Mallinger v. Webster City Oil Co.

• Decision Date: 13 December 1929
• Docket Number: No. 39903.,39903.
• Parties: MALLINGER v. WEBSTER CITY OIL CO. ET AL.
• Court: Iowa Supreme Court

228 N.W. 41

MALLINGER

v.WEBSTER CITY OIL CO. ET AL.

No. 39903.^a1

Supreme Court of Iowa.

Dec. 13, 1929.

Appeal from District Court, Webster County; T. G. Garfield, Judge.

Action under the Workmen's Compensation Act of Iowa, commenced by Lillian Mallinger, as the surviving spouse of W. B. Mallinger, to recover compensation for his death. The usual arbitration committee was waived, and the case in the first instance was ruled by the deputy industrial commissioner to the effect that the said W. B. Mallinger, deceased, was an independent contractor, and compensation therefore was denied. A petition for review of the finding was duly and timely filed with the industrial commissioner, resulting in an affirmance. An appeal was then taken to the district court of Iowa in and for Webster county on the grounds (a) that the facts found by the industrial commissioner do not support the finding and order made by him; and (b) that there is not sufficient competent evidence in the record to warrant the making of the order, as made by said commissioner. The trial court sustained the industrial commissioner, and judgment was accordingly entered. From this judgment, the claimant, Mrs. Lillian Mallinger, appeals. Reversed.V. L. Sharp, of Iowa City, C. J. Rosenberger, of Muscatine, and F. F. Messer, of Iowa City, for appellant.

Havner, Flick, Huebner & Powers, of Des Moines, for appellees.

DE GRAFF, J.

The only question presented on this appeal is well defined, but is nevertheless a troublesome one. Was claimant's husband, W. B. Mallinger, at the time of his death, an employee of the Webster City Oil Company, or was he an independent contractor under the terms of a written contract between him and the said oil company? It may be observed at the outset, that, under the provisions of the Workmen's Compensation Act, “an independent contractor” is not within the purview of the act, but is specifically excepted. Code 1924, § 1421, par. 3(c). It may be further observed that the General Assembly of this state, in writing our Compensation Act, did not define the term “independent contractor.” However, this court has held that the term “independent contractor” does, despite the liberal interpretation of the act, retain its common-law meaning, and is still to be given the meaning that courts have always given the term. Norton v. Day Coal Co., 192 Iowa, 160, 180 N. W. 905. We will not quote the contract verbatim at this point, as we will have occasion presently to consider specifically certain material provisions of this contract.

The record discloses that W. B. Mallinger was killed on December 8, 1926, while he was engaged in collecting accounts for sales he had made on behalf of the Webster City Oil Company. We first state the respective contentions of the parties. The plaintiff-appellant contends that W. B. Mallinger was employed by the defendant-appellee, under the aforesaid written instrument, to sell and deliver its products within a prescribed territory and to collect accounts for sales thus made. The defendant-appellee admits the execution of the contract, but contends that this contract, together with the oral testimony interpretive of such contract, created the relation of an independent contractor.

[1][2][3][4] Section 1378, Code 1924, of the Iowa Workmen's Compensation Act, provides: “No contract, rule, regulation, or device whatsoever shall operate to relieve the employer, in whole or in part, from any liability created by this chapter except as herein provided.” These words have a necessary consequence, which is that, no matter what the intentions of the parties to any contract of employment may be, there can be no waiver of the rights or liabilities created by the act. If a contract of employment purports to make one party an independent contractor, but, by the nature of the services rendered and the actions and attitude of the parties, the relation of employee or servant does exist, then the written contract may be construed as a mere device whereby the employer intended to be relieved of liability. The relation, either as an employee within the meaning of the law, or as an independent contractor, must be determined, not alone by the written words of a contract, but by the actions and intent of the parties in carrying out the purposes of the relationship. An employee means a person who has entered into the employment of, or works under contract of service, express or implied. Section 1421, Code 1924. It is said, in Pace v. Appanoose County, 184 Iowa, 498, 168 N. W. 916, 919: “It will be observed that the employment or work must be ‘under contract of service expressed or implied.’ and when so this brings the employé within the purview the remedy provided and that the relation of contract for service is excluded from the terms of the act.” The material question therefore in this case is whether the deceased was employed by the Webster City Oil Company under a contract of service or for service.

[5][6] The term “independent contractor” is fairly well defined under the decisions of many jurisdictions. An independent contractor may be said to be one who carries on an independent business and contracts to do a piece of work according to his own methods, subject to the employer's control only as to results. The commonly recognized tests of such a relationship are, although not necessarily concurrent, or each in itself controlling, the existence of a contract for the performance of a certain piece of work at a fixed price, independent nature of his business or his distinct calling, his employment of assistants with the right to superintend their activities, his obligation to furnish necessary tools, supplies, and materials, his right to control the progress of the work, except as to final results.

[7][8][9] Let us apply the tests to the facts in the instant case. The Webster City Oil Company was engaged in the business of marketing gasoline, kerosene, distillate, oil, grease, denatured alcohol, and similar products at retail and wholesale. The business of the corporation could be carried on through human agencies only, and for that purpose it was necessary to employ persons to perform the duties as were necessary to effectuate said purpose. It was necessary to employ those persons who would sell the commodities handled, as well as to employ other persons who would attend to the other details which were inherent in the business. These persons performed their duties for the promotion of the corporation's affairs. They were all employees of the corporation; some were officers, and some were “workmen” or “employees.” The efforts of the entire organization were directed primarily to the marketing or disposing of the products handled by the corporation. The business of the corporation starts with the acquisition of the products, as it does not appear that the corporation itself was a producer, refiner, or manufacturer of said products or materials. Its business ended with the perfected sale or disposal of such products. It had its storehouses, storage tanks, offices, and the equipment necessary to perform its functions as a wholesaler and retailer of gasoline and other commodities commonly handled in said business. The corporation was licensed by the state of Iowa for the sale of the products it handled. It paid the taxes or fees on such commodities as required by the law of Iowa. It was a complete business, of which the sales department was of primary importance. Under its contract and agreement with W. B. Mallinger, it is clearly expressed that he was to perfect sales of the corporation's products in a stated territory, and that he was to have from the corporation a tank truck, measuring buckets, funnels, etc., necessary for the handling of the products that were to be sold and delivered by him. The corporation further agreed to keep the truck repaired, and Mallinger was to keep the truck well oiled, greased, and cleaned, and to use reasonable care in the speed at which the truck was to be driven, and to see that the tires were properly inflated and the radiator filled with water. Particular stress was laid in keeping the truck in good appearance at all times. It was also provided that Mallinger was to pay one-half of the repair expense incurred through any damage to the truck while in his charge. Mallinger was to make sales for cash or credit, and, where credit rating was furnished by the company, Mallinger had no responsibility, but, when he desired to sell to persons concerning whom he had received no credit rating from the company, he was permitted to sell, but, in the event the company was unable to collect for such sales, then Mallinger was bound to pay 50 per cent. of the amount involved. Mallinger was charged with the duty of plainly writing and filling in the “charge tickets,” and three copies...