Summary
In Bennett v. Sinclair Refining Co. (1944), 144 Ohio St. 139, 29 O.O. 223, 57 N.E.2d 776, paragraph four of the syllabus, the court held that, where the existence of the relationship of joint venturers is an issue, the question is one of fact for determination by the trier of fact.
Summary of this case from Hunter v. BPS Guard Services, Inc.Opinion
Nos. 29774 and 29777
Decided October 25, 1944.
Negligence — "Joint adventure" defined — Relationship established by operation of law, when — Issue of relationship question of law or fact, when — Foreign corporation subject to tort action in any county, when — Summons may be issued against another defendant in different county, when.
1. A tort action against a foreign corporation may be brought in any county of this state wherein such corporation owns property or has debts owing to it or where such defendant is found, or where the cause of action, or some part thereof, arose, and where an action is commenced in any such county a summons may be issued to any other county against one or more other defendants.
2. Where one of the issues in a jury trial is the relationship of defendants to each other, ordinarily, if the facts are undisputed, that issue is one of law for determination by the trial court, but where the circumstances, disclosed by the undisputed evidence, are such that reasonable minds might reach different conclusions as to inferences to be drawn therefrom and the ultimate fact to be established thereby, there arises a question of fact for determination by the jury.
3. A joint adventure is a special combination of natural or artificial persons who, without creating a partnership, combine their money, property or time, or all of them, in the conduct of some particular line of trade or some particular business deal for profit.
4. Where the existence of the relationship of joint adventurers is an issue and there is substantial evidence tending to prove that the parties intended to join their property and efforts in furtherance of some enterprise for their joint profit, the question is one of fact for the determination of the jury.
5. A contract of joint adventure need not be established by showing an express agreement between the parties, but it may be implied or inferred, in whole or in part, from their acts and conduct.
APPEALS from the Court of Appeals of Summit county.
This case originated in the Court of Common Pleas of Summit county as an action to recover damages for injury to the person and property of Dorothy Bennett, caused by the claimed negligence of defendants. The basis of the plaintiff's claim is that Doyle Varnes and the Sinclair Refining Company, defendants, on the date in question were engaged in a joint adventure and in furtherance thereof a Ford tank truck was used to haul products of the defendant Sinclair Refining Company to various customers using such products.
The plaintiff was operating her automobile upon a public highway where plaintiff's automobile and the aforementioned Ford tank truck came into collision as the result of which the plaintiff was severely injured and her automobile was practically destroyed.
The salient facts disclosed by the evidence are as follows: On February 6, 1941, Dorothy Bennett (plaintiff) was operating her automobile in a southerly direction upon state route No. 3 in Wayne county, Ohio. The automobile was occupied by the plaintiff and her mother en route from plaintiff's home in Akron to Texas. A Ford tank truck operated by Richard Yoder was traveling in a northerly direction upon that highway en route from Wooster, Ohio, to Seville, Ohio. A collision occurred north of a curve in the highway in or near the city of Creston, Wayne county, Ohio, due to skidding of the truck upon the icy highway. The defendant Varnes was a resident of Wayne county and the Sinclair Refining Company is a foreign corporation engaged in the manufacture and distribution of petroleum products. In the distribution of its products Sinclair operated through district representatives or agents. In the city of Wooster, Wayne county, Ohio, and definitely described territory thereabouts, Sinclair was represented by one Fay Zimmerman whose duties and compensation were fixed by a written contract. Paragraph 8 of which reads as follows:
"8. The agent shall at agent's own expense furnish necessary teams, trucks, motive power, drivers, labor, water, light, power, and heat, and shall also pay all necessary expenses in draying the company's products and equipment and in making sales, deliveries, and collections. The agent shall also at agent's own expense apply for in agent's own name and have installed at agent's headquarters a telephone which shall be listed in the proper telephone directory and other directories in the name of Sinclair Refining Company with the street address of agent's headquarters. All charges for local and long distance calls made by means of such telephone, whether such calls be of a business or private nature, shall be for the account of the agent, and the company shall not in any case be obligated to pay any such charges or to reimburse the agent for any payment so made; provided, however, that the company may pay any such charges and deduct the amounts so paid from any commissions then due or thereafter to become due the agent."
