Walls by Walls v. Allen Cab Co., Inc.
| Citation | 903 S.W.2d 937 |
| Decision Date | 23 May 1995 |
| Docket Number | Nos. 66931,67024,s. 66931 |
| Court | Missouri Court of Appeals |
| Parties | Johnnie WALLS, Deceased, by Ophelia WALLS, Claimant, v. ALLEN CAB COMPANY, INC., General Dispatch Company, Missouri State Holdings Corporation, Missouri State Bank & Trust Company, Employers, Fidelity and Deposit Co. of Maryland, Insurer, and Treasurer of Missouri, As Custodian of Second Injury Fund. |
Robert H. Sihnhold, St. Louis, for claimant.
J. Bradley Young, Roberts, Perryman, Bomkamp & Meives, P.C., St. Louis, for Mo. State Bank, Gen. Dispatch and Mo. State Holdings Corp.
Jeremiah W. (Jay) Nixon, Atty. Gen., Jefferson City, Erwin O. Switzer, III, Asst. Atty. Gen., St. Louis, for Second Injury Fund.
The Missouri State Bank & Trust Company, General Dispatch Company, and Missouri State Holdings Corporation (collectively referred to as "Bank") appeal from the Labor and Industrial Commission's (Commission) award to the spouse of Johnnie Walls (claimant) for workers' compensation death benefits. The Commission found Missouri State Bank & Trust Company (Missouri State Bank) was Johnnie Walls' employer when he was murdered in a taxi cab he owned and operated under a permit of Allen Cab Company (Allen). The Commission concluded Missouri State Bank was operating the taxi cab business and employed drivers, including Johnnie Walls. It used an uninsured company, Allen, as the nominal employer. The companies were the alter ego of Missouri State Bank.
On April 25, 1988, Walls was found fatally shot in a vehicle identified as Allen Cab, No. 109. Walls began working as a cab driver under a permit from Allen in early 1966. Sometime after 1977 he began working full time as a cab driver. In 1987, he started working only part-time because of increasing vision problems. He is survived by a widow, claimant, Ophelia Walls. She filed a claim as a dependent under the Missouri Workers' Compensation Act.
The Administrative Law Judge (ALJ) announced the issues to be tried as follows: the existence of an accident; liability for past medical expenses; rate of liability for death benefits and burial; liability of Second Injury Fund (if employer is uninsured); existence of employer; whether employer maintained insurance with Fidelity and Deposit Company of Maryland; statute of limitations defense; and ultimately, the question of whether alleged employee was an independent contractor.
The ALJ found Johnnie Walls was in fact an employee of Allen at the time of his death. The ALJ determined that Allen was subject to Missouri Workers' Compensation Law and set the compensation rate of benefits at $150 per week from the date of death to the date of the award and continuing until the widow's remarriage or death. The ALJ credited the employer for the $2,000 paid to claimant subsequent to death, but made the employer responsible for $2,000 for burial benefits and for medical expenses in the amount of $10,368.72.
After determining Allen was uninsured at the time of death, the ALJ ruled the Second Injury Fund was jointly liable for all death benefits pursuant to § 287.240 RSMo 1986. The ALJ rejected the assertion by the Second Injury Fund that the claim was barred by the statute of limitations. The ALJ found the statute allows three years for filing a claim when a report of injury is not filed. Section 287.220 RSMo 1986; Lyons v. Lyons Truck Service, 831 S.W.2d 706, 710 (Mo.App.W.D.1992). The ALJ also determined the evidence did not warrant "piercing the corporate veil." The ALJ found Johnnie Walls was not an employee of Missouri State Bank under the definition of employee set out in § 287.020.1 RSMo 1986.
The Commission adopted some of the findings of the ALJ issued September 16, 1993. However, it restructured the final award. It ruled Allen was not the true workers' compensation employer of Johnnie Walls. The Commission majority found substantial and competent evidence in the record to find Missouri State Bank was Walls' employer and its workers' compensation insurance coverage extended to cover the death of the claimant. The Commission "pierced the corporate veil" of Allen after finding complete domination and control over Allen by Missouri State Bank. The purpose of this "corporate web" was to gain profits for Missouri State Bank while disregarding requirements of the Workers' Compensation Act.
