[Cite as Hartings v. Xu, 2014-Ohio-1794.]




                      IN THE COURT OF APPEALS OF OHIO
                          THIRD APPELLATE DISTRICT
                              MERCER COUNTY


HILLARY A. HARTINGS, ET AL.,

        PLAINTIFFS-APPELLANTS,

        v.                                               CASE NO. 10-13-11

THE NATIONAL MUTUAL
INSURANCE COMPANY, DBA
CELINA INSURANCE GROUP, ET AL.,

        DEFENDANTS-APPELLANTS,
        -and-                                            OPINION

JINGHAO XU, ET AL.,

        DEFENDANTS-APPELLEES.


                 Appeal from Mercer County Common Pleas Court
                            Trial Court No. 12-CV-003

      Judgment Affirmed in Part, Reversed in Part and Cause Remanded

                             Date of Decision: April 28, 2014


APPEARANCES:

        Bradley A. Powell for Appellants Hartings
        Robert B. Fitzgerald for Appellants, The National Mutual Ins. Co.
        Krystle N. Marko for Appellee, Rite Rug, Co.
        Lisa A. Hesse for Appellees, Asiana Floors, Inc., etc.
Case No. 10-13-11



ROGERS J.

           {¶1} Plaintiffs-Appellants, Hillary Hartings; Rebecca Bruns, Administratrix

of the Estate of Aubrey Bruns; Rebecca and John Bruns, as parents and natural

guardians of Conner D. Bruns; Rebecca Bruns and John Bruns, as parents and

natural guardians of Keaton Bruns; Rebecca Bruns, individually; and John Bruns,

individually (collectively “Hartings”), and Defendants-Appellants, the National

Mutual Insurance Company d/b/a Celina Insurance Group and Ohio Mutual

Insurance Company (collectively “the Insurance Companies”), appeal the

judgment of the Court of Common Pleas of Mercer County, granting summary

judgment in favor of Defendants-Appellees, Jinghao Xu; Asiana Floors, Jung Ho1

Bae, and Kim Bae2 (collectively “the Baes”); and Rite Rug Company (“Rite

Rug”). On appeal, Hartings and the Insurance Companies argue that the trial court

committed the following errors: (1) granting summary judgment in favor of Rite

Rug and the Baes by finding that Xu was an independent contractor; (2) granting

summary judgment as the decision was based upon a mistake of law; and (3)

granting summary judgment in favor of Rite Rug and the Baes on the issue of

negligent hiring and retention of Xu. For the reasons that follow, we reverse in

part and affirm in part the trial court’s judgment.



1
    We note Jung Ho Bae’s name has also been spelled Jung Hoe Bae in the record.
2
    Kim Bae is also known as Hyo Min Kam and is married to Jung Ho Bae.

                                                    -2-
Case No. 10-13-11



        {¶2} On October 15, 2011, Hillary was driving her vehicle northbound on

US Route 127 in Mercer County, Ohio. Hillary’s three young cousins, Keaton,

Connor, and Aubrey Bruns, were also in her vehicle. Xu was driving his vehicle

westbound on State Route 119, approaching the intersection with US Route 127,

when he failed to stop at a stop sign and crashed into Hillary’s vehicle. It is

undisputed that Xu’s failure to either stop or yield to Hillary’s vehicle constituted

negligence and was the cause of the accident.3 As a result of Xu’s negligence,

Hillary, Keaton, and Connor sustained serious injuries, while Aubrey, who was

only three years old, was killed.

        {¶3} Detective Megan Baker, from the Mercer County Sheriff’s Office, was

assigned to investigate this accident. In a sworn affidavit, she stated that she was

unable to speak with Xu at the accident scene because he could not read or speak

English. She took Xu’s Illinois driver’s license and ran it through central dispatch.

The driver’s license was not valid at the time of the accident. (Docket No. 133, p.

1). Detective Baker stated that she contacted the Illinois Department of Motor

Vehicles and confirmed that Xu’s driver’s license had been cancelled on July 10,

2009. (Id. at p. 2). Detective Baker also obtained a copy of Xu’s driving record

which revealed the following convictions: (1) on November 6, 2007, Xu was

convicted of an assured clear distance violation; (2) on December 13, 2007, Xu
3
  According to the record, Xu was convicted of aggravated vehicular manslaughter and subsequently
deported to China.

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Case No. 10-13-11



was convicted of a one way traffic violation; and (3) on February 1, 2008, Xu was

convicted of failure to control. (Id.).

       {¶4} On January 6, 2012, Hartings filed a complaint against Xu, the

Insurance Companies, Jane/John Doe, and XYZ Corp.           Hartings’ complaint

asserted nine claims: (1) personal injuries for Hillary Hartings; (2) personal

injuries and wrongful death for Aubrey Bruns; (3) personal injuries for Connor

Bruns; (4) personal injuries for Keaton Bruns; (5) medical expense and parental

consortium for Rebecca and John Bruns; (6) declaratory judgment and

underinsured claims against National Mutual Insurance Company; (7) declaratory

judgment and underinsured claims for Celina Insurance Group; (8) vicarious

liability for John and Jane Doe/XYZ Corp; and (9) negligent hiring and negligent

supervision for John and Jane Doe/XYZ Corp.

       {¶5} On March 5, 2012, the Insurance Companies filed their answers.

Hartings’ complaint was amended on July 5, 2012, to add Rite Rug Co., Asiana

Floors, Inc., Jung Ho Bae, Ok Yeun Kinsley, and Hyo Min Kam as Defendants.

Rite Rug filed its answer to the amended complaint on July 19, 2012. Rite Rug

also filed a cross-claim against the Baes on July 23, 2012. On April 3, 2012, the

Baes filed their answer to the amended complaint, and on August 6, 2012, they

filed their answer to Rite Rug’s cross-claim. On August 8, 2012, the Insurance



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Case No. 10-13-11



Companies filed its answers to the amended complaint. On December 14, 2012,

Hartings voluntarily dismissed the complaint against Ok Yeun Kinsley.4

        {¶6} On January 30, 2013, Rite Rug filed a motion for summary judgment.

The Baes also filed a motion for summary judgment on February 1, 2013. On

February 21, 2013, Hartings filed memorandums in opposition to the motions for

summary judgment filed by Rite Rug and the Baes. On February 21, 2013, the

Insurance Companies also filed memorandums in opposition to Rite Rug’s and the

Baes’ motions for summary judgment.

        {¶7} Throughout these pre-trial proceedings, numerous depositions were

taken. The following relevant evidence was adduced from these depositions.

                                             The Baes

        {¶8} Kim came to the United States from South Korea in 1997.                              She

currently has her green card and can read and speak English. In 2002, Kim began

to help Jung Ho Bae5 install flooring. Kim subsequently married Bae in 2003. At

that time, Bae was working for Rite Rug. Kim installed flooring for four months

and then began assisting with paperwork and other office related tasks.

        {¶9} Bae created a flooring business that has gone through several different

name changes. In 2006, his business was called Jay Floorings. The business

4
 Ok Yeun Kinsley is Kim Bae’s mother.
5
 Since Jung Ho Bae created a business that he named after himself, from now on we will refer to Jung Ho
Bae, the individual, as “Bae” and his business as “Jung Ho Bae” in an attempt to avoid confusion among
our readers.

