Fillmore v. Irvine

• Decision Date: 26 August 1983
• Parties: Terrence L. FILLMORE, Plaintiff and Respondent, v. Fleet IRVINE et al., Defendants and Appellants. Civ. 21880.
• Court: California Court of Appeals Court of Appeals

Page 319

194 Cal.Rptr. 319

146 Cal.App.3d 649

Terrence L. FILLMORE, Plaintiff and Respondent, v. Fleet IRVINE et al., Defendants and Appellants.

Civ. 21880.

Court of Appeal, Third District, California.

Aug. 26, 1983.

Certified for Partial Publication.

Marsh, Marsh & Glusman, Harry M. Marsh and Matthew E. Marsh, Chico, for defendants and appellants.

William S. Volpe, Oroville, for plaintiff and respondent.

SIMS, Associate Justice.

Defendants Fleet Irvine, Douglas Tanner, Thomas Tarman and Gene McFarren appeal from a judgment entered May 5, 1982, after court trial in favor of plaintiff Terrence L. Fillmore. ¹ Plaintiff sued defendants to foreclose a mechanic's lien and for breach of oral contract arising from his failure to be paid for services as a drywall finisher. Defendants contend that: (1) the trial court erroneously applied Labor Code section 2750.5's rebuttable presumption that plaintiff was an employee rather than an unlicensed independent contractor barred by statute from recovery; (2) absent the presumption, the evidence was insufficient to sustain the trial court's finding that plaintiff was in fact an employee; and (3) the evidence was insufficient to sustain the finding of an agreement between plaintiff and defendant Tarman to pay for plaintiff's services. We agree with defendants' first two contentions and reverse the judgment. Accordingly, we do not reach the third issue posed by defendants.

FACTUAL AND PROCEDURAL HISTORY

Viewed in the light most favorable to the judgment (see In re Angelia P. (1981) 28 Cal.3d 908, 924, 171 Cal.Rptr. 637, 623 P.2d 198), the record reveals the following: plaintiff is a drywall finisher by occupation; he performed taping and texturing work on defendants' building but he has not been paid. Defendants are partners in a partnership known as Design Concepts, which in 1980 owned real property at 290 Air Park Boulevard in Chico. Defendants constructed a commercial building on the property, with defendant Tarman, a licensed architect and contractor, serving as general contractor. Defendants, through Tarman, subcontracted with Loren Sutton for framing, sheetrock hanging, taping and texturing, wood trim, windows and accessories.

In July 1980 plaintiff was employed by Sam Ivy Drywall, earning ten dollars an hour. Witness Sabia Montandon, also a drywall worker, was employed on defendants' construction project and informed plaintiff of the possibility of work there. Plaintiff accompanied Montandon to defendants' jobsite, where he was introduced to defendant Irvine. Plaintiff and Irvine discussed job specifications and inspected the site. A couple of days later at the jobsite Montandon introduced plaintiff to Sutton. Plaintiff testified that the first thing he told Sutton was that he, plaintiff, was not a licensed contractor and that he would have to become an employee of Sutton's in order to accept the job.

Plaintiff told Sutton he would charge twenty-seven cents per square foot for his services; Sutton would have to provide materials and a scaffold. Sutton replied that he, Sutton, had budgeted thirty cents per foot to complete the job, including materials Plaintiff was to commence work July 24, 1980. He testified that when he arrived at the site none of the needed materials was present; Sutton told him they would be available the next day. When once again they were not, Sutton asked plaintiff to purchase what he needed and Sutton would reimburse him. Plaintiff purchased $1008.80 in materials and was reimbursed by Sutton. Plaintiff deposited the reimbursement in his personal account. Prior to plaintiff's first payday he filled out a form W-4 which Sutton had given him.

and labor. After some discussion Sutton agreed to purchase the needed materials and to pay plaintiff the balance of the budgeted thirty cents per square foot. However, neither plaintiff nor Sutton suggested they reduce this agreement to writing, and no written contract was prepared. Plaintiff was to submit each Friday a statement of the square footage he had completed, and Sutton was to pay plaintiff weekly.

Plaintiff did not receive the weekly payments he was promised, and he told Sutton and job superintendent Robert Novack that he would quit if he weren't paid. On the weekend of August 16th and 17th plaintiff actually remained away from the job although he was supposed to work seven days a week. Sutton explained to plaintiff that he was not being paid because the owners had failed to pay him (Sutton).

