Acadia Insurance Co. v. USA

Filing

Opinion issued by court as to Appellant Acadia Insurance Co.. Decision: Affirmed. Opinion type: Non-Published. Opinion method: Per Curiam. The opinion is also available through the Court's Opinions page at this link http://www.ca11.uscourts.gov/opinions.

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Date Filed: 01/10/2017

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[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 16-11309
Non-Argument Calendar
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D.C. Docket No. 5:13-cv-00895-CLS

ACADIA INSURANCE CO.,
as subrogee of Yedla Management Co., Inc., & Hospitality Enterprises of
Huntsville, Inc.,
d.b.a. Country Inn & Suites,
Plaintiff-Appellant,
versus
UNITED STATES OF AMERICA,
Defendant-Appellee.
________________________
Appeal from the United States District Court
for the Northern District of Alabama
________________________
(January 10, 2017)
Before MARCUS, JULIE CARNES and JILL PRYOR, Circuit Judges.
PER CURIAM:

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In this case involving the Federal Tort Claims Act, 28 U.S.C. § 1346(b)
(“FTCA”), Acadia Insurance Company (“Acadia”) appeals the district court’s
grant of judgment in favor of the United States following a bench trial. In its
complaint, Acadia sought to hold the United States vicariously liable, under the
theory of respondeat superior, for the conduct of Special Agent Michael Siegling,
of the Federal Bureau of Investigation (“FBI”). Acadia claimed that Special Agent
Siegling had started a fire at the Country Inn and Suites in Huntsville, Alabama,
when he negligently discarded smoking materials on the balcony outside his hotel
room. 1 The agent had been staying at the hotel while attending a six-week training
course paid for by the FBI.
In its order granting judgment in favor of the United States, the district court
said it was “inclined to conclude” that Acadia established by a preponderance of
the evidence that Special Agent Siegling negligently caused the fire. However, the
court said it was not necessary to reach that question because, even if Siegling’s
negligent disposal of smoking materials caused the fire, the United States would
not be vicariously liable for his conduct under Alabama law because Siegling was
not acting within the scope of his employment while smoking after hours on his
hotel room balcony. On appeal, Acadia argues that the district court misapplied

1

Acadia had issued an insurance policy to the owners of the Country Inn and Suites, and,
after the fire, paid the owners’ insurance claim. Acadia sued as the owners’ subrogee under the
policy.
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Alabama law to hold that Special Agent Siegling was not acting within the scope
of his employment while smoking on the balcony. After careful review, we affirm.
After a bench trial, we review the district court’s conclusions of law de novo
and its factual findings for clear error. Tartell v. S. Fla. Sinus & Allergy Ctr., Inc.,
790 F.3d 1253, 1257 (11th Cir. 2015). A district court’s determination that an
employee’s actions were outside the scope of his employment is a mixed question
of law and fact subject to de novo review. See Nadler v. Mann, 951 F.2d 301, 305
(11th Cir. 1992).
Under the FTCA, the United States is subject to liability in a tort action in
the same manner and to the same extent that a private individual would be under
the law of the place where the tort occurred. Daniels v. United States, 704 F.2d
587, 591 (11th Cir. 1983); 28 U.S.C. § 1346(b)(1). Thus, to determine liability
under the FTCA, courts must look to the law of the state where the act or omission
occurred. Daniels, 704 F.2d at 591. In this case, we look to Alabama law.
In Alabama, to recover against a defendant upon the theory of respondeat
superior, “it is necessary for the plaintiff to establish the status of master and
servant and that the act done was within the scope of the servant’s employment.”
Solmica of Gulf Coast, Inc. v. Braggs, 232 So. 2d 638, 640 (Ala. 1970).
The rule which has been approved for determining whether certain
conduct of an employee is within the line and scope of his
employment is substantially that if an employee is engaged to perform
a certain service, whatever he does to that end, or in furtherance of the
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employment, is deemed by law to be an act done within the scope of
the employment.
Id. at 642 (quotation omitted).
To fall under the rule, the employee’s conduct “must not be impelled by
motives that are wholly personal, or to gratify his own feelings or resentment, but
should be in promotion of the business of his employment.”

Id. at 642-43.

