Auten v. Mich. Unemployment Comp. Comm'n
| Decision Date | 02 January 1945 |
| Docket Number | No. 70.,70. |
| Parties | AUTEN et al. v. MICHIGAN UNEMPLOYMENT COMPENSATION COMMISSION. |
| Court | Michigan Supreme Court |
OPINION TEXT STARTS HERE
Appeal from Circuit Court, Tuscola County; George W. DesJardins, judge.
Certiorari proceeding by Meredith B. Auten and others, copartners, doing business as G. A. Tindale Ford Sales, against Michigan Unemployment Compensation Commission, to review an order of the Appeal Board of the Commission. From a judgment reversing the order, the Unemployment Compensation Commission appeals.
Affirmed.
Before the Entire Bench.
Roland O. Kern, of Caro, for plaintiffs and appellees.
Herbert J. Rushton, Atty. Gen., Edmund E. Shepherd, Sol. Gen., of Detroit, and Daniel J. O'Hara, Frank Day Smith, and Victor H. Meier, Asst. Attys. Gen., for defendant and appellant.
This is an appeal from a judgment of the circuit court of Tuscola county on certiorari reversing an order of the appeal board of the Michigan unemployment compensation commission.
The record shows that the claimant, John A. McGrath, was employed as a salesman by a copartnership known as ‘G. A. Tindale Ford Sales', from June, 1938, to January 17, 1942, at a regular salary. The partnership was composed of M. B. Auten, G. A. Tindale and R. L. Keppen. The business was managed by R. L. Keppen, who was paid a salary of $175 per month, independently of his share of the profits of the partnership. The other partners received no salary, but depended upon dividends from their investment in the partnership. Keppen had bought an interest in the firm which amounted to 20 percent, and represented an investment of $3000. If Keppen were considered as an employee of the firm during the years 1939, 1940 and 1941 then there would have been 20 or more calendar weeks in each of these years in which there were eight or more individuals employed by the copartnership.
The sole question for our determination is whether a working partner, receiving a stated salary, is ‘in employment’ as defined by the Michigan unemployment compensation act in effect at the time this controversy arose. Act No. 1, Pub.Acts 1936, Ex.Sess., as amended by Act No. 364, Pub.Acts 1941, Comp.Laws Supps. 1940, 1942, § 8485-41 et seq., Stat.Ann.1944 Cum.Supp. § 17.501 et seq.
This is a case of first impression in this State, and where possible the provisions of the law should be liberally construed. See Godsol v. Unemployment Compensation Commission, 302 Mich. 652, 5 N.W.2d 519, 142 A.L.R. 910. In interpreting the definitive provisions of the act we shall have in mind the purpose of the law, the policy declared by the legislature, and that common law rules as to the relation of master and servant, as well as the ordinary rules governing copartnership, provide no controlling tests as against those tests enumerated in the act.
The commission urges that the language of the definitive sections of the act (§§ 40-44) is sufficiently broad to include a working partner as an employee of the firm, and provisions excluding certain classes (§ 42, subd. 6(a, b, c) do not bar such a partnership member from compensation benefits.
It is to be noted that under § 40 of the act a copartnership may be an ‘employing unit’, while under § 42 ‘employment’ means service, including service in interstate commerce, performed for remuneration or under any contract of hire, written or oral, express or implied. The term ‘employee’ remains undefined. The act is silent upon the question of whether a working partner may be considered as an employee of the copartnership. The general rule under workmen's compensation acts is as stated...
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