Ratcliff v. TranStewart Trucking Inc.

684 F.Supp.3d 845

Gregg RATCLIFF, Porsche Holder, Plaintiffs, v. TRANSTEWART TRUCKING INC., Cherokee Insurance Company, Defendants.Burrell Lee, Interested Party.

Case No. 1:22-cv-00623-TWP-KMB

United States District Court, S.D. Indiana, Indianapolis Division

Signed July 31, 2023

Alexander Ryan Craig, Samantha C. Craig Stevens, Christopher M. Barry, David W. Craig, Scott Anthony Faultless, Whitney Lee Coker, Craig, Kelley & Faultless LLC, Indianapolis, IN, William J. Kelley, Craig, Kelley & Faultless, Batesville, IN, for Plaintiffs.

Michael Dean Heavilon, Robert D. Emmerson, DeFur Voran, Fishers, IN, for Defendant Transtewart Trucking Inc.

Dane Andrew Mize, Skiles Detrude, Indianapolis, IN, Haley Baldwin, Wilson Group Law PLC, Auburn, MI, James D. Wilson, Wilson Group Law PLC, Southfield, MI, for Defendant Cherokee Insurance Company.

Burrell Lee, Pro Se.

ORDER GRANTING DEFENDANTS' MOTIONS FOR SUMMARY JUDGMENT AND RULING ON CHEROKEE'S MOTION TO STRIKE SURREPLY

Tanya Walton Pratt, Chief Judge

This matter is before the Court on Motions for Summary Judgment filed pursuant to Federal Rule of Civil Procedure 56 by Defendants TranStewart Trucking Inc. ("TranStewart") (Filing No. 83) and Cherokee Insurance Company ("Cherokee") (Filing No. 86) (together, "Defendants"). Also before the Court is Cherokee's Motion to Strike Surreply (Filing No. 110). Plaintiffs Gregg Ratcliff ("Ratcliff") and Porsche Holder ("Holder") (together, "Plaintiffs") initiated this action after Interested Party Burrell Lee ("Lee"), collided into and injured both Ratcliff and Holder. In their Second Amended Complaint, (Filing No. 54), Plaintiffs allege that TranStewart is vicariously liable for Lee's negligence, and they seek a declaration that Cherokee is required to cover any damages TranStewart owes them. For the reasons discussed below, summary judgment is granted on behalf of TranStewart and Cherokee.

I. BACKGROUND

The following facts are not necessarily objectively true, but as required by Federal Rule of Civil Procedure 56, the facts are presented in the light most favorable to Plaintiffs as the non-moving party. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Zerante v. DeLuca, 555 F.3d 582, 584 (7th Cir. 2009).

A. TranStewart's Business and Orientation Process

TranStewart is a ground transport company that uses semi-trucks, also called semi tractors, to transport cargo (Filing No. 84 at 2; Filing No. 95 at 2). TranStewart does not actually own any trucks or employ any drivers; rather, it leases trucks from the trucks' owners, who either drive the trucks themselves or hire drivers (Filing No. 84 at 2; Filing No. 95 at 2). TranStewart pays only the owners who lease their trucks to TranStewart. If an owner hires a driver, then that owner, and not TranStewart, pays the driver (Filing No. 84 at 2, 4).

All prospective drivers for TranStewart must go through orientation at TranStewart's facility in Michigan, even if they have driven for TranStewart before. Id. at 2. The orientation process includes filling out an application, receiving instructions on procedures, drug and alcohol screening, and the procurement of insurance, license plates, and fuel cards, among other items (Filing No. 84 at 2-3; Filing No. 87 at 6). While the prospective drivers are in orientation, TranStewart inspects the trucks to ensure they comply with the Department of Transportation's and TranStewart's requirements. If a truck does not pass inspection, "the whole process stops and does not move forward" (Filing No. 84 at 3).

B. TranStewart's Relationship with Burrell Lee and Darrell Haston

Lee is a professional truck driver with a commercial driver's license (Filing No. 95 at 1). He has been driving for decades and has driven for multiple trucking companies. Id. at 2. At one point, Lee operated his own trucking company (Filing No. 95 at 13; Filing No. 97-1 at 18-22). Lee had leased his trucks and driven for TranStewart at least twice in the past: from May 30, 2019 to February 13, 2020; and from February 17, 2021 to December 21, 2021 (Filing No. 95 at 1). Lee stopped driving for TranStewart in February 2020 and December 2021 because his trucks began experiencing mechanical problems. Id.

In December 2021,¹ Lee had an in-person meeting with a TranStewart representative. The representative told Lee that TranStewart would try to find him another truck to drive. Id. at 2. In January 2022, TranStewart became aware that non-party Darrell Haston ("Haston") was looking to lease his truck but needed a driver (Filing No. 95 at 2-3; Filing No. 84 at 3). Jacob Turpin ("Turpin"), a TranStewart employee, informed Haston that Lee was available to lease and drive Haston's truck (Filing No. 84 at 3). TranStewart then provided Haston's contact information to Lee and encouraged Lee to contact Haston (Filing No. 95 at 3).