In 1933, Zimmerman entered into an agreement with Varnes to sell Sinclair products from Sinclair's bulk station at Wooster, Ohio, to Varnes' customers, for which service Varnes was compensated at the rate of one and one-fourth cents per gallon on gasoline and seven per cent of the retail price of oils and greases sold. The chassis of the tank truck was the property of Varnes and the tank was the property of Sinclair. Upon the sides of the tank truck were signs in large letters "Sinclair." Upon the rear end of the truck were mastodon emblems, the trade mark of Sinclair. Both the signs and the emblems were furnished by Sinclair. Varnes did not pay for the tank, the signs or the emblems, but was to use them so long only as he engaged in the distribution of Sinclair products. Cans and other receptacles on the truck were marked with Sinclair's name.
Prior to the date of the accident, Varnes had built two filling stations, one at Seville and one at West Salem, and leased both stations to Sinclair. Varnes supplied those stations, among others, from the tank truck which was on its way to supply the Seville station when the accident occurred.
Varnes with the help of Sinclair also developed about seventy farmer customers. Sinclair promoted sales for Varnes upon which he received the commissions. In 1940, Yoder was employed to drive the tank truck and Varnes devoted most of his time in getting customers. Yoder regularly took out gas from the bulk station in the tank truck and brought in collections. All checks were made payable to either Sinclair or Varnes and cash receipts and checks were turned in each morning without deductions and were deposited to the account of Sinclair. Credit was extended to some customers after approval by Sinclair. Sinclair stood any loss within the approved range of credit and any loss not within the approved range was absorbed by Varnes.
Each customer, when a purchase was made, was given a sales slip at the top of which was printed "Sinclair Refining Company." When payment was made a receipt was given on a form slip furnished by Sinclair, which read in part, "Received payment for Sinclair Refining Company." Varnes or Yoder, after payment, signed the Sinclair agent's name and under it his own initials.
Upon this state of facts the trial court submitted to the jury the question of whether Sinclair and Varnes were engaged in a joint adventure. The jury returned a verdict in favor of plaintiff in the sum of $25,000 against both defendants. After overruling motions for a new trial judgment was entered upon the verdict.
Each defendant filed an appeal upon questions of law and the Court of Appeals affirmed the judgment.
Thereafter each defendant filed a motion to certify the record. Varnes' motion is numbered 29777 and Sinclair's motion 29774 on the docket of this court. Both motions were granted.
The two cases were heard together and will be disposed of in one opinion.
Messrs. Slabaugh, Seiberling, Guinther Pflueger, for appellee.
Messrs. Wise, Roetzel Maxon and Mr. William A. Kelly, for appellant Sinclair Refining Company.
Messrs. Brouse, McDowell, May Bierce, for appellant Doyle Varnes.
In the statement of facts Dorothy Bennett has been designated as plaintiff, Sinclair Refining Company as Sinclair, and Doyle Varnes as Varnes and such designations will be followed in this opinion.
The principal assignments of error may be stated thus:
1. That the court was without jurisdiction of the persons of the defendants.
2. That plaintiff failed to allege, state or prove defendants were engaged in a joint adventure; therefore the Court of Common Pleas of Summit county was without jurisdiction to entertain the action.
3. That the trial court erred in refusing to direct a verdict in favor of the defendants at the conclusion of plaintiff's evidence and at the conclusion of all the evidence.
4. That the court erred in its charge to the jury.
5. That the court erred in overruling the motions for judgment notwithstanding the verdict.
The first assignment of error is based upon the proposition that the defendant Varnes was a resident of Wayne county, Ohio, and defendant Sinclair was a foreign corporation; therefore, defendants not being engaged in a joint adventure, the Court of Common Pleas of Summit county did not acquire jurisdiction of their persons.
