Moon v. Ervin

• Decision Date: 05 February 1943
• Docket Number: 7032
• Citation: 133 P.2d 933,64 Idaho 464
• Court: Idaho Supreme Court
• Parties: S. RAY MOON, Claimant, Appellant, v. TIM ERVIN, Employer, Cross-Appellant, and HOME LUMBER & COAL CO., a corporation; STATE INSURANCE FUND, Surety; MAY ERVIN and DR. EUGENE SCHREIBER, Respondents

133 P.2d 933

64 Idaho 464

S. RAY MOON, Claimant, Appellant, v. TIM ERVIN, Employer, Cross-Appellant, and HOME LUMBER & COAL CO., a corporation; STATE INSURANCE FUND, Surety; MAY ERVIN and DR. EUGENE SCHREIBER, Respondents

No. 7032

Supreme Court of Idaho

February 5, 1943

Rehearing denied March 1, 1943.

WORKMEN'S COMPENSATION-EMPLOYER-EMPLOYEE-JOINT ADVENTURE-INDEPENDENT CONTRACTOR-PARTNERSHIP.

1. The essential element of the relationship of "employer and employee" is the right of control.

2. Under section of Workmen's Compensation Act including in term "employer" owner or lessee of premises on which workmen are employed, or other person who was virtually the proprietor of the business carried on on such premises but who was not the direct employer of such workmen, owner of premises on which dwelling was being constructed who was not the proprietor, or operator of the construction business, and had no right of control over workmen directly employed by uninsured building contractor was not an employer of the workmen so as to be liable for compensation for injuries sustained by the workman. (I.C.A., sec. 43-1806.)

3. In order to hold as an "employer," under the Workmen's Compensation Act, the owner or lessee of premises, or other person, who is not the direct employer of the workmen employed on such premises, it must be shown that such owner, lessee or other person was the proprietor or operator of a business carried on on such premises. (I.C.A sec. 43-1806.)

4. Section of Workmen's Compensation Act making "employer" who is subject to the provisions of the Act liable for compensation to employee of a contractor or subcontractor under such employer did not apply to owner of premises on which dwelling was being constructed who had no right of control over laborers directly employed by the uninsured contractor and who was not an employer within the meaning of the section of the Act defining employer. (I.C.A secs. 43-1611, 43-1806.)

5. Failure of owner of premises on which dwelling was being constructed, who was not an employer within section of Workmen's Compensation Act defining "employer," or a contractor or subcontractor within section prescribing means of securing compensation to employees, to enforce against contractor and contractor's surety provision of contract requiring contractor to maintain insurance to protect owner from claims under the Act did not render owner secondarily liable to laborer injured in the course of the construction of the dwelling. (I.C.A., sec. 43-1611 43-1806.)

6. Whether a person who is not a direct employer of a workman is nevertheless an employer within meaning of the Workmen's Compensation Act depends on whether such person comes within the statutory definition of an employer. (I.C.A., sec 43-1806.

7. Where lumber company supplying most of material for construction of a dwelling had no interest in profits made by the uninsured contractor, though it was active in assisting contractor in obtaining the contract and drew the plans and specifications and advanced some money for the payment of labor bills, company was not a "joint adventurer" with the contractor, and the contractor was not an "independent contractor" of the company, so as to impose liability on the company for injuries sustained by injured workman of the contractor. (I.C.A., secs. 43-1601, 43-1806.

8. It is essential to a joint adventure that the profit accruing be joint and not several.

9. A profit jointly sought in a single transaction is the chief characteristic of a joint adventure.

10. A mere agreement to share in profits constitutes, of itself, neither a "partnership" nor a "joint adventure," and in order to constitute one of these relationships there must be other facts showing that the relationship was the intention of the parties, or such as to estop a denial of the relationship as against third parties.

11. A lumber company furnishing most of the materials for the construction of a dwelling and advancing some money to uninsured contractor but not inducing anyone to believe that the company was the employer of the workmen engaged by the contractor, or that the company had any interest in the construction of the dwelling was not "estopped" to deny that it was the employer of the contractor's workmen so as to impose liability for workmen's compensation on the company. (I.C.A., secs. 43-1611, 43-1806.

12. An injured employee of an uninsured contractor was not entitled to recover workmen's compensation from the insured materialman on the ground that the materialman and his surety constituted the "industry" and that the compensation act creates an entity out of industry and charges to the industry all losses sustained by the injured workman, since the act does not contemplate payment to an injured workman by the State Insurance Fund unless his employer is insured with the Fund. (I.C.A., secs. 43-1001, 43-1101, 43-1110, 43-1112, 43-1611, 43-1806, 43-1309, 43-1604, 43-1719.

13. Workmen's Compensation Act is to be construed liberally in favor of employees, but compensation depends on the existence of the employer-employee relationship. (I.C.A., secs. 43-1611, 43-1806.

