Moore and Chicago Mill & Lumber Co. v. Phillips

• Decision Date: 17 October 1938
• Docket Number: 4-5180
• Citation: 120 S.W.2d 722,197 Ark. 131
• Parties: MOORE AND CHICAGO MILL & LUMBER COMPANY v. PHILLIPS
• Court: Arkansas Supreme Court

120 S.W.2d 722

197 Ark. 131

MOORE AND CHICAGO MILL & LUMBER COMPANY v. PHILLIPS

4-5180

Supreme Court of Arkansas

October 17, 1938

Appeal from Jefferson Circuit Court; T. G. Parham, Judge; affirmed as to Moore and King, and reversed and dismissed as to Chicago Mill & Lumber Co.

Judgment reversed.

Austin M. Coates, Coleman & Gantt and Daggett & Daggett, for appellants.

E W. Brockman, Reinberger & Reinberger and Bridges & Bridges, for appellees.

GRIFFIN SMITH, C. J. Mr. Justice HUMPHREYS and Mr. Justice MEHAFFY dissent

OPINION

GRIFFIN SMITH, C. J.

Judgments aggregating $ 12,125 to compensate personal injuries sustained by Adeline Phillips, Kathleen Williams, and Fitzhugh Brunson, were returned on jury verdicts against Arthur Moore, Allen King, and Chicago Mill & Lumber Company, the latter a corporation.

It is alleged that Moore and King were employees of the corporation; that in April, 1937, the three plaintiffs, mentioned supra, were in an automobile driven by Brunson; that a truck belonging to Moore and driven by King, with whom Moore was riding, collided with the Brunson car; that the three plaintiffs were severely and permanently injured, and that at the time the accident occurred Moore and King were engaged in a mission for Chicago Mill & Lumber Company.

There is a great deal of testimony explaining how the accident occurred, much of which is in conflict. There were questions of fact for the jury's consideration, presented under proper instructions as to Moore and King, and the judgments against them are affirmed.

As to the Chicago Mill & Lumber Company, the situation is different. In 1934 Arthur Moore, who had previously lived at Vicksburg, Mississippi, moved to a farm near West Helena, Arkansas. For many years he had been engaged in the timber business, principally as a logging contractor. After going to West Helena, he executed various contracts with Howe Brothers Lumber Company and Shannon Lumber Company, under which he cut and delivered timber from lands owned by the corporations. There is no evidence contradicting his testimony that in the execution of such contracts he owned and furnished the material and equipment and employed the necessary labor. Prior to execution of the contract here involved, he had performed for the Company under only one contract in 1934, later moving some 25,000 feet for the Company, but under verbal agreement. He was also engaged in the business of buying timber and selling logs to various mills.

February 20, 1937, the Company purchased from Mrs. Sallie M. Erwin the standing timber on 340 acres of land in Drew county, the time for removal thereof being restricted to two years. April 3, 1937, the Company and Moore entered into a written contract under which, for a compensation of $ 10 per thousand feet, Moore agreed to cut, transport and deliver the standing timber to the right-of-way of the Missouri Pacific Railroad at Monticello. There is no evidence tending to question execution of the contract, or good faith of the parties. To the contrary, it is shown that from April 3 to April 23, Moore was engaged in executing the work contemplated by the contract. Original ledger sheets, showing the account of Moore with the Company from March 1, 1937, to April 3, 1937, as well as other original records and entries thereon--all of which were made prior to April 23--were introduced in evidence.

These records reflected that on April 9 settlement was had between Moore and the Company, in accord with terms of the contract, for 6,783 feet of logs. April 23 a like settlement, covering 22,035 feet of logs, was had. The record further shows that Moore lived on a farm containing 60 acres, which was "clear," some five miles distant from the plant of the Company in West Helena; that he was the owner of a truck and trailer, and a tractor, although the Company had advanced him some money and had taken a mortgage; that he owned log wagons, mules, and various other camp property, and that he transported this equipment to the lands and established a camp thereon. He took with him laborers then regularly in his employ, and at a later date hired log laborers, some of whom were employed by him to cut timber "by the thousand." He also employed persons owning trucks to transport the timber to Monticello. Settlements were made with his labor at bi-weekly periods, and up to June, 1937, payments were made by Moore from his own funds. Thereafter, laborers were paid by the "woods foreman" of the Company, Cox, but on payrolls made out by Moore, and at his direction, and receipts taken from each employee were introduced in evidence, showing performance of labor on "Arthur Moore's job."