Attention will first be directed to defendant Varnes.
The accident having occurred in Wayne county and Varnes being a resident thereof, any action in which he was the sole defendant could be maintained only in the courts of that county. (Section 11277, General Code.)
Sinclair, being a foreign corporation, could be sued in the instant tort action in any county in the state of Ohio in which it owned property or had debts owing to it, or where such defendant was found, or where the cause of action, or some part thereof, arose. (Section 11276, General Code.)
The answer of Sinclair specifically admits that it owned property and credits in Summit county; therefore the action was properly maintainable against the defendant Sinclair in Summit county, Ohio.
Section 11282, General Code, provides in part as follows:
"When the action is rightly brought in any county, according to the provisions of the next preceding chapter [Sections 11268 to 11278, General Code], a summons may be issued to any other county, against one or more of the defendants, at the plaintiff's request * * *."
By virtue of the provisions of this section, the action having been brought against Sinclair according to the provisions of Section 11276, General Code, summons was properly issued to Wayne county against defendant Varnes.
If defendant Varnes was joined properly with Sinclair then he was rightly brought into Summit county; on the other hand, if Varnes and Sinclair were joined improperly then there existed no right to compel Varnes to submit to the jurisdiction of the courts of Summit county ( Stark County Agricultural Society v. Brenner, an Infant, 122 Ohio St. 560, 172 N.E. 659). Whether he was joined properly with Sinclair was dependent upon an issue of fact, to wit, whether Sinclair and Varnes were engaged in a joint adventure at the time of the injury. That issue not being determinable in advance of the trial, the court did not err in overruling the motions of defendants attacking the jurisdiction of the court, made prior to trial.
Before proceeding to consider assignments of error Nos. 2, 3 and 5, which will be disposed of together, we shall direct our attention to assignment No. 4, "That the court erred in its charge to the jury."
This assignment of error makes complaint of the charge in four particulars: (A) That the court failed to charge that the accident occurred on a state route or main thoroughfare in or outside of the business or closely built up portion of a municipal corporation; (B) that the court quoted that portion of Section 12603, General Code, pertaining to the assured clear distance ahead; (C) that the court charged that a vehicle meeting another approaching from the opposite direction shall pass to the right; and (D) that the court failed to define the term "proximate cause." Complaints A and D are grounded upon omissions to charge.
The record discloses that at the conclusion of the charge to the jury the court said:
"Does counsel for the plaintiff think of any subject the court should touch upon that I have failed to speak on, or any errors the court has made?
"Mr. Guinther: No.
"The Court: Counsel for the defense? * * *
"Any suggestions or corrections by the defendants?
"Mr. Kelly: Nothing.
"Mr. Bierce: Nothing."
It is well established in this state that a judgment will not be reversed for an omission to charge upon a particular subject matter, where, as here, counsel have been granted full opportunity to call such omission to the attention of the court.
Complaint B is that the court quoted that portion of Section 12603, General Code, pertaining to the assured clear distance ahead. As to this claim the record discloses that in the charge the court used the following language:
"It is the law of Ohio that no person shall operate a motor vehicle in and upon the public roads and highways at a speed greater or less than is reasonable or proper, having due regard to the traffic, surface and width of the road or highway and of any other conditions then existing, and no person shall drive any motor vehicle in and upon any public road or highway at a greater speed than will permit him to bring it to a stop within the assured, clear distance ahead. It shall be prima facie lawful for an operator of a motor vehicle to drive the same at a speed not exceeding twenty miles per hour when passing a school building, or the grounds during school recess and while children are going to or leaving school during the opening or closing hours.
"Twenty miles per hour in business or closely built up portions of municipal corporations.
"Twenty-five miles per hour in all other portions of a municipal corporation except on state routes or on main thoroughfares.
"Thirty-five miles per hour on state routes or main thoroughfares within municipalities outside business portions.
"Forty-five miles per hour on highways outside of municipal corporations.
