Nussbaum v. Wright, 83-707

• Decision Date: 22 June 1984
• Docket Number: No. 83-707,83-707
• Citation: 350 N.W.2d 559,217 Neb. 712
• Parties: Loren K. NUSSBAUM, Appellant, v. Lyle F. WRIGHT et al., Appellees.
• Court: Nebraska Supreme Court

Page 559

350 N.W.2d 559

217 Neb. 712

Loren K. NUSSBAUM, Appellant, v. Lyle F. WRIGHT et al., Appellees.

No. 83-707.

Supreme Court of Nebraska.

June 22, 1984.

Syllabus by the Court

1. Workmen's Compensation: Appeal and Error. The findings of fact of the Workmen's Compensation Court have the same force and effect as a jury verdict in a civil case and will not be set aside unless clearly wrong.

2. Workmen's Compensation: Master and Servant. The general test in determining whether an employee is a servant of his original master, or of the party to whom he has been furnished, is whether in the particular service which he is engaged to perform he continues to be liable to the direction and control of his master, or becomes subject to that of the party to whom he is lent or hired.

3. Workmen's Compensation: Master and Servant. It is quite generally agreed that in order to transfer liability from the general employer to the one to whom the employee is loaned, there must be some consensual relationship between the loaned employee and the employer whose service he enters, sufficient to create a new employer-employee relationship. Where an employee enters the service of another at the command and pursuant to the direction of the master, no new relationship is created. While the employee may be subject to the direction of the temporary master, he is there in obedience to the command of his employer; and in doing what the new master directs him to do, he is performing his duty to the employer who gave the order. Consent cannot be inferred merely from the fact that the employee obeyed the commands of his master in entering the services of another.

4. Workmen's Compensation: Master and Servant. Before the new master and servant relationship can be made effective, the servant must understand that he is submitting himself to the control of the new master.

5. Workmen's Compensation: Employer and Employee. Before an employer to whom the injured employee is loaned can be found liable for injuries to the loaned employee, the employee must show that he has made a contract of hire, express or implied, with the special employer, that the work being done is essentially that of the special employer, and that the special employer has the right to control the details of the work.

6. Workmen's Compensation: Statutes. The "statutory employer" provisions of Neb.Rev.Stat. § 48-116 (Reissue 1978) do not supersede the exemption provisions of Neb.Rev.Stat. § 48-106(2) (Reissue 1978).

7. Workmen's Compensation. Employment which is both casual and which is not in the usual course of the trade, business, profession, or occupation of the employer is exempt from coverage under the Nebraska Workmen's Compensation Act.

Holtorf, Kovarik, Nuttleman, Ellison, Mathis & Javoronok, P.C., Gering, for appellant.

Geoffrey V. Pohl and R. Kevin O'Donnell of McGinley, Lane, Mueller, O'Donnell & Merritt, Ogallala, for appellee Wright.

Reddish, Curtiss, Moravek & Danehey, Alliance, for appellee Hinton.

KRIVOSHA, C.J., BOSLAUGH, WHITE, HASTINGS, CAPORALE, and GRANT, JJ.

WHITE, Justice.

This is an appeal from the order of a three-judge panel of the Nebraska Workmen's Compensation Court denying relief to the appellant, Loren K. Nussbaum. The three errors assigned are that the Workmen's Compensation Court was clearly wrong in (1) finding that appellant was not, at the time of his injury, a loaned employee of Bartt S. Hinton, (2) failing to find that Lyle F. Wright was a statutory employer of appellant, Neb.Rev.Stat. § 48-116 (Reissue 1978), and (3) failing to find that a previous judgment of the compensation court finding that appellant, at the time of his injury, was the employee of one Darrell Carlton Hinton, also known as "Jeff" Hinton (Jeff), did not bar the action against Lyle F. Wright and Bartt S. Hinton under the doctrine of res judicata. The lower court found against appellant on the first two assignments and thus did not rule on the issue raised by the third assignment.

We review the decision of the compensation court for error only, keeping in mind that findings of fact will not be set aside unless clearly wrong. Niesen v. Logan County Co-op Oil Assn., 215 Neb. 587, 340 N.W.2d 146 (1983).

A brief recitation of the facts is necessary. Jeff Hinton and Bartt Hinton are father and son. Each is engaged in a general contracting business. No evidence was presented that the two were associated in a partnership or joint undertaking; rather, the evidence shows that each undertook separate general construction tasks as an individual proprietor. For approximately 2 months prior to the accident of July 31, 1981, appellant was the full-time employee of Jeff Hinton, generally engaged in erecting fences and corrals for local ranchers. Shortly before July 31, 1981, Bartt Hinton called his father, and the two agreed upon, or Bartt requested, the assistance of Jeff and the appellant in the completion of a painting project at the ranch of Lyle Wright near Hyannis, Nebraska. The project consisted of painting the home and ranch buildings, and the cost was agreed to between Wright and Bartt Hinton on a bid amount. Wright did not supervise the work nor exercise any control over who performed the work. The evidence discloses that Wright is engaged in the occupation of a rancher and has no other occupation. It is also established that neither Bartt Hinton nor Lyle Wright has workmen's compensation coverage.

On the day of the accident appellant rode out to the Wright ranch with Jeff Hinton. Jeff directed appellant to mix paint, directed his work, asked if appellant wished to take a break, and received the report of the injury. The injury happened when appellant, who was spray painting the roof of a garage, slipped and impaled his palm on a nail in the roof. Later, at lunchtime, the spray equipment was cleaned with diesel fuel, and that afternoon the hand began to swell. Appellant went to a hospital and underwent a long and painful treatment for the resulting inflammation and infection. Ultimately, one finger and a portion of another were required to be amputated. That appellant suffered a severe and permanent disability is not disputed.

Appellant filed suit in the Workmen's Compensation Court and secured a judgment against Jeff Hinton. Jeff responded by filing a petition of voluntary bankruptcy.

Appellant then filed this suit against Bartt Hinton, claiming that he was an employee of Bartt, and against Lyle Wright, claiming that Wright was a statutory employer.

As stated previously, there was no evidence that the Hintons operated as a partnership in the painting of the Wright farm. The negotiating took place between Wright and Bartt Hinton, and Wright looked to Bartt only for completion of the project. Rather, the evidence appears that appellant was a "loaned employee."

In Mid-America Pipeline Co. v. Warren, 187 Neb. 710, 713-14, 193 N.W.2d 749, 751-52 (1972), we quoted with approval from Shamburg v. Shamburg, 153 Neb. 495, 45 N.W.2d 446 (1950):

" * * * the general test in determining whether an employee is a servant of his original master, or of the party to whom he has been furnished, is whether in the particular service which he is engaged to perform he continues to be liable to the direction and control of his master, or becomes subject to that of the party to whom he is lent or hired. * * *

" * * * 'It is quite generally agreed that in order to transfer liability from the general employer to the one to whom the employee is loaned, there must be some consensual relationship between the loaned employee and the employer whose service he enters, sufficient to create a new employer-employee relationship. Where an employee enters the service of another at the command and pursuant to the direction of the master, no new relationship is created. While the employee may be subject to the direction of the temporary master, he is there in obedience to the command of his employer, and in doing what the new master directs him to do he is performing his duty to the employer who gave the order. * * * Consent cannot be inferred merely from the...