Rehearing denied March 1, 1943.

Appeal from the Industrial Accident Board.

Proceeding under Workmen's Compensation Act by S. Ray Moon, employee and claimant, to recover compensation for injuries; opposed by Home Lumber & Coal Co., a corporation, State Insurance Fund, surety, May Ervin and Dr. Eugene Schreiber, respondents. From an order denying compensation as against respondents, the claimant appeals. Cross-appeal by Tim Ervin, employer. Affirmed.

Award of the board affirmed. Costs to respondents.

E. B. Smith and Hugh N. Caldwell for appellant.

"Employer," includes the owner of premises, but who, by reason of these being an independent contractor, is not direct employer of the workmen there employed. (I. C. A., sec. 43-1806; I. C. A., sec. 43-1611; Hiebert v. Howell, 59 Idaho 591, 599, 85 P.2d 699; Modlin v. Twin Falls Canal Co., 49 Idaho 199, 286 P. 612.)

The retention by the employer of the right to exercise control or supervision, even though not exercised, is the main test of the relationship of employer and employee. (In re Black, 58 Idaho 903, 80 P.2d 24; O'Neil v. Madison Lumber & Mill Co., 61 Idaho 546, 105 P.2d 194.)

F. W. Jarvis and Walter Griffiths for cross-appellant.

Two or more parties engaged in a joint enterprise in the performance of which, workmen are employed, and injured in the course of that employment, both joint adventures occupy the position of employers in the same relation as members of a co-partnership. This relationship exists even though one may be the general employer and the other a mere special employer. When two or more parties are mutually benefitted by an enterprise for which workmen are hired, who are injured in the performance of their duties, both are held to occupy the relationship of employer. (Am. Jur., vol. 30, p. 680, secs. 7 and 10; Simpson v. Richmond Worsted Spinning Co., 128 Maine 22, 145 A. 250; Darling v. Ruddy, 318 Mo. 784, 1 S.W.2d 163, 58 A. L. R. 493; Stockton v. Anderson Motor Service, Mo.App. 89 S.W.2d 573; Sand Springs Home v. Dail, Okla. 103 P.2d 524; Pinson v. Minidoka Highway District, 61 Idaho 731, 106 P.2d 159.)

Frank L. Benson for respondent, State Insurance Fund, and Robert I. Troxell and Elam & Burke for respondent, Home Lumber & Coal Co.

The relationship of employer and independent contractor arises only where a party employs another to do a piece of work but retains no control over such person. (35 Am. Jur. 445; Moreland v. Mason, 45 Idaho 143, 260 P. 1035; In re Fisk, 40 Idaho 304, 232 P. 569; Jones v. Packer John Mines Corp., 60 Idaho 653, 95 P.2d 572.)

A sale of materials to a building contractor does not make the party selling such materials the proprietor of the business of constructing buildings in which the contractor is engaged nor create an "employer independent contractor relationship"; to constitute such a status and create such a relationship it is necessary that the party selling the material engage in the business of building houses and contract with the contractor for their construction. (Sec. 43-1611, I. C. A.; Sec. 43-1806, I. C. A.; In re Fisk, 40 Idaho 304, 232 P. 569; Commercial Lumber Co. v. Nelson (Olka.), 72 P.2d 829; Warr Lumber Co. v. Henry (Okla.) 112 P.2d 358.)

The relationship of employee and employer arises only where evidence establishes that the employer has the right of hiring and discharging the employee and has control and direction of the employment to which the contract relates, together with right of control of performance and right to control the manner in which the work shall be done. (35 Am. Jur., 445; Joslin v. Idaho Times Publishing Co., 56 Idaho 242, 53 P.2d 323; E. T. Chapin Co., et al. v. John W. Scott, 44 Idaho 566, 260 P. 172.)

Smith & Ewing for respondent, Dr. Eugene Schreiber.

"Employer" does not include the mere owner of premises, unless he is the proprietor or operator of the business there carried on. (I. C. A. 1932, Sec. 43-1806; I. C. A. 1932, Sec. 43-1820; I. C. A. 1932, Sec. 43-1611; Packett v. Moretown Creamery Company, 99 A. 638, L. R. A., 1918-F, 173.)

Employment not carried on by the employer for the sake of pecuniary gain is not covered by the Workmen's Compensation Act. (I. C. A. 1932, Sec. 43-1001; I. C. A. 1932, Sec. 43-904; I. C. A. 1932, Sec. 43-1811.)

DUNLAP, J. HOLDEN, C. J., Ailshie, Budge and Givens, JJ., concur.

OPINION

DUNLAP, J.

In June, 1940, Dr. Eugene Schreiber, one of the respondents, and cross-appellant, Tim Ervin, entered into and signed a written contract whereby the cross-appellant agreed to erect for Dr Schreiber a residence in Caldwell. This agreement,...