Caudill v. EAN Holdings LLC

William Caudill, duly appointed guardian of minor infants T.M. and C.M.; Charles Samuel Hammett; Kimberly Dawn Hammett; and Haylie Hammett, Plaintiffs below, Petitioners v. EAN Holdings LLC, d/b/a Enterprise Rent-A-Car; Buenaventura Jesurum; Empire Fire and Marine Insurance Company; Rental Insurance Services, Inc., and Rafael Lorenzo Herrera, Defendants below, Respondents.

No. 21-0096

Supreme Court of Appeals of West Virginia

April 26, 2022

Raleigh County 16-C-13, 16-C-14

MEMORANDUM DECISION

On March 22, 2015, Rafael Herrera drove a rented Ford Explorer north in the southbound lane of I-77 in Raleigh County. The Explorer collided into a Ford Escape driven by Lisa McCormick, who died in the collision. Her children, C.M. and T.M., and their friend, Haylie Hammett, were seriously injured in the collision. Mr. Herrera suffered only minor injuries.

William Caudill, guardian of T.M. and C.M., ^[1] and Haylie Hammett, Charles Samuel Hammett, and Kimberly Dawn Hammett (the Hammetts)^[2] filed suit against Mr Herrera^[3] in the Circuit Court of Raleigh County in 2016. They also named as defendants EAN Holdings LLC d/b/a Enterprise Rent-a-Car (EAN), ^[4] Buenaventura Jesurum ^[5] Rental Insurance Services Inc. (RIS), ^[6] and Empire Fire and Marine Insurance Company (Empire).^[7] In a series of orders entered in 2020, the circuit court granted summary judgment to EAN, Mr. Jesurum, RIS, and Empire on Petitioners' claims. Petitioners now appeal those orders.

Upon consideration of the standard of review, the briefs, the record presented, and the parties' oral arguments, the Court finds no substantial question of law and no prejudicial error. For these reasons, a memorandum decision affirming the circuit court's orders is appropriate under Rule 21 of the Rules of Appellate Procedure.

I. FACTUAL BACKGROUND

On or around March 11, 2015, Mr. Herrera tried to rent a vehicle from EAN at its Cleveland, Tennessee branch (EAN Tennessee). He was accompanied by Mr. Jesurum, whom he had known for only a few days. Mr. Herrera showed EAN employees his valid, Florida driver's license (which identified Mr. Herrera as a "safe driver"), but he had neither a credit card nor proof that he lived near Cleveland, so EAN would not rent a vehicle to him. The men returned to EAN Tennessee on March 13. This time, Mr. Jesurum asked to rent a car with Mr. Herrera as a second driver. Mr. Jesurum showed staff at EAN Tennessee his driver's license, proof of address, and gave them his debit card. After signing the necessary paperwork, EAN Tennessee rented a Chrysler Town & Country van to Mr. Jesurum.

The rental agreement between EAN and Mr. Jesurum did not specify that anyone other than Mr. Jesurum was permitted to drive the Town & Country. The box on the rental agreement regarding the states in which the rented van could be operated was also left blank. Further, under EAN Tennessee Rental Guidelines, authorized additional drivers had to meet the same qualifications as the named renter. So, Mr. Herrera-who did not qualify to rent a vehicle from EAN due to lack of credit and proof of permanent address-did not qualify as an authorized driver of Mr. Jesurum's rental vehicle.

According to Mr. Jesurum, he gave the Town & Country to Mr. Herrera on March 13 or early the next morning so the latter could drive another man to a job opportunity out of state. Mr. Herrera later stated that he had been given the van with instructions to drive to Mesa, Arizona and pick up six people from a Wal-Mart parking lot.^[8] Mr. Herrera stated that he had been paid to make the trip and intimated that the six people were in this country illegally. By March 21, Mr. Herrera had made one out-and-back trip to Arizona.^[9]

Around noon on March 21, 2015, Mr. Herrera arrived at an EAN branch in Corbin, Kentucky (EAN Kentucky). The Town & Country had been driven approximately 7, 700 miles since Mr. Jesurum had rented it on March 13. Mr. Herrera told Brent Bradshaw, branch manager, that the Town & Country had a bad transmission, and that he wanted another vehicle. Mr. Herrera provided Mr. Bradshaw with a copy of the rental agreement. Mr. Bradshaw checked EAN's internal computer system and saw that Mr. Herrera was listed there as an additional driver of Mr. Jesurum's rental vehicle. He viewed Mr. Herrera's Florida driver's license and saw that it was unexpired. Mr. Bradshaw would later attest that during their interaction, Mr. Herrera did not appear impaired, intoxicated, or otherwise unfit to drive. Mr. Herrera has also attested that while present at EAN Kentucky, he gave EAN personnel no reason to believe that he was under the influence of drugs or alcohol, no information about his driving history or possible involvement in criminal activity, and no information that would have suggested that he was not capable of driving a rental vehicle. Mr. Bradshaw accepted the Town & Country, provided a Ford Explorer to Mr. Herrera, and then watched him drive out of the parking lot.