                                                 -5-
Case No. 10-13-11



name changed to Asiana Flooring Incorporated in 2007. Kim testified that they

only used the name “Asiana Flooring Inc.” for two years.6 Finally, in 2009, the

business name changed to Jung Ho Bae.                     Jung Ho Bae operates as a sole

proprietorship.

        {¶10} Kim testified that the purpose of Jung Ho Bae was to deliver and

install Rite Rug flooring for Rite Rug. Jung Ho Bae has been working exclusively

for Rite Rug since 2002. Kim Bae Dep., p. 34-35. Kim also stated that Jung Ho

Bae does not have an office address, but instead has space inside the Rite Rug

warehouse in West Chester, Ohio.

        {¶11} Kim testified that it was Jung Ho Bae’s responsibility to find

competent drivers and installers for Rite Rug. Kim also testified:

        Q: Whose decision – whose ultimate decision was it to select or
        hire individuals to deliver and install [for] RiteRug7?

        A:    Jung Ho Bae.

        Q: Okay. RiteRug didn’t place any restrictions on who you could
        hire?

        A:    No.

        Q: Did RiteRug require Jung Ho Bae to make certain that whoever
        was delivering or installing their product [have] a valid driver’s
        license?


6
  However, several checks, which were dated July 1, 15, and 22 of 2011, were issued by Asiana Flooring
Inc. to Xu. Kim Bae Dep., p. 166-167; Kim Bae Dep., Exhibit 4, p. 1-3.
7
  We note that in some of the depositions, Rite Rug is incorrectly spelled as one word.

                                                 -6-
Case No. 10-13-11



       A:    Yes.

       Q: Did they require that anybody who was delivering or installing
       their product [have] a particular type of driving record –

       A:    No.

       Q: -- meaning – okay. Did RiteRug require Jung Ho Bae to make
       certain that whoever you selected or hired to deliver or install their
       product was able to communicate in English?

       A:    No.

       Q: Did RiteRug ever, and I mean from the time this agreement was
       signed in 2002 to the present, did RiteRug ever get involved with the
       process of selecting who was to perform the delivery and installation
       of the product?

       A:    No.

Id. at p. 43-45.

       {¶12} Although Kim testified Rite Rug was never involved in the hiring of

the installers, Kim stated that Rite Rug would sometimes tell her not to send an

installer to a specific job site and Kim would follow those instructions. Id. at p.

46.

       {¶13} Kim works closely with the office manager of Rite Rug. Every day,

the office manager will give Kim work orders, and then Kim will assign the

different work orders to the Jung Ho Bae installers. After the work orders are

completed, Kim returns a list of completed jobs to the office manager and gets

paid. Kim elaborated on her relationship with Rite Rug:

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Case No. 10-13-11



       A:    In the morning they give me the schedule.

       Q: All right. So, there was no phone call to you. It was something
       left on your desk?

       A:    Yeah. They leave it on the desk, schedule and work order.

       Q:    What’s the difference between a schedule and a work order?

       A: Scheduling is just – they just type it in the computer, you know,
       job name and, you know, how much amount of the work under next
       to it, so we can just write it down, who’s doing what job, just record
       of it.

       Q: And those documents would be placed on your desk before you
       arrived in the morning?

       A:    Yes.

       Q:    What time did you normally arrive in the morning?

       A:    Six o’clock.

       ***

       Q: Okay. What do you do next? After you receive the schedule,
       the work order, review the schedule and work order to make certain
       all of the documents are in place, what’s the next thing you do?

       A: Put a name on the schedule and installer’s name on the work
       orders. I pick up the job for work orders, and I figure it out, who’s
       going to do which job, and I put their name on the work order and
       also put the name on their schedule, my schedule, too, so I know
       who did which job, which guy did which job.

Id. at p. 52-53, 55-56.




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       {¶14} Jung Ho Bae has fifteen installers who are all Chinese or Korean.

The installers come to Jung Ho Bae’s office space in the Rite Rug warehouse to

find out their job assignments every morning. Ted Han is an installer for Jung Ho

Bae and also helps Kim with paperwork. Every morning, the different installers

will talk to Han, who is in charge of distributing the job assignments. Once the

installers receive their assignments, they pick up the flooring material at a

different area in that same Rite Rug warehouse.

       {¶15} Kim testified that Rite Rug, not Jung Ho Bae, inspects the installers’

work. She also explained that if an installer is new, someone from Jung Ho Bae

will walk the job site with the new installer, but stated that Jung Ho Bae does not

train any of its installers. Kim also stated that she has an ongoing relationship

with all her installers. She also testified that the installers are not allowed to pick

up the Rite Rug materials and install the flooring whenever they like. Instead,

there are certain hours when they must pick up the Rite Rug materials and the

installers must install the flooring on the date listed on the work order.

       {¶16} Kim also testified that, to her knowledge, the installers do not work

for anyone else. The installers get paid on a weekly basis and get paid depending

on how many jobs they complete. When asked if Jung Ho Bae can fire the

installers it retains, Kim stated:

       Q:    Can you fire them?

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Case No. 10-13-11




       A: Yeah. If I don’t like them, we can let them go, but, you know –
       but we never done that.

       Q: You haven’t done that, but you have the right to fire somebody
       that you don’t feel is doing a good job?

       A: Yeah. If he keeps, you know, messing up the job or not
       showing up, then you know, I use somebody else, because they’re
       just subcontractor.

       Q:   Has any of these deliverers or installers quit?

       A:   Yes.

       Q: There is nothing in any employment agreement or any written
       agreement between Jung Ho Bae and the installers that prevent them
       from quitting. Correct? They can quit if they don’t want to keep
       working for you?

       A:   They can quit, yeah.

Id. at p. 119-120.

       {¶17} Kim admitted that Jung Ho Bae does not conduct criminal

background checks before they hire installers or check an applicant’s driving

history. Kim stated she checks to make sure that each installer has a valid driver’s

license by “[l]ooking at their ID.” Id. at p. 123. She also stated that she does not

require the installers to speak or communicate in English. While Kim requires that

the installers have insurance coverage, she does not ask for proof of insurance or

verify that the installers actually obtain the insurance. Id. at p. 125.



                                          -10-
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       {¶18} Kim also explained how she met Xu. According to Kim, she first

met Xu in February or March 2011. Xu was introduced to her by another Rite

Rug installer, Mr. Choi. Kim stated that when she met Xu, he had stated that he

recently came to Cincinnati and moved from either Indiana or the Cleveland area.

Kim also testified that Xu had signed a subcontractor agreement form before he

started working for Jung Ho Bae. The subcontractor form was written in both

Korean and English. It stated, in relevant part:

       Tools and/or supplies and vehicle are to be furnished by the installer.

       Once installer leaves warehouse, he/she assumes all responsibility of
       material being short and/or lost.

       Any poor working condition must be reported immediately.
       Otherwise installer assumes responsibility of damaged and/or poorly
       installed materials.

       Installer assumes all responsibility for job, once it is handed to them.
       Amy [sic] failure to complete job, either due to accident of [sic]
       illness, must be reported immediately.

       Installer must maintain a clean, safe working environment at all
       times while on job site. Any fines due to a failure to comply is [sic]
       the installers [sic] responsibility.

       Installer must have cell phone or way to communicate.

