Williams v. Cleveland Cliffs Iron Co., Forest Products Div.

• Decision Date: 14 August 1991
• Docket Number: No. 126767,126767
• Citation: 190 Mich.App. 624,476 N.W.2d 414
• Parties: Harold E. WILLIAMS, Plaintiff-Appellant, v. CLEVELAND CLIFFS IRON CO., FOREST PRODUCTS DIVISION and Second Injury Fund, Defendants-Appellees. 190 Mich.App. 624, 476 N.W.2d 414
• Court: Court of Appeal of Michigan — District of US

Page 414

476 N.W.2d 414

Harold E. WILLIAMS, Plaintiff-Appellant, v. CLEVELAND CLIFFS IRON CO., FOREST PRODUCTS DIVISION and Second Injury Fund, Defendants-Appellees.

No. 126767.

190 Mich.App. 624, 476 N.W.2d 414

Court of Appeals of Michigan.

Submitted Oct. 3, 1990, at Marquette.

Decided May 2, 1991.

Approved for Publication Aug. 14, 1991, at 9:10 a.m.

Released for Publication Nov. 18, 1991.

[190 MICHAPP 624] Green, Renner, Weisse, Rettig, Rademacher & Clark, P.C. by Frederick C. Weisse, Escanaba, for plaintiff-appellant.

Clancey, Hansen, Chilman, Graybill & Greenlee, P.C. by Ronald E. Greenlee, Ishpeming, for defendants-appellees.

Before MURPHY, P.J., and BRENNAN and MARILYN J. KELLY, JJ.

PER CURIAM.

Plaintiff appeals by leave granted from a decision of the Workers' Compensation Appeal Board finding him not entitled to benefits [190 MICHAPP 625] under the Workers' Disability Compensation Act. M.C.L. Sec. 418.101 et seq.; M.S.A. Sec. 17.237(101) et seq. The basis for the finding was that plaintiff was not an employee of defendant Cleveland Cliffs Iron Company. We affirm.

On appeal, plaintiff argues that the WCAB erred in applying the economic reality test to determine whether he was an employee or independent contractor for purposes of the act. He contends alternatively that, if the economic reality test is the correct test, the board applied the wrong version of the test to the facts of this case.

Plaintiff hauled logs for the Forest Products Division of Cleveland Cliffs. He drove his own truck which he had purchased with financing assistance from Cleveland Cliffs. On October 10, 1980, plaintiff was hit by a log which rolled from his truck while he was unloading at a sawmill. The mill had purchased the logs from Cleveland Cliffs. Plaintiff sustained serious injuries and is now a paraplegic.

On February 5, 1981, plaintiff filed a claim for disability compensation benefits. Following a hearing, the referee denied the claim concluding that plaintiff was not an employee of Cleveland Cliffs. The WCAB affirmed.

Plaintiff claims that the board erred in applying the economic reality test to determine whether he was an employee or an independent contractor. He contends that the board should have either applied previous Michigan Supreme Court "logging cases" or followed the trend in national law.

Our review of a decision by the WCAB is limited. In the absence of fraud, findings of fact by the board are conclusive and may not be set aside if supported by record evidence. However, we will reverse the WCAB's decision if the board operated within the wrong legal framework or if its decision [190 MICHAPP 626] is based on erroneous legal reasoning. Flint v. General Motors Corp., 184 Mich.App. 340, 343, 457 N.W.2d 157 (1990).

In 1959, the Supreme Court made its ruling in Tata v. Muskovitz, 354 Mich. 695, 94 N.W.2d 71 (1959). Before that decision, Michigan followed the common-law control test to determine whether an employee-employer relationship existed for the purposes of workers' compensation. Since Tata, our Supreme Court has consistently used the economic reality test when questions have arisen under workers' compensation law relative to the existence of an employment relationship. Wells v. Firestone Tire & Rubber Co., 421 Mich. 641, 647, 364 N.W.2d 670 (1984); Andriacchi v. Cleveland Cliffs Iron Co., 174 Mich.App. 600, 436 N.W.2d 707 (1989).

Plaintiff cites four Supreme Court cases dealing with the relationship between a log hauler and a logging company. He asserts that, in line with these cases, we must find him to be an employee of Cleveland Cliffs. See Dennis v. Sinclair Lumber & Fuel Co., 242 Mich. 89, 92, 218 N.W. 781 (1928); Warner v. Fullerton-Powell Hardwood Lumber Co., 231 Mich. 328, 329, 204 N.W. 107 (1925); Van Simaeys v. George R. Cook Co., 201 Mich. 540, 546, 167 N.W. 925 (1918); Tuttle v. Embury-Martin Lumber Co., 192 Mich. 385, 399, 158 N.W. 875 (1916). However, each of these cases was decided using the control test, before Michigan abandoned it. The control test is no longer the applicable law or the appropriate test. Tata, supra. The WCAB did not err by refusing to treat these "logging" cases as authority.

Plaintiff also asserts that the WCAB should have followed the nationwide trend in the law toward finding owner-drivers in the logging industry to be employees of the logging company. This trend is [190 MICHAPP 627] described by Professor Larson in his treatise on workers' compensation law. 1C Larson, Workmen's Compensation Law, Sec. 44.34(e), pp. 8-159 to 8-165. However, Michigan law clearly provides that the relationship must be analyzed under the economic reality test. We are unable to adopt the position which Professor Larson identifies as in line with the national trend in face of the clearly stated precedent of our own Supreme Court.

Plaintiff next asserts that the WCAB erred by applying the four-factor economic reality test.

The economic reality test has been variously described as composed of four factors, eight questions or two basic queries. Askew v. Macomber, 398 Mich. 212,...