Zelney v. Murphy

• Decision Date: 19 September 1944
• Docket Number: No. 28023.,28023.
• Citation: 387 Ill. 492,56 N.E.2d 754
• Parties: ZELNEY v. MURPHY, Director of Labor, et al.
• Court: Illinois Supreme Court

387 Ill. 492

56 N.E.2d 754

ZELNEY

v.MURPHY, Director of Labor, et al.

No. 28023.

Supreme Court of Illinois.

Sept. 19, 1944.

Separate claims by Robert Robey and George W. Katana for unemployment compensation filed with Francis B. Murphy, Director of Labor, based in part on contention that claimants were in employ of Peter F. Zelney, doing business as Triangle Motorcycle Package Service, which claims were consolidated on hearing. From a judgment of the circuit court quashing writ of certiorari and affirming the decision of the board of review, and the Director, finding that claimants were in the employment alleged, Peter F. Zelney, etc., appeals.

Judgment affirmed.Appeal from Circuit Court, Cook County; Michael Feinberg, judge.

Alfred F. Beck, of Chicago, for appellant.

George F. Barrett, Atty. Gen. (William C. Wines, of Chicago, of counsel), for appellees.

THOMPSON, Justice.

Appellees, Robert Robey and George W. Katana, hereinafter referred to as claimants, filed individual claims with the Department of Labor, for unemployment compensation under the provisions of the Illinois Unemployment Compensation Act, claiming they were in the employ of Peter F. Zelney, doing business as Triangle Motorcycle Package Service. The claims were consolidated on hearing and appellant, Zelney, seeks review of a judgment of the circuit court of Cook county, quashing the writ of certiorari and affirming the decision of the board of review and the Director, finding that Robert Robey and George W. Katana were in the employ of appellant and so entitled to unemployment compensation.

Appellant contends that the Unemployment Compensation Act, Ill.Rev.Stat.1943, chap. 48, par. 217 et seq., is invalid for reasons set out in his brief, and that the record does not sustain the findings of the Department of Labor that Robey and Katana were employee of appellant, Zelney.

The facts show that Peter F. Zelney, doing business as Triangle Motorcycle Package Service, operated a motorcycle package delivery service in the city of Chicago. An over-all picture of the operation of the business reveals that Zelney maintained an office with telephone service and advertised in the Chicago classified telephone directory, commonly known as the Red Book, ‘giving just the name [Triangle Motorcycle Package Service] and special delivery motorcycles.’ In furnishing this service Zelney engaged the owners of certain motorcycles among whom were the claimants, Robey and Katana, who drove and owned their own motorcycles, furnished and paid for their own licenses, gas and oil. Zelney owned the business, kept the books, furnished an office, telephone service, receipt forms, and rate cards setting forth the fees to be charged customers for various services. The fees for the services rendered were divided between Zelney and the motorcycle drivers, seventy per cent going to the drivers and thirty per cent to Zelney. Zelney, after receiving a telephone call from a customer that a package was to be picked up and delivered, called one of the drivers, who had reported to his office for such service, giving him the name and location of the customer. The driver then answered the call for the pickup, received from the customer his instructions concerning the delivery, delivered same and took a receipt therefor which he turned into the office maintained by Zelney, with a notation thereon of the service. For this service the customer was billed by Zelney. To expedite the handling and delivery of packages and to eliminate duplication by the drivers, they sometimes brought packages to Zelney's office where they dumped them in a pile on the floor of a garage which belonged to Zelney, putting the receipts corresponding thereto in a basket. When a call for a pickup came in, the driver whose turn it was to answer the call would look over the tickets and sort out from the pile the corresponding packages to be delivered in the vicinity of the pickup. The pickups were free. The driver received the seventy per cent only on deliveries but it evened itself up. Mrs. Zelney, wife of appellant, who worked in the office, answered the telephone and kept the books, often sorted the tickets of packages to be delivered in the same vicinity of the pickups. The drivers frequently delivered C.O.D. packages and in such cases the money received was all turned over to Zelney without deduction by the driver of any part of his fee. Zelney would then deduct the whole fee upon remitting to the customer. The business, as built up by Zelney, consisted of customers who were steady and regular and most of them were carried on open account, Zelney billing them for services rendered. The drivers were paid their share of the earnings at the end of each week by Zelney, who assumed the risk of non-collection.

The evidence discloses that Robey and Katana were at liberty to do work for other persons but never did. Their entire time was taken up in deliveries and pickups for the Triangle Motorcycle Package Service, operated by Zelney. Neither were under written contracts although some of the others were so engaged. There were no set starting, working, or quitting hours. The drivers, however, usually reported for work between eight and nine o'clock in the morning at the office of Zelney.

