Mulder v. Mendo Wood Products, Inc.

• Decision Date: 17 March 1964
• Court: California Court of Appeals Court of Appeals
• Parties: Albert MULDER, Robert B. Riddle, and Arthur O. Woodall, Plaintiffs and Respondents, v. MENDO WOOD PRODUCTS, INC., E. C. Welch and J. D. Welch, Jr., Defendants and Appellants. Civ. 21307.

Page 479

37 Cal.Rptr. 479

225 Cal.App.2d 619

Albert MULDER, Robert B. Riddle, and Arthur O. Woodall, Plaintiffs and Respondents, v. MENDO WOOD PRODUCTS, INC., E. C. Welch and J. D. Welch, Jr., Defendants and Appellants.

Civ. 21307.

District Court of Appeal, First District, Division 2, California.

March 17, 1964.

Rehearing Denied April 16, 1964.

Hearing Denied May 13, 1964.

Timothy W. O'Brien, James F. Kemp, Ukiah, for appellants, Casey & Palmer, by John T. Casey, Portland, Or., of counsel.

Thomas F. Cleland, Ukiah, for respondents.

SHOEMAKER, Presiding Justice.

This is an action by three former employees of defendant Mendo Wood Products, Inc., to recover wages allegedly due them under the Fair Labor Standards Act of 1938 (29 U.S.C.A. § 201 et seq.). The complaint alleged that plaintiffs Albert Mulder, Albert Woodall, and Robert Riddle, were each employed as truck drivers by the defendant for specified periods during the years 1959 and 1960; that each of the plaintiffs worked a considerable number of hours in excess of 40 hours per week; that at the times such employment was performed, defendant was subject to the provisions of the Fair Labor Standards Act and was required to pay plaintiffs time-and-a-half for their hours of overtime; that defendant had in fact paid plaintiffs only straight time and that they were therefore entitled to recover the difference between time-and-a-half and straight time for the hours of overtime worked, liquidated damages in an equal amount, and attorney's fees. In addition, plaintiff Riddle alleged that during the years 1959 and 1960, he had worked a number of hours in the defendant's employ for which he had received no pay whatever. He sought straight wages for the hours so worked, liquidated damages in an equal amount, and attorney's fees.

The defendant answered, admitting that it was subject to the Fair Labor Standards Act at the times mentioned in the complaint, and that it had employed plaintiffs as truck drivers during the periods alleged. As an affirmative defense to each cause of action, defendant alleged that it was a private carrier of property by motor vehicle within the meaning of Part II of the Interstate Commerce Act (49 U.S.C.A. § 301 et seq.); that plaintiffs were employees with respect to whom the Interstate Commerce Commission had the power to establish qualifications and maximum hours of service pursuant to said act; and that plaintiffs were accordingly exempted from the maximum hours and overtime provisions of the Fair Labor Standards Act by section 13, subdivision (b)(1) of said act (29 U.S.C.A. § 213(b)(1)).

The evidence established that defendant was a California corporation engaged in the manufacture and sale of studs, and that its principal place of business was located at the Ridgewood Ranch in Ukiah, California. In order to deliver its studs to purchasers, the defendant used trucks which it leased from other companies and which were operated by drivers in its own employ. Plaintiff Mulder was employed by the defendant as a truck driver during the period from January 1, 1959 through September 15, 1960; plaintiff Woodall, during the period from January 1, 1959 through July 15, 1960; and plaintiff Riddle, during the period from January 1, 1959 through August 15, 1960. Time cards covering the periods in question showed that each of the plaintiffs had worked a substantial number of hours in excess of 40 hours per week, for which they were paid only straight time. Computations based upon these time cards demonstrated that the difference between straight time and time-and-a-half pay for the total number of overtime hours worked came to $2,222.90 in the case of plaintiff Mulder; $2,240.33 in the case of plaintiff Woodall; and $1,885.77 in the case of plaintiff Riddle. In addition, plaintiff Riddle, during the period from May 1, 1959 through July 31, 1960, spent 216 hours attending his truck during breakdowns on the road and received no compensation whatever for this time. Straight time pay during the period in question was $2.37 per hour.