Plaintiff and Sutton met with Novack and defendants Tarman and Irvine to try to resolve the matter. Tarman initially told plaintiff he would have to discuss his not being paid with Sutton, the subcontractor, rather than with him. Plaintiff testified that "when we informed him [Tarman] that Loren [Sutton] was saying the reason we weren't getting paid is because Mr. Tarman was not paying him, the whole gist of the conversation changed. He, Mr. Tarman, said if we would go back to work, finish the job, that he would make sure we got paid, whether he had to make out joint checks to be made out to Sutton and myself ... he would see to it we got paid. But not until the end of the job."

Plaintiff asked some drywall-finisher friends of his to assist with the job. They did so unpaid, as plaintiff had previously done on jobs of theirs. Plaintiff completed the job on August 28, and recorded a mechanic's lien on defendants' realty in the amount of $10,221.20 (which he contends represents his wages for about a month's work), a figure he arrived at by using the previously-agreed formula of 30 cents per square foot minus 2.7 cents cost of materials. Defendant Tarman indicated he was satisfied with plaintiff's work. Although defendants paid Sutton for all drywall work, including that performed by plaintiff, plaintiff has never received any payment for his labor from Sutton or from defendants.

Plaintiff filed this action on December 1, 1980, against defendants and Sutton, seeking to foreclose his lien and to enforce defendant Tarman's promise to pay him if Sutton failed to do so. Recourse to the bankrupt Sutton was, as a practical matter, unavailable. (Ante, fn. 1.) Defendants resisted plaintiff's claim, contending that (1) plaintiff was not Sutton's employee but was rather an unlicensed independent contractor barred by Business and Professions Code section 7031 from maintaining the action; and (2) plaintiff failed to give preliminary notice of his mechanic's lien as required by Civil Code section 3097.

The trial court found, inter alia, that (1) Labor Code section 2750.5 created a rebuttable presumption that plaintiff was an employee rather than an independent contractor; (2) defendants failed to rebut the presumption; (3) plaintiff held a valid lien on defendants' real property; and (4) a valid contract existed between plaintiff and defendant Tarman.

DISCUSSION

I

We begin with an overview of three code sections involved in this appeal, Business and Professions Code sections 7031 ² and 7053, ³ and Labor Code section 2750.5, ⁴ which are set out in the margin.

Section 7031 provides that anyone who engages in the business of, or acts in the capacity of, a contractor without possessing a valid contractors' license, if one is required by law, is barred from maintaining an action to collect compensation or foreclose a mechanics' lien. (Lewis & Queen v. N.M. Ball Sons (1957) 48 Cal.2d 141, 154, 308 P.2d 713, and cases cited therein; see Walker v. Thornsberry (1979) 97 Cal.App.3d 842, 158 Cal.Rptr. 862.) At the time of trial, ⁵ section 7053 exempted from the requirements Section 2750.5 differentiates "worker[s] performing services for which a license is required" by the "Contractors" chapter of the Business and Professions Code (Ch. 9, div. 3, § 7000 et seq.) into two categories, "employees" and "independent contractors." The section creates a rebuttable presumption, affecting the burden of proof, that a worker who performs services requiring a contractor's license, or who works for one who is required to possess such a license, is an employee rather than an independent contractor. The section further provides that any person performing any activity which requires a contractors' license shall hold a valid license as a condition of having independent contractor status. (Ante, fn. 4.) Section 2750.5 explicitly provides in part that: "For purposes of workers' compensation law, this presumption is a supplement to the existing statutory definitions of employee and independent contractor, ..." (Emphasis added.)

                of section 7031 contractors' employees, whose sole compensation is wages.  (Pickens v. American Mortgage Exchange (1969) 269 Cal.App.2d 299, 305, 74 Cal.Rptr. 788.)   Since it is conceded that plaintiff was unlicensed, and that he was performing work for which a license is required if performed by a contractor (see Bus. & Prof.Code, § 7026), his right to maintain this action is dependent upon his being characterized as an employee rather than an independent contractor
                

With this statutory overview we turn to defendants' contentions on appeal.

II

Defendants first contend that the trial court improperly applied section 2750.5 to a determination of whether plaintiff was an employee. ⁶

In analyzing section 2750.5, ⁷ we have in mind that "In construing the words of a statute ... to discern its purpose, the provisions should be read together; an interpretation which would render terms surplusage should be avoided, and every word should be given some significance, leaving no part useless or devoid of meaning. [Citations.]" (City and County of San Francisco v. Farrell (1982) 32 Cal.3d 47, 54, 184 Cal.Rptr. 713, 648 P.2d 935.) The penultimate paragraph of section 2750.5 provides in relevant part that a person performing an activity requiring a contractors' license "shall hold a valid contractors' license as a condition of having independent contractor status." (Emphasis added.) This provision does not simply...