### IN THE COURT OF APP EALS OF TENNESS EE AT JAC KSON N O V E MB E R 7 , 200 7 S es sio n

TENNES SEE FARMERS MUTUAL INS. CO. v . KENT CHE RRY, ET AL


### .

Direc t Appeal from the Circ uit Court for Laud erdale County

No. 5965 Joseph H. Walk er, III, Judge

No. W2007-00342-C OA-R3-C V - F iled April 7, 2008

I n this app e a l w e mu s t d e te r mi n e w h e th e r

anin ju r e d p arty w a s a “ f ar m e mp lo y e e ” w it

h in the meaningof a f

arm owne r’s liability

insuran ce p o l i cy

. The a lleg ed employ ee is the f arm owne r’s fathe r. He was g rinding corn to fee d the fa rm owner ’s cattle when he w as injured. The fathe r and his wi fe fi le d s uit

a g a ins t th e so n a

nd his wi fe se e kin g to re c ov e r dama g e s a s a re su lt o f t he a c c ide nt. Th e so n’ s f

arm ow ne r’ s li a

bil ity po lic y pr ov ide d c ov e ra g e fo r oc c ur re nc e s to “ fa

rm e mpl oy e e s” in

cer tain instances. The insurer f iled this declaratory

judgme nt action see king a decla ration that it had no duty to defe nd or indemnify the insureds beca use the fathe r was not a far m e mploy ee. The trial court he ld that the fathe r wa s a farm employ ee a nd order ed the insure r to defe nd and indemnify the ins ur e ds in t

he un de rl y inglaws uit . We a ff ir m.

Tenn. R. App . P . 3.; Appeal as of Right; Judgme nt of th e Circ uit Court Aff irm ed

A LA N E. H I G H ERS , P.J ., W.S ., delivere d the opinion of the cour t, in which D AVI D R. F ARMER , J ., joined, and H OL L Y M. K I RBY , J ., joined,

Andre w H. Owe ns, Memphis, TN, for Appe llant

Wil liam Dan Doug las, J r., Ripley , TN, for Appellee s, Kent Cherr

y and Cathy

Cherry

Charles M. Ag ee, Jr., Dy ersbur g , TN, for Appellee s, Gera ld Cherry and Shirley

Cherry-2- OP IN ION

I. F A C TS & P R OC EDU R A L H I S T ORY

This case involves a family of cattle deale rs. Ger ald C herr y ’s father and gr andfather we re in t he c a ttl e busi nes s, and

Ge ra ld e ve ntu a lly

ow ne d a

nd op e rate d h is o wn

bu sin e ss, a

so le proprietor ship known as Ger ald Cherr y L ivestock Company . Ger ald Cherr y L ivestock Company bo ug ht a nd so ld c a ttl e . G e ra ld h a d tw o s on s, Ke nt C he rr y and Do ugChe rr

y . K e nt w or

ke d f or Ge ra ld Che rr y L ive sto c k Comp any pe rf or min g du tie s suc h as fe e din g the c a ttl e

. Ke nt wa s not pa id a c e rt a in salary or wa g e for

his work, but acc ording to Gera ld, Kent “j u s t go t what he ne eded, what he

w an te d

. ” K e n t c o u ld w r it e c h e c k s o u t o f G e r a ld Ch e r r y L iv e s to c k Co mp an y ’ s b u s in e s s chec king

a c c ount.

As Ger ald nea

red r etireme nt ag e, Ke nt took on a g reater role in operating Ge rald Cher ry L ivestock Company . For

about five y ear s, both K ent and Ger ald wer e in c harg e of the business, and they considere d themselves to be joint owner s of the business. When Ger ald turned 63 y ears old, he “te chnica lly

retire d” and be g an re ceivingso ci al s ecur ity retire ment benef

its. Accordingto the pa rt ie s, “ a ll thin g s we re tur

ne d ov e r to [Ke nt]” a t th e ba nk , b ut t he re wa s n o c on tr a c t in vo lve d w ith the transf er of the business, and no mone y chang ed hands. A fter the transfe r, Ge rald no long er ha d any owner ship interest in the business, its equipment, or the land whe re it oper ated.

