Arizona’s High Court Rules Employer Not Liable for Employee Crash During Out of State Travel

An employer is not liable for injuries sustained by a third party involved in an auto accident with a company employee during a work trip, the Arizona Supreme Court ruled this week.

The high court reasoned that an employer is not liable for the actions of an employee while traveling on assignment, if the employee is not acting within the scope of his or her employment and the employer exerted no control over the employee’s actions.

Ian Gray worked for Gulf Interstate Engineering, Inc., a Houston-based energy consulting company. Gray, a resident of Texas, worked on a project in Mexico while staying in a hotel in Yuma, Ariz., traveling to the project with a rental car. Gulf reimbursed Gray for his travel and meal expenses.

Because travel to and from the project site involved crossing the border and delays were possible, the company considered the workday complete when its workers returned to their hotel rather than when they left the job site.

After returning to the hotel on the evening of December 11, 2007, Gray drove to a restaurant with another employee. After dinner, as the two Gulf employees were driving back to the hotel, they were involved in an accident with a motorcycle operated by Aaron Engler. Engler alleged that Gray made an improper left turn, hitting his motorcycle and causing him injury. Engler filed a lawsuit against Gray, as the driver, and Gulf, as the employer. Engler alleged Gray negligently caused the accident and Gulf was vicariously liable for its employee’s conduct.

The company filed a motion for summary judgment on the basis that Gray was not acting within the “course and scope of employment.” The trial court concurred and granted the motion on behalf of Gulf.

In a separate case decided within two weeks of the Engler decision, McCloud v. Kimbro, Division Two of the Arizona Court of Appeals ruled that an employee traveling on assignment is continually within the course and scope of employment, even if he or she is traveling to and from a restaurant whether off duty or not, because “eating is incidental to a multiple-day assignment” and serves a business purpose.

Despite the ruling in McCloud, Division One of the Arizona Court of Appeals affirmed the trial court’s decision in Engler. The court concluded that Gray’s eating dinner while on assignment was no different than while he was not on assignment. Since Gulf imposed no control over where Gray could dine and what he could do once he returned to the hotel for the night, the company could not be vicariously liable for Gray’s actions.

Engler appealed, petitioning the Arizona Supreme Court to review the matter. Because of the conflict between the decisions in McCloud and Engler, the petition was granted.

Though the court in McCloud looked at the principles of workers compensation to guide them in their decision, the Supreme Court chose to instead reaffirm the Court of Appeals decision in Engler, reasoning that because workers’ compensation and tort law differ and the fact there could be an infinite number of claimants claiming third party liability, the decision should not be solely based on workers’ compensation principles.

The case is Aaron Engler v. Gulf Interstate Engineering, CV-11-0273-PR.