Murphy v. Doniphan Telephone Co.

• Decision Date: 14 February 1941
• Docket Number: 37267
• Citation: 147 S.W.2d 616,347 Mo. 372
• Parties: Andrew J. Murphy, Sr., Chairman, Edward C. Crow, and Harry P. Drisler, Members of the Unemployment Compensation Commission of Missouri, Appellants, v. Doniphan Telephone Company, a Corporation
• Court: Missouri Supreme Court

147 S.W.2d 616

347 Mo. 372

Andrew J. Murphy, Sr., Chairman, Edward C. Crow, and Harry P. Drisler, Members of the Unemployment Compensation Commission of Missouri, Appellants, v. Doniphan Telephone Company, a Corporation

No. 37267

Supreme Court of Missouri

February 14, 1941

Appeal from Ripley Circuit Court; Hon. Robt. I. Cope Judge.

Affirmed.

Harry G. Waltner, Jr., and Edward D. Summers for appellants.

(1) All employers as defined in the Unemployment Compensation Law are required to make contributions to the Unemployment Compensation Fund. 42 U.S.C. A., secs. 501, 1101; Sec. 6, Laws 1937, p. 585. (2) The defendant in this case is an employer within the meaningh of the Unemployment Compensation Law. Subsecs. 3 (g), 3 (h) (1), (4), Laws 1937, pp. 575, 576; Murphy v. Hurlbut Undertaking & Embalming Co., 346 Mo. 405, 142 S.W.2d 449; Sec. 655, R. S. 1929; Unemployment Comp. Comm. v. City Ice & Coal Co., 216 N.C. 6, 3 S.E.2d 290; Gibson Products Co. v. Murphy, 100 P.2d 453; Commerce Clearing House Unemployment Ins Service (Colo.), 8011.02, p. 9513; Commerce Clearing House Unemployment Ins. Service (Ind.), 6079, p. 17,379; Commerce Clearing House Unemployment Ins. Service (Md.), 8020, p 23,505; Commerce Clearing House Unemployment Ins. Service (Texas), 1311.01, p. 46,015; Commerce Clearing House Unemployment Ins. Service (Wash.), 1311.01, p. 50,014; Carmichael v. Southern Coal & Coke Co., 301 U.S. 495, 57 S.Ct. 868, 81 L.Ed. 1245, 109 A. L. R., 1327.

Chas. B. Butler for respondent.

(1) Employing unit: subdivision (g), Section 3, Act 1937, page 575, defines employing unit as follows: "Employing unit means any individual or type of organization, including any partnership, association or trust, estate, joint stock company, insurance company or corporation, whether domestic or foreign, or the receiver, trustee in bankruptcy, trustee or successor thereof, or the representative of a deceased person, which has, or subsequent to January 1, 1936, had in its employ one or more individuals performing services for it in this State. (2) "Employer means," any employing unit which for some portion of a day, but not necessarily simultaneously, in each of twenty weeks, whether or not such weeks are or were consecutive, within either the current or the preceding calendar year, has or had in its employment eight or more individuals, irrespective whether the same individuals were or are employed in each such day. Sec. 3, Laws 1937, p. 576. (3) "Any employing unit, which, together with one or more other employing units, is owned or controlled by legally enforceable means or otherwise, directly or indirectly, by the same interests, or which owns or controls one or more other employing units by legally enforceable means or otherwise, and which, if treated as a single unit with such other employing units or interests would be an employer under paragraph (1) of this subsection." Laws 1937, p. 576, subsection (h). (4) Complete control of a corporation is vested in a board of directors, not in the individual stockholders, although one may have a majority of the capital stock. Section 4558: Majority of board shall constitute a quorum, when -- powers.

Dalton, C. Hyde and Bradley, CC., concur.

OPINION

DALTON

This is an action to recover "contributions" alleged to be due under the provisions of our Unemployment Compensation Act. [Laws 1937, p. 574 et seq., amended 1939, Laws 1939, p. 892 et seq., Mo. Stat. Ann., sec. 13194, sec. 1 et seq., p. 4770.] Upon a trial before the court, without the aid of a jury, a judgment was entered for the defendant and plaintiffs have appealed.

We have jurisdiction by reason of the fact that appellants are state officers within the meaning of Section 12, Article 6 of the Constitution. [Murphy, Sr., v. Hurlbut Undertaking & Embalming Co., 346 Mo. 405, 142 S.W.2d 449, 450.]

