A. Mazzetti & Sons, Inc. v. Ruffin

• Citation: 437 A.2d 1120
• Court: United States State Supreme Court of Delaware
• Decision Date: 18 November 1981
• Parties: A. MAZZETTI & SONS, INC., Defendant Below, Appellant, v. Joseph RUFFIN and First State Masonry, Inc., Claimant and Defendant Below, Appellees.

Page 1120

437 A.2d 1120

A. MAZZETTI & SONS, INC., Defendant Below, Appellant, v. Joseph RUFFIN and First State Masonry, Inc., Claimant and Defendant Below, Appellees.

Supreme Court of Delaware.

Submitted Sept. 18, 1981.

Decided Nov. 18, 1981.

Upon appeal from Superior Court. Reversed.

B. Wilson Redfearn and Colin M. Shalk (argued) of Tybout, Redfearn, Casarino & Pell, Wilmington, for defendant-appellant.

George B. Heckler, Jr. (argued) of Heckler & Cattie, P. A., Wilmington, for claimant and defendant-appellees.

Before NcNEILLY, QUILLEN and HORSEY, JJ.

HORSEY, Justice.

The ultimate question in this workmen's compensation appeal is whether claimant at time of injury was in a joint or a concurrent employment relationship with his two employers. Both employers, A. Mazzetti & Sons, Inc. (A. Mazzetti) and First State Masonry, Inc. (First State), appeal a decision of the Superior Court reversing the Industrial Accident Board's finding that their employee, Joseph Ruffin, was at time of injury in their "joint service" within the meaning of 19 Del.C. § 2354. ¹ As a consequence of this finding, both employers were required under § 2354 to contribute to the payment of Ruffin's workmen's compensation benefits. We reverse.

Ruffin, a construction laborer, injured a toe of his left foot in a construction accident. The accident occurred when an iron form dropped on his foot as he and his foreman, Robert Bruton, were setting the form in place in preparation for pouring concrete for a building foundation. Thinking the injury to be of no consequence, Ruffin did not report it to Bruton until after Ruffin had worked an undetermined further number of days. By then, his foot had become infected; and because of a diabetic condition, Ruffin's left leg was eventually amputated.

I

Petitioning the Industrial Accident Board for compensation for both total disability and permanent injury, Ruffin placed the date of his injury as on or about December 12, 1978; and Ruffin sought compensation from both A. Mazzetti and First State, in reliance on 19 Del.C., § 2354. Thus, he contended that when injured he was in the "joint service" or employ of both A. Mazzetti and First State within the meaning of § 2354.

A. Mazzetti and First State agreed that Ruffin had suffered an industrial accident for which he was entitled to compensation. However, they disagreed as to who his employer was at the time of injury. The two companies, though closely related as will be seen, had different compensation carriers. Also, the awards were for substantial sums. Hence, the real parties in interest are the compensation carriers and the two employers are but the nominal protagonists.

The Industrial Accident Board found Ruffin at time of injury to have been in the "joint service" of A. Mazzetti and First State under 19 Del.C., § 2354. The Board also found Ruffin's date of injury to be "on or about" December 12, 1978. Applying § 2354, the Board ordered the respective compensation carriers of A. Mazzetti and First State to share equally the cost of Ruffin's compensation benefits.

On appeal by First State, Superior Court reversed for lack of "substantial competent evidence" to support the Board's finding of joint liability. The Court found the facts to support at most a "concurrent" or "dual"-but not a joint-employment relationship. The Court then remanded the case to the Board for the limited purpose of determining who Ruffin was "working for" when injured.

A. Mazzetti appeals, arguing that the Court entered in its standard of review. A. Mazzetti contends that the Court improperly acted as a fact finder and then substituted its own findings of fact for those of the Board. Urging affirmance of the Board's decision under the substantial evidence rule, ² A. Mazzetti contends that there was substantial evidence to support the Board's finding that Ruffin was in the joint employ, i.e., "joint service", of A. Mazzetti and First State when injured so as to sustain the Board's joint liability holding.

