Minnesota Supreme Court Recognizes Common Law Claim for Negligent Selection of Independent Contractor
The Minnesota Supreme Court, in Alonzo v. Menholt, ___ N.W.3d ___ (Minn. 2024), recently held the tort of negligent selection of an independent contractor now exists under Minnesota common law.
In Alonzo, Alberto Lopez, a truck driver hauling sugar beets, crashed into Pedro Alonzo, who was also a sugar beet hauler. Alonzo suffered serious injuries during the crash requiring an airlift to a nearby hospital. When law enforcement officers arrived at the scene, they discovered Lopez had a suspended license, an active felony arrest warrant, and multiple DWI convictions and speeding infractions. At the time, Lopez hauled sugar beets for Braaten Farms, which worked as an independent contractor for Menholt Farms.
Alonzo sued Menholt for negligently selecting Braaten as an independent contractor. Neither Menholt nor Braaten ran background checks or interviewed Lopez prior to hiring him; however, negligent selection of an independent contractor had never been recognized by either the Minnesota Supreme Court or Minnesota Court of Appeals. The district court granted summary judgment for Menholt concluding Minnesota recognizes a claim for negligent selection of an independent contractor. However, in this case, no genuine issues of material fact existed as to whether Menholt failed to exercise reasonable care. The Minnesota Court of Appeals affirmed the granting of summary judgment. However, the appellate court held Minnesota did not recognize the cause of action. The Minnesota Supreme Court also affirmed. However, in doing so, the court held that the cause of action did exist under Minnesota common law, just not in this case based on the lower courts’ factual analysis.
In determining whether a new common law cause of action should be recognized, the court employed the four-factored test found in Larson v. Wasemiller.
The first factor asks whether the new tort is an inherent, or the natural extension of, a well-established common law right. The court held this factor was satisfied, as analogous torts have been upheld and no significant distinction exists between those and negligent selection of an independent contractor. Additionally, the court cited the Restatement (Second) of Torts as support for the new cause of action.
The second factor asks whether other states have recognized the tort. Menholt did not dispute that a majority of states have established the tort as legitimate, satisfying the second fact.
The third factor is whether recognizing the tort creates tension with other applicable law. While the amici argued tension exists with the general rule that principals are not liable for the actions of independent contractors, the court reasoned multiple exceptions already exist to current law on non-liability for hiring independent contractors. The court reasoned that establishing the new tort would not actually be an exception, as it’s a natural extension of common law tort principles. Because no tension is created by the tort, the fourth factor, which asks if the tension created outweighs the importance of other protections, was inapplicable.
The Supreme Court recognized Menholt’s concerns that the creation of the new tort might chip away at the inherent benefits found in using independent contractors, such as reduced costs. Seeking to preempt potentially broad applications of their decision, the court narrowed how claims should be made with this new cause of action. A heightened duty of care for verifying an independent contractor’s competency only arises when the work involved requires work not within the competence of an average person. Further, there still must be proximate cause between the negligence of the principal who hired the independent contractor and the injury suffered by the plaintiff.
It remains to be seen the extent to which this new common law tort will generate an increase in litigation involving the selection of independent contractors. In the meantime, please contact Matt Johnson with any questions.