Moore customarily returned to his home near West Helena on Friday preceding alternate Saturdays, to procure settlement with the Company for the amount due him under the contract. The bases for such settlements were "scale sheets" forwarded the Company by Cox.

In the execution of his contract, and in going to and from the land, Moore used a pick-up Ford truck, the state license to which was in his name. April 23, 1937, he left camp in this truck, accompanied by one of his employees, Allen King, a tractor driver. He started from Monticello for West Helena to effect settlement for logs hauled during the preceding bi- weekly period. While on his way home the accident complained of occurred. Allegations that Moore and King were servants of the Company were met with the answer that Moore was an independent contractor; that neither Moore nor King was, or ever had been, employees of the Company. The contract between Moore and the Company was filed as an exhibit to the answer. There was no substantial proof to show that the contract was colorable, nor were there any allegations or proof that it was not bona fide. Plaintiffs contended only that phraseology of the contract, by reason of provisions relating to control and direction of operations, created the relation of master and servant, rather than owner and contractor; and that the Company had by conduct subsequent to the execution of the contract destroyed the relation of owner and contractor, if the contract did in law create such relation, and thereby created the relation of master and servant.

The case may be disposed of by a determination of two principal questions: (1) Does the contract between Moore and the Company, standing alone, create the relationship of owner and contractor? (2) If it be held that the contract did make Moore an independent contractor, is the evidence adduced by plaintiffs sufficient to show that the parties, by subsequent conduct, abandoned this contractual relation and substituted in lieu thereof the relation of master and servant?

If the first question be affirmatively answered, and the second one be answered in the negative, it necessarily follows that the Company would not be under any liability to plaintiffs. Correct determination of the first question necessarily involves consideration of the contract.

Preliminary to the contractual terms, it is first stated that the Company and the "contractor" have "reached an agreement for the cutting, hauling and delivery of the timber." The land on which it is situate is described; point of delivery is fixed; and the contractor was obligated to "actively begin work . . . within ten days . . . and continuously and diligently prosecute the work so as to complete the delivery of all the timber by the first day of July, 1937."

Section 1 provided that the contractor ". . . has or will provide at his own expense all the teams, logging equipment, labor, etc., necessary to reasonably guarantee the prompt and faithful cutting, hauling and delivery of all or any part of the timber and logs, within the time provided; and keep the timber and logs free from all liens or claims for labor or otherwise; and the corporation may require the contractor to reasonably satisfy it in that behalf before making any payment to him as herein provided."

Section 2 required the contractor to confine operations to such subdivisions as the corporation should direct. It further required him to cut and remove the timber from such subdivision most remote from delivery point. The particular subdivision on which the contractor "shall begin operations" was to be "as directed" by the Company.

Under Section 3 the corporation retained the power to "direct" as to the species to be cut and removed.

Section 4 provided that the timber should be cut in a careful and workmanlike manner, "as may be directed and changed in writing from time to time by the corporation," and that the full product of the tree should be obtained and logs cut to the best advantage in standard lengths.

Section 5 required delivery of the logs in a reasonable time and fixes a penalty on the contractor for default in this respect.

Section 6 required delivery of the logs within fifty feet of the loading equipment on track at Monticello; and the dumping grounds were to be prepared by contractor "at his own expense." If logs were lost or damaged, the contractor is held liable thereof.

Section 7 provided for measurement of logs delivered and bi-weekly statements therefor, on inspection and measurement by an agent of the Company. Contractor was to be furnished with a duplicate tally of logs scaled, which, without objection, was made final basis of settlement.

Section 8 covered the price per thousand feet to be paid contractor "for all logs delivered," but 10 per cent. of the contract price was to be retained until the contract was completely performed, and upon breach by the contractor, the amount retained was to be held by the corporation as liquidated damages. This section further provided: "In addition to the 10 per cent. retention to guarantee the...