Waring v. Henry
| Decision Date | 21 April 1947 |
| Docket Number | 39737 |
| Citation | 203 S.W.2d 470,356 Mo. 749 |
| Parties | George Waring, Formerly Doing Business as the St. Louis County Bus Lines, St. Louis County, Missouri, Appellant, v. Carl J. Henry, Elmer John Keitel, Sr., and Harry P. Drisler, Members of the Unemployment Compensation Commission of Missouri |
| Court | Missouri Supreme Court |
Motion for Rehearing or to Transfer to Banc Overruled July 14, 1947.
Appeal from Cole Circuit Court; Hon. Edward T. Eversole Judge.
Affirmed.
Edwin A. Smith for appellant.
(1) The decision of the respondents and the judgment of the trial court affirming said decision and the latter's overruling appellant's motion for a new trial, were against the law and against the decisions of the Supreme Court of Missouri and are not supported by substantial evidence. Laws 1937, sec. 3 (I) (4), p. 576; Laws 1939, Sec. 3 (I) (4), p. 889; Murphy v. Doniphan Tel. Co., 147 S.W.2d 616; Texas Unemployment Comp. Comm. v. Bass, 151 S.W.2d 567; Kellogg v. Murphy, 164 S.W.2d 285; Krisman v. Unemployment Comp. Comm., 171 S.W.2d 575; Atkisson v. Murphy, 179 S.W.2d 27. (2) Respondents' whole case is predicated upon Laws of Missouri, 1937, Sec. 3 (I) (4), and Laws of Missouri, 1939, Sec. 3 (I) (4). There is and was no competent or substantial evidence before respondents or before the trial court, that there had been substantial unification of the two businesses, viz.: Appellant, doing business as the St. Louis County Bus Lines and the Suburban Service Bus Co., a corporation, of which appellant was president. Kellogg v. Murphy, 164 S.W.2d 285; 5th point, and other cases cited under (1). (3) Where the question involved is (as here) whether the person on whom the tax is sought to be imposed comes within the statutory provision imposing the tax, the statute must be construed strictly against the taxing authority and liberally in favor of the person sought to be held. Texas Unemployment Comp. Comm. v. Bass, 151 S.W.2d 567, point (5); where they have a similar statutory provision; Atkisson v. Murphy, 179 S.W.2d 27, point (6). (4) The decision of the respondents and the judgment of the trial court affirming said decision and the latter's overruling appellant's motion for a new trial deprived the appellant of his property without due process of law as guaranteed to him by the 5th Amendment to the Constitution of the United States of America, as well as the 14th Amendment to said Constitution, and to the equal protection of the law as further guaranteed to him by said 14th Amendment; and also deprived him of his property without due process of law as guaranteed to him by Section 30 of the Constitution of the State of Missouri of 1875, and to Section 10 of the Constitution of the State of Missouri of 1945.
Michael J. Carroll, Chief Counsel, and Charles F. Moseley, Assistant Counsel, for respondents.
(1) Respondents' findings of fact in their decision and order of reassessment are supported by competent and substantial evidence. Murphy v. Doniphan Tel. Co., 347 Mo. 372, 147 S.W.2d 616; Kellogg v. Murphy, 349 Mo. 1165, 164 S.W.2d 285; Trianon Hotel Co. v. Keitel, 350 Mo. 1041, 169 S.W.2d 891; Atkisson v. Murphy, 352 Mo. 644, 179 S.W.2d 27; Laws 1937, p. 576, sec. 3 (h) (4); Sec. 9423 (h) (4), R.S. 1939; Sec. 9432B (c), R.S. 1939, as amended 1943, Laws 1943, p. 940. (2) The respondents' decision and order of reassessment correctly applied the law to the facts found, and such application of the law was properly affirmed by the trial court. Murphy v. Doniphan Tel. Co., 347 Mo. 372, 147 S.W.2d 616; Kellogg v. Murphy, 349 Mo. 1165, 164 S.W.2d 285; Krisman v. Murphy, 351 Mo. 18, 171 S.W.2d 575; Texas Unemployment Comp. Comm. v. Bass, 151 S.W.2d 567; Laws 1937, p. 576, sec. 3 (h); Sec. 9423 (h), R.S. 1939. (3) Respondents' decision and order of reassessment and the judgment of the trial court in affirmation thereof do not deprive the appellant of his property without due process of law or of the equal protection of the laws under state and federal constitutions. Village of Grandview v. McElroy, 318 Mo. 135, 298 S.W. 760; Kellogg v. Murphy, 349 Mo. 1165, 164 S.W.2d 285; Krisman v. Murphy, 351 Mo. 18, 171 S.W.2d 575.
Barrett, C. Westhues and Bohling, CC., concur.
