Pearson v. PEERLESS FLOORING COMPANY

101 S.E.2d 301 (1958) 247 N.C. 434

Mrs. Elizabeth PEARSON, Widow of Carl A. Pearson, Deceased (Employee),
v.
PEERLESS FLOORING COMPANY (Employer), Textile Insurance Company (Carrier); Moore Dry Kiln Company (Employer), and Standard Accident Insurance Company (Carrier).

No. 600.

Supreme Court of North Carolina.

January 10, 1958.

Sapp & Sapp, Greensboro, for defendants Peerless Flooring Co. and Textile Ins. Co., appellants.

King, Adams, Kleemeier & Hagan, Greensboro, for plaintiff, appellee.

Smith, Moore, Smith, Schell & Hunter, Greensboro, for defendants Moore Dry Kiln Co., and Standard Acc. Ins. Co., appellees.

BOBBITT, Justice.

The judgment as to Moore and its carrier is final. Plaintiff did not appeal. Cf. Willingham v. Bryan Rock & Sand Co., 240 N.C. 281, 82 S.E.2d 68. Moreover, plaintiff, in his brief, says: "There is no evidence which could possibly support the conclusion that Pearson was an employee of Moore."

This appeal relates solely to plaintiff's claim as against Peerless and its carrier. If Pearson was the employee of Peerless, as plaintiff contends, the death was compensable. If Pearson was not the employee of Peerless, but an independent contractor, as appellants contend, the Industrial Commission had no jurisdiction and the proceeding should be dismissed. Admittedly, Peerless and its employees were subject to the Act. The crucial question is whether the employer-employee relationship existed as between Peerless and Pearson.

Appellants insist that Judge Rousseau should have, but did not, make independent findings of fact relevant to the controverted jurisdictional question, citing Hart v. Thomasville Motors, 244 N.C. 84, 92 S.E.2d 673, and Aylor v. Barnes, 242 N.C. 223, 87 S.E.2d 269, which cite, inter alia, Aycock v. Cooper, 202 N.C. 500, 163 S.E. 569, and Francis v. Carolina Wood Turning Co., 204 N.C. 701, 169 S.E. 654. These cases support the view that when a defendant-employer challenges the jurisdiction of the Industrial Commission, "the findings of fact made by the Commission, on which its jurisdiction is dependent, are not conclusive on the superior court, and * * * said court has both the power and the duty, on the appeal of either party to the proceeding, to consider all the evidence in the record, and find therefrom the jurisdictional facts, without regard to the finding of such facts by the commission." Aycock v. Cooper, supra [202 N.C. 500, 163 S.E. 571]. It is noted that Hart v. Thomasville Motors, supra, and Francis v. Carolina Wood Turning Co., supra, relate to whether the injured party was an employee; that Aylor v. Barnes, supra, relates to whether the injured employee, within the meaning of G.S. § 97-36, was a resident of this State and entitled to compensation on account of an accident in Virginia; and that Aycock v. Cooper, supra, relates to whether the employer had less than five employees regularly employed in his business within this State.

Yet, in a series of cases where the controverted jurisdictional question was whether the injured party was an employee or an independent contractor, this Court appears to have based decision on the rule applicable to non-jurisdictional questions, which, as stated in Lassiter v. Carolina Telephone & Telegraph Co., 215 N.C. 227, 230, 1 S.E.2d 542, 543, is as follows: "It is established in this jurisdiction that the findings of fact made by the Industrial Commission, if supported by competent evidence, are conclusive on appeal and not subject to review by the Superior Court or this Court, although this Court may have reached a different conclusion if it had been the fact finding body." See Scott v. Waccamaw Lumber Co., 232 N.C. 162, 59 S.E.2d 425; Cooper v. Colonial Ice Co., 230 N.C. 43, 51 S.E.2d 889; Creighton v. Snipes, 227 N.C. 90, 40 S.E.2d 612; Graham v. Wall, 220 N.C. 84, 16 S.E.2d 691; Cloninger v. Ambrosia Cake Bakery Co., 218 N.C. 26, 9 S.E.2d 615.

Whether the facts found by the Commission are supported by competent evidence, McCraw v. Calvine Mills, Inc., 233 N.C. 524, 64 S.E.2d 658, and whether the facts found by the Commission support the legal conclusion that the injured party was an employee, Smith v. Southern Waste Paper Co., 226 N.C. 47, 36 S.E.2d 730, and Hayes v. Board of Trustees of Elon College, 224 N.C. 11, 29 S.E.2d 137, and Beach v. McLean, 219 N.C. 521, 14 S.E.2d 515, are reviewable by the court as questions of law.