       Installer must have a valid driver’s license and car insurance at all
       times.

       Installer must be bonded and certified. Any bodily injuries, either to
       others and/or themselves, including personal property and/or


                                        -11-
Case No. 10-13-11



           property at jobsite is the responsibility of the installers while
           traveling to jobsite, on jobsite and/or travelling from jobsite.

(Emphasis sic.) Kim Bae Dep., Exhibit 3, p. 1.

           {¶19} Kim looked at the expiration date8 of Xu’s driver’s license. She was

unaware that he had an invalid license from the State of Illinois. She did not ask

Xu about prior car accidents or if he had any previous moving violations. Kim has

never driven with Xu. Kim also had the following discussion concerning whether

Xu could read street signs.

           Q: How do you know that – he doesn’t communicate in English.
           How do you know that he can safely operate this vehicle to get to the
           job site? How do you know that?

           A: He – I ask him, “do you know how to read the map?” He say,
           “Yes.”

           Q: Well, he can read the map, but he can’t read the road signs.
           Correct?

           A:     Well, let me explain.

           Q:     If you know.

           A:     Yeah. Let me explain.

           Q:     Go ahead.

           A: If the road name is like Smith Road, he’ll look at the Smith
           Road, and he look for the Smith Road. And then, you know, it will
           say “right on” with the picture, you know, on the Map Quest. So,
           he just look at that, and, you know – I told him – and, you know,

8
    It is undisputed that Xu’s license, although cancelled, was not expired at the time of the accident.

                                                       -12-
Case No. 10-13-11



       when he start to working, we gave him Map Quest, just what
       company attached. He never had problems. But, you know, I never
       speak any English with him. So, I don’t know how much English he
       have, either, you know, but he just told me he doesn’t speak any
       English.

Kim Bae Dep., p. 162-163.

       {¶20} Kim also recalled Xu coming to the warehouse on October 14, 2011.

She assigned Xu to install flooring for TK Kunkler at 406 Lowry Road, Fort

Recovery, Ohio (“the Kunkler job”). She testified that a map was attached to the

Kunkler job work order. After she assigned Xu the Kunkler job, Kim assumed

that Xu went to pick up the flooring material at a different part of the warehouse

and then he left to complete the job. Kim stated that Xu was supposed to do the

Kunkler job on Friday.

       Q: So, he was supposed to deliver and install the material at the
       Kunkler address in Fort Recovery, Ohio on October 14th, 2011, on a
       Friday?

       A:   Yes.

       Q: And that’s because that’s Jung Ho Bae’s policy and procedure
       with respect to how the work and when the work is to be performed?

       A:   Yes.

       Q: And he was to complete the job that day, because it was a vinyl
       job that should only last one day?

       A:   Yes. And it was a small job, too.

Id. at 180-181.

                                       -13-
Case No. 10-13-11



       {¶21} Kim testified that she learned Xu was in a car accident on Saturday

after Han called her and informed her about the accident. She further stated that it

was not until that following Monday when she discovered that Xu was on his way

to complete the Kunkler job when he got into the car accident. Jung Ho Bae had

also scheduled Xu a repair job on Saturday, October 15, 2011, in Beavercreek,

Ohio (“Beavercreek repair job”). Xu completed the Beavercreek repair job before

he got in the car accident.

                                       Rite Rug

       {¶22} Rite Rug is a flooring distributor who sells and installs flooring. Rite

Rug’s headquarters are in Columbus, Ohio but they do business all throughout

Ohio and in Indiana, Illinois, North Carolina, South Carolina, Tennessee,

Kentucky, Pennsylvania, and Georgia. Rite Rug sells all sorts of flooring products

such as carpet, tile, hardwood, vinyl, and laminate. Rite Rug’s customers mostly

consist of new home builders. Once a future homeowner selects the material he or

she wants installed, the builder will notify Rite Rug of the type and amount of

material that is needed for that specific house. The price for the material is

negotiated and then a date for installation of the material is scheduled. All of the

flooring material is stored in the Rite Rug warehouse. The material is owned by

Rite Rug until it is installed in the home.



                                         -14-
Case No. 10-13-11



      {¶23} Vince Moyer, Rite Rug’s builder operations manager, was deposed

in this matter. It is Moyer’s responsibility to make sure the home builders are

satisfied with the installation of Rite Rug’s flooring materials. Moyer was able to

explain Rite Rug’s relationship with Jung Ho Bae:

      A: Rite Rug – builders call in their jobs they have for tomorrow, a
      week from now. It’s put on a schedule. The jobs are then all given
      to Kim Bae. She then dispatches it to other subcontractors that go
      out and do the work.

      Q: And where does Kim get the list of jobs from? Does she get
      them from, for example, you, or does she get them from home
      office, or where does she get them from?

      A:    The Cincinnati office scheduling box.

Moyer Dep., p. 13-14.

      {¶24} Moyer was also able to explain the hiring process for installers.

Moyer stated:

      A: We would get a packet from our corporate office that has
      subcontractor information that you have to fill out from – and I don’t
      know all of the packages, but I know there’s, like, W-2 forms,
      subcontractor agreement, and forms like that –

      Q:    Okay.

      A: -- a big packet that we have to give to every installer that wants
      to become a subcontractor for Rite Rug, background check.

      ***

      Q:    * * * Does it include, for example, do I need insurance?


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Case No. 10-13-11



       A:    You need insurance.

       Q: Okay.          Is that automobile insurance and general liability
       insurance?

       A:    Yes.

       Q:    Okay. You said there’s a background check?

       A:    Yes.

       Q:    Is that a criminal background check?

       A:    Not sure.

       Q:    Okay. What about driving record?

       A: I know they make a copy of their driver’s license and send it in,
       but what our corporate office does with it, I couldn’t tell you.

Id. at p. 20-22.

       {¶25} Once the application is completed, Moyer will send it into the

corporate office and get a response whether the applicant can work as a

subcontractor for Rite Rug. Moyer does not verify any of the information in the

application packets because that is the corporate office’s responsibility.

       {¶26} While Rite Rug supplies installers with materials for installation, it

does not provide tools or cars to installers. Moyer stated that all the new home

builders have an understanding that the installation is done by subcontractors.

Moyer also stated:



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Case No. 10-13-11



       Q: Sure. [The builders] rely upon you, Rite Rug, to make the
       selection of who installs the material that they’ve ordered from Rite
       Rug. Correct?

       A:     Correct.

       Q: You sell yourself as being able to provide that service.
       Correct?

       A: Yes and no. We don’t sell ourselves to provide it, because we
       don’t install it. We hire subcontractors to do it, and they know that.

Id. at 109.

       {¶27} When asked whether Rite Rug has the ability to ban installers from

certain job sites, Moyer had the following exchange:

       Q: Have you, in your years of working with Kim, ever told her to
       not use a particular individual crew member or any crew?

       A: I’m sure I have. I mean, I’m sure there’s been builders that
       have said, “We don’t want Mr.” – I’m going to say Thomas, or, you
       know, but –

       Q:     Sure.

       A: “We don’t want Mr. Thomas back on this job site.” So, that
       would be myself or Aaron or someone to call Kim and say, “hey, Joe
       from Ryan Homes does not want Mr. Thomas back on the job site.”

       Q:     And you have the right to do that, don’t you, Rite Rug?

