Vandriest v. Midlem, 82-507

• Decision Date: 10 August 1983
• Docket Number: No. 82-507,82-507
• Parties: , 12 Ed. Law Rep. 922, 6 O.B.R. 239 VANDRIEST et al., Appellants, v. MIDLEM, Supt., Appellee.
• Court: Ohio Supreme Court

Page 183

6 Ohio St.3d 183

452 N.E.2d 321, 12 Ed. Law Rep. 922, 6 O.B.R. 239

VANDRIEST et al., Appellants, v. MIDLEM, Supt., Appellee.

No. 82-507.

Supreme Court of Ohio.

Aug. 10, 1983.

Sindell, Lowe & Guidubaldi Co., L.P.A., Steven A. Sindell and Claudia R. Eklund, Cleveland, for appellants.

Baran & Baran Co., L.P.A., and Gregory G. Baran, Mansfield, for appellee.

PER CURIAM.

The controlling question in this appeal is whether appellee is entitled to the immunity from suit provided by the workers' compensation statutes. ¹ If Crestview, appellee's employer, was also appellant's employer, then appellant's action is barred by R.C. 4123.74 and 4123.741. If the school district was not appellant's employer, however, then appellee may not invoke the statutory immunity.

This court considered a related issue in Daniels v. MacGregor Co. (1965), 2 Ohio St.2d 89, 206 N.E.2d 554 , and Campbell v. Central Terminal Warehouse (1978), 56 Ohio St.2d 173, 383 N.E.2d 135 . Daniels and Campbell involved claims brought by employees of temporary labor agencies against the customers of these agencies. This court held in both cases that the claimants were employees of the agencies' customers even though the customers, at whose places of business the claimants suffered their injuries, made no direct payments to or paid workers' compensation premiums for the claimants. In Campbell, at page 176, 383 N.E.2d 135, we found that "there existed an implied contract of hire between * * * [the agency's customer] and appellant [the claimant], whereby appellant in effect authorized * * * [the agency] to offer his services for hire, and * * * [the customer], by approving the referral, accepted appellant's offer." The implied contract rationale of Campbell applies with equal force to the case at bar. Appellant authorized NYC to offer his services for hire, and Crestview, by approving the referral, accepted appellant's offer.

The court of appeals correctly characterized the nature of appellant's job as follows: "The employment relationship here was one status. It depended for its very existence upon an accommodation by an agency (the school district) willing to provide work opportunities, and a government agency willing to provide the funds for such employment, including premiums for Workers' Compensation. The single employment requires both." (Emphasis sic.) This determination is fully consistent with Campbell.

Appellant contends that he had no employer-employee relationship with Crestview because his wages were paid by NYC. ² Under Daniels and Campbell, however, payment alone is not the critical inquiry. Rather, our previous cases have looked not to the source of compensation but to " 'the right to control the manner or means of performing the work * * *.' " Daniels, 2 Ohio St.2d at page 94, 206 N.E.2d 554, quoting Behner v. Indus. Comm. (1951), 154 Ohio St. 433, 96 N.E.2d 403 , paragraph one of the syllabus. See, also, Campbell, 56 Ohio St.2d at page 175, 383 N.E.2d 135.

Appellant argues that NYC actually controlled him on the job, first, because appellant could only engage in a limited range of activities pursuant to federal and state regulations and, secondly, because NYC was required to make regular inspections of the job site to ensure that program participants complied with all applicable rules. ³ The actual work performed by appellant, however, was assigned and directed by school district employees, including appellee. Even if NYC maintained ultimate control by retaining the power to remove CETA workers from a job site, Crestview exercised immediate control of appellant while he was at work. ⁴

While there are no reported Ohio cases dealing with this precise issue, a recent Pennsylvania case, Keller v. Old Lycoming Township (1981), 286 Pa.Super. 339, 428 A.2d 1358, considered this question. In Keller, the executrix of a deceased CETA worker, who had been killed while working on a township project, brought wrongful death and survivor actions against the township. The court held that the township enjoyed workers' compensation immunity notwithstanding the fact that another agency had paid the decedent's wages and workers' compensation premiums. In Keller, the township's role was analogous to the school district in the case at bar and an entity named Service, Training, and Education Programs ("STEP") functioned as did NYC herein. The court addressed the control question as follows at pages 350-351, 428 A.2d 1358:

"Here, it was the township, and not the federal government or any agency managing CETA programs, such as STEP, that directed the installation of the sewer line and controlled the operations at the worksite where Harold Keller was injured. The township could most directly affect the risks of accidents at the worksite. While STEP also assumed an interest in the safety and other work conditions of CETA workers, it had neither the power nor the responsibility to direct the installation of the sewer line. It could not, for instance, tell Keller's co-workers what ditches to dig, or how to dig them. What it could do was to impose limited sanctions on employers for not complying with its requests. Thus, if an employer did not comply with its directives, it could terminate the worksite as a place where CETA workers could work."

