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RLI Insurance Co. v. Vermont Agency of Transportation

8/23/2000

ENTRY ORDER


In the above-entitled cause, the Clerk will enter:


Plaintiff RLI Insurance Company appeals a Chittenden Superior Court order granting defendant's motion for summary judgment. RLI commenced this action requesting, in part, that the court enter a declaratory judgment that it had no duty to defend or to provide coverage for defendant Wayne Eells in a wrongful death suit. RLI argues that Eells was not an employee of the named insured, Champlain Valley Aviation, Inc., (CVA) within the meaning of the applicable insurance policy and hence was not covered. The superior court granted summary judgment to Eells. We affirm.


This case arises out of a mid-air collision at the Franklin County State Airport in Swanton, Vermont, between two planes owned by CVA. One plane was rented and operated by Charles Boyer, a student pilot. The other plane was rented and operated by Todd Taylor. Taylor's passengers were Sandra Irving and her ten-year-old son Andrew. Taylor, Irving, and her son died as a result of the collision. Irving's husband and surviving son filed a wrongful death claim against Boyer and others, including Eells, who was Boyer's flight instructor.


Eells demanded that RLI provide him with a defense and indemnification pursuant to a commercial operator's insurance policy issued to CVA. The policy provides liability coverage to CVA as the named insured and insures CVA's employees for acts within the scope of their employment. The issue before us is whether the superior court erred in its determination on summary judgment that Eells was an employee of CVA. RLI contends that he was an independent contractor.


Our review of the court's decision is de novo. We use the same standard as the trial court and will therefore affirm a summary judgment "if there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law." Granger v. Town of Woodford, 167 Vt. 610, 611, 708 A.2d 1345, 1346 (1998) (mem.); see also, V.R.C.P. 56(c). In this case, the material facts are not in dispute. RLI conceded at oral argument that if Eells was an employee of CVA, he is entitled to coverage under the policy. Therefore, the case turns entirely on the legal determination of Eells' employment status with CVA.


We construe insurance contracts according to their terms and the parties' intent as implied by those terms. See Utica Mut. Ins. Co. v. Central Vt. Ry., 133 Vt. 292, 295, 336 A.2d 200, 203 (1975). Because the policy does not define "employee," we assume the parties intended the word's ordinary meaning. See Landry v. Dairyland Ins. Co.,166 Vt. 634, 635, 701 A.2d 1035, 1036 (1997) (mem.). In this context, an "employee" is defined in contrast to an "independent contractor."


When determining whether a worker is an employee or an independent contractor, we have relied on the "right to control" test. See Reed v. Glynn, 168 Vt. 504, 506, 724 A.2d 464, 466 (1998). If the party for whom the work is being done may prescribe the result, means and the methods by which the other shall do the work, an employee/employer relationship is established. See id. In this case, CVA was a full-service operation offering refueling, aircraft maintenance, tie downs, storage, airplane rental and flight instruction. CVA's president, Stewart Boyd, was not a licensed flight instructor; consequently, he retained Eells to offer flight instruction. Eells was responsible for certain aspects of instruction without control by CVA. Because Boyd was not a licensed flight instructor, he could not legally control the method of the instructional work performed by Eells. See 14 C.F.R. ยง 61.3 (2000) (only a certified flight instructor may give flight tr

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