Cherokee Lines, Inc. v. Bailey, 76673

• Decision Date: 21 September 1993
• Docket Number: No. 76673,76673
• Citation: 859 P.2d 1106,1993 OK 111
• Parties: CHEROKEE LINES, INC., Petitioner, v. Dillard F. BAILEY, Truckmen, Inc., and the Workers' Compensation Court, Respondents.
• Court: Oklahoma Supreme Court

Page 1106

859 P.2d 1106

1993 OK 111

CHEROKEE LINES, INC., Petitioner, v. Dillard F. BAILEY, Truckmen, Inc., and the Workers'

Compensation Court, Respondents.

No. 76673.

Supreme Court of Oklahoma.

Sept. 21, 1993.

Certiorari to the Court of Appeals, Division 3; Original Proceedings to Review Order of the Workers' Compensation Court; Noma D. Gurich, Trial Judge.

Certiorari to review opinion of Court of Appeals affirming the order of the Workers' Compensation Court which determined that petitioner, Cherokee Lines, Inc., was the employer of claimant, Dillard F. Bailey based upon the loaned servant doctrine. The Court of Appeals concluded that the Workers' Compensation Court had proper jurisdiction to hear the workers' compensation claim which arose from an injury in the State of Georgia. CERTIORARI PREVIOUSLY GRANTED. COURT OF APPEALS OPINION VACATED. ORDER OF THE WORKERS' COMPENSATION COURT REVERSED WITH DIRECTIONS TO DISMISS.

Paul V. McGivern, Jr., Daniel L. Crawford, McGivern, Scott, Gilliard, McGivern & Robinson, Tulsa, for petitioner.

David P. Reid, Ash, Crews & Reid, Tulsa, for respondents.

SIMMS, Justice:

Cherokee Lines, Inc. (Cherokee), petitioner herein, requests this Court to review the order of the Workers' Compensation Court which found that the court had jurisdiction to adjudicate the workers' compensation claim of Dillard F. Bailey, respondent. The Court of Appeals affirmed the order of the Workers' Compensation Court. Certiorari was granted to determine whether Cherokee Lines, an Oklahoma trucking company, was the employer of Bailey when he was injured in Georgia. Because we find that Cherokee Lines was not Bailey's employer, we vacate the opinion of the Court of Appeals, reverse the order of the Workers' Compensation Court, and remand this cause with directions to dismiss Bailey's claim.

"When the existence of the employer-employee relationship is an issue before the Workers' Compensation Court, a jurisdictional question is presented and the Supreme Court on review will not accept findings of the court as conclusive, but will weigh evidence contained in the record and independently evaluate law and facts to determine the existence or absence of the relationship." Beall v. Altus Public School Dist., 632 P.2d 400, 401 (Okla.1981). See also Osmus v. City of Oklahoma City, 568 P.2d 1259 (Okla.1977) and Brewer v. Bama Pie, Inc., 390 P.2d 500 (Okla.1964).

Bailey went to the offices of Cherokee Lines in Cushing, Oklahoma in late December, 1989. Bill Orr, the safety director and truck driver recruiter for Truckmen, Inc., administered a written test for truck drivers and a driving test to Bailey. Truckmen is a labor service company that specializes in recruiting truck drivers and leasing them out to long haul trucking companies such as Cherokee Lines. When Truckmen recruits truck drivers in Oklahoma, they offer two options to the drivers.

The options were explained at trial by Charles Cline, the operator of Cherokee Lines, and Robert Beaver, the president of Truckmen. Each of these men testified that the first option is for the truck driver to drive his own vehicle to Chattanooga, Tennessee, and go through the testing and screening process. If approved by Truckmen, then the driver is hired, required to sign an employment agreement, and leased to a trucking company. Under the second option, which Bailey chose, the driver is screened and tested at the Cherokee Lines offices in Oklahoma by Orr. If approved by Truckmen, then the driver is presented to Cline to see if he will approve the driver to be leased to Cherokee Lines. If so, the driver is hired by Cherokee Lines as a temporary employee until he reaches Tennessee where he resigns from Cherokee Lines and is hired by Truckmen.