       A:     Try not to say –

       Q: Rite Rug has the right to say this person isn’t wanted on the job
       site. Correct?

       A:     If our customer tells us that, yes, absolutely.

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Case No. 10-13-11




Id. at p. 125.

       {¶28} Moyer also stated that he is unaware whether the installers work for

any other companies, but knew that in the past, some installers advertised their

services for other companies.

       {¶29} Aaron Bayer, the production manager for Rite Rug, was also deposed

and testified as to Rite Rug’s policies and procedures. He stated that it is Rite

Rug’s policy for the installers to come to the warehouse to “pick up, inspect the

material, load the material[,] and then deliver [it].” Bayer Dep., p. 37. Bayer also

testified that it is Jung Ho Bae’s responsibility, not Rite Rug’s, to assign the

installers to the different job sites. He stated that Jung Ho Bae was already

working for Rite Rug in 2007 when he started working for Rite Rug. Bayer

admitted that he personally does nothing to ensure that the installers are competent

to drive. He stated he is unaware if Rite Rug does anything to verify the installers

are competent drivers.         Bayer also explained that Rite Rug provides all the

installers with maps and directions to each job site “[t]o make sure they know how

to get there.” Id. at p. 43.

       {¶30} When asked how Rite Rug obtains installers, Bayer testified:

       Q: Okay. All right. Well, let’s go on to the installation phase.
       Who installs RiteRug’s product?

       A:    Installers.

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Case No. 10-13-11




       Q:    Where does RiteRug obtain installers?

       A:    We don’t have any installers.

       Q:    How do you know that?

       A: We hire Kim, Asiana Floors or Jung Ho Bae to install our
       floors, and however she handles that is up to her, as long as the jobs
       get done.

Id. at p. 45-46.

       {¶31} Bayer explained that part of his job is to inspect the work that is done

by the installers. Bayer also stated:

       Q:    Does RiteRug provide training to these installers?

       A:    No.

       Q:    How do you know that?

       A: It would be up to me or Vince [Moyer] to set up some type of
       training.

       Q: You expect and require that the installers, that they’ve been
       trained on how to install RiteRug’s product?

       A:    Yes.

       Q: And they need to know how to install product according to the
       trade, the industry and the manufacturer’s specifications. Correct?

       A:    Correct.

Id. at p. 48.       Bayer stated that Rite Rug usually does not need to provide

instruction or guidance to the installer on particular jobs, but “[o]ccasionally it

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Case No. 10-13-11



does.” Id. a p. 52. Bayer testified that there have been times when he has

instructed Kim not to send back the original installer on a job when the installer

has made a significant mistake.

       {¶32} Bayer agreed that “the delivery and the installation is an integral part

of the RiteRug business of selling flooring[.]” Id. at p. 58-59. Bayer also stated

that Jung Ho Bae is the exclusive installer for the builder division of the non-

carpet materials. Bayer also admitted that Rite Rug advertises itself as a “seller

and installer of floor materials.” Id. at p. 143. He elaborated:

       Q: Okay. So, when you’re working with these builders or the
       homeowners in the retail arena, you don’t say, ‘Hey, we’ll sell you
       the materials and then we’re going to hire somebody else to install
       them,’ do you?

       A:   No, we do not, as far as I know.

       Q: It comes as a package. RiteRug is selling this and installing it
       for you. Right?

       A:   As far as I know, yes.

Id. at p. 143-144.

       {¶33} Bayer testified that Jung Ho Bae installers are not allowed in the

warehouse when the warehouse is closed. He also testified that Jung Ho Bae has

had a space in the warehouse since he started working for Rite Rug. When asked

if he was aware that Jung Ho Bae used installers who were not legal residents of

the United States, Bayer replied, “I don’t know.” Id. at p. 101.

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Case No. 10-13-11



          {¶34} Erin Appleman is the advertising director for Rite Rug and is

“[r]esponsible for media buys, marketing materials, and communication to the

public in the form of advertising.” Appleman Dep., p. 8. Appleman was able to

talk about Rite Rug’s website, specifically, their installation FAQ section. She

stated:

          Q: You used phrases [on Rite Rug’s website] such as Rite Rug’s
          installers, our installers, we. Do you agree that the intention of –
          your intention was to notify the reviewing public or the viewing
          public of the website that it was Rite Rug’s people that were going to
          install the Rite Rug product?

          A:    No.

          Q:    What was your intention?

          A:    That Rite Rug installs the products that they sell.

          ***

          Q:    Okay. Why didn’t you say subcontractors in the website?

          A:    No reason. I mean, we didn’t.

Id. at p. 41.

          On Rite Rug’s installation section of their website it states:

          Once you purchase your Rite Rug carpet, hardwood, laminate, tile or
          vinyl flooring at any of our locations, we’ll set up installation
          immediately.

          And even though our team of professional installers reports to us,
          they work for you, ensuring your satisfaction at every turn. They’re
          quick, polite, tidy and experienced. Why we’d even say you can

                                            -21-
Case No. 10-13-11



       expect the professional installation and customer service you get
       from Rite Rug to be “seamless.”

Appleman’s Dep., Exhibit A, p. 3.

       {¶35} The website also has a section about installation warranties.

Appleman did not know why Rite Rug would give a warranty on an installation

performed by subcontractors. Appleman testified that none of her superiors have

ever told her to change the wording in the installation section of Rite Rug’s

website.

       {¶36} Michael Nelson, Rite Rug’s corporate warehouse manager, was also

deposed. He testified that although Rite Rug does not give formal evaluations of

its installers, Rite Rug does train its installers.

       Q: * * * How did you make certain that Rite Rug’s installers were
       meeting the industry standards?

       A:    Through meetings, through training.

       Q:    With the installers?

       A:    Yes. Sir.

       Q: Do you recall, you know, any of those particular
       circumstances? Were these like a field day or operations day at Rite
       Rug where people who were doing installation would have to do
       come up for training, or would they be one-on-one type training with
       installers?

       A:    Both.

Nelson Dep., p. 47.

                                           -22-
Case No. 10-13-11



       {¶37} Nelson also testified that Rite Rug does not do anything to verify its

installers are competent to deliver its materials.

       Q: * * * What did Rite Rug do to make certain that the person who
       was delivering Rite Rug’s product to the job site was competent to
       deliver that material, to drive that vehicle containing Rite Rug’s
       product from the warehouse to the job site?

       A:    Nothing that I’m aware of.

       Q: Now I want to break that down just to make sure we cover
       everything. Did Rite Rug make certain that the individual who was
       driving, delivering the material, had a valid driver’s license?

       A:    No, sir.

       Q: Did they make certain that that driver or deliverer had car
       insurance?

       A:    No, sir.

       Q: Did they do anything to make certain that person who was
       delivering the product could communicate in English?

       A:    No, sir.

Id. at p. 56-57.

       {¶38} Nelson also testified that installers get paid on a regular basis and the

amount of their pay check is based on how many jobs that installer completed in a

pay period. However, if, after Rite Rug’s inspection, it finds that the job was

completed incorrectly, it will back-charge the installer for that job and he will not

get reimbursed until the job is done correctly.