"It shall be prima facie unlawful for any person to exceed any of the foregoing speed limitations."
It is obvious that the court was reading to the jury from Section 12603, General Code. Nothing further was said as to the assured clear distance ahead.
One of the assignments of negligence is that the tank truck was being operated at a speed greater than was reasonable and proper, having due regard for the conditions then prevailing. That allegation was denied in the answer of defendant Varnes. Section 12603, General Code, was applicable to that issue and the fact that the court read the assured clear distance ahead provision of the statute, although inapplicable, cannot be deemed to be prejudicial.
Complaint C is that the court in charging the jury as to passing vehicles going in opposite directions said " 'a vehicle meeting another vehicle approaching from the opposite direction, shall pass to the right' " and that the failure " 'to pass to the right of the vehicle that is approaching your vehicle is negligence in and of itself.' "
We think this part of the charge was both proper and appropriate. Section 6310-18, General Code (110 Ohio Laws, 136), now Section 6307-26, read as follows: "A vehicle meeting another vehicle approaching from the opposite direction shall pass to the right." By this statute the duty of the driver of a motor vehicle to keep to the right is made a specific requirement and a violation thereof is negligence as a matter of law. ( Mahoning Savings Trust Co., Exr., v. Kellner, Admx., 131 Ohio St. 69, 1 N.E.2d 616.) This court has held frequently that where one is charged with the violation of such a statute and seeks to avoid the legal effect thereof, the burden is upon the person so charged to show such a state of facts, over which he had no control, as to make compliance therewith impossible. Glasco v. Mendelman, 143 Ohio St. 649.
We conclude that no prejudicial error was committed in the charge to the jury.
Assignments Nos. 2, 3 and 5 all revolve around the controlling issue in this case: Whether the defendants were engaged in a joint adventure. If there was no joint adventure then under the pleadings and evidence the court acquired no jurisdiction over the person of Varnes, and Sinclair was deprived of its right to remove the cause to the federal court, which right it could have exercised except for the fact that Varnes was joined as a defendant.
In the statement of facts we have set forth in some detail the evidence upon the question of joint adventure.
The only reasonable conclusion from a reading of this record is that joint adventure was the controlling and in reality the only contested issue in the case. The defendants offered no evidence upon any other subject.
This judgment can be sustained only upon that theory. If Varnes was an agent or servant of Sinclair or an independent contractor then this judgment must be reversed.
The appellants (Sinclair and Varnes) vigorously assert that there was no joint adventure; that the court should have so declared as a matter of law; and that in submitting that issue to the jury the court committed prejudicial error.
If under the pleadings and the evidence it was the duty of the court to declare the relationship of the parties, as a matter of law, then the submission of that question to the jury was prejudicial error, or if upon the evidence adduced reasonable minds could come to no conclusion other than that the defendants were not engaged in a joint adventure, then it was the duty of the court to instruct a verdict in favor of defendants or in the event of a verdict for the plaintiff to render judgment notwithstanding the verdict.
These propositions will be considered in the order stated.
(1) Under the pleadings and the evidence adduced was it the duty of the court to declare the relationship of the defendants as a matter of law?
The Ohio rule, as deduced from the decided cases, would seem to be that where the ultimate fact is undisputed, ordinarily a question of law is presented for determination by the court, but where the ultimate fact must be determined from inferences to be drawn from other facts and where reasonable minds may reach different conclusions from such inferences, then it is proper to submit the determination of the ultimate fact to the jury.
In Sack v. A. R. Nunn Son, 129 Ohio St. 128, 194 N.E. 1, this court said:
"And while ordinarily under undisputed facts the question as to whether the relation of master and servant or that of independent contractor arises by reason of such facts, the trial court should say to the jury which relation exists ( Schickling, an Infant, v. Post Publishing Co., 115 Ohio St. 589, 155 N.E. 143), yet where the circumstances disclosed by the uncontradicted evidence, as in this case, are such that reasonable minds might reach different conclusions as to inferences to be drawn therefrom and the ultimate facts established thereby ( Pence v. Kettering, 128 Ohio St. 52, 190 N.E. 216; Dippel v. Juliano, 152 Md. 694, 137 A. 514) there arises a question of fact for the jury, and this court thinks the trial court erred in not submitting to the jury under proper instructions the question of the relationship of this driver to the defendants and their responsibility for his acts."
