Stanford Law School - Robert Crown Law Library

Filed 6/23/11

IN THE SUPREME COURT OF CALIFORNIA

DAWN RENAE DIAZ,
Plaintiff and Respondent,
S181627
v.
Ct.App. 2/6 B211127
JOSE CARCAMO et al.,
Ventura County
Defendants and Appellants.
Super. Ct. No. CIV 241085

A person injured by someone driving a car in the course of employment
may sue not only the driver but that driver‘s employer. The employer can be sued
on two legal theories based on tort principles: respondeat superior and negligent
entrustment. Respondeat superior, a form of vicarious liability, makes an
employer liable, irrespective of fault, for negligent driving by its employee in the
scope of employment. The theory of negligent entrustment makes an employer
liable for its own negligence in choosing an employee to drive a vehicle.
If, as here, a plaintiff asserts both theories, and the employer admits vicarious
liability for any negligent driving by its employee, can the plaintiff still pursue the
negligent entrustment claim? The answer is ―no,‖ as we held in Armenta v.
Churchill (1954) 42 Cal.2d 448 (Armenta). The Court of Appeal here held to the
contrary. Armenta, it concluded, is inconsistent with this state‘s current system of
allocating liability for tort damages based on comparative fault — a system created
by decisions of this court in the 1970‘s and by the California electorate‘s later
adoption of the Fair Responsibility Act of 1986 (Proposition 51). We disagree with
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the Court of Appeal. We therefore reverse that court‘s judgment and remand for a
new trial.
I
Plaintiff Dawn Renae Diaz was driving south on U.S. Highway 101 near
Camarillo, Ventura County. Defendant Jose Carcamo, a truck driver for defendant
Sugar Transport of the Northwest, LLC, was driving north in the center of three
lanes. Defendant Karen Tagliaferri, driving in the center lane behind Carcamo,
moved to the left lane to pass him. As Tagliaferri, without signaling, pulled back
into the center lane, her vehicle hit Carcamo‘s truck, spun, flew over the divider,
and hit plaintiff‘s SUV. Plaintiff sustained severe, permanent injuries.
Plaintiff sued Tagliaferri, Carcamo, and Sugar Transport. She alleged that
Carcamo and Tagliaferri had driven negligently and that Sugar Transport was both
vicariously liable for employee Carcamo‘s negligent driving and directly liable for
its own negligence in hiring and retaining him. In their answer, Carcamo and
Sugar Transport denied any negligence.
At trial, plaintiff‘s expert witness testified that Carcamo should have been in
the right lane, should have monitored his mirrors better, and should have averted a
collision by slowing or steering away as Tagliaferri entered his lane. Plaintiff‘s
counsel argued that Carcamo sped up to keep Tagliaferri from passing, noting
Sugar Transport‘s failure to produce the chart from the truck‘s tachograph, which
would have recorded Carcamo‘s speed, acceleration, and braking. But another
driver, who was the only nonparty witness to the collision between Carcamo and
Tagliaferri, testified that Carcamo had not accelerated. With respect to defendant
Tagliaferri, her counsel conceded that she was partly at fault; defendants Sugar
Transport and Carcamo contended that she alone was at fault.
Defendant-employer Sugar Transport offered to admit vicarious liability if
its employee Carcamo was found negligent. That admission, Sugar Transport
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argued, would bar plaintiff from further pursuing her claims for negligent
entrustment, hiring, and retention. In support, Sugar Transport cited Jeld-Wen,
Inc. v. Superior Court (2005) 131 Cal.App.4th 853 (Jeld-Wen), in which a Court
of Appeal, applying our holding in Armenta, supra, 42 Cal.2d 448, directed a trial
court to dismiss a negligent entrustment claim after the defendant employer‘s
admission of vicarious liability for its employee‘s driving.
Over defendant-employer Sugar Transport‘s objection, the trial court here
admitted evidence of Carcamo‘s driving and employment history, as offered by
plaintiff in support of her negligent hiring claim. The evidence showed two prior
accidents involving Carcamo: one in which he was at fault and was sued, the
other occurring only 16 days before the accident here. Other evidence showed that
Carcamo was in this country illegally and had used a ―phony‖ Social Security
number to obtain employment, that he had been fired from or quit without good
reason three of his last four driving jobs, that he had lied in his application to work
for Sugar Transport, and that, when Sugar Transport had sought information from