                                          -23-
Case No. 10-13-11



           {¶39} Nelson also testified that he knows that Rite Rug’s carpet installers

are employees, however, he was unaware if the installers of hard surface flooring

are Rite Rug employees. Id. at 424. Nelson also stated that he has precluded an

installer from working for Rite Rug. Nelson stated that “there were decisions

made that this particular installer was – was not of the quality we wanted, so we

were no longer going to use their services.” Id. at p. 44-45. This happened on

more than one occasion.

                                                      Xu

           {¶40} Xu testified at his deposition9 that he does not know Jung Ho Bae or

Kim Bae. He stated he knew Han, but never went to a warehouse near Cincinnati.

When presented with the subcontractor agreement he signed for Jung Ho Bae, Xu

adamantly denied that he had signed the agreement or had even seen it before. He

also stated that no one has ever explained the terms of the contract to him.

           {¶41} Xu explained that every work site he has worked on had a supervisor.

If he needed to ask the supervisor a question, he would call Han, and Han would

translate for him. He purchased all tools needed to install floors and also bought

the van he drove. He also explained that he does not need any instructions or

directions on how to install flooring because “all information was contained in the

work order[.]” Id. at p. 177.

9
    Since Xu does not speak English, a translator was present during his deposition and translated for Xu.

                                                     -24-
Case No. 10-13-11



       {¶42} Xu thought that at the time of his car accident he had a valid driver’s

license. He also testified:

       Q: Were you able to understand, based on the map, where the job
       site was?

       A:   Yes, I can.

Xu Dep., p. 138. Xu also admitted that at the time of the accident he was on his

way to a job site.

       {¶43} Xu also stated:

       Q:   Okay. If he didn’t want to do a job, could he turn it down?

       A: Of course. Yeah, for example, if on the same day maybe the
       first one call and the second one call right away, I have to refuse.

       Q:   Because he couldn’t be in two places at the same time?

       A:   No.

       Q: Okay. But whether or not he declines a job is up to him,
       correct?

       A:   Yes, I decide myself.

Id. at p. 141-142.

       {¶44} Xu could correctly identify what a stop sign looks like.      Also he

stated he has a GPS device in his car. Xu also stated that he looked up directions

on his computer at home to figure out how to get to the job site on October 15,

2011. He memorized the route and drew himself a “simple map.” Id. at p. 144.


                                       -25-
Case No. 10-13-11



According to Xu, Mr. Choi met Xu at his house and gave him materials for the

Kunkler job. He also denied doing a repair job in Beavercreek, Ohio the morning

of October 15, 2011.

      {¶45} Xu testified that it was his belief that he had a valid driver’s license

on October 15, 2011. He further stated:

      Q: So it’s your testimony that you did not know that the state of
      Illinois cancelled your license on July 20th, 2009; is that correct, July
      10th, 2009?

      A: I have no way to know because there was no notice, no mailing,
      no message. And when I bought my car nobody tell me anything
      about my driver’s license being a problem. I have no way to know.

      Q:   Where were you living in Chicago?

      A:   A friend’s place.

      Q:   Where was your friend’s place?

      A:   No, no idea.

      Q: Do you remember the address you gave the Department of
      Motor Vehicles in Illinois as to where you lived?

      A:   Don’t remember.

      Q: Do you remember giving them the address of a furniture store
      in Illinois as your home address?

      A:   I have no idea.

      Q: You don’t remember that, is that what you are telling me? You
      don’t remember giving the Illinois Bureau of Motor Vehicles the
      address of a furniture store as your home address?

                                        -26-
Case No. 10-13-11




       A:   No idea.

Id. at p. 188-189.

       {¶46} On May 8, 2013, the trial court granted summary judgment in favor

of the Baes and Rite Rug.

       {¶47} Hartings and the Insurance Companies filed this timely appeal,

presenting the following assignments of error for our review.

              The Insurance Companies’ Assignment of Error No. I

       THE  TRIAL   COURT     ERRED   IN  SUSTAINING
       DEFENDANTS/APPELLEES     [SIC] MOTION[S]  FOR
       SUMMARY JUDGMENT WHEN GENUINE ISSUES OF
       MATERIAL FACT EXISTED[.]

             The Insurance Companies’ Assignment of Error No. II

       THE   TRIAL   COURT    ERRED   IN SUSTAINING
       DEFENDANTS/APPELLEES     [SIC] MOTIONS   FOR
       SUMMARY JUDGMENT AS THE DECISION WAS BASED
       UPON A MISTAKE OF LAW[.]

                       Hartings’ Assignment of Error No. I

       THE TRIAL COURT ERRED BY GRANTING SUMMARY
       JUDGMENT IN FAVOR OF THE DEFENDANTS-
       APPELLEES, RITE RUG CO. AND/OR THE BAES BY
       RULING, AS A MATTER OF LAW, THAT XU WAS AN
       INDEPENDENT CONTRACTOR OF RITE RUG CO.
       AND/OR THE BAES.

                       Hartings’ Assignment of Error No. II



                                       -27-
Case No. 10-13-11



       THE TRIAL COURT ERRED BY GRANTING SUMMARY
       JUDGMENT IN FAVOR OF THE DEFENDANTS-
       APPELLEES, RITE RUG CO. AND THE BAES ON THE
       ISSUE OF THE NEGLIGENT HIRING AND RETENTION OF
       XU.

       {¶48} Due to the nature of the assignments of error, we elect to address

them out of order and address the Insurance Companies’ and Hartings’ first

assignments of error together.

                  Insurance Companies’ Assignment of Error No. II

       {¶49} In its second assignment of error, the Insurance Companies contend

that the trial court erred in applying the standard set out in Bostic v. Connor, 37

Ohio St.3d 144 (1988), since Bostic has been superseded in statute after the

enactment of R.C. 4123.01(A)(1)(c). We disagree.

       {¶50} The Insurance Companies argue that the trial court erred by not using

the proper test for determining whether Xu was an employee or an independent

contractor.   They contend that the common law test set out in Bostic was

superseded in statute after the enactment of R.C. 4123.01(A)(1)(c). However, it is

Rite Rug’s and the Baes’ contention that even if Bostic was superseded by R.C.

4123.01(A)(1)(c), since the present case does not deal with workers’

compensation, R.C. 4123.01(A)(1)(c) is irrelevant. We find that the legislature

only intended to redefine employees as it relates to construction contracts in

workers’ compensation cases when it enacted R.C. 4123.01(A)(1)(c).

                                       -28-
Case No. 10-13-11



      {¶51} R.C. 4123.01(A)(1)(c) states, in relevant part:

      As used in this chapter:
      (A)(1) “Employee” means:

      ***

      (c) Every person who performs labor or provides services pursuant
      to a construction contract, as defined in section 4123.79 of the
      Revised Code, if at least ten of the follow criteria apply:
      (i)    The person is required to comply with instructions from the
      other contracting party regarding the manner or method of
      performing services;
      (ii)   The person is required by the other contracting party to have
      particular training;
      (iii) The person’s services are integrated into the regular
      functioning of the other contracting party;
      (iv) The person is required to perform the work personally;
      (v)    The person is hired, supervised, or paid by the other
      contracting party;
      (vi) A continuing relationship exists between the person and the
      other contracting party that contemplates continuing or recurring
      work even if the work is not full time;
      (vii) The person’s hours of work are established by the other
      contracting party;
      (viii) The person is required to devote full time to the business of
      the other contracting party;
      (ix) The person is required to perform the work on the premises of
      the other contracting party;
      (x)    The person is required to follow the order of work set by the
      other contracting party;
      (xi) The person is required to make oral or written reports of
      progress to the other contracting party;
      (xii) The person is paid for services on a regular basis such as
      hourly, weekly, or monthly;
      (xiii) The person’s expenses are paid for by the other contracting
      party;
      (xiv) The person’s tools and materials are furnished by the other
      contracting party;

                                       -29-
Case No. 10-13-11



       (xv) The person is provided with the facilities used to perform
       services;
       (xvi) The person does not realize a profit or suffer a loss as a result
       of the services provided;
       (xvii) The person is not performing services for a number of
       employers at the same time;
       (xviii) The person does not make the same services available to the
       general public;
       (xix) The other contracting party has a right to discharge the
       person;
       (xx) The person has the right to end the relationship with the other
       contracting party without incurring liability pursuant to an
       employment contract or agreement.

