Wisconsin Business and Commercial Litigation

In Maypark v. Securitas Security Services USA, Inc. (Sep. 1, 2009), the District III court of appeals was presented with a unique (to be charitable) fact pattern.  Security Manager Schmidt, employed by Securitas, which was the security services subcontrator for Polaris, was responsible for creating photo ID badges for Polaris employees.  One lonely night, Schmidt copied the photographs of about thirty female Polaris employees, took them home, printed them out, ejaculated on them, and posted pictures of the sullied photos on a number of websites. 

Upon learning of the website contents, Polaris notified Securitas, which immediately terminated Schmidt’s employment.  Schmidt removed the offending photos from the websites.  Nevertheless, at a trial brought by ten of the women in the pictures, Securitas was found liable for negligent training and supervision.

District III confessed some confusion arising from recent Supreme Court precedent:

However, given recent guidance from our supreme court, it is unclear how we are to set forth our analysis.  Depending on the cases we review, we should either (1) evaluate whether Securitas had a duty under the circumstances of this case, see Hocking v. City of Dodgeville, 2009 WI 70, PP10-13 . . . , or (2) consider whether Securitas’s actions constituted a breach of the duty of ordinary care, see Behrendt v. Gulf Underwriters Insurance Co, 2009 WI 71, PP15-31 . . . .

Ultimately, the court determined that its confusion didn’t really prevent a reasoned conclusion.

We conclude it does not matter which approach we employ because, in the end, they are one and the same.  A conclusion of no negligence under the first approach requires that we determine the defendant was not required to act, while under the second it requires that we determine there was no breach for failing to act because the defendant was not required to act.  . . .  Without explicitly employing either approach in this case, we simply conclude Securitas was not negligent, as a matter of law.

The court ended up relying on another negligent supervision case to determine that Schmidt’s acts were, in something of a judicial understatement, not reasonably foreseeable.  Maypark should bring some comfort to employers who fret about the seemingly endless limits of their liability for the acts of employees.

In Behrendt v. Silvan Industries, Inc. , opinion filed July 9, 2009, the Wisconsin Supreme Court addressed a question that plagues many manufacturing and service provider employers:  What is the employer’s liability for side jobs performed by its employees using company equipment?  The answer (not as clear as you might like):

In order for an employer to be vicariously liable for an employee’s act, the act must have been within the scope of employment. We agree with the court of appeals that summary judgment is appropriate on the claim of vicarious liability because the only evidence presented was that the tank was a side project that was completed for the employee’s own purpose and thus was outside the scope of employment.

The plaintiff’s argument that permitting side jobs raised employee morale did not persuade the court. 

In the lengthiest portion of the decision, the court emphasized that the employer bore the duty that all Wisconsin residents bear to exercise care to prevent creating an unreasonable risk of injury to another.  However, it also concluded that the injury here, caused when a tank, originally built as a side job by a Silvan employee and later modified, exploded, was not a reasonably foreseeable risk.  The court’s language is worth a look by any employer whose employees occasionally take on side jobs.

However, we then look at whether Silvan breached that duty by failing to exercise the care a reasonable person would use in similar circumstances. In most cases, whether a defendant breached a duty is a question of fact that is submitted to the jury and thus is not appropriate for summary judgment. In this case, however, it is the lack of foreseeable risk that convinces us, as a matter of law, that Silvan cannot be said to have failed to exercise ordinary care with regard to its policy on side jobs. Further, there is no material fact in dispute as to Silvan’s policies about side jobs and its prohibition on employees making pressurized vessels as side jobs for personal use. There is in addition uncontroverted evidence in the record that Silvan took steps such as having holes cut into any tanks that were considered as scrap—-as well as testimony of the tank’s owner that this tank itself originally had holes in it—-and that the point of cutting holes into the tanks was to keep them from being used with air pressure. Summary judgment is appropriate on the negligence claim because under these circumstances Silvan did not breach its duty to act with ordinary care.