Carcamo‘s prior employers, the lone response gave him a very negative evaluation.
Sugar Transport opposed instructing the jury on plaintiff‘s negligent
retention and hiring claims, arguing that its offer to admit vicarious liability barred
such instructions. It also sought a mistrial, claiming the prior-accident evidence
had been highly prejudicial. Its efforts failed. Before closing arguments, Sugar
Transport stipulated with plaintiff to vicarious liability for employee-driver
Carcamo‘s negligence, if any.
The jury found that defendants Tagliaferri and Carcamo had driven
negligently, that defendant Sugar Transport had been negligent in hiring and
retaining Carcamo as a driver, and that the retention was a cause of plaintiff‘s
injuries. The jury allocated fault for the accident among all three defendants:
45 percent to Tagliaferri, 35 percent to Sugar Transport, and 20 percent to Carcamo.
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It awarded plaintiff over $17.5 million in economic damages and $5 million in
noneconomic damages. The trial court entered a judgment in the form required by
the Fair Responsibility Act of 1986, enacting Civil Code sections § 1431.1–1431.5
and amending section 1431 (Proposition 51). Under the judgment, Tagliaferri and
Sugar Transport were each jointly liable for all of plaintiff‘s economic damages
but only severally liable for part of her noneconomic damages — Tagliaferri for
45 percent and Sugar Transport for 55 percent (its 35 percent plus its employee
Carcamo‘s 20 percent).
The Court of Appeal affirmed. It acknowledged our 1954 holding in
Armenta, supra, 42 Cal.2d 448, that if an employer admits vicarious liability for
its employee‘s negligent driving, a plaintiff cannot rely on a negligent entrustment
claim to introduce evidence of the employee‘s driving record. It also recognized
that in Jeld-Wen, supra, 131 Cal.App.4th 853, another Court of Appeal had applied
Armenta in directing dismissal of a negligent entrustment claim. The Jeld-Wen
court rejected a claim that Armenta, which was decided ―in 1954, before the 1970‘s
development of comparative negligence rules,‖ had been ―adversely affected‖ by
those rules. (Jeld-Wen, supra, at pp. 870–871.) The Court of Appeal here
distinguished Armenta because it involved negligent entrustment rather than
negligent hiring and it did not involve an allocation of comparative fault. And in
disagreeing with Jeld-Wen, the Court of Appeal here stated (mistakenly) that Jeld-
Wen had not ―purport[ed] to deal with the allocation of fault required by
Proposition 51.‖
Because the Court of Appeal‘s decision here conflicts with that in
Jeld-Wen, supra, 131 Cal.App.4th 853, and casts doubt on the viability of our
holding in Armenta, supra, 42 Cal.2d 448, we granted the petition for review of
defendants Sugar Transport and Carcamo.
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II
Defendants contend the Court of Appeal erred in holding that this court‘s
adoption of a comparative fault–based system for allocating tort liability (see Li v.
Yellow Cab Co. (1975) 13 Cal.3d 804 (Li)) has undermined our holding in Armenta,
supra, 42 Cal.2d 448. Under Armenta, they argue, employer Sugar Transport‘s
offer to admit vicarious liability for any negligence of its employee-driver Carcamo
required the trial court to withhold plaintiff‘s negligent hiring and retention claims
from the jury, and to exclude the evidence plaintiff offered to support those claims,
such as Carcamo‘s poor driving record and employment history, his
dishonesty, and his status as an illegal alien and resultant use of a ―phony‖ Social
Security number to obtain employment. We agree, as explained below.
The respondeat superior doctrine makes an employer liable, irrespective of
fault, for an employee‘s tortious conduct in the scope of employment. (Mary M. v.
City of Los Angeles (1991) 54 Cal.3d 202, 209.) Such vicarious liability was at
issue in Armenta, supra, 42 Cal.2d 448. In that case, as truck driver Dale Churchill
was backing up, he hit a man, killing him. The man‘s survivors sued Dale and his
wife, Alece, who owned the truck and employed Dale. (Id. at p. 451.) The
plaintiffs alleged that Dale had driven negligently in the scope of employment and
that Alece, aware of Dale‘s carelessness, had been negligent in entrusting the truck
to him. (Id. at p. 456.) The defendants‘ answer admitted that Dale had been acting
in the scope of employment at the time of the accident. At trial, the court excluded
evidence of Dale‘s ―37 traffic violations, including a conviction of manslaughter,‖
as being ―directed to an issue . . . removed from the case by the pleadings.‖ (Ibid.)
We upheld that ruling.
Armenta held that Alece‘s admission of vicarious liability made the