It is conceded by respondent's brief that the respondent and one Dee A. Rice, hereinafter mentioned, were, at all times mentioned in the petition, "employing units" within the meaning of paragraph (g) of Section 3, of our Unemployment Compensation Act. [Laws 1937, p. 575, amended Laws 1939, p. 888, Mo. Stat. Ann., sec. 13194, sec. 3 (g), p. 4770.] It is conceded that neither respondent nor Rice was an "employer" within the meaning of subdivision (1), paragraph (h) of Section 3 of the act, because neither, considered alone, had eight or more employees, as provided in the act. [Laws 1937, p. 575, amended Laws 1939, p. 889.]

Appellants contend that the sole question presented is whether or not respondent is an "employer" within the meaning of subdivision 4, paragraph (h) of Section 3, of the act, Laws 1937, p. 576, amended Laws 1939, p. 888, which further defines an "employer" as "Any employing unit which, together with one or more employing units, is owned or controlled by legally enforceable means or otherwise, directly or indirectly, by the same interests, or which owns or controls one or more other employing units by legally enforceable means or otherwise, and which, if treated as a single unit with such other employing units or interests, or both, would be an employer under paragraph (1) of this subsection."

Respondent did not demur to the petition, nor to any count thereof, but answered, denying generally the allegations in the petition. On trial appellants offered evidence in support of the several counts of the petition. Appellants called Dee A. Rice, respondent's president, as their witness. His testimony tended to show that respondent was a Missouri corporation owning and operating a telephone system in Ripley County; that, of the 500 outstanding shares of capital and voting stock of respondent corporation, Dee A. Rice owned 449 shares; that the wife and father of Dee A. Rice owned the remaining 51 shares; that Dee A. Rice was employed by respondent as its president and general manager; that he was actually managing the affairs of the company; that respondent, at all times mentioned in the petition, had seven individuals in its employment; that Dee A. Rice individually owned, operated and managed a telephone system in Wayne County under the trade name of Wayne County Telephone Company; that Dee A. Rice in such capacity employed six persons during the period mentioned in the petition; that respondent, and the wife and father of Dee A. Rice, had no interest in the Wayne County Telephone Company; that the funds of the two companies were kept in separate accounts and the books, business and affairs of each were totally separate and apart from the other; that the Public Service Commission of Missouri would not permit Dee A. Rice to consolidate respondent's business with his own; that neither Dee A. Rice nor the respondent had elected to come under the provisions of the Unemployment Compensation Act; that, except as to Dee A. Rice, the employees of the respective companies were not the same; and that the companies had no connection whatever, except that Dee A. Rice owned stock in respondent, as hereinbefore mentioned, and was the president, a director, and the general manager of respondent and, also, individually owned, managed and operated the Wayne County Telephone Company.

Appellants submitted to witness Rice an exhibit purporting to show the amount of wages paid by respondent to its employees during 1937, the several quarters of 1938, and the first quarter of 1939, being the periods covered by the several counts of the petition. Witness stated: "I have read plaintiff's exhibit '1' over hurriedly and I think the facts stated there are substantially correct, but I can't say that they are unless I would compare them with my records . . . I can't tell you as to whether or not the amounts of the payrolls set out in plaintiff's exhibit 1 are correct or not. . . . I can't say positively that they are correct. . . .

"I was present when field adviser L. F. Monnig prepared a report, and I assume that plaintiff's exhibit 2 which purports to be 'Employer's Summary Contribution Report for the year 1937' is it. I gave Mr. Monnig some figures from the records I have and the figures contained on this report are probably the figures I gave him. . . . I gave him some figures there that he asked for."

Plaintiff's exhibits 2 and 3 were subsequently identified by appellants' witness Meyer as records kept in the ordinary course of business of the Commission. These exhibits were signed by Mr. Monnig, who was not a witness. Witness Meyer stated that they were made up by Mr. Monnig; that he heard Mr. Monnig ask Mr. Rice which employees were at Doniphan and which at Neelyville; that the figures came from the Social Security figures; that the witness did not examine the payroll books. This witness further stated: "I can't say whether the copies of the Social Security Reports from which these figures were taken had his signature on them or not. He gave them to us and told us they were the Social Security returns and represented his payroll." Over respondent's objection these exhibits were admitted in evidence. From the amount of the payrolls as disclosed by the several exhibits, the amounts of the contributions sought to be recovered would have to be determined on a percentage basis as provided by the act.

At the close of the evidence, respondent made no request for declarations of law in the nature of demurrers to the evidence. No requests for findings of fact or declarations of law were made by either party, and none were given. The court did not indicate the ground upon which it found for the defendant on the several counts. Under such circumstances the judgment would ordinarily have to be affirmed, if it could be sustained on any reasonable theory and if no errors appeared on the face of the record proper. [Stoepler v. Silberberg, 220 Mo. 258, 119 S.W. 418...