Ware v. INDUSTRIAL COM'N

• Decision Date: 28 December 2000
• Docket Number: No. 1-00-1279 WC.,1-00-1279 WC.
• Citation: Ware v. INDUSTRIAL COM'N, 743 N.E.2d 579, 318 Ill.App.3d 1117, 252 Ill.Dec. 711 (Ill. App. 2000)
• Parties: William WARE, Appellant, v. The INDUSTRIAL COMMISSION et al. (Superior Carriers, Appellee).
• Court: Appellate Court of Illinois

743 N.E.2d 579

318 Ill.App.3d 1117

252 Ill.Dec. 711

William WARE, Appellant, v. The INDUSTRIAL COMMISSION et al. (Superior Carriers, Appellee).

No. 1-00-1279 WC.

Appellate Court of Illinois, First District, Industrial Commission Division.

December 28, 2000.

Slavin & Slavin, Christopher Mose, Chicago, for Appellant.

Inman & Fitzgibbons, Ltd., William D. Brewster, Chicago, for Appellee.

Justice COLWELL delivered the opinion of the court:

Claimant, William Ware, appeals a decision of the circuit court of Cook County confirming a decision of the Industrial Commission (Commission). The Commission reversed the decision of the arbitrator awarding benefits under the Workers' Compensation Act (Act). 820 ILCS 305/1 et seq. (West 1994). The Commission found that claimant failed to prove that an employer-employee relationship existed between him and respondent, Superior Carriers (Superior). We reverse.

BACKGROUND

Ware was an over-the-road truck driver who owned his own semi-tractor. Superior was a company engaged in the business of delivering freight for various customers. Superior provided tank trailers to Ware. On October 1, 1992, Superior dispatched Ware to deliver a load of methanol to a facility in Michigan owned by Shell Chemical (Shell). A pump, which was used for unloading, was leaking and Ware attempted to tighten the packaging on the pump. Ware's jacket became entangled in the pump's drive shaft, and he was severely injured. The pump was located on the tractor. Superior required that the tractor be equipped with the pump.

At the time of the accident, Ware was operating under an agreement with Superior titled "Equipment Lease Agreement Between Independent Contractor And Carrier." The lease referred to Ware as an independent contractor. The agreement provided that Ware would lease his tractor to Superior, giving it "exclusive possession, control, and use for the limited purpose of complying with state and federal transportation law." Under the lease, Superior was required to pay for insurance to cover the vehicle when it was being operated in Superior's service. Superior also was to acquire "bobtail" insurance to cover the vehicle when it was not operated in their service. This insurance was charged to Ware. Ware was paid a percentage of the gross revenue from each particular job. The lease required Ware to submit several documents in order to be paid. The lease also provided that the cost of tank cleaning was to be split between the parties and that Ware was responsible for inspecting the tanks. One of the documents Ware had to turn in to be paid was a "tank cleaning check off list." The lease allowed Ware to hire other individuals to operate the truck, but required his hiring decisions to be approved by Superior. Ware was responsible for all costs of operation. The lease also prohibited Ware from using his tractor to haul freight for other companies without Superior's approval. The lease could be terminated at anytime, after 30 days from its effective date, if either party gave notice by certified mail. Superior could also terminate the lease immediately under various circumstances, including failure to provide a competent driver. This was not the first lease between the parties; rather, Superior would terminate a lease and issue a new one when necessary to comply with applicable local or federal regulations. The lease the parties were operating under at the time of the accident was signed January 14, 1991. Ware stated that he understood the lease and entered into it voluntarily.

Ware was paid a percentage of the gross revenue, except when hauling for Shell where he was paid by the mile. He did not receive any form of a benefit package. Superior did not withhold income or social security taxes from Ware's compensation. Ware received a federal 1099 form rather than a W-2 form.

Ware had been employed by D & L Transport when Superior acquired that company in 1987. Ware was working under a lease agreement, and Superior canceled that lease and issued a new one. Since that time, Ware worked exclusively for Superior. He quit in 1989, but he returned after two weeks. While working for Superior, Ware did not have any other customers and did not advertise as a separate business. He was, however, incorporated. Ware did have another driver operating his truck for an undetermined amount of time in 1991 and 1992.

