Claims of Naylor

• Decision Date: 15 August 1986
• Docket Number: No. 86-57,86-57
• Citation: 723 P.2d 1237
• Parties: In the Matter of the Claims of Linda M. NAYLOR, wife of Stanley D. Naylor, deceased, an employee of Railworks, Inc. RAILWORKS, INC. Appellant (Employer-Defendant), The State of Wyoming, ex rel. Wyoming Workers' Compensation Division, Appellant (Objector-Defendant), v. Linda M. NAYLOR, Appellee (Claimant).
• Court: Wyoming Supreme Court

Page 1237

723 P.2d 1237

In the Matter of the Claims of Linda M. NAYLOR, wife of Stanley D. Naylor, deceased, an employee of Railworks, Inc.

RAILWORKS, INC. Appellant (Employer-Defendant), The State of Wyoming, ex rel. Wyoming Workers' Compensation Division, Appellant (Objector-Defendant), v. Linda M. NAYLOR, Appellee (Claimant).

No. 86-57.

Supreme Court of Wyoming.

Aug. 15, 1986.

A.G. McClintock, Atty. Gen., Gerald A. Stack, Deputy Atty. Gen., Josephine T. Porter, Asst. Atty. Gen., Cheyenne, for appellant, State of Wyoming.

Harlan W. Rasmussen, Sheridan, for appellant, Railworks, Inc.

Hardy H. Tate, Sheridan, for appellee.

Before THOMAS, C.J., and BROWN, CARDINE, URBIGKIT and MACY, JJ.

BROWN, Justice.

This appeal comes to us from an award of worker's compensation to appellee Linda M. Naylor, widow of Stanley D. Naylor. Mr. Naylor was killed in an automobile accident while returning home to Sheridan, Wyoming after quitting work as a rail cutter in Colorado. Appellants Railworks, Inc., the employer, and the Wyoming Worker's Compensation Division (the state), contested the award and bring this appeal raising the following issues:

"I

"Was appellee an independent contractor or an employee of appellant at the time of the accident?

"II

"Did appellee's death arise out of and in the course of employment under Section 27-12-102(a)(xii), W.S.1977?"

We will affirm the trial court's finding that Mr. Naylor was an employee, but reverse the award of worker's compensation inasmuch as we find Naylor was not within the scope of his employment when the accident occurred.

The facts show that Mr. Naylor was hired by Railworks, Inc., to cut boxcars and rails. Naylor was hired in Sheridan, Wyoming, but the job site was in Keenesburg, Colorado. To facilitate the transporting of employees, Naylor used his personal van. On several occasions, Naylor was given money for gas to drive his van.

On October 21, 1985, Naylor terminated his employment. Work was slow and he felt he could make more money "selling firewood," so he quit. Later that day Naylor went to a bar and began drinking. Around 5:30 or 6:00 p.m., he informed his supervisor, Bill Workman, in the bar, that "he was going to quit." Mr. Workman testified that Naylor was "intoxicated" at the time.

Around 8:00 p.m. Naylor left in his van, driven by a co-employee, Albert Kukuchka. Mr. Kukuchka had also quit that day. They were driving back to Sheridan when Naylor fell out of the passenger door and died of massive head injuries. The accident occurred approximately 100 miles from Keenesburg, Colorado. His widow, appellee Linda Naylor, filed for worker's compensation. After a hearing, the trial court found Mr. Naylor was an employee operating within the scope of his employment and entitled to benefits. The trial court made a factual determination that Naylor had quit his job and appellant does not contend otherwise.

I

In their first issue, appellants ask whether the trial court erred in determining that Naylor was an "employee" within the meaning of the worker's compensation act, as opposed to an "independent contractor." Section 27-12-102(a)(viii), W.S.1977 (June 1983 Replacement), defines employee as:

" 'Employee' means any person who has entered into the employment of or works under contract of services or apprenticeship with an employer engaged in an extrahazardous occupation, except a person whose employment is purely casual and not for the purpose of the employer's usual trade or business, or those engaged in clerical work and not subject to the hazards of the business. 'Employee' also includes the officers of a corporation, the business of which is classed as extrahazardous, if the officers are actually subject to the hazards of the business in the regular performance of their duties, and the employer elects to come under the provision of this act by notifying the division by registered mail at least thirty (30) days prior to the effective date of the coverage. Coverage remains effective until withdrawn by written notice to the division. Any reference to an employee who has been injured and dies, includes his dependents or his legal representatives, or his guardian or next friend if the employee is a minor or incompetent. No minor employee shall be denied the benefits of this act for the sole reason that his employment is in violation of the labor laws governing the employment of minors."