In Beach v. McLean, supra, Barnhill, J. (later C. J.), in an analysis of the extent to which the courts were bound by the Commission's finding and conclusion that the injured party was an employee of the corporate defendant, says [219 N.C. 521, 14 S.E.2d 518]: "(1) What were the terms of the agreement—that is, what was the contract between the parties; and (2) what relationship between the parties was created by the contract—was it that of master and servant or that of employer and independent contractor? The first involves a question of fact and the second is a question of law." Again: "The commission having found the facts in respect to the terms and conditions upon which McLean undertook the work of dismantling and salvaging the machinery purchased by defendant from Superior Yarn Mills, it settled the question of fact involved in the `finding' or conclusion as to the nature and extent of the contract. Hence, the element of fact involved in the conclusion is settled. Both the court below and this Court are bound thereby. The only question presented is the legal status of McLean under the contract. The commission's conclusion in this respect is reviewable." (Here the injured party was employed by McLean; and the crucial question was whether McLean was an independent contractor or an agent of the corporate defendant.)

The cases cited above (except Lassiter v. Carolina Telephone & Telegraph Co.) turn on whether plaintiff was an employee; but none prior to Aylor v. Barnes, supra, cites either Aycock v. Cooper, supra, or Francis v. Carolina Wood Turning Co., supra. While the rule announced in those cases was not applied in the intermediate cases, apparently there was no express reconsideration or discussion of its soundness. Even so, in the case before us, we need not undertake to reconcile or to resolve the apparent conflict in the cited decisions.

The record, fairly interpreted, does not show that Judge Rousseau failed to consider the evidence and make his own findings of fact therefrom. Indeed, the stronger inference is that he did so. Certainly, if he considered the findings of fact of the Commission correct, and his judgment so states, the rule contended for by appellants would not require a mere rephrasing of essentially the same factual findings in order to demonstrate that the findings made by him were his own rather than an approval of the Commission's findings because supported by some competent evidence.

The record shows that Judge Rousseau, after a full review of the evidence, found not only that the findings of fact of the Commission were supported by competent evidence but that they were correct. He adopted the findings of fact made by the Commission as his own "as fully as if set forth verbatim in this judgment." The phraseology of the judgment, quoted above, takes on special significance when considered in the light of the fact that Peerless and its carrier, in their "proposed findings of fact, conclusions of law, and judgment" had specifically brought to Judge Rousseau's attention that it was "the duty of this Court to find the facts from the evidence herein" and to base the court's legal conclusions on such findings.

Unquestionably, the record discloses that the findings of fact, made by the Commission and also by Judge Rousseau, are supported by ample competent evidence. The only remaining question is whether the facts so established support the legal conclusion that Pearson was an employee rather than an independent contractor. Smith v. Southern Waste Paper Co., supra.

In Hayes v. Board of Trustees of Elon College, supra, Barnhill, J. (later C. J.), citing many cases, discusses the distinction between an "employee" and an "independent contractor." Too, he sets forth a number of elements which ordinarily tend to identify either the employee relationship or the independent contractor relationship. He adds [224 N.C. 11, 29 S.E.2d 140]: "The presence of no particular one of these indicia is controlling. Nor is the presence of all required. They are considered along with all other circumstances to determine whether in fact there exists in the one employed that degree of independence necessary to require his classification as independent contractor rather than employee."

In subsequent cases, including Smith v. Southern Waste Paper Co., supra, Scott v. Waccamaw Lumber Co., supra, and Cooper v. Colonial Ice Co., supra, both the general principles relating to the respective relationships and the incidents of each are set forth and need not be repeated.

These indicia established by the findings of fact, tend to support the view that Pearson was an employee, viz.:

1. According to their written contract, the equipment and materials were sold by Moore to Peerless, f. o. b., Jacksonville, Florida. While Moore agreed to furnish and did furnish "complete plans and specifications recommended for the construction of kiln buildings and installation of equipment," the installation was to be made by Peerless.

2. If desired and requested by Peerless, Moore agreed to recommend an experienced mechanic "to superintend the installation of equipment." But, it was agreed, if Peerless engaged the services of a mechanic recommended by Moore upon request by Peerless, "this mechanic is to be your (Peerless') employee."