Th e pa rt ie s d id n ot a dv e rt ise or ann ounc e to the pu bli c that Ge ra ld wa s r e tir ing . T he pr op e rt y
and e qu ipm e nt c on tin

ue d to be ins ur e d in

Ge ra ld’ s n a me , a

nd the te le ph on e bo ok

c on tin ue d to lis t “Ge rald Cherry L ivestock Company ” beside Ger ald’s home tele phone number . Kent simply beg an
c o n d u c t i n g t h e c a t t l e b u s i n e s s a s a s o l e p r o p r i e t o r s h i p kn o w n a s C h e r r y C a t t l e an d

L an d C o mp an y,
and he lis te d the bu sin e ss’ s in c ome and e xpe ns e s o n h is t a x re tur

ns . H ow e ve r, Ge ra ld c on tin ue d to

wo rk wi th K e nt i n th e c a ttl e bu sin e ss. Ea c h mo rn ingthe y wo uld me e t and dis c us s w hat ne e de d to be do ne . K e nt h a d th e ult imate “ say so ” re g ard ing the bu sin e ss an d wou ld te ll Ge ra ld wh a t ta sk s to pe rf or m. H ow e ve r, Ge ra ld w ou ld s ome tim e s te ll K e nt what to do , a nd Ke nt w ou ld obe y

him beca use he w as his fathe r.

Ge ra ld w ou ld f

e e d, “ do c tor ,” ha

ul, and g e ne ra lly loo k a ft e r the c a ttl e , s e ll, tr a de , a nd ba rg a in fo r c a ttl e , and so me tim e s ne g oti a te purc ha se s of e qu ipm e nt. Ge ra ld d id n ot h a ve se t w or kin g ho ur s, and he did not re ceive an hourly wag e or cer tain salary . I nstead, he was a uthorized to write chec ks

on the bu sin e ss c he c kin g a c c ount f or wh a te ve r h e ne e de d. Mo st o f h is h ou se ho ld b ills w e re pa id fr om t he bu sin e ss a c c ount, su c h as his ins ur anc e pr e miums, pr op e rt y ta xes, g ro c e ry

bil ls, uti lit ie s, hairc uts, etc. Some of the pa y ments to or for Ge rald we re de ducted by Cherry Cattle and L and as business expenses, but other pay ments made to or for him wer e treated as personal e x penses a nd not deducte d. Kent and Cathy also used the busine s s ac co u n t to pay for some of

their own pe rsonal expenses, which we re not tre ated a s deductions for Che rry Cattle and L and.

On Dec ember

22, 2003, approx i m at el y ten y ear s after

Ger ald “tec hnically

retire d,” Ke nt

as k edGe ra l d

an d M arv i n Fi s k
, an em p l o y ee o f C h erry C at t l e an d L an d C o mp an y , t o gri n d

en o u ghT h e bol d e mph as i s on a l l de f i n ed t er ms h as be en r emov ed. 1

-3- c o r nt o f e e d t h e c a t t l e t h r o u g h t h e h o l i d ays

. T h e c o r n w a s l o c a t e d i n g r a i n b i n s o nt h e “ H u mp h r e ys Fa rm,” whic h was owned by Kent and his brothe r, Doug . Ger ald and Ma rvin wer e using a tra ctor and g rinder owned by Cherry Cattle and L and Company to gr ind the corn, a

nd they hooked the two machines tog ether

by a “PTO,” or power t ake off. They started the tr actor

and beg an ser

vicing it by oiling its chains. Appar ently , Ger ald’s clothing beca me entang led in the machine , and he was pulled into it and seriously

injured. Ge rald was hospitaliz ed for an ex tended period and unable to work for approximately

six months.