negligent entrustment claim irrelevant. (Armenta, supra, 42 Cal.2d at p. 457.)
Vicarious liability and negligent entrustment, we explained, were ―alternative
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theories under which . . . to impose upon [Alece] the same liability as might be
imposed upon [Dale].‖ Alece‘s admission of vicarious liability, we stated, had
removed ―the legal issue of her liability . . . from the case‖ (ibid.) leaving ―no
material issue . . . to which the offered evidence could be legitimately directed.‖
(Id. at p. 458.)
Armenta, supra, 42 Cal.2d 448, reflects the majority view among American
jurisdictions. (Mincer, The Viability of Direct Negligence Claims Against Motor
Carriers in the Face of an Admission of Respondeat Superior (2010) 10 Wyo.
L.Rev. 229, 235.) But we decided Armenta nearly 60 years ago. Since then,
marked changes have occurred in California law on the allocation of liability for
tort damages among multiple wrongdoers. Before determining whether those
changes affect our holding in Armenta, we summarize them in part III below.
III
In 1954, when we decided Armenta, supra, 42 Cal.2d 448, California courts
imposed tort liability for a plaintiff‘s injuries on an ―all-or-nothing‖ basis.
(American Motorcycle Assn. v. Superior Court (1978) 20 Cal.3d 578, 583, 591–
598 (American Motorcycle); Li, supra, 13 Cal.3d at pp. 809–811 & fn. 3.) At that
time, juries ―generally did not determine the relative degree or proportion of fault‖
of the parties. (Evangelatos v. Superior Court (1988) 44 Cal.3d 1188, 1196.)
Instead, if ―the plaintiff‘s fault had contributed in any measure to his own injury,
his recovery was barred,‖ while ―every defendant found somewhat responsible for
an indivisible injury, no matter how slight his or her fault, was liable for all the
damages.‖ (DaFonte v. Up-Right, Inc. (1992) 2 Cal.4th 593, 597 (DaFonte).)
In that system, once an employer admitted vicarious liability for an
employee‘s tortious conduct within the scope of employment, it did not matter, for
purposes of a plaintiff‘s recovery, whether a trial court submitted to the jury a
negligent entrustment claim against the employer along with the negligence claim
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against the employee. Either vicariously under the respondeat superior doctrine,
or ―directly‖ on a negligent entrustment claim, the employer would be liable for
100 percent of a plaintiff‘s damages, or else not liable at all.
In 1975, this court replaced the old all-or-nothing system of tort liability with
a comparative fault system ―under which liability for damage will be borne by those
whose negligence caused it in direct proportion to their respective fault.‖ (Li, supra,
13 Cal.3d at p. 813.) Under comparative fault principles, a plaintiff‘s negligence no
longer bars recovery, but reduces ―the damages awarded . . . in proportion to the
amount of negligence attributable to the [plaintiff].‖ (Id. at p. 829.) Three years
later, to ensure a similarly fair apportionment of damages among tortfeasors, we also
eliminated the all-or-nothing character of the common law doctrine of equitable
indemnity. (American Motorcycle, supra, 20 Cal.3d at p. 583.) We thus permitted
―a right of partial indemnity, under which liability among multiple tortfeasors may
be apportioned on a comparative negligence basis.‖ (Ibid.) We declined, however,
to eliminate the common law doctrine of joint and several liability, under which any
defendant whose tort was a cause of an injury was liable for all of the plaintiff‘s
damages. (Id. at pp. 582–583.) Thus, if one defendant proved to be insolvent, the
burden of paying its share of damages fell on the other defendants, not the plaintiff.
In 1986, California voters further limited the all-or-nothing character of tort
liability by adopting Proposition 51. To ensure that ―defendants in tort actions shall
be held financially liable in closer proportion to their degree of fault‖ (Civ. Code,
§ 1431.1, subd. (c)), Proposition 51 limits the scope of joint liability among
tortfeasors. In cases ―based upon principles of comparative fault,‖ each defendant
is liable for all the plaintiff‘s economic damages but only ―for the amount of non-
economic damages allocated to that defendant in direct proportion to that
defendant‘s percentage of fault.‖ (Civ. Code, § 1431.2, subd. (a).) For that
purpose, a ―defendant‘s percentage of fault‖ (ibid.) is ―his or her proportionate
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share of fault as compared with all fault responsible for the plaintiff‘s injuries.‖
(DaFonte, supra, 2 Cal.4th at p. 603, italics omitted.) Accordingly, ―damages
