Holmes v. Morgan

• Court: Court of Appeals of Oregon
• Writing for the Court: Before SCHWAB; THORNTON
• Citation: 498 P.2d 830,10 Or.App. 242
• Parties: Cliff HOLMES, dba Bigger and Better Poultry, Respondent, v. Ross MORGAN, Administrator, Employment Division, State of Oregon, Appellant, and Ruby E. Danforth, Defendant.
• Decision Date: 21 November 1972

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498 P.2d 830 10 Or.App. 242 Cliff HOLMES, dba Bigger and Better Poultry, Respondent,
v.
Ross MORGAN, Administrator, Employment Division, State of
Oregon, Appellant,
and
Ruby E. Danforth, Defendant. Court of Appeals of Oregon, Department 2. Argued and Submitted May 31, 1972.
Decided July 7, 1972.
Rehearing Denied Aug. 8, 1972.
Review Denied Nov. 21, 1972.

[10 Or.App. 243]

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Al J. Laue, Asst. Atty. Gen., Salem, argued the cause for appellant. With him on the brief were Lee Johnson, Atty. Gen. and John W. Osburn, Sol. Gen., Salem.

Sidney A. Brockley, Oregon City, argued the cause for respondent. With him on the brief were Jack, Goodwin & Urbigkeit, Oregon City.

Before SCHWAB, C.J., and LANGTRY and THORNTON, JJ.

[10 Or.App. 244] THORNTON, Judge.

This is an appeal by the Administrator of the Employment Division and a claimant for unemployment insurance from a judgment order of the circuit court of Clackamas County reversing and setting aside an Employment Appeals Board order in favor of claimant. The Appeals Board ruled that all services performed by claimant were covered by the Unemployment Compensation Law.

The central issue before us is whether the trial judge erred in holding that the work in which claimant was engaged was exempt from the Unemployment Compensation Law as agricultural labor under former ORS 657.045(2)(d). ¹

Cliff Holmes, the employer, is engaged in the business of processing and selling frying chickens under the assumed business name of Bigger and Better Poultry. Claimant's work consisted of eviscerating, cutting up and packaging frying chickens. The essential facts are as follows: Employer buys eggs and delivers them to a commercial hatchery for hatching. The hatchery then delivers the chicks to growers under contract with employer. The growers raise the chicks until they are eight to nine weeks old. Contract haulers then deliver the chicks to employer's processing[10 Or.App. 245] plant, where they are processed, packaged and then sold.

Employer's contract with the growers provides that ownership of the chicks remains with employer at all times. Employer actively supervises the chicken-raising process and retains the right to move in and assume personal care of the birds if the feeder-grower fails to follow instructions. Employer is responsible for any loss of chicks during the first two weeks; after that the feeder-grower is responsible. Employer

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provides insurance for losses by reason of acts of nature. The feeder-growers are paid an agreed minimum price per pound for all frying chickens delivered for processing. From this amount the cost of the chicks, feed and any medication is deducted.

Employer began operating in 1950. Since then it has changed its method of acquiring chickens three times. At first it raised the chickens on farms which it leased. Next it switched to contract growers. Initially, the chicks, food and medication were provided without cost to the growers, with the growers' return reduced to provide for cost of the feed. However, the growers sold chickens contrary to their agreement and used the feed for other purposes, in addition to feeding the chicks, and this was costly to the employer, since it was not taken into consideration. Under the present system the price of the chicks, feed and medication is debited to the growers' account and subtracted from what they are paid. The only constant in the employer's operation is the processing plant.

Under the provisions of the law in force on the date this case arose, services performed in processing any agricultural or horticultural commodity 'as an [10 Or.App. 246] incident to ordinary farming operations' are agricultural labor and thus...