Bennett v. Industrial Com'n of Utah, 20705

• Court: Supreme Court of Utah
• Writing for the Court: STEWART; HALL; HOWE
• Citation: 726 P.2d 427
• Parties: Robert N. BENNETT, Plaintiff, v. INDUSTRIAL COMMISSION OF UTAH, Johnson Brothers Construction and C.L. Matthews Construction, Defendants.
• Docket Number: No. 20705,20705
• Decision Date: 30 September 1986

Page 427

726 P.2d 427 Robert N. BENNETT, Plaintiff,
v.
INDUSTRIAL COMMISSION OF UTAH, Johnson Brothers Construction
and C.L. Matthews Construction, Defendants. No. 20705. Supreme Court of Utah. Sept. 30, 1986.

Page 428

George K. Fadel, Bountiful, for plaintiff.

Carvel R. Shaffer, Bountiful, Erik M. Ward, Ogden, for defendants.

STEWART, Justice:

Plaintiff Robert N. Bennett seeks reversal of an Industrial Commission order which denied him workers' compensation benefits. At issue is whether Bennett was an employee of Johnson Brothers Construction and a "statutory employee" of C.L. Matthews Construction Co. We reverse the Commission's order.

The facts are as follows: Bennett, a trained cement finisher, was regularly employed by Johnson Brothers Construction from May, 1983, until November, 1983, when he was terminated due to a reduction in work force. After termination, Bennett collected unemployment benefits. During his unemployment, he established a checking account in the name of Bob Bennett Construction and informed Johnson Brothers that he intended to obtain a contractor's license, although he never did. During December, 1983, Bennett performed several small jobs for Johnson Brothers. On each job, he was paid cash in a lump sum without any deductions from the payments.

In February, 1984, C.L. Matthews Construction contracted to do remodeling work, including replacing the concrete driveway, at the Kimball Condominium in Salt Lake City. Matthews let a subcontract to Johnson Brothers to remove and replace the driveway. Johnson Brothers and Matthews agreed that payment for the job would be approximately $400 and that Matthews would furnish the concrete and rental equipment, including a jackhammer and a compressor, for the project. Matthews testified that he "went through all the details with Chris [Johnson], and then left the job for him to complete." Johnson Brothers then contacted Bennett and another former employee, Don Russell, ¹ and, as the Commission stated, "asked them if they would like to do the job for a set sum." The job would take about two days. Bennett and Russell agreed.

On the first day, they removed all the concrete and completed the subgrading. On the second day, according to the Commission, "Johnson Brothers appeared at the site twice to see how the work was coming

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along and to check the specifications." During that day, Russell struck a nail which flipped into Bennett's eye. The injury resulted in surgery and the possibility that Bennett may need a lens transplant to fully regain his vision.

After Bennett was injured, one of the Johnsons stepped in to help Russell complete the job. Johnson Brothers tendered Bennett a check for $150 made payable to "Bob Bennett Construction" for his work on the job. Bennett refused to cash the check and returned it to Johnson Brothers with a note stating that he did not have a contractor's license. He requested that Johnson Brothers reissue the check payable to him personally.

The Commission held that Bennett was not entitled to workers' compensation benefits because he was an independent contractor. Its ruling was based on the findings that Bennett had intended to become an independent contractor, had established a bank account for a contracting business, and had been paid in a lump sum with no deductions. The Commission also found that Johnson Brothers "did not exercise a demonstrable amount of control over the work project. They only made two inspection visits to the site to determine if the specifications were being met." Because the Commission ruled that Bennett was not an employee of Johnson Brothers, it did not address the nature of the legal relationship between Matthews and Johnson Brothers.

I.

In reviewing Industrial Commission orders, we defer to the Commission's findings of fact unless it makes findings not supported by substantial evidence. Pinter Construction Co. v. Frisby, 678 P.2d 305, 307 (Utah 1984). We do not defer to the Commission when construing statutory terms or when applying statutory terms to the facts unless the construction of the statutory language or the application of the law to the facts should be subject to the Commission's expertise gleaned from its accumulated practical, first-hand experience with the subject matter. See generally, Utah Department of Administrative Services v. Public Service Commission, 658 P.2d 601, 611 (Utah 1983).

Whether a worker is an employee within the meaning of the workmen's compensation laws requires the application of a statutory standard to the facts. Since resolution of the issue is not benefitted by Commission expertise or experience, we do not defer to the Commission's ruling. Board of Education v. Olsen, 684 P.2d 49, 51 (Utah 1984). See also Christean v. Industrial Commission, 113 Utah 451, 455, 196 P.2d 502, 504 (1948); Stover Bedding Co. v. Industrial Commission, 99 Utah 423, 424-25, 107 P.2d 1027, 1027 (1940). Since the evidence is essentially uncontradicted, we need to determine only whether, as a matter of law, the Commission erred in ruling that Bennett was not an employee. See Rustler Lodge v. Industrial Commission, 562 P.2d 227, 228 (Utah 1977); Sommerville v. Industrial Commission, 113 Utah 504, 506, 196 P.2d 718, 719 (1948); Intermountain Speedways, Inc., v. Industrial Commission, 101 Utah 573, 577-78, 126 P.2d 22, 24 (1942); Stover Bedding Co. v. Industrial Commission, 99 Utah at 425, 107 P.2d at 1028; Stricker v. Industrial Commission, 55 Utah 603, 607-08, 188 P. 849, 851 (1920).

II.

On the merits, we first address the issue of whether the Commission erred in ruling that Bennett was not an employee of Johnson Brothers. Section 35-1-43(1)(b) defines "employee" as every person "in the service of" an employer as defined in § 35-1-42(2). What constitutes being "in the service of" has often been determined by reference to common law master-servant principles, although in Rustler Lodge, we indicated a broadening of the term pursuant to Restatement (Second) of Agency § 220. Rustler Lodge, 562 P.2d at 228. However, it will almost always follow that if the evidence shows that an "employer" retains the right to control the work of the claimant, the claimant is the employer's employee for workmen's compensation purposes.

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E.g., Bambrough v. Bethers, 552 P.2d 1286, 1291 (Utah 1976); Auerbach Co. v. Industrial Commission, 113 Utah 347, 195 P.2d 245 (1948). Certainly, the concept of right to control is not to be rigidly and narrowly defined. ² Rather, it should be defined to give full effect to the remedial purposes of the Workmen's Compensation Act. See Hinds Co. v. Industrial Commission, 20 Utah 2d 322, 437 P.2d 451 (1968), which held that it was proper to resolve doubt as to whether a worker was an employee in favor of the employee.

Many factors have been applied in determining the right to control. Among those factors are actual supervision of the worker, the...