Ronan Brings in Jones
TO: Marcia Losordo Associate
FROM: Arthur Ackerman
RE: Third-party complaint in Schulansky v. Ronan U.S. District Court No. 2011-6719
DATE: January 4, 2012
I have reviewed and filed your answer and counterclaim in the Schulansky case. I have also discussed with Dick Ronan the possibility of filing a third-party complaint against Arlen Jones, the backhoe operator who did the excavation work on the job. On the basis of that discussion, I have decided to proceed with the third-party complaint.
As you are no doubt aware, Fed. R. Civ. P. 14(a)(1) allows us to implead Jones if he “is or may be liable to [our clients] for all or part of the plaintiff’s claim” against them. In other words, we can implead Jones if we have a right to reimbursement from him for any damages Schulansky recovers from us. In my judgment, we may be able to obtain indemnification from Jones if Schulansky recovers on either her breach of contract claim or her negligence claim. Please let me know if you agree with the following line of reasoning, which leads me to that conclusion.
As you suggested in your earlier memo, it is not clear whether Jones acted as a subcontractor to Ronan or as Ronan’s employee in doing the excavation work. The accepted test is the extent of control Ronan could exercise over Jones in the course of the work, and the facts on this are ambiguous. On the one hand, Ronan apparently did have an informal letter agreement with Jones for the excavation work. This, and the facts that Jones worked for a flat price and used his own equipment support the argument that he acted as an independent contractor. On the other hand, according to Ronan, he consistently directed Jones in the course of the work and considered Jones (who worked quite regularly for Ronan) an employee, even though he usually paid him by the job. In addition, the informality of their arrangement suggests an employment relationship more than a contract. Given the ambiguity in the evidence, it will likely be a jury question whether Jones should be characterized as an employee or independent contractor.