Starkenberg v. North Dakota Workmen's Compensation Bureau

• Decision Date: 25 February 1944
• Docket Number: 6906.
• Citation: 13 N.W.2d 395,73 N.D. 234
• Court: North Dakota Supreme Court

13 N.W.2d 395

73 N.D. 234

STARKENBERG v. NORTH DAKOTA WORKMEN'S COMPENSATION BUREAU.

No. 6906.

Supreme Court of North Dakota

February 25, 1944

Rehearing Denied. March 14, 1944.

Syllabus by the Court.

1. The relation of employer and employee must exist in order to render the North Dakota Workmen's Compensation Fund liable for compensation benefits. The Fund is not liable for injuries sustained by an independent contractor.

2. One who contracts to construct a building for another, in accord with a stipulated plan, without being subject to the latter's superintendence, orders, or control in respect of the details of the work; who has absolute control of the work, may work such hours as he sees fit to work, may do the work himself or employ others to assist, and is to be paid a definite, stipulated sum when the building has been fully completed, is not an employee but is an independent contractor.

3. In the instant case, it is held, for reasons stated in the opinion that a person injured in the construction of a portable granary was an independent contractor, and, hence was not within the scope of the North Dakota Workmen's Compensation Act.

Nilles Oehlert & Nilles, of Fargo, for appellant.

Alvin C. Strutz, Atty. Gen., and P. B. Garberg Asst. Atty. Gen., for defendant and respondent.

CHRISTIANSON, Judge.

This is an appeal from a judgment against a claimant in a proceeding under the Workmen's Compensation Act. Laws 1919, c. 162 as amended. The proceeding was instituted by Inga Starkenberg, the surviving widow, to recover compensation on account of the death of her husband, Felix Starkenberg.

Felix Starkenberg died on August 24, 1942, as a result of injuries which he had sustained on that day while constructing a portable granary for the Carpenter Lumber Company at Jamestown, North Dakota. Inga Starkenberg presented a claim for compensation to the Workmen's Compensaton Bureau. The claim was rejected by the Bureau on the ground that Felix Starkenberg was not an employee of the Carpenter Lumber Company but was an independent carpenter. Thereafter Inga Starkenberg duly appealed to the district court from the decision of the Bureau. The district court held that Starkenberg was working as an independent contractor, that he was not an employee, and that there was no liability on the part of the Bureau. Judgment was rendered accordingly, and Inga Starkenberg has appealed to this court, and demanded a trial anew.

The sole question presented for determination here is whether in constructing the portable granary Felix Starkenberg was working as an employee of the Carpenter Lumber Company, or was working as an independent contractor.

There is no conflict in the evidence. The facts established by the evidence are substantially as follows:

Felix Starkenberg was a carpenter residing in the city of Fargo, in this State. He decided to go to Fort Peck or Great Falls, Montana to look for work. He drove his car. On August 3, 1942, while on his way to Montana, his car broke down, and the car was towed into Jamestown.

At that time the Carpenter Lumber Company, which operated a lumber yard in Jamestown, was taking orders from farmers for portable granaries, and had contracted, and was contracting, with carpenters to build such granaries. The granaries were of different sizes. The company paid a certain sum for the construction of a complete granary, ranging from $15 for the smallest size to $55 for the largest size. There were no written "specifications or drawings", except for the first granary. There was a drawing for that. After that had been constructed, when a carpenter came and wanted to figure on the work, he was told to go out and look over the granary that had been built, and that others to be built would be like the one he viewed, but of the different sizes indicated to him, and he was told how much the company would pay for the construction of such granaries which, as said, ranged in amount from $15 for the smallest size up to $55 for the largest size.