must be apportioned among [the] ‗ ―universe‖ of tortfeasors‘ including ‗nonjoined
defendants.‘ ‖ (Ibid.)
Because Proposition 51 applies only to ―independently acting tortfeasors
who have some fault to compare,‖ the allocation of fault it mandates cannot
encompass defendants ―who are without fault and only have vicarious liability.‖
(Rashtian v. BRAC-BH, Inc. (1992) 9 Cal.App.4th 1847, 1851 [Prop. 51 did not
apply to car owner vicariously liable for permissive user‘s negligence]; see
Srithong v. Total Investment Co. (1994) 23 Cal.App.4th 721, 728 [Prop. 51 did not
apply to property owner liable vicariously for contractor‘s negligence].)
One type of defendant excluded from allocations of fault under Proposition
51 is an employer who faces only vicarious liability under the respondeat superior
doctrine for torts committed by its employees in the scope of employment. (Miller
v. Stouffer (1992) 9 Cal.App.4th 70, 83.) In a case involving such an employer-
defendant, the ― ‗ ―universe‖ of tortfeasors‘ ‖ among whom the jury must
apportion fault (DaFonte, supra, 2 Cal.4th at p. 603) does not include the
employer. Instead, the employer‘s share of liability for the plaintiff‘s damages
corresponds to the share of fault that the jury allocates to the employee. (Miller v.
Stouffer, supra, 9 Cal.App.4th at p. 83.) An employer liable solely on a theory of
respondeat superior can thus have no greater fault than its negligent employee
acting in the scope of employment. The question here is whether plaintiff‘s
assertion of an additional claim against the employer — for negligent entrustment,
hiring, or retention — requires a different approach to allocating fault. We explore
that issue in part V, after addressing certain preliminary issues in part IV below.
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IV
The Court of Appeal here distinguished Armenta, supra, 42 Cal.2d 448, on
the ground that it involved negligent entrustment, while this case involves
negligent hiring. This distinction fails. A claim that an employer was negligent in
hiring or retaining an employee-driver rarely differs in substance from a claim that
an employer was negligent in entrusting a vehicle to the employee. Awareness,
constructive or actual, that a person is unfit or incompetent to drive underlies a
claim that an employer was negligent in hiring or retaining that person as a driver.
(See Judicial Council of Cal. Civ. Jury Instns. (2010) CACI No. 426.) That same
awareness underlies a claim for negligent entrustment. (See CACI No. 724.) In a
typical case, like this, the two claims are functionally identical. We now consider
plaintiff‘s forfeiture claims.
Plaintiff contends that defendant-employer Sugar Transport has forfeited its
right to invoke our holding in Armenta, supra, 42 Cal.2d 448, by not admitting
vicarious liability before trial, as did the defendants in Armenta and in Jeld-Wen,
supra, 131 Cal.App.4th 853. Neither decision, however, required such admissions
to be made before trial.
If, as here, all of a plaintiff‘s causes of action depend on a contention that
an employee‘s negligent driving in the scope of employment was a cause of the
plaintiff‘s injuries, and if the defendant-employer offers to admit vicarious liability
for its employee‘s negligent driving, then that offer will ―remove[] from the case‖
the issue of the employer‘s liability for any damage caused by its employee‘s
negligent driving, leaving no ―material issue‖ to which negligent entrustment
evidence can be relevant. (Armenta, supra, 42 Cal.2d at pp. 456–457.) It makes no
difference that here defendant-employer Sugar Transport offered to admit
vicarious liability at trial instead of before.
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Plaintiff also claims that defendant-employer Sugar Transport forfeited its
right to invoke the holding of Armenta, supra, 42 Cal.2d 448, by not moving to
bifurcate the trial into two separate parts: one pertaining to the negligent driving
cause of action against Tagliaferri and employee-driver Carcamo, and the other on
the negligent hiring and retention causes of action against Sugar Transport. But,
as we held in Armenta, and as we affirm in this decision, an employer‘s admission
of vicarious liability for its employee‘s negligence makes claims of negligent
entrustment, hiring, or retention irrelevant. Thus, no reason exists to try such
claims at all, whether separately from the negligence claim or at the same time.
V
We now consider whether our 1954 holding in Armenta, supra, 42 Cal.2d
448, has been undermined by this court‘s later adoption of comparative fault
principles (see pp. 6–7, ante) and by the California electorate‘s adoption of