See, also, Leonard v. Kreider, a Minor, 128 Ohio St. 267, 190 N.E. 634; Keesecker v. G. M. McKelvey Co., 141 Ohio St. 162, 47 N.E.2d 211; Schickling, an Infant, v. Post Publishing Co., supra; and Pence v. Kettering, supra.
We can see no legitimate reason why the rule announced in those cases should not be applied to this case.
Without again reviewing the evidence in any great detail, the record discloses that the defendant Sinclair relied principally upon its contact with Zimmerman.
Had there been no deviation from the terms of the contract it would have been the duty of Zimmerman to furnish the tanks for the delivery of the Sinclair products from the bulk station to the customers. This provision of the contract, however, was abrogated by Sinclair's furnishing the tank to Varnes for such deliveries as were made by him. Sinclair also furnished signs and emblems to place upon the tank and permitted whoever was in charge of the truck to make its collections and sign its receipts.
From this brief review of the evidence it seems quite clear that the ultimate fact as to whether the defendants were engaged in a joint adventure could be determined only from the reasonable inferences to be drawn from the undisputed evidence, including the written contract between Sinclair and Zimmerman.
We think that reasonable minds might well have reached different conclusions as to the inferences to be drawn from the undisputed evidence and that a proper jury question was presented.
(2) The final question is whether there was any evidence of joint adventure and if so was the evidence of such a substantial nature that reasonable minds might reach different conclusions upon that question.
In the solution of this problem, naturally the first question is: What is a joint adventure? Many definitions of that term may be found in the adjudicated cases and text books. The appellants concede that no substantial fault can be found with the following definition found in 23 Ohio Jurisprudence, 330, Section 2:
"A joint adventure has been defined to be a special combination of persons undertaking jointly some specific adventure for profit, without any actual partnership or corporate designation; an association of persons to carry out a single business enterprise for profit, for which purpose they combine their property, money, effects, skill, and knowledge. * * *
"The relation of joint adventurers obviously is created where two or more persons combine their money, property, or time in the conduct of some particular line of trade, or for some particular business deal, agreeing to share jointly, or in proportion to capital contributed, in the profits and losses, assuming that the circumstances do not establish a technical partnership."
See, also, 48 A. L. R., 1055; 63 A. L. R., 909; and 138 A.L.R., 968, and cases there cited.
A joint adventure, although not identical, is closely akin to a partnership, and both relationships are governed by the same rules of law. A contract of joint adventure need not be established by showing an express agreement between the parties, but it may be implied or inferred, in whole or in part, from their acts and conduct. See 138 A. L. R., 968, and cases cited.
Where the existence of the relationship of joint adventures is an issue and there is substantial evidence tending to prove that the parties intended to join their efforts in furtherance of some enterprise for their joint profit, the question is one of fact for the determination of the jury.
Here the uncontradicted evidence discloses that Sinclair and Varnes did combine their property. Sinclair owned the tank and Varnes the truck. Both were engaged in the single enterprise of distributing Sinclair's petroleum products. The signs upon the tank indicated to the public that Sinclair was interested in the distribution enterprise. Each was interested in making a profit. The customers were Varnes' and he could sell to them without limitation. On each gallon sold by him he made a profit of one and one-fourth cents, and, while the record does not disclose the exact profit to Sinclair, the jury might well have presumed that Sinclair was interested in and did make a profit. The same is true as to oils and greases.