Individual assignments were initiated by Superior through a travel order. Ware did not make arrangements with Superior's customers. The order would tell a driver what load he was carrying, where to deliver it, what times he had to pick up and deliver it, and what equipment he needed to unload. The order also provided some routing information. Timetables reflected the requests of Superior's customers. Generally, drivers were not required to follow the suggested route, but if hazardous materials were being hauled, the route was mandatory in some areas.

Superior provided instructions to Ware regarding the operation and maintenance of his truck. Superior prohibited Ware from carrying unauthorized passengers in his truck. It required Ware to notify Superior if an accident occurred. Superior forbade Ware to operate more hours than allowed by federal law and threatened to terminate him if he received three speeding tickets in one year. Superior set forth procedures for operating in cold weather. These procedures included how to clean the vehicle, where to park, what kind of fuel to purchase, and when to check the trailer for condensation. Superior instructed Ware to remove all hoses from the trailer he was using and place them on a cleaning rack at the end of a shift. Superior required Ware to take a physical every two years. The results of the physicals were sent directly to Superior. Superior's company logo was displayed on Ware's tractor. Many of the requirements Superior mandated originated in federal regulations governing the trucking industry.

In 1989 and 1990, Ware was a part of a portion of Superior's fleet which was dedicated to serving Shell. Shell imposed additional requirements on this fleet. Ware was required to display the Shell logo, as well as the Superior logo, on his tractor. He was required to wear a uniform, bearing both companies logos, and to shave his beard. OSHA required drivers to be clean shaven so that an oxygen mask would fit, if necessary. Because Shell required instant communication with these drivers, Superior installed a cellular telephone in Ware's truck. Ware was required to attend safety meetings while part of this fleet.

Ware's truck was registered in Superior's name. This was required by federal regulations. The cost of the license was deducted from Ware's compensation. The "bobtail" insurance Superior selected for Ware's truck listed both parties as insureds. The cost of this insurance was also deducted from Ware's compensation.

Ware was allowed to purchase his own workers' compensation insurance policy under the lease. In 1990, Superior put together an "occupational accident plan" through CIGNA. This was not a true workers' compensation plan. If a driver successfully made a workers' compensation claim against Superior, the benefits of this policy would be paid to Superior. All drivers were required to either procure their own workers' compensation insurance or enroll in the CIGNA plan at their own expense. Ware initially declined to participate in the CIGNA plan, despite not having his own insurance at the time. In May 1991, Superior told Ware he would no longer be dispatched unless he enrolled in the CIGNA policy, and Ware complied. Ware had provided his own workers' compensation insurance in the past.

Following his accident, Ware was unable to make payments on his truck. He sold it on February 1, 1993. In a letter dated April 26, 1993, Superior terminated the lease agreement. Joe Benes, a Superior employee, testified that Ware inquired about employment as a "company driver" around this time.

The arbitrator awarded Ware benefits under the Act. 820 ILCS 305/1 et seq. (West 1994). The arbitrator relied primarily on Superior's right to control Ware's activities and the nature of Ware's work in relation to Superior's business. The arbitrator also cited Superior's retention of the right to discharge Ware and the fact that Superior provided equipment and material to Ware in support of his decision. The arbitrator noted that Ware was paid as an independent contractor, but found that this factor did not outweigh those upon which he relied.

The Commission reversed. The Commission found the present case controlled by Earley v. Industrial Comm'n, 197 Ill.App.3d 309, 143 Ill.Dec. 126, 553 N.E.2d 1112 (1990). The Commission found the case similar to Earley in the following respects: both case involved similar vehicle insurance arrangements; both cases involved claimants who paid for their own health insurance; both cases involved claimants who were paid a percentage of gross revenue for shipments delivered; both cases involved parties operating under a lease with an exclusivity provision; and both cases involved similar arrangements regarding how the claimants were dispatched. The Commission also noted that Ware had incorporated and that the lease identified him as an independent contractor. Finally, the Commission rejected Ware's contention that Superior's greater ability to terminate the lease allowed Superior to exercise substantial control over Ware.

The circuit court of Cook County found that the Commission's decision was not contrary to the manifest weight of the evidence. The circuit court also relied on the present case's similarities to Earley. The court noted that the dispatch procedures used in both cases were the same. The court rejected Ware's reliance on the exclusivity provision in the lease, finding that it was imposed by federal regulations rather than Superior and that it applied to the tractor rather than to Ware personally. The court noted that most of...