Lanteigne v. Smith

Opinion by Mr. Chief Justice Drew, At 3 o’clock on the morning of August 7,1947, James Duffy, defendant, negligently drove an automobile owned by Earl E. Smith, co-defendant, into the front of a restaurant owned by Renee Lanteigne and Madeline M., his wife,' plaintiffs. To recover for the property damage and for personal injuries to the wife-plaintiff, this action in trespass was instituted and resulted in verdicts for [134] plaintiffs against both defendants. Motions for judgment n. o. v. and new trial by defendant Smith were dismissed and judgments were entered in the sum of $5,247.51 against defendants. Smith then filed this appeal, conceding Duffy’s negligence, and raising as the sole question the sufficiency of the evidence to show that Duffy was his agent. Smith owned an automobile sales agency known as “Royal Sales” in the City of Bethlehem. Duffy operated an automobile repair shop adjoining Smith’s showroom and from time to time did repair work on cars owned by Smith. He also had an arrangement with Smith whereby Smith would pay him a commission on any automobiles he, Duffy, might sell. On the morning of the accident Duffy was driving an Oldsmobile owned by Smith and bearing a dealer’s license plate No. A922S which had been issued to “Royal Sales”. He was riding on the wrong side of State Highway Route 309, just north of the Borough of Quakertown, Bucks County, when he collided with a truck going in the opposite direction. Following the collision the car careened, out of control, into the front of plaintiffs’ restaurant, known as “The Pines”, causing personal injuries to the wife-plaintiff and extensive damage to the building. Immediately following the accident Duffy told Lanteigne that he had been demonstrating the car for Smith and was returning home when the collision took place. The next day Smith visited plaintiffs and, according to their testimony, he verified Duffy’s story. At the trial Smith denied making such statements and further denied that Duffy had authority to take the automobile out to demonstrate it. Duffy did not enter an appearance or testify at the trial. The learned trial judge charged the jury that the presence of Smith’s dealer’s tags on the automobile raised a rebuttable presumption that Duffy was acting as Smith’s agent at the time of the accident. It is that [135] portion of the charge to which Smith raises his most strenuous objection. It is true that this Court has repeatedly laid down the rule that the presence of dealer’s license plates on an automobile at the time of an accident raises a rebut-table presumption that the car was being driven by his servant acting within the scope of his employment: Frew v. Barto, 345 Pa. 217, 26 A. 2d 905; Morgan v. Heinel Motors, Inc., 329 Pa. 360, 197 A. 920; Conley v. Mervis, 324 Pa. 577, 188 A. 350; Coates v. Commercial Credit Co., 310 Pa. 330, 165 A. 377; Haring v. Connell, 244 Pa. 439, 90 A. 910. However, that presumption has never been an arbitrary one but arose because of the limited purposes for which dealer’s tags may be used. As we said in Coates v. Commercial Credit Co., supra, at 333: “. . . as the legislature has specified the occasions on which dealers’ automobiles may legally be operated, it must be presumed that its prescribed rules are being complied with.” When the presumption of agency was first established in Haring v. Connell, supra, the permitted uses of cars containing dealer’s tags were limited to a few essential business purposes.1 Thereafter, §502 of The Vehicle Code of 1929 2 expanded the use of dealer’s tags to allow a member of the dealer’s family to drive a car containing those tags for the personal pleasure of the driver. Under that Act, this Court, speaking through Mr. Justice Linn, stated in Morgan v. Heinel Motors, Inc., supra, at 365: “. . . it is to be noted that section 502, clause (b), allows the use of dealer’s license plates if a dealer or a member of his family operates the vehicle for the user’s pleasure. In such case mere proof of ownership of the tags is [136] not sufficient; if the car be operated by a member of the dealer’s family for the purposes of the user and not for the purposes of the dealer, clause (b) places the same within the well settled rule that in such circumstances the owner of the car is not liable: Warman v. Craig, 321 Pa. 481, 184 A. 757, and cases cited in that opinion.” The Vehicle Code of 1929, §502, was amended by the Act of June 27, 1939, P. L. 1135, and now allows the use of such tags not only for the personal pleasure of the dealer’s family but also for the pleasure of his employes. With that amendment the language of the Morgan case, quoted above, becomes equally applicable to cars driven by employes of the dealer. It can no longer be presumed that an employe driving an automobile with dealer’s tags is acting within the scope of his employment since he might, with equal legality, be using the vehicle for his own personal pleasure. That being true, the trial court erred in permitting the jury to infer agency from the fact that Smith’s dealer’s tags were on the car. Smith contends that with the presumption removed there was no evidence of agency and he is, therefore, entitled to a judgment n. o. v. With that contention we cannot agree. It was incumbent on plaintiffs to prove that the driver, Duffy, was engaged in the business of his employer, Smith, at the time of the accident and that he was acting within the scope of his authority: Warman v. Craig, 321 Pa. 481, 184 A. 757; Orluske v. Nash Pbg. Motors Co., 286 Pa. 170, 133 A. 148; Reed v. Bennett, 276 Pa. 107, 119 A. 827. This burden was met when Lanteigne testified that Smith told him that Duffy had been demonstrating the car in an effort to sell it for Smith and was returning home when the accident occurred. It is true that Smith denied making such statements but that denial merely raised an issue of credibility which was properly left to the jury: Nanty-Glo Boro. v. Amer. Surety Co., 309 Pa. 236, 163 A. 523. [137] The other errors assigned need not be detailed here. They were fully and correctly disposed of by the court below in its opinion. However, the error in the charge on the presumption arising from the presence of dealer’s plates on the car requires that a new trial be granted to Smith. It must be noted here that Duffy’s negligence is conceded. Therefore, the sole issue to be determined at the retrial is whether Duffy was acting as Smith’s agent at the time of the accident. If that issue be resolved in plaintiff’s favor, then judgment must be entered against Smith in the same amount as the judgment now standing against Duffy. The judgments are reversed and the record is remitted to the court below for a new trial in conformity with this opinion. Footnotes [1] Act of April 21, 1911, P. L. 74. That Act provided, inter alia, that “A dealer’s tag . . . shall not be used for any other purposes than testing or demonstrating the vehicle to a prospective purchaser, or in removing the same from place to place for the purpose of sale.” [2] Act of May 1,1929, P. L. 905.