Upon the theory that George Waring, doing business as the St. Louis County Bus Lines, was an employer within the meaning of the affiliate clause Mo. R.S.A., Sec. 9423(h) (4) of the Unemployment Compensation Law the Commission assessed contributions and interest against him for the years 1937 to 1941 inclusive. On review the Circuit Court of Cole County found that the final decision of the Commission was supported by competent and substantial evidence and affirmed the award. Upon this appeal by Waring the sole question for determination is whether there is competent and substantial evidence in support of the Commission's finding of fact. Mo. R.S.A., Sec. 9432B(c); Kellogg v. Murphy, 349 Mo. 1165, 164 S.W.2d 285; Wood v. Wagner Electric Corp., 355 Mo. 670, 197 S.W.2d 647.
Admittedly, since January 1942, George Waring has been subject to the act and, accordingly, has been paying contributions as an employer under the act. But it is the position of the Commission that he was also under the act from 1937 through 1941 because he owned, operated and controlled the St. Louis County Bus Line and, at the same time, was the majority stockholder of the Suburban Service Bus Company, the two businesses being managed and controlled by the same three persons, George Waring and his sons, Frank and Lee. In considering this case, therefore, we confine ourselves to the instance of two business units, one of which is a corporation, the majority stockholder of which is the sole owner of the other business. In so doing we eliminate from our consideration the instances which truly come under the successor clause of the act (Arado v. Keitel, (Mo.), 182 S.W.2d 176; Bucklin Coal Mining Co. v. Unemployment Comp. Com., No. 40,002, 356 Mo. 313, 201 S.W.2d 463) rather than those which come under the affiliate clause. See and compare the collection of cases in 142 A.L.R. 918 and 158 A.L.R. 1237.
The Commission examined but two witnesses, the appellant, George Waring, and its field adviser, Glenn S. Barrow. For twenty years Mr. Waring was employed by a retail hardware store. He testified that he was the sole owner, operator and manager of the St. Louis County Bus Line and that his sons, Frank and Lee, had no interest whatever in that enterprise. During the years 1937, 1938, 1939 and 1940 that bus line consisted of two, sometimes three, busses. That bus line is a single route running from Cherokee over Gravois to Hampton and Affton. The equipment of the St. Louis County Bus Line is kept and maintained in private garages, most of the time in a garage at Gravois and Rock Hill Road. Originally, one of the busses had been a school bus, one was purchased in Chicago and one was purchased from Suburban Service Bus Company and, at the time of the hearing, one bus had been leased on a month to month basis from Suburban Service Bus Company. Mr. Waring testified that St. Louis County Bus Line operated under a permit from the City of St. Louis.
The Suburban Service Bus Company is a corporation with fifty shares of capital stock. Originally, Mr. Waring owned twenty-one shares of the stock and his sons, Frank and Lee, owned two shares each, while a Mr. Carron owned twenty-two shares of stock and Mrs. Carron owned two shares with one daughter and one share with another daughter. In 1935 Mr. Carron died and his stock was transferred to his wife. On June 15th, 1937 Mr. Waring bought the twenty-five shares of stock from Mrs. Carron and her daughters. Mr. Waring's sons, Frank and Lee, had been working for the company and on December 24, 1939, he gave each of them seven additional shares of stock in the company. On January 9th, 1940 he gave Lee an additional seven shares and in February 1940 Mr. Waring divided the stock so that he owned eighteen shares and each son owned sixteen shares. Throughout the time Mr. Waring and his sons have been the directors of the corporation. Mr. Waring has always been president and the sons secretary-treasurer or vice-president. At the time of the hearing Frank Waring was forty years of age and Lee was in his thirties.
The Suburban Service Bus Company operates twenty-two or twenty-three busses over both regular and irregular routes under permits from the Missouri Public Service Commission. The regular route is from 8200 N. Broadway to Riverview Drive to Prospect Hill, to Riverview Gardens and return. Another route is over Broadway to Spanish Lake and the St. Louis Training School. In addition the company has a contract with the City of St. Louis to transport waterworks employees to the Chain of Rocks. For a part of the time the company has transported workers to the Curtis-Wright plant.
The office of Suburban Service Bus Company is at 9300 Bellefontaine Road, sixteen miles from the garage where St. Louis County busses are kept. Mr. Waring testified that his son, Lee, did the office and book work for the company while Frank managed the garage and repair work. He testified that he took no part in the management or operation of that company. He said that company was managed and controlled by his two sons, Frank and Lee. When asked what his functions as president of the company were he said: He said: "I established this for the children."
The sons live in separate houses just west of the garage on Bellefontaine. Mr. Waring lives with Frank and uses the basement of Frank's home as an office from which he conducts the affairs of St. Louis County Bus Lines. He testified that he kept separate books...
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