(Emphasis added.)       Thus, the definition of employee contained in R.C.

4123.01(A)(1)(c) is limited to claims filed under Chapter 4123. It is undisputed

that this case does not involve a claim for workers’ compensation, thus, R.C.

4123.01(A)(1)(c) is inapplicable.

       {¶52} To support their position, the Insurance Companies argue that

Slauter v. Klink, 2d Dist. Montgomery No. 18150, 2000 WL 1162041 (Aug. 18,

2000), stands for the proposition that the legislature intended to redefine employee

and substitute the statutory test contained in R.C. 4123.01 for the common law

standard for any case that deals with construction contracts. We do not interpret

the Second District’s opinion so broadly. In Slauter, the appellant was allegedly

injured by a truck driven by the appellee. Id. at *1. At the time, the appellant and

appellee worked for the same company. Id. The appellant received workers’

compensation benefits for his injuries, but filed suit against the appellee claiming

                                        -30-
Case No. 10-13-11



that she had negligently operated the truck.      Id.   The appellee successfully

asserted that she was immune from tort actions by co-workers under R.C.

4123.741.    Id.    The trial court used the statutory test found in R.C.

4123.01(A)(1)(c) to determine whether the appellee was an employee.              Id.

However, the appellant argued that the trial court should have used the common

law standard. Id.

       {¶53} The court in Slauter found that R.C. 4123.01(A)(1)(c), “appears to be

an attempt to codify the various factual matters courts have considered when

deciding if an employee relationship, including the employer’s ‘right to control,’

exists.” Id. at *4. The court also looked to Sub. H. Bill No. 245 for guidance and

noted that the “legislature’s intent in amending 4123.01 was to redefine

‘employee’ for purposes of the Workers’ Compensation Law.” (Emphasis added.)

Id.   Lastly, in Slauter, the court had to determine whether the appellee was an

employee in order to see whether the immunity provision of R.C. 4123.741

applied. Since the appellee invoked a defense that was found within the workers’

compensation chapter, it was appropriate for the court to use the test found in R.C.

4123.01(A)(1)(c) to determine whether she was an employee.

       {¶54} Other courts have similarly agreed that the statutory test found in

R.C. 4123.01(A)(1)(c) only applies to workers’ compensation cases. See Grange

Mut. Cas. Co. v. Laughlin, 5th Dist. Licking No. 12-CA-0089, 2013-Ohio-4447;

                                       -31-
Case No. 10-13-11



Snyder v. Stevens, 4th Dist. Scioto No. 12CA3465, 2012-Ohio-4120. In Laughlin,

the court held that since “R.C. Chapter 4123 sets forth Ohio’s statutory scheme for

workers’ compensation[,] * * * R.C. 4123.01 defines an ‘employee’ for purposes

of workers’ compensation.” 2013-Ohio-4447, ¶ 21. Further, in Snyder, the court

held that because the appellant did not “bring a claim under R.C. 4123 and [did]

not cite any case law incorporating this standard into a common law negligence

claim” the statutory standard was inapplicable. 2012-Ohio-4120, ¶ 27.

       {¶55} While the Insurance Companies are correct in noting that Bostic

involved a workers’ compensation claims, it is apparent that courts have adopted

the common law standard set out in Bostic to apply to all sorts of matters that do

not implicate workers’ compensation claims. For example, the Ohio Supreme

Court has recently used the standard set out in Bostic to determine whether Virtual

Learning Academy instructors were independent contractors or teachers entitled to

compensation from the State Teachers Retirement Board. State ex rel. Nese v.

State Teachers Retirement Bd. Of Ohio, 136 Ohio St.3d 103, 2012-Ohio-1777, ¶ 2.

This court has also used the test set out in Bostic to determine whether a physician

was an employee or independent contractor for gender discrimination purposes.

Bower v. Henry Cty. Hosp., 3d Dist. Seneca No. 13-12-46, 2013-Ohio-2844, ¶ 28.




                                       -32-
Case No. 10-13-11



       {¶56} Therefore, because Hartings did not bring a claim under R.C. 4123,

we find that the statutory test found in R.C. 4123.01(A)(1)(c) is not applicable to

this matter.

       {¶57} Accordingly, we overrule the Insurance Companies’ second

assignment of error.

                       The Insurance Companies’ & Hartings’
                             Assignments of Error No. I

       {¶58} In their first assignments of error, the Insurance Companies and

Hartings argue that the trial court erred in granting summary judgment in favor of

the Baes and Rite Rug because there were genuine issues of material fact as to

whether Xu was an employee of the Baes and of Rite Rug. We agree.

                                Standard of Review

       {¶59} An appellate court reviews a summary judgment order de novo.

Hillyer v. State Farm Mut. Auto. Ins. Co., 131 Ohio App.3d 172, 175 (8th

Dist.1999). Accordingly, a reviewing court will not reverse an otherwise correct

judgment merely because the lower court utilized different or erroneous reasons as

the basis for its determination. Diamond Wine & Spirits, Inc. v. Dayton

Heidelberg Distrib. Co., 148 Ohio App.3d 596, 2002-Ohio-3932, ¶ 25 (3d Dist.),

citing State ex rel. Cassels v. Dayton City School Dist. Bd. of Edn., 69 Ohio St.3d

217, 222 (1994). Summary judgment is appropriate when, looking at the evidence


                                       -33-
Case No. 10-13-11



as a whole: (1) there is no genuine issue as to any material fact, and (2) the moving

party is entitled to judgment as a matter of law. Civ.R. 56(C). In conducting this

analysis the court must determine “that reasonable minds can come to but one

conclusion and that conclusion is adverse to the party against whom the motion for

summary judgment is made, [the nonmoving] party being entitled to have the

evidence or stipulation construed most strongly in the [nonmoving] party’s favor.”

Id. If any doubts exist, the issue must be resolved in favor of the nonmoving

party. Murphy v. Reynoldsburg, 65 Ohio St.3d 356, 358-59 (1992).

       {¶60} The party moving for summary judgment has the initial burden of

producing some evidence which demonstrates the lack of a genuine issue of

material fact. Dresher v. Burt, 75 Ohio St.3d 280, 292 (1996). In doing so, the

moving party is not required to produce any affirmative evidence, but must

identify those portions of the record which affirmatively support his argument. Id.

at 292. The nonmoving party must then rebut with specific facts showing the

existence of a genuine triable issue; an adverse party may not rest on the mere

allegations or denials of the party's pleadings. Id.; Civ.R. 56(E).