Proposition 51, with its related limit on joint liability (see p. 7, ante). Armenta
held that if a plaintiff sues a driver‘s employer on theories of respondeat superior
and negligent entrustment, the employer can, by admitting liability on the first
claim, bar the second. (Id. at p. 457.) Citing Armenta, defendant-employer Sugar
Transport here argues that its offer to admit vicarious liability for any negligent
driving by its employee, Carcamo, barred plaintiff from pursuing claims of
negligent hiring or retention, and that the Court of Appeal erred in concluding
otherwise. Plaintiff responds that in cases like this in which Proposition 51
requires an allocation of fault among multiple tortfeasors, Armenta is inconsistent
with the principles of comparative fault adopted after Armenta.
Plaintiff asserts that if Proposition 51 applies to limit a defendant‘s liability
for noneconomic damages, necessitating an allocation of fault, then the principles
of California‘s comparative fault system require the trial court to include both the
employer and its employee-driver in the ― ‗ ―universe‖ of tortfeasors‘ ‖ to whom
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the jury will allocate fault (DaFonte, supra, 2 Cal.4th at p. 603). It logically
follows, according to plaintiff, that the jury can hold an employer responsible for
two shares of fault: one based on the employee‘s negligent driving in the scope of
employment, for which the employer is liable vicariously, and one based on the
employer‘s own negligence in choosing a driver, for which the employer is liable
―directly.‖ To exclude the employer‘s independent fault for its negligence in
hiring and retention, plaintiff argues, would distort the process of allocating fault
by removing a party who is at fault from the universe of tortfeasors. We disagree.
In 2005, the Court of Appeal in Jeld-Wen, supra, 131 Cal.App.4th 853,
rejected a similar argument. Negligent entrustment, that court reasoned, may
establish an employer‘s own fault but ― ‗should not impose additional liability‘ ‖;
instead, ― ‗the employer’s liability cannot exceed [that] of the employee.‘ ‖ (Id. at
p. 871, italics added by Jeld-Wen.) We agree. As Jeld-Wen noted, if an employer
admits vicarious liability for its employee‘s negligent driving in the scope of
employment, ―the damages attributable to both employer and employee will be
coextensive.‖ (Ibid.) Thus, when a plaintiff alleges a negligent entrustment or
hiring cause of action against the employer and the employer admits vicarious
liability for its employee‘s negligent driving, the universe of defendants who can
be held responsible for plaintiff‘s damages is reduced by one — the employer —
for purposes of apportioning fault under Proposition 51. Consequently, the
employer would not be mentioned on the special verdict form. The jury must
divide fault for the accident among the listed tortfeasors, and the employer is liable
only for whatever share of fault the jury assigns to the employee.
Disagreeing with Jeld-Wen, supra, 131 Cal.App.4th 853, the Court of
Appeal here reasoned: Negligent hiring or retention claims entail not vicarious but
direct liability, which is based on an employer‘s independent fault for the distinctly
culpable act of entrusting a vehicle to an employee who the employer should know
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is unfit to drive safely; Proposition 51 requires a jury to apportion fault among all
defendants to ensure that all bear responsibility for noneconomic damages ―in
proportion to their degree of fault‖ (Civ. Code, § 1431.1, subd. (c)); therefore, a
negligent hiring or retention claim can ―impose[] greater responsibility on Sugar
Transport than would be attributed to it for simply being Carcamo‘s employer,‖ as
Sugar Transport is liable both vicariously for Carcamo‘s fault and directly for its
own, independent fault. Excluding proof of negligent hiring or retention, the Court
of Appeal held, makes it ―impossible‖ to allocate fault as Proposition 51 requires,
because the allocation cannot include all defendants who bear independent fault.
No matter how negligent an employer was in entrusting a vehicle to an
employee, however, it is only if the employee then drove negligently that the
employer can be liable for negligent entrustment, hiring, or retention.1 (Jeld-Wen,
supra, 131 Cal.App.4th at pp. 863–864.) If the employee did not drive
negligently, and thus is zero percent at fault, then the employer‘s share of fault is
zero percent. That is true even if the employer entrusted its vehicle to an
employee whom it knew, or should have known, to be a habitually careless driver
with a history of accidents.