As to losses the situation, as shown by the record, was that if credit was extended by Sinclair to any of Varnes' customers the range of credit was fixed by Sinclair and losses within that range were absorbed by it; if, however, Varnes extended credit to such a customer beyond such credit range or if Varnes extended credit to a customer without approval from Sinclair, and loss resulted, Varnes absorbed such loss.
We think that from the evidence reasonable minds might well have concluded that Sinclair and Varnes did combine their property, money and time in the conduct of distributing petroleum products; that each participated in the profits and losses; and that there was no actual partnership or corporate designation.
The jury having concluded that the appellants were engaged in a joint adventure, we are not prepared to say that such conclusion is contrary to law.
The doctrine of joint adventure is one of comparatively recent origin in the law and the many reported cases throw light upon the extent to which this modern doctrine has been developed. We are concerned here only with what is the proper rule to be applied in a case where a third person brings an action against two or more persons or corporations, as joint adventurers, basing the cause of action upon the negligent act of one of them.
The case of Martin v. Weaver (Tex.Civ.App.), 161 S.W.2d 812, presented this situation: The plaintiff's wife had been injured while riding as a passenger in a taxicab. Martin owned the cab and had turned it over to one Cruger to drive. Cruger and Martin divided the earnings from the cab. The suit was against Martin and 94 Transportation, Inc., and charged that they were "engaged as joint adventurers in the common enterprise." The company insisted that it had nothing to do with the driving of the taxicabs. It leased small pieces of land in the city of El Paso and maintained telephones on them. It permitted Martin and other owners of taxicabs to stand their cars on the lots. When a telephone call came the first car in line responded to the call. The company got nothing out of the earnings of the taxicabs in carrying the passenger. Each taxicab driver paid an initial payment of five dollars and one dollar per day thereafter to the company. Martin and other taxicab owners put signs on each car identifying it as "94 Taxi." Objection was made that the action could not be maintained jointly against Martin and the company. The company said that Cruger was Martin's man, not its. Martin said that Cruger was the company's man, not his, because Cruger had, in fact, been selected by the company. The court said (page 816):
"The relationship between the company and Martin is only important here insofar as it affects the relationship of Martin and the driver. However, we believe the company and Martin were engaged in a joint venture. This venture was the transportation of passengers for hire."
Champ v. Atkins, 128 F.2d 601, was an action involving the suspension of licenses of members of a taxicab association on the ground that they had failed to pay a judgment rendered against them. The court held that such judgment was valid and unless paid, the licenses would be suspended. The situation in the action in which the judgment had been rendered was as follows: Persons who owned cabs paid one dollar a week to the Harlem Taxicab Association. They used common telephone service and other common service and facilities. All the cabs were of one color. The cab which caused injury was operated by one Murchison. Champ, the injured party, brought an action against all the members of the association and recovered judgment against them upon the theory that they were engaged in a joint enterprise.
See, also, E. D. Bedwell Coal Co. v. State Industrial Commission, 157 Okla. 227, 11 P.2d 527; Sand Springs Home v. Dail, 187 Okla. 431, 103 P.2d 524; Cunningham v. Stuckey, 144 Kan. 118, 58 P.2d 42; Larson v. Lewis-Siman-Jones Co., 29 Cal.App.2d 83, 84 P.2d 296; United Transportation Co. v. Jefferies, 211 Ind. 226, 5 N.E.2d 524.
We conclude that where two or more persons, natural or artificial, without creating a partnership, combine their money, property or time, or all of them, in the conduct of some particular line of trade or for some particular business deal for profit, a joint adventure is thereby created. Such "joint adventure" relationship may be established in favor of third persons by operation of law through the acts and conduct of the parties even though they never intended such relationship. See Simpson v. Richmond Worsted Spinning Co., 128 Me. 22, 145 A. 250.
We have examined the record and find no error prejudicial to the rights of either of the defendants-appellants, and it follows that the judgments of the Court of Appeals should be and hereby are affirmed.
Judgments affirmed.
WEYGANDT, C.J., WILLIAMS and TURNER, JJ., concur.
MATTHIAS, HART and ZIMMERMAN, JJ., dissent.
