Jenkins was an irresponsible employee, and therefore was
likely to cause harm to third parties with the truck.  We disagree.  The crux
of the issue is whether ECO knew or should have known that Jenkins intended
or was likely to use the truck in such a manner as to create an unreasonable
risk of harm to others.  The only inference from the evidence in the record
is that Jenkins had attendance problems at work about six months before the
accident, and that he was known to take ECO’s trucks home without authorization. 
Jenkins’s driving record contained no violations, accidents, or suspensions
over the three-year period prior to the accident.  There is simply no evidence
that ECO knew that Jenkins was likely to drive the truck recklessly, or that
ECO knew that Jenkins was likely to entrust the truck to someone else who would
drive it recklessly.

Gadson attempts to close this
gap by using negative inferences from the fact that Jenkins did not testify
at the trial.  See Duckworth v. First Nat’l Bank, 254 S.C. 563,
576, 176 S.E.2d 297, 304 (1970) (“If a party knows of an available witness on
a material issue and such witness is within his control and if without satisfactory
explanation he fails to call him, the jury may draw the inference that the testimony
of the witness would not have been favorable to such party.”)  However, this
rule is not applicable here because Jenkins was no longer an employee of ECO
at the time of trial and thus was no longer under ECO’s control.  Id.
at 576-77, 176 S.E.2d at 304. 

The test for legal sufficiency
of the evidence in South Carolina is “whether the evidence serves to prove a
fact or permits an inference of fact that would enable an ordinarily intelligent
mind to draw a rational conclusion therefrom in support of the right of the
plaintiff to recover.”  Mahaffey v. Ahl, 264 S.C. 241, 248, 214 S.E.2d
119, 122 (1975).  We find insufficient evidence to support the knowledge prong
of Gadson’s negligent entrustment claim against ECO.  The evidence presented
is simply not enough to permit an ordinarily intelligent mind to rationally
infer that ECO knew that Jenkins was likely to entrust the vehicle to another
who would drive recklessly.  Accordingly, we find the trial court erred in denying
ECO’s motions for directed verdict and JNOV. 

Jenkins’ liability for negligently
entrusting the truck to John is a separate issue.  Jenkins did not dispute that
he had control of the vehicle, or that he entrusted the vehicle to John.  Additionally,
Jenkins has not disputed that this entrustment was unauthorized.  We find the
record supports the inference that Jenkins knew or should have known that John’s
use of the vehicle was likely to cause harm.  Jenkins knew that John had been
drinking alcoholic beverages.  Jenkins was apparently familiar with John’s character,
because he was John’s cousin.  Moreover, because Jenkins did not testify on
his own behalf, the jury was permitted to infer that any testimony would have
been unfavorable.  See McCowan v. Southerland, 253 S.C. 9, 12, 168 S.E.
573, 574 (1969) (stating that as to facts that were peculiarly within defendant’s
knowledge, the defendant’s unexplained failure to testify raises an inference
that his testimony, if it had been submitted, would have been unfavorable to
his position).  Accordingly, we find the trial court did not err in denying
Jenkins’s motions for directed verdict and JNOV. 

CONCLUSION

Based on the foregoing, the order of the
trial court is

AFFIRMED in part, and REVERSED in part.

HUFF, KITTREDGE, and BEATTY, JJ., concur.

[1] The official accident investigation report listed Jenkins as the
driver of the truck, but the jury by special interrogatory found the driver
at the time of the accident to be John.

[2] The other cases have been settled and are no longer a part of this
appeal.  In addition, John did not appeal the judgment against him. 

[3] After the trial, Jenkins’ attorney spoke to one of the jurors and
discovered that several of the jurors either knew of Jenkins and John or knew
of their reputations.  Additionally, one of the jurors had a cousin who worked
for ECO.  The attorney prepared an affidavit testifying to what he heard. 

[4] In Lydia v. Horton, 343 S.C. 376, 540 S.E.2d 102 (Ct. App.
2000), this court adopted the Restatement (Second) of Torts §§ 308 and 390
as the standard for negligent entrustment in South Carolina.  Lydia
involved a first party cause of action for negligent entrustment.  The South
Carolina Supreme Court reversed this court’s opinion, holding that the plaintiff
could not recover on a first party negligent entrustment cause of action because
“(1) South Carolina’s modified comparative negligence scheme would bar recovery
for this type of claim, and (2) the public policy considerations addressed
. . . in Tobias v. Sports Club, Inc., 332 S.C. 90, 504 S.E.2d 318 (1998).” 
Lydia v. Horton, 355 S.C. 36, 39, 583 S.E.2d 750, 752 (2003).  The
supreme court also “decline[d] to adopt sections 308 and 390 of the Restatement”
based on the facts of that case.  Id. at 43, 583 S.E.2d at 754.  We
do not find the supreme court’s ruling in Lydia would prevent application
of section 308 of the Restatement under the facts of the present case as the
question addressed in Lydia was whether South Carolina recognizes a
first party negligent entrustment claim.