Dicks v. Cleaver, 28734.

• Decision Date: 28 October 1970
• Docket Number: No. 28734.,28734.
• Citation: Dicks v. Cleaver, 433 F.2d 248 (5th Cir. 1970)
• Parties: Albert R. DICKS, Plaintiff-Appellant, v. Frank D. CLEAVER, Defendant-Appellee. Rodney W. NIELSEN, Plaintiff-Appellant, v. Frank D. CLEAVER, Defendant-Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

433 F.2d 248 (1970)

Albert R. DICKS, Plaintiff-Appellant, v.Frank D. CLEAVER, Defendant-Appellee.

Rodney W. NIELSEN, Plaintiff-Appellant, v.Frank D. CLEAVER, Defendant-Appellee.

No. 28734.

United States Court of Appeals, Fifth Circuit.

September 15, 1970.

Rehearing Denied and Rehearing Denied October 28, 1970.

Landman Teller, Vicksburg, Miss., for appellants.

Lawrence J. Franck, Jackson, Miss., Lee Davis Thames, Vicksburg, Miss., for appellee.

Before JOHN R. BROWN, Chief Judge, and BELL and INGRAHAM, Circuit Judges.

Rehearing Denied and Rehearing En Banc Denied October 28, 1970.

JOHN R. BROWN, Chief Judge:

The problem here is whether a jury, required under the classic test for estoppel to decide whether a party has been misled into action by the adversary, is entitled to know the facts bearing upon who the real party is.More specifically it is whether, in an otherwise run-of-the-mill automobile tail-gating damage suit, the plaintiffs were entitled to prove that the same insurance company was both the workmen's compensation insurer and automobile liability insurer of the named defendant.We hold such testimony to have been here admissible and reverse.

The injuries occurred December 30, 1964, when the automobile driven by defendant-appellee Cleaver (owned by him or his company), struck the rear-end of an oil truck in Mississippi injuring each of the plaintiff-appellants, Dicks and Nielsen, as well as Cleaver.In the trial of the suit instituted three years later the big issue centered around the status of the plaintiffsvis-a-vis Cleaver,¹ that is whether each was then an employee of Cleaver or just a former employee so that on the trip in question each of the three out of self-interest was severally engaged in seeking employment for the two individuals and contracting work for Cleaver's company.If they were employees their rights were limited to the applicable Workmen's Compensation Act and the existence of the employer-employee relationship would be an absolute bar to the Mississippi damage suit.After first instructing the jury that, as a matter of law, Cleaver was guilty of negligence proximately causing the serious injuries, the Court submitted the critical question of status to the jury under a general charge calling for a general verdict.The Court in effect instructed that to return a verdict for the plaintiff the jury must decide two things: (1) that the plaintiff was not an employee of Cleaver, and if not an employee (2)the plaintiff was not estopped to deny the existence of the employer-employee relationship.On (1)the plaintiffs had the burden of proof and on (2) it was on the defendant.With knowledge or the means of knowledge forever concealed as to what really was decided by the general verdict for the defendant, the jury may have held that (a)the plaintiff was an employee (which ended it right then and there, or (b)they were not employees but(c)they were estopped to deny existence of the employee status.

Attacking the judgment for the defendant on the verdict, the plaintiffs urge that there was insufficient evidence to warrant submission of the issue of employment or estoppel and, failing in that, the Court erred in the admission of three exhibits, in the jury charge on credit for "compensation" benefits received and, as mentioned at the beginning the exclusion of testimony on the dual interest of Cleaver's insurer.We find no error in the admission of the exhibits or in the Court's perhaps needlessly complicated handling of the credit problem.On this record we conclude that there was evidence warranting the submission of the basic issue of employment status.Although the question may be much closer, we assume without deciding that, on this record, the evidence warranted the submission of estoppel.Since our reversal calls for the admission of additional testimony on estoppel which may well open up considerable exploration on the actions of Cleaver and others now unidentified, we make no forecast about the sufficiency of the record on any such retrial.With these holdings our discussion is much simplified.