“[W]hether an alleged wrong is committed by the employee during his regular
working hours is not dispositive of the question whether the employee was acting
within the scope of his employment. Instead, the dispositive question is whether
the employee was engaged in an act that he was hired to perform or in conduct that
conferred a benefit on his employer.” Hulbert v. State Farm Mut. Auto. Ins. Co.,
723 So. 2d 22, 24 (Ala. 1998) (citations omitted).
On this record, we cannot say that the district erred in concluding that
Special Agent Siegling was not acting within the line and scope of his employment
at the time of the fire. Evidence adduced at trial showed that at the relevant time,
Siegling was smoking on his hotel room balcony, while he was off duty in the
evening. At that time, his conduct was not being supervised by the FBI, nor was
he engaging in activities that furthered its business. Rather, his smoking was
impelled by purely personal motives. Indeed, the FBI did not pay for Special
Agent Siegling’s cigarettes, but instead prohibited him from purchasing cigarettes
with his government credit card.

Nor was he even required to stay at that
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particular hotel. In short, the record shows that at the time of the fire, Special
Agent Siegling was not engaged in any action benefiting the FBI.
On appeal, Acadia argues that while the FBI may not have benefited directly
from Special Agent Siegling’s smoking, a smoke break is a minor detour from an
employee’s job duties, which does not take his conduct outside the scope of his
employment under Alabama law. Acadia cites Natco Corp. v. Mallory, 80 So. 2d
274 (Ala. 1955), in which the Alabama Supreme Court held that an employee
injured when he went into the pit under his employer’s conveyor belt to retrieve his
fallen package of cigarettes was acting within the scope of his employment, as that
term was defined in Alabama’s workmen’s compensation statute.
But Natco is distinguishable from the instant case in many ways. For one,
the standard for liability in the workmen’s compensation context is not the same as
that in the respondeat superior context under Alabama law. See Ex parte Stewart,
518 So. 2d 118, 120 & n.2 (Ala. 1987) (“[W]e have . . . expressly rejected any oneto-one correspondence between compensation cases and the common law in the
application of the law of master and servant, recognizing that compensation cases
require a broader conception of the employer-employee relationship.”). Moreover,
Natco involved an employee who was at his worksite, during his on-duty hours,
and who was injured by his employer’s machinery. 80 So. 2d at 274-75. The
employee was not smoking, but was instead retrieving cigarettes he had dropped
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while he was working. Id. Here, in contrast, Special Agent Siegling was in a hotel
room, after a training class had ended for the day, and he allegedly started a fire
with cigarettes he had purchased for himself.
There is language in Natco indicating that a smoke break is a minor detour
under Alabama law that does not take an employee’s conduct outside the scope of
his employment. See id. at 275-76. But the facts adduced at trial did not show that
Special Agent Siegling was taking a smoke break on his hotel room balcony on the
night of the fire. Rather, Siegling testified that, during the six-week course, he
typically left the hotel early in the morning, around 4:45 a.m., and returned around
4:00 or 5:00 p.m. Siegling considered himself off-duty when at the hotel. While
he studied from time to time in his hotel room for exams held in the course, he did
not testify that he was studying on the night the fire occurred, or that he was taking
a break from studying when he went out onto his balcony to smoke that night.
These facts also distinguish this case from Hulbert. There, the Alabama
Supreme Court found a genuine issue of material fact concerning an employer’s
vicarious liability for a car accident caused by her nanny, who was driving to the
employer’s vacation home to help care for the employer’s children. 723 So. 2d at
24. In Hulbert, the nanny’s driving to the employer’s vacation home benefitted the
employer, and one of the employer’s children was in the car with the nanny at the
time of the accident, which could have suggested the nanny was on duty. See id.
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See also Edgewater Motels, Inc. v. Gatzke, 277 N.W.2d 11, 16-17 (Minn. 1979)
(upholding jury verdict finding employer vicariously liable for negligent conduct
of employee whose cigarette smoking caused fire in hotel room, where employee
was “24-hour-a-day man,” used the hotel room as his “office away from home,”
and was reviewing expense reports when he started the fire).
Acadia further argues that Special Agent Siegling’s smoking on his hotel
room balcony was within the scope of his employment because the FBI reasonably
could have expected that he would be smoking in his hotel room. In its appellate
brief, Acadia asserts that the FBI “paid for [Siegling] to have a smoking room.”
But this is not supported by the trial evidence. While Agent Siegling testified that
an ashtray was in his room, there was no evidence about whether the FBI
specifically requested a smoking room for Siegling, or even whether the Country
Inn and Suites distinguished between smoking and non-smoking rooms. On the
other hand, Agent Siegling testified that, while the FBI paid for his lodging and
meals and permitted him to use a government credit card for his expenses, it did