When Naylor went to work for Railworks, Inc., he was required to sign a contract. Paragraph 8 of this contract provided that the company "shall have no right to control or direct the details, manner or means by which contractor accomplishes the results of his work on each project." Based upon this, appellants claim Naylor was an independent contractor. But the evidence shows that Railworks, Inc., paid worker's compensation for its employees. When the company president was asked why worker's compensation was paid when he claimed employees were "independent contractors," he stated he purchased the worker's compensation because, "It's the cheapest form of insurance. * * * " We have oft-stated that the main determining factor in deciding whether one is an employee or an independent contractor is whether the employer retains the right to control the details of the work. Noonan v. Texaco, Wyo., 713 P.2d 160 (1986); Scott v. Fagan, Wyo., 684 P.2d 805 (1984); Burnett v. Roberts, 57 Wyo. 511, 121 P.2d 896 (1942).

In Fox Park Timber Co. v. Baker, 53 Wyo. 467, 488, 84 P.2d 736, 743, 120 A.L.R. 1020 (1938), we stated the following regarding whether one is an employee or independent contractor:

" * * * An outstanding * * * [test] is whether the employer has or has not retained the right of control over the party whose status is in question. If he has retained such right, the party is generally regarded as a servant. Stockwell v. Morris, 46 Wyo. 1, 22 P.2d 189; 28 R.C.L. 762; 71 C.J. 455, and cases cited. Another test is whether either of the parties possesses the right to terminate the services at will without incurring liability to the other, this embracing, of course, the right of the employer at any time to discharge the party performing the work, an affirmative answer establishing the status of master and servant. * * * "

From a review of the evidence, it appears that the employment relationship could be terminated at any time, thus indicating a master-servant relationship.

In response to questioning by the court, Bruce Harbel, a co-worker testified that Bill Workman, supervisor of Railworks, was indeed the boss:

"THE COURT: The Court has a couple questions, Mr. Harbel.

Mr. Workman--what was his function as far as you were concerned?

"THE WITNESS: He was our boss.

"THE COURT: What would he do? Did he tell you what to do or what?

"THE WITNESS: Yeah.

"THE COURT: How did he tell you what to do?

"THE WITNESS: He told us to go to work. He was--well--huh, I don't know really.

"THE COURT: Did he direct you in any way on the work you were to do?

"THE WITNESS: Yeah. He told us when--like, they had a big Cat out there pulling rail, and Bill would come back to the house and tell us that it was ready to go on out--things like that, yes.

"THE COURT: But did he direct you on how you were to perform the job once you were there?

"THE WITNESS: Well, on the rail it was more or less no one really knew what they were doing, so it was kind of a group discussion on what to do next.

" * * *

"THE COURT: Well, other than telling you when you were to go out there, did Mr. Workman do anything else? That's what I'm trying to get at. Did he direct you when you were on the job or were you your own director or your own boss, or was he your boss on the job?

"THE WITNESS: He was the boss on the job.

"THE COURT: In what way? What did he tell you to do or not to do?

"THE WITNESS: He could tell us to cut this part over here and go to this part over here and finish up this part over here. You know, that was his plan.

"THE COURT: So he directed you in what you did?

"THE WITNESS: Yes.

"THE COURT: How you cut these boxcars or the rails up?

"THE WITNESS. Yes."

Although there is evidence to the contrary, we think the trial court was correct in concluding that Naylor was an employee of Railworks, Inc., and not an independent contractor. Furthermore, the company did pay worker's compensation for its employees. It is inconsistent and a misuse of the worker's compensation system to pay for employees as such and then claim the workers are independent contractors once a claim is made.

We rejected a similar argument in the case of In re Reed, Wyo., 444 P.2d 329, 330 (1968), wherein we stated:

"We find no merit in the first-mentioned ground of appeal. Although there is some intimation and casual reference by Husman Bros. to the fact that appellee was performing a contract which created the relationship of principal and independent contractor rather than employer and employee, there is no cogent argument presented to substantiate this, and the fact that the corporation reported him to the Workmen's Compensation Department as being on its payroll is inconsistent with the contention."

For all the reasons stated, we affirm the trial court's determination that Naylor was indeed an employee of Railworks, Inc.

II

In their second issue, appellants claim the trial court erred in finding that Naylor was within the scope of his employment when he was killed while traveling home.

To be compensable, an injury must arise out of and in the course of employment. § 27-12-102(a)(xii), W.S.1977 (June 1983 Replacement). There must be a causal connection between the injury and the course of employment, and such a causal connection is found when there is a logical nexus between the injury and some condition, activity, environment or some requirement of the employment. Parker v. Energy Development Co., Wyo., 691 P.2d 981 (1984).

It is the general rule in this state that workers are not within the course of their employment while they are going...