                       Employee v. Independent Contractor

       {¶61} Generally, while an employer is vicariously liable for the negligent

acts of its employees committed within the scope of employment under the

doctrine of respondeat superior, an employer of an independent contractor is not

                                         -34-
Case No. 10-13-11



liable for the negligent acts of the independent contractor.10 Pusey v. Bator, 94

Ohio St.3d 275, 278 (2002); Clark v. Southview Hosp. & Family Health Ctr., 68

Ohio St.3d 435, 438 (1994).

         {¶62} To determine whether a party is an employee or an independent

contractor, we must resolve the central question of “who had the right to control

the manner or means of doing the work[?]” Bostic, 37 Ohio St.3d at paragraph

one of the syllabus. This inquiry is fact-intensive and requires the consideration of

a number of factors, none of which are dispositive by themselves. Id. at 146.

Factors to be considered include “who controls the details and quality of the work;

who controls the hours worked; who selects the materials, tools and personnel

used; who selects the routes traveled; the length of employment; the type of

business; the method of payment; and any pertinent agreements or contracts.” Id.

         {¶63} Usually, when the evidence is not in dispute or facts are admitted, the

question of whether a person is an employee or independent contractor is a matter

of law to be decided by the court. Id.; Schickling v. Post Publishing Co., 115 Ohio

St. 589 (1927). However, when the worker offers some evidence that he was an

10
   Ohio recognizes three exceptions to this rule. Sullivan v. Oregon Ford, Inc., 552 F.Supp.2d 681, 685
(N.D.Ohio 2008). First, an employer may be liable for injuries that are a result of the employer’s failure to
“exercise reasonable care in the selection of a competent and careful independent contractor.” Albain v.
Flower Hosp., 50 Ohio St.3d 251, 257-258 (1990) overruled on other grounds in Clark v. Southview Hosp.
& Family Health Ctr., 68 Ohio St.3d 435 (1994). Second, an employer may be liable if the independent
contractor is performing a non-delegable duty imposed by statute, contract, common law, or arising from
inherently dangerous work. Id. Third, an employer may be liable for the negligence of an independent
contractor under the doctrine of agency by estoppel. Id. at 262-263.


                                                   -35-
Case No. 10-13-11



employee rather than an independent contractor, the issue becomes a question for

the trier of fact to decide. Bostic at 146-147; see also O’Day v. Webb, 29 Ohio

St.2d 215, paragraph four of the syllabus (1972) (“It is the duty of a trial court to

submit an essential issue to the jury when there is sufficient evidence relating to

that issue to permit reasonable minds to reach different conclusions on that issue *

* *.”).

          {¶64} Since Hartings and the Insurance Companies have presented

sufficient evidence to allow reasonable minds to differ on the issue of whether Xu

was an employee to the Baes and/or Rite Rug, we find that the trial court erred in

granting the Baes’ and Rite Rug’s motions for summary judgment. Our review of

the record reveals that there was evidence from which a jury could reasonably

infer that Xu was either an employee or an independent contractor.

          {¶65} On one hand, evidence was presented which tends to prove that Xu

was an independent contractor. It is undisputed that the installers had to provide

their own tools and vehicles. While it appears that Rite Rug attached a map to

work orders, there was no testimony presented that the installers were instructed

they had to follow these routes to the job sites. Lastly, the method of payment is

also suggestive of an independent contractor since Xu was paid per job, and not at

an hourly rate. While the presence of subcontractor agreements also points toward



                                        -36-
Case No. 10-13-11



an independent contractor relationship, Xu adamantly denied signing a

subcontractor agreement, making this a disputed fact.

       {¶66} On the other hand, evidence was presented which tends to indicate

that the Baes and Rite Rug had the right to control the manner or means by which

Xu performed his work. The mere fact that a contracting party reserves the right

to approve the work of the worker does not necessarily establish an employer-

employee relationship. Perron v. Hood Industries, Inc., 6th Dist. Lucas No. L-06-

1396, 2007-Ohio-4478, ¶ 31. Only when “the control of the work reserved in the

employer which effects a master-servant relationships is control of the means and

manner of performance of the work, as well as of the result; an independent

contractor relationship exists * * *.” Id.

       {¶67} While it was undisputed that Rite Rug had supervisors at the job sites

and inspected the work of the installers, the Insurance Companies and Hartings

also presented some evidence that Rite Rug controlled the means and manner of

performance of its installers. Although there was testimony that Rite Rug does not

train its installers, this was contradicted by Nelson’s testimony that Rite Rug does,

in fact, train its installers, both in group meetings and in one-on-one sessions.

Kim Bae also stated that sometimes the Baes will “walk the job site” with new

installers in order to teach them how to properly install floors.



                                         -37-
Case No. 10-13-11



       {¶68} Further, all the flooring materials that the installers use are provided

by Rite Rug. After receiving a work order, the installers are directed to pick up

Rite Rug flooring materials in the Rite Rug warehouse before they drive to the job

sites. Testimony was elicited from both Rite Rug employees and the Baes that

they retained the right to terminate installers if they did not produce satisfactory

work. The fact that none of the installers were discharged is irrelevant, as long as

the Baes and Rite Rug maintained the right to discharge an installer if necessary.

The ongoing nature of the Baes’ and Rite Rug’s relationship also points to an

employer-employee relationship. See Harmon v. Schnurmacher, 84 Ohio App.3d,

207, 213 (11th Dist.1992). (“[A]n independent contractor is generally hired to

complete a single job only and does not have a continuing, full-time relationships

with a single client.”). Rite Rug has employed the Baes to provide them with

installers for over 10 years and has even provided them with office space in its

warehouse to conduct business. Rite Rug exclusively uses the Baes to install their

flooring. Similarly, the Baes only work for Rite Rug.          Thus, there is some

evidence of an ongoing relationship with the installers, the Baes, and Rite Rug.

       {¶69} Construing the evidence most strongly in Hartings’ favor, we find

that the trial court erred in granting the Baes’ and Rite Rug’s motions for summary

judgment.



                                        -38-
Case No. 10-13-11



       {¶70} Accordingly, we sustain Hartings’ and the Insurance Companies’

first assignments of error.

                       Hartings’ Assignment of Error No. II

       {¶71} In her second assignment of error, Hartings contends that the trial

court erred by granting summary judgment in favor of the Appellees on the issue

of negligent hiring and retention. We agree.

       {¶72} In order for a plaintiff to prove negligent hiring or retention, he or

she must show:

       (1) [T]he existence of an employment relationship; (2) the
       employee’s incompetence; (3) the employer’s actual or constructive
       knowledge of such incompetence; (4) the employee’s act or
       omission causing the plaintiff’s injuries; and (5) the employer’s
       negligence in hiring or retaining the employee as the proximate
       cause of plaintiff’s injuries.

Evans v. Ohio State Univ., 112 Ohio App.3d 724, 739 (10th Dist.1996), quoting

Ruta v. Breckenridge-Remy Co., 6th Dist. Erie No. E-80-039, 1980 WL 351648

(Dec. 12, 1980). These elements are related to the basic elements of negligence:

duty, breach, proximate cause, and damages.