Mr. Herrera spent the night of March 21 in a hotel in Tennessee. He later stated that he spent the night with a teenage girl and ingested cocaine, so that he "rested but he didn't sleep." Mr. Herrera also stated that he had contact with a man (presumably Mr. Jesurum) and that he informed Mr. Jesurum that he was tired. According to Mr. Herrera, Mr. Jesurum told him to continue to drive.

Roughly twenty-four hours after picking up the Explorer from EAN Kentucky, Mr. Herrera drove that vehicle northward in the southbound lane of Interstate 77, near Beckley, West Virginia. Ms. McCormick drove her Ford Escape southward in the southbound lane. The vehicles collided. Ms. McCormick was killed, and T.M., C.M., and H.H. were seriously injured. Mr. Herrera suffered minor injuries. Mr. Herrera was indicted for murder, one count of driving under the influence causing death, and three counts of driving under the influence causing injury. He later pled no contest to voluntary manslaughter.^[10] Mr. Jesurum had accepted supplemental liability insurance protection (SLP) offered through EAN when he rented the Town & Country on March 13. Empire was the SLP insurer and RIS investigated the collision. On March 30, 2015, a claims supervisor with Zurich, third-party administrator to Empire, wrote to Mr. Jesurum and Mr. Herrera and denied and disclaimed coverage under the SLP because Mr. Herrera had not been listed on the rental agreement as an authorized driver of the EAN rental vehicle. On April 6, 2015, Mr. Jesurum and Mr. Herrera were notified by the Zurich claims supervisor that the March 30, 2015 disclaimer of coverage was rescinded but that Empire was reserving its rights under the policy due to questions regarding Mr. Herrera's status as an additional, authorized driver on the rental agreement and the possibility that he was under the influence of alcohol or drugs at the time of the collision. On February 15, 2016, the Zurich claims supervisor notified Mr. Jesurum and Mr. Herrera that the April 6, 2015, reservation of rights was being revised, and that the remaining coverage question was whether Mr. Herrera had been under the influence of alcohol or drugs at the time of the collision. On June 5, 2017, the Zurich claims supervisor notified Mr. Jesurum and Mr. Herrera that the investigation of the claim was concluded and that the reservation of rights had been rescinded. Coverage-limits offers have been made to Mr. Caudill, guardian of T.M., C.M., and the Hammetts.

Petitioners filed their complaint in January 2016 and amended it in June 2017. The amended complaint includes the following claims: I. Negligence of Mr. Herrera; II. Negligence Per Se of Mr. Herrera; III. Negligent Entrustment of EAN; IV. Negligence of Ms. McCormick; V. Negligence Per Se of Ms. McCormick; VI. Negligent Entrustment of Brent Monroe (owner of the Ford Escape); VII. Negligent Entrustment of Mr. Jesurum; VIII. Declaratory Judgment; IX. Direct Negligence, Vicarious Liability, and Joint and Several Liability of EAN; and X. Intentional Infliction of Emotional Distress (IIED), Civil Conspiracy and Collusion Between EAN, RIS, and Empire.

EAN moved for summary judgment of Petitioners' claims for negligent entrustment, negligence, and IIED/conspiracy in September 2018.^[11] RIS and Empire moved for summary judgment of Petitioners' IIED/conspiracy claim in October 2019, and Mr. Jesurum moved for summary judgment of the negligent entrustment claim that month, as well. The court granted RIS, Empire, and Mr. Jesurum's motions in February and March 2020. Petitioners later moved the court to reconsider those orders, and the court denied those motions in June 2020. Then, the court granted EAN's motion for summary judgment in December 2020.^[12] This appeal followed.

II. STANDARD OF REVIEW

"A circuit court's entry of summary judgment is reviewed de novo, "^[13] "and, therefore, we apply the same standard as a circuit court."^[14] "Summary judgment is appropriate if, from the totality of the evidence presented, the record could not lead a rational trier of fact to find for the nonmoving party, such as where the nonmoving party has failed to make a sufficient showing on an essential element of the case that it has the burden to prove."^[15]

If the moving party makes a properly supported motion for summary judgment and can show by affirmative evidence that there is no genuine issue of a material fact, the burden of production shifts to the nonmoving party who must either (1) rehabilitate the evidence attacked by the moving party, (2) produce additional evidence showing the existence of a genuine issue for trial, or (3) submit an affidavit explaining why further discovery is necessary as provided in Rule 56(f) of the West Virginia Rules of Civil Procedure.^[16]

III. ANALYSIS

Petitioners...