not pay for his cigarettes and specifically prohibited him from purchasing
cigarettes with the government credit card. Thus, if anything, the FBI discouraged
Agent Siegling from smoking while he was on official government business.
Acadia also points to cases in which courts have held employers liable for
car accidents caused by employees traveling on official business, who were driving
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to or from restaurants to purchase meals paid for by the employer. Flohr v.
Mackovjak, 84 F.3d 386, 390-92 (11th Cir. 1996) (applying California law to hold
United States vicariously liable for car accident an Army engineer on temporaryduty assignment caused while driving to a restaurant in a rental car paid for by the
government); Singleton v. Burchfield, 362 F. Supp. 2d 1291, 1293-95 (M.D. Ala.
2005) (applying Alabama law to hold United States vicariously liable for car
accident an Air Force officer attending five-week training course caused while
driving back to his hotel in a government car after eating dinner at a restaurant).
Acadia says that since an employee’s smoking confers just as much benefit on the
employer as the employee’s eating, the government should be held liable for
Special Agent Siegling’s negligent smoking activities.
We’re unpersuaded. First of all, the cases Acadia cites involve employees
who were driving vehicles that were either owned or rented by the employer, and
Alabama law applies a presumption that an employee driving his employer’s
vehicle is acting within the scope of his employment. Pryor v. Brown & Root
USA, Inc., 674 So. 2d 45, 48 (Ala. 1995). There is no such presumption for
employees staying at hotels paid for by their employers. Secondly, whereas the
government paid for the transportation and meals of the employees in Flohr and
Singleton, the FBI did not pay for Special Agent Siegling’s cigarettes, but instead
prohibited him from purchasing cigarettes with his government credit card. As for
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Acadia’s reliance on Pryor for the proposition that an employer can be held
vicariously liable even for conduct it prohibited, it is inapposite here. Pryor says
that such liability may be imposed if the employee was acting within the line and
scope of his employment. Id. at 47-48. But, as we’ve already explained, there is
nothing to suggest that Special Agent Siegling was acting within the line and scope
of his employment when he was smoking on his hotel room balcony at the time of
the fire.
Acadia argues in passing that Special Agent Siegling’s smoking may have
been necessary for his optimal performance during the six-week training course,
given the adverse symptoms addicted smokers typically experience when they go
through nicotine withdrawal. However, Acadia presented no evidence to this
effect at trial. Rather, Special Agent Siegling testified only that he smoked every
day or every fourth day.
We also reject Acadia’s claim that the district court erred by referencing
cases from jurisdictions outside Alabama to decide if Siegling was acting within
the scope of his employment while smoking after-hours on the hotel balcony.
Acadia acknowledges that no Alabama case resolves whether an employer is
vicariously liable for an employee’s negligent cigarette smoking activities in his
hotel room while the employee is traveling on official business. The district court
did not err in looking to analogous cases from other jurisdictions to guide its
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analysis as to whether Alabama courts would impose liability under the same
circumstances. The court expressly concluded that “the Alabama Supreme Court
would follow the reasoning of cases from those jurisdictions.” (emphasis added).
Finally, Acadia argues that not holding the FBI liable for Agent Siegling’s
negligent cigarette-smoking activities does not comport with the policy reasons
behind vicarious liability in Alabama. We disagree. In Hollis v. City of Brighton,
the Alabama Supreme Court explained:
Respondeat superior liability seems fully justified because (1) it tends
to provide a spur toward accident prevention; (2) it tends to provide
greater assurance of compensation for accident victims; and (3) at the
same time it tends to provide reasonable assurance that, like other
costs, accident losses will be broadly and equitably distributed among
the beneficiaries of the enterprises that entail them.
885 So. 2d 135, 145 (Ala. 2004) (quotations omitted, alteration adopted).
We are not convinced that holding the FBI vicariously liable for a fire
Special Agent Siegling allegedly caused while smoking on his hotel room balcony
after hours, when he was not engaged in any activity that would benefit the FBI,
would “spur toward accident prevention.” Again, it is relevant here that the FBI
already discourages cigarette-smoking by agents traveling on official FBI business
by prohibiting them from purchasing cigarettes with a government credit card.
Nor are we convinced that holding the FBI vicariously liable would equitably
distribute losses among the beneficiaries of Special Agent Siegling’s cigarette
smoking, since there was no evidence the FBI benefitted from Siegling’s smoking.
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Instead, we agree with district court that holding the FBI vicariously liable on these
facts risks holding employers liable for any acts done by employees while traveling
on official business, which is contrary to Alabama law. See Solmica, 232 So. 2d
at 640.
AFFIRMED.

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