1
We can conceive of instances in which the employer may be liable for
negligence independent of its employee, for example, when the employer provides
the driver with a defective vehicle. Here, however, plaintiff‘s theory of employer
Sugar Transport‘s separate liability was based solely on the theory of employer
negligence in hiring and retaining Carcamo as a driver. As Sugar Transport‘s
admission of vicarious liability triggered the principles of Armenta, supra, 42
Cal.2d 448, we need not address other theories of employer liability, separate from
and independent of the employee-driver‘s negligence.

We note that in Syah v. Johnson (1966) 247 Cal.App.2d 534, the Court of
Appeal upheld an employer‘s liability for negligent entrustment when the
employee was found not to have been negligent. We express no views on whether
Syah was decided correctly. We disapprove Syah to the extent it is inconsistent
with the views expressed here.
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Comparative fault ―is a flexible, commonsense concept‖ adopted to enable
juries to reach an ― ‗equitable apportionment or allocation of loss.‘ ‖ (Knight v.
Jewett (1992) 3 Cal.4th 296, 314.) If, as here, an employer offers to admit
vicarious liability for its employee‘s negligent driving, then claims against the
employer based on theories of negligent entrustment, hiring, or retention become
superfluous. To allow such claims in that situation would subject the employer to
a share of fault in addition to the share of fault assigned to the employee, for
which the employer has already accepted liability. To assign to the employer a
share of fault greater than that assigned to the employee whose negligent driving
was a cause of the accident would be an inequitable apportionment of loss.
Our conclusion finds support in certain decisions of other state courts that
have adopted or retained the majority rule that a defendant-employer‘s admission
of vicarious liability bars claims for negligent entrustment, hiring, or retention.
The relevant decisions fall into two categories: (1) those in which a state court that
already used a system of comparative fault adopted the majority rule (McHaffie v.
Bunch (Mo. 1995) 891 S.W.2d 822, 826; Willis v. Hill (Ga.Ct.App. 1967) 159
S.E.2d 145, 160, revd. on other grounds (Ga. 1968) 161 S.E.2d 281) and (2) those
in which a state court, having first adopted the majority rule and having later
adopted comparative fault, then chose to retain the majority rule, as we now do
(Gant v. L.U. Transport, Inc. (Ill. App. 2002) 770 N.E.2d 1155, 1159–1160; Loom
Craft Carpet Mills, Inc. v. Gorrell (Tex. App. 1992) 823 S.W.2d 431, 432).
Plaintiff insists that the ―fault‖ to be compared in allocating comparative
fault is moral fault, and that negligently entrusting a vehicle to an employee
involves moral culpability distinct from the moral culpability of the employee for
driving negligently. Defendants respond that when a jury compares ―fault,‖ it
primarily compares the degree to which each party‘s conduct contributed causally
to plaintiff‘s injuries. We need not here address in the abstract the relative roles of
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moral culpability and causation in the law of comparative negligence or fault. As
discussed ante at page 13, the objective of comparative fault is to achieve an
equitable allocation of loss. That objective is not served by subjecting the
employer to a second share of fault in addition to that assigned to the employee
and for which the employer has accepted liability.
To summarize, we reaffirm our holding in Armenta, supra, 42 Cal.2d 448,
that an employer‘s admission of vicarious liability for an employee‘s negligent
driving in the course of employment bars a plaintiff from pursuing a claim for
negligent entrustment. Therefore, the trial court here erred in not applying that
holding to this case. We now turn to defendants‘ contention that the error
prejudiced them.
VI
To establish prejudice, a party must show ―a reasonable probability that in
the absence of the error, a result more favorable to [it] would have been reached.‖
(Soule v. General Motors Corp. (1994) 8 Cal.4th 548, 574.) We explore that issue
below.
To show that Sugar Transport‘s driver, Carcamo, was prone to drive
negligently (which was relevant to plaintiff‘s negligent hiring and retention claims
against Sugar Transport), plaintiff offered evidence of his past accidents, including
one in which he was at fault and another that had occurred just 16 days before the
accident here. To further support her negligent hiring claim, plaintiff offered
evidence of Carcamo‘s poor employment record: As a person illegally in this