It is urged by appellant the claimants are independent contractors within the meaning of the Illinois Unemployment Compensation Act and not employees of appellant; that the act is unconstitutional both under the State and Federal constitutions. As to the constitutional questions involved, it is contended that the disbursements of contributions made to the Director of Labor, being public funds, violates section 16, 17 and 20 of article IV of the State constitution, Smith-Hurd Stats. This question was not presented to the trial court and on appeal will not be considered. It is a well-settled rule that a constitutional question cannot be presented in this court for review unless it was presented to the lower court for its determination. The rule applies in cases of this kind. The record of the circuit court must disclose in some manner that such a question was presented to it for its determination before it can be raised in this court. Odin Coal Co. v. Industrial Comm., 297 Ill. 392, 130 N.E. 704;Savoy Hotel Co. v. Industrial Board, 279 Ill. 329, 116 N.E. 712.

It is contended by appellant that contributions under the Unemployment Compensation Act cannot be sustained as taxes and that under sections 1 and 2 of article IX, of the State constitution, the legislature is restricted to taxation for revenue only and to three classes of taxes. The three classes are: (1) Property taxes on a valuation basis; (2) occupation taxes; and (3) franchise or privilege taxes. All property taxes must be ad valorem. All other taxes must be uniform. The cases of Bachrach v. Nelson, 349 Ill. 579, 182 N.E. 909, and Winter v. Barrett, 352 Ill. 441, 186 N.E. 113, 89 A.L.R. 1398, are cited in support of this proposition.

If it could be said that this is a taxing statute there would be some merit to appellant's contention. However, in the case of Zehender & Factor, Inc., v. Murphy, 386 Ill. 258, at page 262, 53 N.E.2d 944, at page 946, this court said: ‘The Unemployment Compensation Act declares its policy and moving purpose to be to alleviate the evils flowing from wide-spread unemployment and to provide benefits to those workers coming within the act as at least a partial reimbursement for loss of income during periods of unemployment. Section 23(a) of the act, Ill.Rev.Stat.1943, chap. 48, par. 240(a), provides that the money collected under the act shall be kept separate and apart from all public monies of the State by the State Treasurer, who is made the custodian thereof, and that the act shall be administered by the Director of Labor exclusively for the purpose of the act. In Oak Woods Cemetery Ass'n v. Murphy, 383 Ill. 301, 50 N.E.2d 582, this court declared this statute to be an exertion of the police power of the State, holding that relief of unemployment is a public purpose and that the act is remedial. On this same principle it has been held that acts which may be regarded as enacted in the interest of public welfare and providing for assistance of the unemployed, are entitled to receive liberal interpretation. Maine Unemp. Comp. Comm. v. Androscoggin, Junior, Inc., 137 Me. 154, 16 A.2d 252;New Haven Metal & Heating [Supply] Co. v. Danaher, 128 Conn. 213, 21 A.2d 383;Young v. Bureau of Unemp. Comp. , 10 S.E.2d 412;Singer Sewing Machine Co. v. State Unemp. Comp. Comm., 167 Or. 142, 103 P.2d 708,116 P.2d 744, 138 A.L.R. 1398. Illinois remedial legislation has heretofore been regarded as entitled to liberal construction even though it requires involuntary contributions to maintain it. Grand Trunk Western Railway Co. v. Industrial Comm., 291 Ill. 167, 125 N.E. 748;Chicago, Wilmington & Vermilion Coal Co. v. People, 181 Ill. 270, 54 N.E. 961,48 L.R.A. 554;Consolidated Coal Co. v. Illinois, 185 U.S. 203, 22 S.Ct. 616, 46 L.Ed. 872.

‘While we are not inclined to quibble over the distinction between contributions and the assessment of payments, we are of the opinion that the amounts required to be paid do not come within the classification of general taxation, and that the statute is not a taxing statute and is entitled to liberal construction to the end that its purposes may be met.’

It is urged that the State may not take private property nor money for a private use and that the act as a whole violates sections 1, 2, 13 and 20 of article II of the State constitution and section 1 of the fourteenth amendment to the Federal constitution; and the case of People v. Chicago, M. & St. P. R. Co., 306 Ill. 486, 138 N.E. 155, 158, 28 A.L.R. 610, is cited in support of such contention. The statute there, as questioned, provided a penalty for any employer who made a deduction in wages for a period of two hours used by such employee in voting at any...