The parties stipulated that Bailey was initially hired by Cherokee Lines while he was in Oklahoma. On January 4, 1990, Bailey rode in a Cherokee Lines truck with another driver to California. They then drove to Chicago where Bailey was assigned a truck bearing the Cherokee Lines logo. From there, Bailey drove the truck "solo" to Chattanooga, Tennessee, arriving on January 12, 1990. On that date, he signed a letter of resignation from employment with Cherokee Lines and executed an employment agreement with Truckmen. This employment agreement emphasizes that no other employer/employee relationship existed other than his with Truckmen and that Tennessee would be the forum for the resolution of any workers' compensation claims.

Both Cline and Beaver testified that Bailey was an employee of Truckmen upon signing the agreement. Cline stated that Cherokee Lines does not employ permanent drivers of its own, but rather, leases drivers from Truckmen to operate their trucks. It is undisputed that Bailey drove a Cherokee Lines truck, kept his records in a Cherokee Lines driving log, and called the Cherokee Lines dispatcher twice a day. Cline and Beaver explained that the truck belonged to Cherokee Lines and that the driving log had to be under Cherokee Lines' name because Cherokee Lines had authority to haul certain goods regulated by the Interstate Commerce Commission (ICC) across state lines. Under U.S. Department of Transportation regulations, the common carrier, Cherokee Lines, had to keep driving logs that designate Cherokee Lines as the trucking company with the ICC authority. Since Truckmen only leases truckers and does not have authority from the ICC to haul certain goods, Truckmen does not provide a driving log with its name on it.

Cline further explained that the truck drivers who are driving their trucks call Cherokee Lines dispatchers to report the temperature of the load, what the load is, where they are going with it, and when they anticipate they will arrive at their destination. This information was apparently important because much of Cherokee Lines' business was hauling candy for M & M/Mars Candy Company. Moreover, messages to the drivers from customers, Truckmen, and even the truckers' spouses were relayed through the "message center," the designation Cline gave to the dispatchers.

Beaver stated that Truckmen also dispatched the drivers to Georgia, Tennessee and Alabama when Beaver or his assistant, Steve Tuton, found a load for them to haul. In fact, evidence indicated that Truckmen, and not Cherokee Lines, dispatched Bailey to Georgia where he was injured on January 23, 1990. However, Bailey testified that Cherokee Lines dispatched him to Georgia for that load.

The arrangement between Cherokee Lines and Truckmen also included Cherokee Lines issuing a credit card to the Truckmen drivers to use in purchasing fuel, oil and other items necessary for the truck and to get cash advances to pay for meals, motels and other personal expenses. Each week, the driver was to send the receipts for these expenses to Cherokee Lines. Cherokee Lines then pays Truckmen for the use of the drivers and subtracts the credit card charges from this payment. In turn, Truckmen pays the drivers for their work. Moreover, Truckmen is responsible for withholding federal income taxes and social security taxes as well as providing benefits such as hospitalization insurance to the drivers. Truckmen also has workers' compensation insurance covering the drivers throughout the United States.

Bailey testified that he thought that he was working for Cherokee Lines. He based this primarily upon the fact that he was driving a Cherokee Lines truck. He further stated that he thought Orr, who hired him, worked for Cherokee. He then clarified this statement by saying that he understood Orr was "working hiring employees for Cherokee." Additionally, he explained that he signed the resignation letter and employment agreement because he was instructed to sign them by Orr when he arrived at the Truckmen office in Tennessee.

Contrary to his testimony that he was working for Cherokee Lines, Bailey admitted that when he got to the Truckmen office in Tennessee, they told him he was going to work for Truckmen. He further admitted that when he signed the resignation letter he understood that he was resigning from Cherokee Lines and when he signed the employment agreement, he understood that he was being hired by Truckmen.

Cline stated that Cherokee Lines paid Bailey for the few days he was temporarily working for him. However, Bailey...