Bank argues the Commission erred in the following: (1) finding Walls was an employee and not an independent contractor; (2) finding Walls was an employee of Missouri State Bank; (3) "piercing the corporate veil" of Allen to make an award against Missouri State Bank; (4) not finding the claim barred by the statute of limitations; and, (5) failing to assess liability against the Second Injury Fund.
The standard of review in a workers' compensation case is limited. We must review the entire record to determine whether the Commission's award is supported by competent and substantial evidence. Willis v. Jewish Hospital, 854 S.W.2d 82, 84 (Mo.App.E.D.1993). An appellate court will defer to the judgment of the Commission on factual disputes regarding inferences and evidence and will not substitute its own judgment. Id.
Bank's first point is the Commission erred in finding the claimant was an employee rather than an independent contractor. Bank asserts the Commission's finding was not based on competent and substantial evidence regarding the ownership of the cab. The Commission found the requisite supervision and control to support a finding that Walls was an employee. Under Workers' Compensation Law, claimant must establish an employee-employer relationship by showing claimant worked in the service of the alleged employer and the employer controlled those services. Lawson v. Lawson, 415 S.W.2d 313, 319 (Mo.App.1967).
The determination of whether Walls was an employee or an independent contractor is a determination of law that is subject to independent appellate review. Miller v. Hirschbach Motor Lines, Inc., 714 S.W.2d 652, 654 (Mo.App.1986).
The definition of an employee is set out in § 287.020.1 RSMo 1986. According to the relevant parts of the statute:
The word "employee" as used in this chapter shall be construed to mean every person in the service of any employer, as defined in this chapter, under any contract of hire, express or implied, oral or written, or under any appointment or election, including executive officers of corporations. Any reference to any employee who has been injured shall, when the employee is dead, also include his dependents, and other persons to whom compensation may be payable.
The term "independent contractor" has been judicially interpreted in the absence of a definition under the Workers' Compensation statute:
An independent contractor is one who, exercising an independent employment, contracts to do a piece of work according to his own methods, without being subject to the control of his employer, except as the result of his work. Miller, 714 S.W.2d at 656, (quoting Vaseleou v. St. Louis Realty & Securities Co., 130 S.W.2d 538, 539 (Mo.1939)).
Walls owned his own cab. He was responsible for maintenance and repair of the vehicle. He painted and identified the cab according to the rules of Allen. He paid stand dues of $600 per month to Allen for radio dispatching, office overhead, liability expenses, and the use of Allen's cab permit. The City of St. Louis requires two permits in order to operate a cab. It issues a limited number of permits to each cab company to be distributed to individual drivers. These permits are for the vehicle. Allen was in possession of approximately 90 cab permits at the time of Walls' death. The permits must be periodically renewed in order to prove to the city liability insurance is in place. In addition, the individual driver must obtain a personal driving permit issued from the city. Walls was in possession of both permits at the time of death.
Walls enjoyed the independence of setting his own hours, driving his own cab, and collecting fares directly from patrons. He received radio dispatches from Allen but he was not required to respond to any specific requests. An individual performing his own work on his own terms may be construed as an independent contractor. Miller, 714 S.W.2d at 656. However, Walls' ability to drive his cab and perform his work remained dependent on his relationship with Allen. He was compelled to follow the rules of the cab company and was required to pay the stand dues each month in order to retain his license. The existence of employer control over the services to be provided by an individual is indicative of an employer-employee relationship. Id.
Bank asserts as a matter of law Walls was an independent contractor. It emphasizes distinctions in employer-employee relationships. In Goodman v. Allen Cab Co., Inc., 360 Mo. 1094, 232 S.W.2d 535 (1950), the court found a cab driver was an independent contractor based on his independence in accepting fees and dispatches, purchasing gas, and his individual responsibility for the maintenance of the vehicle.
Walls experienced similar independence concerning his acceptance of work and the maintenance of his vehicle. However, he was dependent on Allen for his permit to operate a cab and his liability insurance. Allen compelled its drivers to purchase gas from them and instigated specific rules and regulations concerning the appearance and operation of the cabs. The present facts are more in line with the case of Shinuald v. Mound City Cab Co., 666 S.W.2d 846 (Mo.App.1984) where a similar relationship existed concerning stand dues, liability insurance, maintenance and ownership of cabs, and the use of a cab permit.
This court in Shinuald examined the employer's control or right to control an individual through "relative nature of the work tests." Ceradsky...
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