On Tuesday, November 20, 2018, the North Carolina Court of Appeals issued two (2) decisions on liability issues important to business owners and their insurers.  https://appellate.nccourts.org/opinion-filings/?c=coa

In Kevin McKenzie, Administrator of the Estate of Yvonne Lewis v. Richard Charlton, et al., No. COA18-82, addressed the distinction between an “independent contractor” and “employee” in the context of “respondeat superior liability”.  Plaintiff’s decedent was a pedestrian killed by a vehicle driven by defendant Mr. Charlton, who at the time was a home health care aide driving his charge (“Mr. Smith”) while working for defendant RFI.  RFI and Charlton had a written “independent contractor agreement”, and the trial court granted summary judgment to RFI on that basis, that RFI could not be responsible for the actions of Charlton while driving, dismissing the suit against RFI.  The Court of Appeals reversed, finding fact issues despite the clearly written contract, including that Charlton worked approximately 40 hours per week for RFI, had no other patients in his care other than Mr. Smith, and that RFI had “right to control” how Charlton did his job. The case is remanded back to the trial court likely for a jury trial in the wrongful death action.

Unquestionably, employers and their liability insurers must be hyper-vigilant about over reliance upon “independent contractor” designations. This issue touches not just auto liability litigation as in this case, but also wage/hour/overtime, workers compensation, employee benefits and tax laws, and beyond.

In Sadie Carter, et al v. St. Augustine’s University, No. COA17-1008, employees complained of unpaid time at work, and were promptly thereafter fired.  The employees filed suit in state court under the North Carolina Wage and Hour Act, and Retaliatory Employment Discrimination Act. The jury ruled in their favor, awarding punitive damages, but they elected treble damages instead, yet the trial court denied them attorneys’ fees.  On appeals by both sides, unpublished, the court upheld all aspects of the trial court rulings.  These parties clearly spent many tens of thousands of dollars on this litigation; the Record on Appeal spans over 1,400 pages.