3. At the request of Peerless, Moore recommended Pearson; Pearson's compensation was $2.25 per hour plus board and transportation from and to Jacksonville. As pointed out in Hayes v. Elon College, supra, "doing a specified piece of work at a fixed price or for a lump sum or upon a quantitative basis," ordinarily is incident to the relationship of independent contractor; but, as stated by Larson, Workmen's Compensation Law, Vol. 1, sec. 44.33, "Payment on a time basis is a strong indication of the status of employment."

4. Pearson was not free to employ assistants or to purchase materials. All materials were provided by Peerless; and all labor, that of the employees of Younts, an independent contractor, and that of its regular employees, was provided by Peerless. Freedom to select such assistants as he may think proper ordinarily is incident to the relationship of independent contractor. Hayes v. Board of Trustees of Elon College, supra.

5. Ordinarily, the selection of one's own time for the performance of his work is incident to the relationship of independent contractor. Hayes v. Board of Trustees of Elon College, supra. But Pearson could perform his work only during the hours when the employees of Peerless or of Younts were available.

6. Peerless had the right to discharge Pearson. Appellants contend: "The test is whether or not Pearson was subject to discharge solely because he adopted one plan over the other for the installation of the dry kilns." It may be fairly inferred that Pearson, employed on an hourly wage plus board and transportation basis, had no legal right to remain at this job until the installation was completed; and it would appear that Peerless had the right to discharge him for any reason or no reason, without obligation other than payment of his agreed wages for the number of hours he worked plus board and transportation expense.

7. If Peerless had had in its regular employment a mechanic or construction foreman with sufficient experience and skill to supervise the installation in accordance with the plans and specifications therefor furnished by Moore, unquestionably his status as employee would not have been altered by the fact that Peerless reposed in him the responsibility of directing and supervising the installation. Under the circumstances here disclosed, there would seem little, if any, difference between the status of such employee and the status of one specially employed (Pearson) to perform such services.

"An independent contractor is one who exercises an independent employment, and contracts to do specified work for another by his own methods without subjection to the control of his employer, except as to the result of his work. His one indispensable characteristic is that he contracts to do certain work, and has the right to control the manner or method of doing it. The test to be applied in determining whether the relationship of the parties under a contract for the performance of work is that of employer and employee, or that of employer and independent contractor is whether the party for whom the work is being done has the right to control the worker with respect to the manner or method of doing the work, as distinguished from the right merely to require certain definite results conforming to the contract. If the employer has the right of control, it is immaterial whether he actually exercises it. (Citations omitted.)" Ervin, J., in Scott v. Waccamaw Lumber Co., supra [232 N.C. 162, 59 S.E.2d 426]. "* * * and it is not material as determinative of the relationship whether the employer actually exercises the right of control. (Citations omitted.)" Devin, C. J., in Hinkle v. City of Lexington, 239 N.C. 105, 79 S.E.2d 220, 222.

We attach no particular significance to the fact that Johnson was often present as the work progressed. Naturally, as the secretary-treasurer and general manager of Peerless, he was interested. Nor do we attach much weight to the fact that Johnson suggested a change in plans, which, on the basis of a drawing prepared by Peason, was approved by Moore.

True, the objectives of Peerless and of Pearson were identical, that is, to make the installation in accordance with the Moore plans and specifications. Indeed, it appears that Pearson was employed because of his experience and skill in this type of work; but the mere fact that Pearson was experienced and skilled in the type of work for which he was employed does not imply that Peerless had lost its right to control Pearson's conduct during the progress of the work and to intervene if perchance (1) Peerless objected to any instructions given by Pearson to the employees of Peerless or of Younts, or (2) Peerless considered the installation as directed by Pearson to be in violation of the Moore plans and specifications, or (3) the installation as directed by Pearson was objectionable to or interfering with the other operations of Peerless. The mere fact that no occasion actually arose, except the incident mentioned, when Peerless did intervene to exercise its right of control, does not negative the existence of its right to do so.

For the reasons stated, there is no error in the court's conclusion that Pearson was fatally injured by accident arising out of and in the course of his employment by Peerless. Indeed, this case is strikingly similar to Smith v. Southern Waste Paper Co., supra, where the same conclusion was reached.

We have examined each of appellants' assignments of error. Suffice to say, none discloses error deemed sufficient to affect the result or to require particular consideration.

Affirmed.