country, he had used a false Social Security number to get hired; he had been fired
from (or quit without good reason) three of his last four driving jobs; and he had
lied in his application to work for Sugar Transport. In addition, plaintiff presented
extensive testimony about Sugar Transport‘s inadequate hiring practices, thereby
making the company appear indifferent to the need to screen or train drivers for
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safety. That testimony showed, for example, that when Sugar Transport hired
Carcamo, it did not make adequate efforts to get evaluations of him from his past
employers and it ignored the one evaluation it did receive, which was very negative.
All of that evidence should have been excluded after Sugar Transport offered
to admit vicarious liability. Had that evidence been excluded, and had the special
verdict form not listed defendant-employer Sugar Transport as a separate tortfeasor
from defendant-employee Carcamo, it is reasonably probable that the jury would
have reached results more favorable to one or both defendants on two issues, as
explained below.
The first issue on which the jury would probably have reached a different
result is whether employee Carcamo drove negligently in this case. Evidence of an
employee‘s past accidents (admitted here to support the negligent hiring claim
against employer Sugar Transport) is highly prejudicial to the defense of a negligent
driving claim against the employee. Such evidence creates a prejudicial risk that
the jury will find that the employee drove negligently based not on evidence about
the accident at issue, but instead on an inference, drawn from the employee‘s past
accidents, that negligence is a trait of his character. (See Jeld-Wen, supra, 131
Cal.App.4th at p. 862, fn. 5; id. at pp. 866–867, citing Evid. Code, § 1104.)
Accordingly, had the trial court not made the errors noted above, it is reasonably
probable that the jury would have reached a result more favorable to both Carcamo
and Sugar Transport on the question of whether Carcamo drove negligently.
The second issue on which the jury would probably have reached a different
result but for the trial court‘s error is its allocation of fault. As to this issue,
however, the trial court‘s error prejudiced only Sugar Transport, not Carcamo. The
jury assigned defendant Tagliaferri 45 percent of the fault, employee-driver
Carcamo 20 percent, and employer Sugar Transport 35 percent. That allocation
made Sugar Transport liable (directly or vicariously) for 55 percent of the fault.
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Had the trial court correctly listed only the drivers (that is, Carcamo and Tagliaferri)
on the verdict form as tortfeasors to whom the jury could assign shares of fault,
employer Sugar Transport‘s only source of liability would have been its vicarious
liability, under the doctrine of respondeat superior, for the share of fault assigned to
employee Carcamo. In that case, the jury might well have assigned to Carcamo
alone less than the 55 percent share of fault that it assigned to both him and Sugar
Transport together, thereby reducing Sugar Transport‘s total liability. In other
words, being responsible for only one out of two shares of fault (rather than two out
of three shares of fault) would probably have worked in Sugar Transport‘s favor.
This conclusion is supported by several facts. First, defendant Tagliaferri‘s
counsel admitted that his client was at fault in the accident. Second, both Carcamo
and the only nonparty witness to the accident testified that Tagliaferri pulled into
Carcamo‘s lane without signaling, and that Carcamo never changed speed.
(Tagliaferri‘s injuries left her with no recollection of the accident.) Third, the
jury‘s allocation of fault shows that it considered Tagliaferri to be more at fault
than Carcamo. Indeed, the jury assigned to Tagliaferri over twice the fault (45
percent) that it assigned to Carcamo (20 percent). We therefore perceive a
reasonable probability that, had the trial court excluded the prejudicial evidence
and arguments presented by plaintiff‘s counsel, and instructed the jury to divide
fault between Carcamo and Tagliaferri alone — rather than including Carcamo‘s
employer, Sugar Transport, among the tortfeasors to whom it could allocate
fault — the jury would have assigned to Carcamo alone less than the 55 percent
share of fault that it assigned to both him and Sugar Transport together. Although
Sugar Transport would still have been responsible for the share of fault assigned to
Carcamo, the result would have been more favorable to Sugar Transport, because
Sugar Transport would have had no additional, independent liability.
16