I regret that I am unable to concur in the majority opinion and the judgments in these cases. Vicarious liability, whereby one becomes liable for the tortious acts of another, arises only where the tort-feasor stands in the relation of agent with authority to act for, or is under obligation to indemnify, the party made vicariously liable. To create the relationship of partners or joint adventurers there must exist mutual agency between the parties or joint adventurers. That means that each joint adventurer is a principal with power of direction and control as to the joint adventure, and as such each of the other joint adventurers is his agent within the scope of the enterprise in which they are all engaged. There must be such relationship as a predicate for tortious liability against one who did not actively and actually engage in the tortious act. This rule is well expressed in 38 American Jurisprudence, 924, Section 237, as follows:
"Parties cannot be said to be engaged in a joint enterprise, within the meaning of the law of negligence, unless there is a community of interests in the objects or purposes of the undertaking, and an equal right to direct and govern the movements and conduct of each other with respect thereto. Each must have some voice and right to be heard in its control or management." Illingworth v. Maden, Jr., 135 Me. 159, 192 A. 273, 110 A. L. R., 1090; Darman v. Zilch, 56 R.I. 413, 186 A. 21, 110 A. L. R., 826; Fox v. Lavender, 89 Utah 115, 56 P.2d 1049, 109 A. L. R., 105; Campbell v. Campbell, 104 Vt. 468, 162 A. 379, 85 A. L. R., 626; Atlas Realty Co. v. Galt, 153 Md. 586, 139 A. 285.
To make Sinclair liable for the negligence of Varnes, it need only be shown that Varnes was the agent of Sinclair in the operation of the truck, but if there was joint liability because of joint adventure, the evidence must also show that the contract relationship made Sinclair the agent of Varnes. Their relationship must be such that if Sinclair, purporting to furnish kerosene to Varnes for sale and delivery, had, in fact, without the knowledge of Varnes, furnished kerosene mixed with gasoline which would explode at abnormal temperatures, and it did so explode, doing damage to person or property, Varnes would be liable for such damage because Sinclair, as a member of the joint adventure in preparing and delivering the kerosene, was the agent of Varnes. Clearly it was not in the contemplation of the parties or within the terms of their contract to make Varnes liable in damages for any tortious act of Sinclair under such circumstances. Of course, Varnes would be individually liable for the negligent acts of Yoder, his agent, in driving the truck.
The undisputed evidence shows that under the contract between Sinclair and Zimmerman, the distributor, the latter was obliged to hire and pay his own delivery agents. He did hire Varnes and Varnes was paid by Zimmerman by splitting commissions with Varnes on sales made by the latter in Zimmerman's territory. In turn, Varnes, on his own responsibility, selected and hired the driver of the truck and paid him out of Varnes' share of the commissions. It also appears that Varnes owned two filling stations which he leased to Sinclair for a fixed money rental; that the tank on the truck in question was furnished by Sinclair to Zimmerman's bulk station and was there turned over to Varnes to put on his truck; and that the truck carried some advertising signs or emblems which indicated that it was engaged in the delivery of Sinclair products, but these facts are indicia consistent with the relationship of agency rather than that of joint adventure.
There is no evidence that Sinclair agreed or was obliged to furnish the tank for the truck or that its use was in fulfillment of any joint adventure relationship between Sinclair and Varnes. The tank was evidently loaned to Varnes for use in his work, but in any event it did not enter into the determination of the earnings due to either party. There was no mutual sharing of losses or agreement to do so in the event of loss. Varnes took the loss on anything above the credit rating of the customers as fixed by Sinclair, and Sinclair took the loss for anything below that rating.
In my judgment, the facts developed by the evidence do not establish joint adventure as it must exist to create tort liability, but only the relationship of agency. Clearly, Zimmerman was the agent of Sinclair and Varnes the agent of Zimmerman, and possibly the subagent of Sinclair. The essential element of mutual agency necessary to create joint adventure as between Sinclair and Varnes, in my opinion, is lacking.