       {¶73} Regardless of whether Xu is found to be an independent contractor or




                                       -39-
Case No. 10-13-11



an employee of Rite Rug and/or the Baes, some sort of employment relationship11

existed between them. Further, it is undisputed that Xu was incompetent to drive

and deliver Rite Rug materials, since he did not have a valid driver’s license. It is

also undisputed that Xu’s negligence caused the Hartings’ injuries. However, the

parties do dispute whether the Baes and Rite Rug had constructive knowledge of

Xu’s incompetence.            Thus, whether the Baes and Rite Rug owed a duty to the

Hartings turns on whether a reasonably prudent person, with the Baes and Rite

Rug’s knowledge, would have anticipated that Xu would cause a car accident.

        {¶74} It is clear from the record that the Baes and Rite Rug had no actual

knowledge of Xu’s incompetence. The more important question is whether the

Baes and Rite Rug had constructive knowledge.12 Constructive knowledge is

defined as “[k]nowledge that one using reasonable care or diligence should have,

and therefore that is attributed by law to a given person * * *.” Black’s Law

Dictionary 404 (9th Ed.2009).                  The Baes and Rite Rug argue that Xu’s
11
   For purposes of a negligent hiring or retention claim, it is irrelevant whether the worker is an employee
or an independent contractor. Albain, 50 Ohio St.3d at 257 (“It is well-established that an employer must
exercise reasonable care in the selection of a competent and careful independent contractor.”); Rodic v.
Koba, 8th Dist. Cuyahoga No. 77599, 2000 WL 1807042, fn. 2 (“[A]ppellee’s assertion that an independent
contractor relationship is not a sufficient basis for a negligent hiring claim is without merit.”); Best v.
Energized Substation Serv., Inc., 88 Ohio App.3d 109, 115 (9th Dist.1993) (“[Restatement of the Law 2d,
Torts (1965) 376, Section 411] recognizes liability to ‘third persons’ for negligent selection of an
independent contractor.”).
12
   Rite Rug claims in its brief, that it had “no involvement in hiring installers * * *. As such, Rite Rug
would have no involvement in verifying whether an installer possessed a valid driver’s license * * *.” Rite
Rug Br., p. 16. However, this is contradicted by the testimony of its own employee, Moyer, who testified
that every installer must fill out an application packet. Moyer Dep., p. 20. As part of this application
packet, the applicant must make a copy of their driver’s license. Id. at p. 22. Once the application is
complete, Moyer sends it into the corporate office and will receive a response as to whether the applicant
can work for Rite Rug.

                                                   -40-
Case No. 10-13-11



responsibility of transporting the flooring materials was incidental to his main task

of installing the flooring and that since driving a car was not part of his job

responsibilities, they had no duty to look into Xu’s driving history. The Baes and

Rite Rug point towards the subcontractor agreements they made all installers sign.

They argue that these agreements do not mention that delivering goods is part of

an installer’s job responsibilities.

       {¶75} However, this is contradicted by almost every employee who was

deposed from Rite Rug. These employees testified that the transportation of the

flooring materials is a principal responsibility of an installer. Bayer explained that

all the installers are required to deliver the flooring materials to the job sites and

that both the delivery and the installation was an integral part of the Rite Rug

business. Bayer Dep., at p. 36-37, 58. Moyer testified that Rite Rug relies upon

the installers to the deliver the materials to their job sites. Moyer Dep., p. 173.

Benjamin Adams also testified that it is the installer’s responsibility to pick up the

flooring materials from the warehouse and deliver it to the job site. Adams Dep.,

p. 28-29.

       {¶76} Further, Kim Bae testified that delivering materials in Xu’s car was

in furtherance of Jung Ho Bae’s business. She also stated that the installers

deliver Rite Rug’s product and install it on behalf of Jung Ho Bae.



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       {¶77} Therefore, there is some dispute as to whether delivery was an

integral part of Xu’s job responsibilities. There is also the fact that Xu presented

an Illinois driver’s license to the Baes and Rite Rug despite not residing in Illinois

for a significant period of time. Based on the unique circumstances of this case,

the matter should be submitted to a trier of fact to determine whether delivery was

an integral part of Xu’s job responsibilities and whether the Baes and Rite Rug

exercised reasonable care in selecting Xu to deliver their goods by simply looking

at his driver’s license.

       {¶78} The Baes use Mut. Ins. Co. of Eagle Tp. v. Hunt, 3d Dist. Hancock

No. 5-2000-07, 2000 WL 1273607 (Sept. 7, 2000), to support their position.

However, Hunt is distinguishable from the present matter. In Hunt the appellants

hired an independent contractor who set fire to the appellee’s home. Id. at *1.

The trial court found that the fire was caused by improperly disposing of lighted

cigarettes. Id. This court found that even if the appellants were negligent in hiring

the worker, their negligence was not the proximate cause of the fire since such an

accident was “no more probable because the appellants had failed to inspect any of

Smith’s prior work, had failed to request references from him, or had failed to

conduct an extensive interview or background check.” Id. at *3.

       {¶79} In this case, if the jury finds that the Baes and/or Rite Rug did not

make a reasonable inquiry into Xu’s driving history, the jury could also find that

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the Baes’ and Rite Rug’s negligence was the proximate cause of Hartings’

injuries. If the Baes and/or Rite Rug looked into Xu’s driving history, they would

have found that he did not have a valid driver’s license and would not have hired

him to deliver flooring materials. Had Xu not been driving Rite Rug materials to a

job site on October 15, 2011, he would not have gotten into a car accident with

Hartings and the Bruns and caused their injuries. Thus, we do not find the facts

of Hunt analogous to this case.

      {¶80} We similarly find the Baes’ use of Pusey v. Bator, 94 Ohio St.3d 275

(2002), unpersuasive.    In Pusey, the Ohio Supreme Court was outlining the

general exceptions for when an employer may be responsible for the negligent acts

of an independent contractor. Id. at 279. Specifically, the Court was explaining

the inherently dangerous work exception which provides that “the employer hiring

the independent contractor has a duty to see that the work is done with reasonable

care and cannot, by hiring an independentcontractor [sic], insulate himself or

herself from liability for injuries resulting to others from the negligence of the

independent contractor * * *.” Id. at 279-280. However, the inherently dangerous

work exception does not apply when there is only a general anticipation that an

independent contractor may act negligent in some way and thereby cause harm to

a third party. Id. at 280. Since Hartings is not alleging that the Baes or Rite Rug

are vicariously liable for the acts of Xu because he was engaged in an inherently

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dangerous activity, we do not find Pusey to be instructive in this matter. Hartings

asserts that the Baes and Rite Rug were negligent in hiring Xu, not that they were

negligent in supervising Xu while he was engaged in a dangerous activity.

       {¶81} Accordingly, we sustain Hartings’ second assignment of error.

       {¶82} Having found error prejudicial to Hartings and the Insurance

Companies in their first assignment of error and in Hartings second assignment of

error, but having found no error prejudicial to the Insurance Companies in their

second assignment of error, we affirm in part and reverse in part the trial court’s

judgment and remand this matter for further proceedings consistent with this

opinion.

                                                      Judgment Affirmed in Part,
                                                           Reversed in Part, and
                                                               Cause Remanded

WILLAMOWSKI, P.J. and SHAW, J., concur.

/jlr




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