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DISPOSITION
We reverse the judgment of the Court of Appeal and direct that court to
reverse the trial court‘s judgment and remand the case for a complete retrial.

KENNARD, J.
WE CONCUR:

CANTIL-SAKAUYE, C. J.
BAXTER, J.
WERDEGAR, J.
CHIN, J.
CORRIGAN, J.
ALDRICH, J.*

*
Associate Justice of the Court of Appeal, Second Appellate District, Division
Three, assigned by the Chief Justice pursuant to article VI, section 6 of the
California Constitution.
17

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See next page for addresses and telephone numbers for counsel who argued in Supreme Court.

Name of Opinion Diaz v. Carcamo
__________________________________________________________________________________

Unpublished Opinion

Original Appeal
Original Proceeding
Review Granted XXX 182 Cal.App.4th 339
Rehearing Granted

__________________________________________________________________________________

Opinion No.

S181627
Date Filed: June 23, 2011
__________________________________________________________________________________

Court:

Superior
County: Ventura
Judge: Frederick Bysshe

__________________________________________________________________________________

Counsel:

Sonnenschein Nath & Rosenthal, SNR Denton US, Paul E. B. Glad, David R. Simonton; Jones Day,
Elwood Lui and Peter E. Davids for Defendants and Appellants.

Horvitz & Levy, H. Thomas Watson and Karen M. Bray for The California Association of Counties Excess
Insurance Authority, Association of California Insurance Companies and The American Insurance
Association as Amici Curiae on behalf of Defendants and Appellants.

Fred J. Hiestand and Erika C. Frank for The California Chamber of Commerce and The Civil Justice
Association of California as Amici Curiae on behalf of Defendants and Appellants.

Harmeyer Law Group, Jeff G. Harmeyer for Jeld-Wen, Inc., and California Trucking Association as Amici
Curiae on behalf of Defendants and Appellants.

Grassini & Wrinkle and Roland Wrinkle for Plaintiff and Respondent.

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Counsel who argued in Supreme Court (not intended for publication with opinion):

Elwood Lui
Jones Day
555 South Flower Street, 50th Floor
Los Angeles, CA 90071-2300
(213) 489-3939

Roland Wrinkle
Grassini & Wrinkle
20750 Ventura Boulevard, Suite 221
Woodland Hills, CA 91364-6235
(818) 348-1717

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Petition for review after the Court of Appeal affirmed the judgment in a civil action. This case presents the following issue: When a plaintiff alleges negligent driving against an employee and negligent hiring against the employer, does the employer's admission of vicarious liability for the employee's negligence eliminate the negligent hiring cause of action and preclude evidence of the employee's poor driving record?