The annotation editor of American Law Reports, in discussing the legal consequences of a relationship equivalent to that here involved, says (116 A. L. R., 462):
"It appears to be a common practice of the large corporations engaged in the business of producing, refining, and marketing petroleum products, to establish local wholesale or 'tank-wagon' stations in charge of a local 'agent,' 'commission agent,' or similar agent under a written contract or 'agency agreement' commonly providing that the company shall furnish a stock of gasoline, oils, greases, etc. (and, in some instances, the building, tanks, etc., comprising the 'station') to be sold by the 'agent' at prices set by the company (and to remain the property of the company until sold), for cash or on credit authorized by the company, over a specified territory. Such agreements are commonly nonassignable, subject to termination by either party upon a few days' notice, and provide for daily reports of sales and daily remittances of money received from cash sales and credit slips, and monthly reports or statements of stock on hand, from the 'agent' to the company, in return for which the 'agent' receives a specified monthly 'commission' on all goods sold. In addition, these agreements commonly provide that the 'agent' shall have entire charge of the operation and management of the business of the station, pay all license fees, furnish all except specified equipment, including trucks, tank wagons, etc., furnish his own assistants at his own expense, and pay the expenses of conducting the business; that the company's signs, trademarks, etc., shall be placed on the buildings, trucks, tank wagons, etc.; that the 'agent' and his employees shall not be deemed employees of the company, which shall not in any event be liable for the negligence of the 'agent' or his employees in the conduct of the business, and that the 'agent' carry compensation, public liability, etc., insurance for himself and his employees, and agree to indemnify the company against all claims arising from acts or omissions of himself or his employees in the conduct of the business.
"In numerous cases (generally actions by the injured party or owner of the damaged property against the oil company) the question has arisen as to whether the operator of such a 'tank-wagon' or wholesale station, under a contract of the type outlined * * * is a 'servant' or 'employee' of the oil company, so as to make it responsible for personal injuries or property damage resulting from the tort of the operator of the station or his employee; and in the majority of such cases it has been held that such operator is a 'servant' or 'employee' of the oil company, rather than an 'independent contractor' as is commonly contended by the company, generally on the theory that although the terms of the written contract might indicate that the operator had the status of an 'independent contractor,' the company in actual practice retained such power to subject him and his employees to its will and direction that he was in fact a 'servant,' 'employee,' or 'agent,' for whose torts ( and those of his employees) the company was responsible. This was the result reached in the following cases, under contracts generally of the type outlined, supra * * *:" Riggs v. Standard Oil Co., 130 F., 199; Gulf Refining Co. v. Brown, 93 F.2d 870, 116 A. L. R., 449; Magnolia Petroleum Co. v. Johnson, 149 Ark. 553, 233 S.W. 680; Pan-American Petroleum Co. v. Pate, 157 Miss. 822, 126 So. 480; Gulf Refining Co. v. Nations, 167 Miss. 315, 145 So. 327; Buchholz v. Standard Oil Co., 211 Mo. App., 397, 244 S.W. 973; Cholet v. Phillips Petroleum Co. (Mo.App.), 71 S.W.2d 799; Magnolia Petroleum Co. v. Pierce, 132 Okla. 167, 269 P. 1076, 61 A. L. R., 218; Gulf Refining Co. of Louisiana v. Huffman Weakley, 155 Tenn. 580, 297 S.W. 199; Gibson v. Texas Co. (Tex.Civ.App.), 20 S.W.2d 349.
From the cases above cited, the conclusion must be reached that under the circumstances of this case, the liability of the parties is governed by the law of agency and not that of joint adventure. Therefore, the court had no jurisdiction of Varnes in Summit county. His motion to quash service of summons upon him should have been granted and the judgments in these cases against both Sinclair and Varnes should be reversed with a remand for a new trial as to the defendant Sinclair.
MATTHIAS and ZIMMERMAN, JJ., concur in the foregoing dissenting opinion.