The evidence relative to the interstate character of defendant's trucking operations revealed that in the year 1958, defendant's drivers did transport shipments of studs to various out-of-state destinations. It was conceded by the defendant, however, that no out-of-state deliveries were made during 1959 or 1960. The testimony pertaining to the defendant's reason for discontinuing these deliveries was somewhat conflicting. Elwood Welch, the secretary of defendant corporation, testified that there had been no change of company policy commencing in the year 1959, and that the defendant was at all times willing to sell and deliver its studs to both in-state and out-of-state buyers. Plaintiff Mulder testified, however, that there had been a definite change in delivery procedures subsequent to 1958 and that the defendant henceforth arranged to have its out-of-state buyers come to the Ridgewood Ranch and pick up the studs ordered in their own trucks. He also testified that the defendant did not have either an Interstate Commerce Commission permit or Interstate Commerce Commission plates for its trucks.

In any event, all of the hauls made by defendant's drivers during the years 1959 and 1960 were between two points within the State of California. In the majority of cases, the drivers would pick up studs at the Ridgewood Ranch and deliver them to various tracts under construction and to retail or wholesale lumber dealers. Although the defendant introduced evidence to the effect that certain of these wholesale dealers ultimately shipped some of the defendant's studs to out-of-state retail buyers, there was no evidence that such shipments were part of any continuous out-of-state movement commencing at the Ridgewood Ranch. To the contrary, plaintiff Mulder testified that the bills of lading or waybills showed the ultimate destination of the loads delivered by defendant's drivers to be the lumber yard of the particular California wholesaler. Mr. Welch himself confirmed this testimony, and stated that the defendant's duties with regard to its studs ceased upon delivery to an in-state wholesale customer, that the defendant did not undertake to tell its wholesale customers what to do with the studs, and that any further shipment of the studs was dictated by the wholesaler's own requirements and by orders which it might receive from its own out-of-state customers.

In addition to the intrastate shipments to tracts and to retail and wholesale lumber dealers, there was also evidence that the defendant's drivers were occasionally required to haul studs, by way of private road, from the defendant's stud mill to a railroad siding also located on the Ridgewood Ranch, where the studs were loaded on cars and shipped to various out-of-state destinations. The total distance from the mill to the siding was some 1 1/2 to 2 miles.

There was also evidence that sometime during 1959, defendant's drivers delivered the component parts for a feed mill from the Miller Manufacturing Company in Modesto, California, to the Ridgewood Ranch, and that certain of these parts had been manufactured in other states. The feed mill machinery had been ordered by Welch & Welch, a partnership, whose principal place of business was also located at the Ridgewood Ranch and whose members were identical with the shareholders of defendant corporation. Mr. Welch testified that the two companies frequently exchanged equipment and labor and that defendant corporation had provided the trucks and drivers to pick up and deliver the feed mill parts ordered by Welch & Welch. Mr. Thompson, the president and general manager of the Miller Manufacturing Company, testified that Welch & Welch had ordered the parts for the feed mill from his company, that certain of the parts had been manufactured by his company in Modesto and other parts had been ordered from out-of-state manufacturers. Mr. Thompson also testified that certain of the parts manufactured outside the state had been purchased by his company from dealers within the state, and that other parts which had been ordered directly from out-of-state sources were stored by his company for some five or six months before being sold to a particular in-state customer.

Upon this evidence, the trial court found that during the years 1959 and 1960, the defendant was subject to the provisions of the Fair Labor Standards Act and had employed plaintiffs as truck drivers; that at various times during these years, plaintiffs had worked in excess of 40 hours per week; that although plaintiffs were entitled to time-and-a-half for the hours so worked, defendant paid them only straight time; that plaintiff Mulder was entitled to unpaid wages in the amount of $2,220.90, plaintiff Woodall to unpaid wages in the amount of $2,240.03, and plaintiff Riddle to unpaid wages in the amount of $1,885.77; that defendant's refusal to pay the amounts due had necessitated the bringing of the instant action and that $500 was a reasonable amount to allow each plaintiff for attorney's fees; that plaintiffs were also entitled to liquidated damages in the amount of their unpaid wages. The court also found that plaintiff Riddle had worked 216 hours for which he received no pay whatever, that his wages at that time were $2.37 per hour, and that he was entitled to recover the sum of $511.92. Judgment was accordingly entered and defendant appealed therefrom. ¹

Appellant first contends that its trucking operations were exempt from the wage and hour provisions of the Fair Labor Standards Act by virtue of section 13, subdivision (b)(1) of said act (29 U.S.C.A. § 213(b)(1)), which provides in relevant part that 'The provisions of section 207 of this title shall not apply with respect to (1) any employee with respect to whom the Interstate Commerce Commission has power to establish qualifications and maximum hours of service pursuant to the provisions of section...