In the instant case NYC, like STEP in Keller, "could terminate the worksite as a place where CETA workers could work," and "impose limited sanctions," but NYC did not direct appellant in his day to day activities at work or control the operations at the worksite.

The Keller court, moreover, made the following observation relating to the goals of the CETA program:

" * * * our decision is consistent with accomplishing the purposes of CETA, namely, to 'provide job training and employment opportunities for the economically disadvantaged, unemployed, and underemployed persons.' 29 U.S.C. § 801. The obvious reason the federal government undertook to pay the wages and other costs--including the cost of workmen's compensation insurance--was to make it inexpensive for potential employers, such as Old Lycoming Township, to hire a CETA worker. We agree with the lower court that subjecting such employers to actions at common law would inhibit the CETA workers' employment opportunities."

CETA was designed to do more than provide disadvantaged persons with disposable income. A direct subsidy or welfare payment could serve that function. Congress, however, intended that participation in the CETA program would offer eligible employees a meaningful work experience, thereby inculcating sound work habits and a work ethic. If this court adopted appellant's theory of liability, we would effectively subvert the governmental goals underlying CETA insofar as the imposition of civil liability would discourage potential employing agencies, be they school districts as in the case at bar or townships as in Keller, from participating in federal employment programs.

For the reasons hereinbefore stated we affirm the judgment of the court of appeals.

Judgment affirmed.

WILLIAM B. BROWN, SWEENEY, LOCHER and HOLMES, JJ., concur.

LOCHER and HOLMES, JJ., concur separately.

FRANK D. CELEBREZZE, C.J., CLIFFORD F. BROWN and JAMES P. CELEBREZZE, JJ., dissent.

HOLMES, Justice, concurring.

This case raises two issues, each of which may serve as an independent grounds for decision. First, the court is faced with the question of whether a superintendent of schools has sovereign immunity from suit based upon an assertion that his direct negligence caused injuries. Second, there is a question whether the superintendent in this case is immune from suit under R.C. 4123.74.

Turning to the second issue first, R.C. 4123.74 provides that an employer who complies with the provisions of the Workers' Compensation Act is not liable for damages as a result of occupational disease or injury. See, also, R.C. 4123.741 (fellow employees' immunity). In Daniels v. MacGregor Co. (1965), 2 Ohio St.2d 89, 206 N.E.2d 554 , this court held:

"Where an employer employs an employee with the understanding that the employee is to be paid only by the employer and at a certain hourly rate to work for a customer of the employer and where it is understood that the customer is to have the right to control the manner or means of performing the work, such employee in doing that work is an employee of the customer within the meaning of the Workmen's Compensation Act; and, where such customer has complied with the provisions of the Workmen's Compensation Act, he will not be liable to respond in damages for any injury received by such employee in the course of or arising out of that work for such customer. * * * "

This decision was reaffirmed by the court in Campbell v. Central Terminal Warehouse (1978), 56 Ohio St.2d 173, 383 N.E.2d 135 . Thus, this court has adopted a right to control test to determine whether a "loaned servant" is an employee of the party to whom he was loaned. Here, there is no question that the appellee did have the right to control the appellant. Indeed, the whole thrust of appellant's suit is that appellee was negligent in his control of appellant. Therefore, I am in agreement with the majority that based upon this court's holdings in Campbell v. Central Terminal Warehouse and Daniels v. MacGregor Co., supra, the judgment of the court of appeals that the appellee was immune from suit under workers' compensation law should be affirmed.

Second, the discretionary or administrative acts of a superintendent of a local school district should not be distinguished from the acts of other public officers, administrators, or officials, and they, in carrying out their official acts, should be held immune from liability for alleged negligent acts, in the absence of a showing of malicious or willful conduct.

R.C. 3319.01 provides, in pertinent part, that, "The superintendent of a * * * school district shall be the executive officer for the board. * * * " The...