Dicks and Nielsen were dragline operators who had worked for a number of years for Cleaver and his Minnesota based enterprises, engaged in construction jobs in Minnesota, Iowa, Nebraska and perhaps elsewhere in the Midwest.On December 17, 1964 the job at Sac City, Iowa was closed down for the winter because of the weather.There is no doubt that employment ceased as of December 17, 1964 and each of the plaintiffs returned to his home in Minnesota.As in the previous several years, however, each would automatically have been re-employed on application when work resumed.The plaintiffs had discussed among themselves the necessity of trying to find some work, presumably in the South.About Christmas time Cleaver decided that he was going to Arkansas to check into a possible contract job there.Cleaver talked to one of the two plaintiffs about his plans, and, at a minimum, he invited them to go along.The result was that the three decided to go South in two cars.

From here out things get a little fuzzy.Cleaver candidly admitted that during the discussions and prior to departure on the trip nothing was said about employment, pay or expenses.Indeed in his own words he"never said one word to them about the fact that they were going to be paid" for the trip and, from the viewpoint of the plaintiffshe acknowledged that they couldn't have known that they were on the payroll because he, Cleaver, "hadn't told them" because, on his own version, "the subject hadn't come up".After the event Cleaver asserted that he considered each to be on the payroll since he was taking them along to help evaluate prospective dirt moving jobs on which he might bid.At the same time Cleaver acknowledged that he knew the plaintiffs intended to try to work for themselves and needed transportation to do that.There was no word testimony from Cleaver that he advised the plaintiffs that they were to assist him and any such implications were denied categorically by each of the plaintiffs.

The ill-fated trip which began on December 28, 1964 was of short duration.The first stop was in Benton, Arkansas some 600 miles from the Iowa point of departure.The prospect Cleaver was to investigate turned out to be unacceptable even without a job-site inspection.From that contact Cleaver, if not all three, learned of possible prospective openings for work at the missile site near Slidell, Louisiana.En route they stopped at Dumas, Arkansas where they stayed overnight where the prospect for Dicks' individual employment did not materialize.It was then they apparently mutually agreed to cut down expenses as much as possible and Cleaver invited Nielsen and Dicks to ride down to Slidell in Cleaver's car rather than to use both cars.It was uncontradicted that up to the time of the accident, Cleaver had not paid all of the expenses.Plaintiffs insisted that each had paid all of his own and the most that Cleaver ever said was that he thought he paid for gasoline on one occasion in Arkansas and may have paid some or all of the motel bill at one of the stops.

Other factors cast a considerable doubt upon an employment relationship as the trial Judge's questions to Cleaver clearly reflected.First, there was no discussion about the basis for compensation, whether on an hourly rate and if so, what rate, the number of hours to be considered, or the like.In addition, there had been few if any occasions in the past when either of the plaintiffs had been used to inspect a job.And on this trip there was great uncertainty in Cleaver's own recollection whether one or both of them were with him at the time of his conference in Benton, Arkansas where, on review of the plans without job-site inspection, the prospect was turned down.The same doubt pervaded Cleaver's version that he was going into a new state (Arkansas) since some of the plaintiffs were likewise nonresidents.To this was added the fact that Cleaver also had been an experienced dragline operator, raising considerable question whether he needed advice from others.

But then came the accident of December 30, 1964 in which all three were injured and hospitalized for a number of days in the same hospital in Vicksburg, Mississippi.About January 12-14, 1965 while the plaintiffs were still in Vicksburg, a check was issued by Cleaver's wife and delivered to the wives of each of the plaintiffs.²In his Court testimony Cleaver could give few details concerning the instructions, if any, given by him to his wife concerning these checks.The regular ledgered type employees' earning record for each showed an entry, presumably by the bookkeeper in Iowa, for the amount of these checks broken down showing 40 hours work at $2.60 less withholding deductions.But the bookkeeper was unable to state where the 40 hours came from, what it was based upon, and acknowledged that with the trip beginning December 28, 1964, and the work week ending January 2, 1965 as reflected on the bookkeeping record, the time was much less than 40 hours.

But that is not the end of it.Bearing both upon employment status and estoppel is the factor of workmen's compensation benefits and reimbursement of medical expenses.Commencing in late January 1965 each of the plaintiffs received checks from Travelers Insurance Company apparently marked or identified simply as "compensation".³The record does not contain any of the usual claim forms, nor is there any testimony concerning a decision by anyone, whether Cleaver, the employer, or the insurer, Travelers, concerning the decision to pay compensation and medical benefits.⁴There was, however, extensive correspondence to and from Travelers and Mrs. Dicks about delay in the checks for reimbursement of medical expenses and the like.And on January 30, 1965 some person completely unidentified, but presumably representing Travelers, filled out by hand printing...