The lumber company furnished the building material, and the land on which the granaries were constructed. The lumber company had leased a tract of land across the street from its lumber yard for this purpose,-"several hundred feet along there", and the carpenter was told "to build it there. He picked the place where he wanted to build it." The carpenters furnished the tools. A carpenter who had undertaken to construct a granary might do the work himself, or he might employ any assistants he desired to do the work. The lumber company had no control of or superintendence over the workers, or the manner of performance of the work. A carpenter who had undertaken to construct a granary might work such hours as he chose. He could begin work at such hour as he saw fit and stop when he saw fit. He could work all the time, or part time. The only understanding was that the carpenter who had undertaken to construct a granary "should have it finished in a reasonable time so that the farmer wouldn't be upset over not getting his building", but there was "no time limit." The company was interested only in the completed structure. Whenever a granary was finished, the manager or assistant manager of the company inspected the granary, and if it was accepted, the lumber company paid the carpenter with whom it had contracted the amount agreed upon for the finished structure. Two of the carpenters with whom the lumber company had contracted had other men working for them. These men were paid by the carpenters with whom the lumber company had contracted, and the manager of the lumber company testified that one of these carpenters carried workmen's compensation insurance on the men that worked with him in constructing the granaries, and that he thought the other one, also, carried such insurance.

Felix Starkenberg went to work and constructed four granaries, under the arrangement above stated. The granaries were accepted, and he was paid the amounts which it was stipulated he should be paid therefor. Starkenberg furnished his own tools, and according to the testimony of the assistant manager of the lumber company, Starkenberg had two men with him about a day and a half. He stated that they were transients who had come in on a train, and that he did not know what arrangement Starkenberg had made with them as to compensation; that the only thing he knew he saw them out there "up on the roof shingling with him (Starkenberg) and the next day or so they were gone." It is undisputed that under the arrangement between the lumber company and Starkenberg he had the right to engage such help as he desired, and that if he did it would be up to him to compensate such workers, and that the lumber company would have no control over them, -they would be working for Starkenberg and not for the lumber company. Starkenberg was at work on the fifth granary when he was injured. He fell from the roof, and as a result of the injury he sustained he died about ten minutes thereafter.

The record shows that the lumber company had complied with the Workmen's Compensation Act, and that its employees in the lumber yard at Jamestown were covered; but the company had not listed any employees as carpenters.

Whether a person is an employee or an independent contractor is often a close, as well as a decisive, question in cases arising under Workmen's Compensation Laws; because generally an independent contractor is not within the scope of such laws, or entitled to compensation benefits. 1 Schneider, Workmen's Compensation, 2d Ed., p. 284; 71 C.J., p. 445; 28 R.C.L. p. 762. That is the rule in this state. "Under the Workmen's Compensation Act the relation of employer and employee must exist in order to make its provisions applicable." Kronick v. McLean County, 52 N.D. 852, 204 N.W. 839, 840. One who is an independent contractor and not an employee is not within the scope of the act. Janneck v. Workmen's Compensation Bureau, 67 N.D. 303, 272 N.W. 188.

Hence, under the laws of this State, the question whether a claimant under the Workmen's Compensation Act, at the time of the injury was working as an employee, or as an independent contractor is one which affects the right to participate in the fund at all. Whether it is just, or whether it is sound public policy, to grant compensation to one who is injured while performing a certain work when he is working as an employee, and to deny him such compensation if he is injured while performing the same work as an independent contractor is a matter for the legislature, and not for the courts. The legislature has said that an employee shall be insured in the instances falling within the act, and that an independent contractor is not within the act. The courts have to power to amend the law.

The distinction between an employee and an independent contractor has long been recognized by the law. 28 R.C.L. p. 762. This distinction has been recognized, also, under the Workmen's Compensation Laws. 1 Schneider, Workmen's Compensation, 2d ed., p. 284; 71 C.J. p. 445; 28 R.C.L. p. 762; Kronick v. McLean County, supra; Janneck v. Workmen's Compensation Bureau, supra; Mutual L. Ins. Co. v. State et al., 71 N.D. 78, 298 N.W. 773, 138 A.L.R. 1115.

While there is much confusion in the authorities as to the result reached in the application thereof, the courts generally if not unanimously have adopted the principle that "one who contracts with another to do a specific piece of work for him, and who executes the work entirely in accord with his own ideas, or with a plan previously given him by the person for whom the work is done, without being subject to the latter's orders in respect of the details of the work with absolute control thereof is not a servant of his employer, but is...