Lee contacted Haston, and the two men spoke on the telephone and later met at Haston's home (Filing No. 97-1 at 13); (Filing No. 84 at 3). As a result of the meeting, Haston decided to let Lee drive his truck. TranStewart was not involved in Haston's decision to hire Lee as a driver (Filing No. 84 at 3; Filing No. 95 at 3). Lee understood that if TranStewart decided to lease Haston's truck, then TranStewart would pay only Haston, and Haston would pay Lee (Filing No. 84 at 4; Filing No. 95 at 5). Haston knew that before TranStewart would lease his truck, it would need to pass an inspection at TranStewart's Michigan facility (Filing No. 84 at 4).

C. Lee's Trip to TranStewart's Facility

TranStewart instructed Haston to have Lee drive the truck to Michigan, where TranStewart would inspect the truck and execute a lease (Filing No. 95 at 3). Haston permitted Lee to drive the truck to Michigan and gave Lee "about $500" for gas (Filing No. 84 at 4; Filing No. 95 at 3, 5).² TranStewart did not pay Lee for his trip to Michigan (Filing No. 95 at 5). Lee did not believe he was under TranStewart's control or dispatch during the drive to Michigan, but he believed he would be hired once he completed orientation and TranStewart executed a lease. Id. Lee decided to drive Haston's truck to Michigan because he wanted to continue working for TranStewart (Filing No. 95 at 5; Filing No. 97-1 at 6-7, 17).

TranStewart specified the date that Lee needed to arrive at its facility for inspection and orientation (Filing No. 95 at 3). TranStewart required Haston to have the truck inspected before it left for Michigan and required that Lee have the inspection documentation with him upon his arrival. Id. TranStewart further instructed Haston to ensure Lee brought a valid medical card and doctor's report. Id. TranStewart did not exercise any control over the route Lee took to TranStewart's facility (Filing No. 85-1 at 18).

D. The Letter of Intent and GAAC Policy

TranStewart provided a "Letter of Intent" for Lee's drive to Michigan. The letter was dated January 26, 2021,³ signed by Turpin, and stated:

Please be aware that Burrell Lee will be hired to work as a driver for TranStewart Trucking Inc. (MC363125) on January 28th, 2021. He will be en route to orientation during January 26th to 29th. If you have any questions, feel free to contact me direct at [phone number]. (Filing No. 84 at 4; Filing No. 97-11).

The Letter of Intent was intended to explain to law enforcement why the truck did not have a license or placards and provide assurance that the driver was not "attempting to do anything illegal" (Filing No. 84 at 4; Filing No. 95 at 4).

Haston also requested that TranStewart obtain a non-trucking insurance policy for Haston to cover Lee's trip to Michigan (Filing No. 84 at 4; Filing No. 95 at 4). TranStewart obtained the policy from Great American Assurance Company ("GAAC"), which listed Haston as the named insured and had an effective date beginning January 26, 2022 (the "GAAC Policy") (Filing No. 88-4; Filing No. 84 at 4; Filing No. 95 at 4). As its name suggests, a non-trucking insurance policy covers accidents involving a truck not being used for trucking. See Hartford Ins. Co. of Se. v. Occidental Fire & Cas. Co. of N.C., 908 F.2d 235, 239 (7th Cir. 1990). The GAAC Policy specifically excludes coverage for any damages "arising out of any accident which occurs while the covered auto is being used in the business of any lessee or while the covered auto is being used to transport cargo of any type" (Filing No. 88-4 at 15). The GAAC Policy also excludes as an "insured" "[a]nyone engaged in the business of transporting property for hire." Id. at 14.

TranStewart was identified as the "Motor Carrier" on the Application for Physical Damage and Non Trucking Liability Insurance for Independent Contractors (Filing No. 97-10). The truck was also given a "Fleet ID" on the Certificate of Insurance, which was the last four digits of the truck's serial number (Filing No. 97-2 at 8-9; Filing No. 97-9).

E. The Cherokee Policy

TranStewart separately obtained an insurance policy from Cherokee, identified as Policy No. CA 210081, with effective dates from May 1, 2021 to May 1, 2022 (the "Cherokee Policy") (Filing No. 87 at 8). TranStewart was the primary insured under the Cherokee Policy.

Under the Cherokee Policy, as amended, "insureds" include "You [TranStewart] for any covered 'auto' "; "[a]nyone else while using with your permission a covered 'auto' you own, hire or borrow," with certain exceptions; and "[t]he owner or anyone else from whom you hire or borrow a covered auto that is not a trailer while the covered auto is being used exclusively in the business of transporting property by auto for hire under executed written contract with the Named Insured" (Filing No. 88-6 at 2, 5, 7, 49).

The Cherokee Policy provides coverage for certain damages arising from auto accidents and "resulting from the ownership, maintenance or use of a covered 'auto' " (Filing No. 88-6 at 6). The Cherokee Policy does not define "covered 'auto,' " but the "Hired Autos Specified As Covered Autos You Own...