First State disagrees but cross appeals. It contends: (a) that the Board's findings were insufficient to support a joint employment relationship; and (b) that Superior Court correctly found Ruffin to be in a concurrent or dual employment relationship with A. Mazzetti and First State. From this, First State argues it necessarily follows that Ruffin could only have been working for one employer at a time. Since it was agreed that Ruffin was setting concrete forms when injured (whatever the date) and that form-setting was A. Mazzetti's assigned phase of the work, First State says that Ruffin was obviously only working for A. Mazzetti when injured. Hence, according to First State, remand is unnecessary; and this Court should make such finding. The consequence of finding Ruffin to have been working for A. Mazzetti when injured would, of course, be that A. Mazzetti alone is liable for Ruffin's compensation benefits.

II

There is little, if any, dispute as to the material facts-other than as to the date of Ruffin's injury, or more precisely, the date he was found to have been injured. In December 1978 and for some weeks prior thereto, Ruffin, an hourly construction worker, was in the employ of both A. Mazzetti and First State. Both concerns were involved in construction work, and both were owned and controlled by the families of Adolfo and Remo Mazzetti. A. Mazzetti, incorporated in 1955, usually engaged in general contracting work. Its only shareholders were Adolfo Mazzetti and his son, Remo. Adolfo, though President of A. Mazzetti, was no longer active in the business and his son, Remo, had been in charge of its day-to-day operations since 1957. Remo was "General Manager" of A. Mazzetti as well as its Secretary and Treasurer.

First State, incorporated in 1965, was also involved in construction work; and it too was controlled and managed by Remo Mazzetti who served as both President and "General Manager." He and his wife were First State's only shareholders. While A. Mazzetti usually acted as a general contractor, First State limited its activities to subcontracting for masonry, brick and concrete block work. As a general rule, First State and A. Mazzetti worked on different job sites.

Both companies shared the same building, the same telephone number and the same accountant. However, the two companies were maintained as distinct corporate entities. Separate sets of books and records were kept for each; that is, separate income and expense records, separate payroll-time records ad even separate lines of credit. But both companies had virtually the same employees-the same general manager, the same foremen, and the same laborers. As a necessary consequence, the same employees were freely transferred back and forth between the two companies.

On the particular job where Ruffin was injured, both A. Mazzetti and First State were acting as subcontractors for the general contractor. Indeed, they were the only subcontractors for the job. Each company's bid was for an identical sum, $35,000; and the two bids, submitted simultaneously, were in a format suggesting that they were to be considered as one bid for all the work to be subcontracted. Remo Mazzetti prepared the bids for both companies. A. Mazzetti contracted to do the following work: "excavation, patching of roadway and foundation excavation." First State contracted to do the "concrete work at sump, building, foundation, and pad." Remo Mazzetti's explanation of the identical sums bid for both portions of the job was simply that he expected each of his two companies to do "approximately" half of the work. He explained his admittedly less-than-clear bid breakdown of the work between the two companies as meaning that A. Mazzetti was responsible for the excavation and form-setting or "first stage" of the work and that First State was responsible for the pouring of the concrete for the foundation and slab, the "second stage" of the job. However, Remo Mazzetti qualified his descriptive two-stage division of the work as being only "approximately" so and as "about the way it works." As stated, Joseph Ruffin was injured in the formsetting or first stage of the work.

III

The parties do not dispute the meaning of the term "joint service" as found in 19 Del.C. § 2354. The parties agree that "joint service" is synonymous with joint employment; and the Court below also equated "joint service" under § 2354 with joint employment. Hence, for these purposes, there is agreement that the terms are to be understood to be synonymous.

There is also no dispute as to the meaning of the term "joint employment" and the distinguishing characteristics between a "joint employment" relationship and a "dual" or "concurrent" employment relationship. Both parties rely on the following descriptions of the terms as found in Larson's treatise, Workmen's Compensation Law :

"When a single employee works for two or more employers, an arbitrary two-way classification distinguishing 'joint employment' and 'dual employment' helps to sort out these almost infinitely varied cases.

Joint employment occurs when a single employee, under contract with two employers, and under the simultaneous control of both, simultaneously performs services for both employers, and when the service for each employer is the same as, or is closely related to, that for the other. In such a case, both employers are liable for workmen's compensation.

Dual employment occurs when a single employee, under contract with two employers, and under the separate control of each, performs services for the most part for each employer separately and when the service for each employer is largely unrelated to that for the other. In such a case, the employers may be liable for workmen's compensation separately or jointly, depending on the severability of the employee's activity at the time of injury.

Joint employment is possible, and indeed fairly common, because there is nothing unusual about the...