Ger ald and his w ife, Shirley Cherry
, subsequently filed suit ag ainst Kent and his wife , Cathy Che rr y , in the Cir c uit Court of L a

ud e rd a le County , Te nn e sse e , se e kin g to re c ov e r d a ma g e s a s a re su lt of the acc ident. Kent and Cathy Cherry claimed that their insurer, Tenne ssee Fa rmers M u t ual I ns ur anc e Com

pa ny (“ Te nn e sse e F arm e rs ” ), ha d a duty to de fe nd and ind e mni fy the m in the laws uit

. Their f arm owne r’s liability

insurance policy

contained an endorse ment entitled “F arm Employ ers L iability ,” which pr ovided:

. . . An y ter m in the po lic y in c on fl ic t w ithany

pr ov isi on

in t his endorse ment shall be of no e ffe ct and inapplica ble. Cov e ra g e E – Pe rs on a l L ia bil ity is am e nd e d to exte nd lia bil ity

cov era g e to i ns ur e ds fo r o c c ur re nc e s to fa

rm e mpl oy e e s w hil e eng ag ed in the fa

rming operations of an insured at or away from the ins ur e d p re mis e s. Cov e ra g e F – Med ic a l Pay me nts to O the rs is a

me nd e d to inc lud e a s a

me dic a l c ov e re d pe rs on a fa rm e mpl oy e e wh o s uf

fe rs a
me dic a l c ov e re d inj ur

y ari sin g ou t of an oc c ur

re nc e wh ile e ng a g e d in the fa rming operations of an insured. 1 Th e te rm “ fa rm e mpl oy e e ” wa s d e fi ne d in the po lic y , in

re le va nt p art , a s f

oll ow s: Fa rm employ ee me ans y our employ ee, under the direc tion of

an insured, whose duties and ac ts are in c onnection with y our fa rming op e ratio ns

. But fa rm employ ee doe s not mean: 1. a pe rs on wo rk ingun de r a

n e xch ang e la

bo r a g re e me nt;

. . .

Te nn e sse e F arm e rs fi le d th is d e c lara tor y jud g me nt ac tio n in

the Cir c uit

Court of L a ud e rd a le County , seekinga dec laration that it had no d u t y t o d ef en d or indemnify

Kent and Cathy

Cherry beca u s e G e r a ld

Ch e r r y w a s n o t a

“ f ar m e mp lo y e e ” w it

h in th e me an in g o f

th e p o li c y

. T e n n e s s ee Fa rmers did not dispute that Ger ald was eng ag ed in a fa rming operation when he wa s injured, but it contended that Ge ra ld was not an “ employ ee” of Ke nt Cherry and/or Cher

ry Cattle and L andT he part i es al s o pr es ent ed ot her ar gu ment s t hat ar e not at i s s ue on appeal

. T enn es s ee Far mers ar gu ed t hat 2

K en t ’ s i n s u r an ce pol i cy di d n ot pr ov i de cov er ag e b ecause t h e H u mph r ey s Fa r m wh er e t h e ac ci den t oc cu r r ed wa s n ot listed a s a n “ins u re d p re m ise s” o n his in su ra n c e p o licy. I n ste a d , th e H u m p h re ys F a rm w a s ins u re d u n d e r G e ra ld ’s p o licy. Exc l u s i on 6 of

K en t ’ s pol i cy pr ov i ded t h at t h er e wa s n o co verag e f or bodi l y i n

j u r i es a r i s i n g ou t of

t h e “ own er s h i p, mai nt ena nce , or us e of

an y pre mi s es wh i ch i s not t he i ns ur ed premi s es

. ” W e rea d t he t r i al co ur t ’ s o r der as f i ndi ng t hat E xcl us i on 6 of

K ent ’ s pol i cy di d appl y t o i ni t i al l y excl ude cover age b eca us e t he H umphre y s Far m was not an i ns ur ed
pr emi s es , an d t h e Che r r y s do n ot pr es en t an y ar g u men t r el at i v e t o t h i s i s s u e on appe al

. H owe v er , t h er e wou l d s t i l l be

c o v e ra g e if

G e ra ld w a s a “far m e m p lo ye e ” b e c a u se the “F a rm E m p lo ye rs L ia b ili ty” e n d o rs e m e n t ex te n d e d c o v e ra g e to

o c c u rr e n c e s to far m e m p lo ye e s “a t o r a w a y fro m the insu re d p re m ise s.” A l so at t ri al
, t he C herry s argued t hat K ent ’ s p o l i cy shoul d b e ref o rme d b ecause hi s i nsur ance agent ad d ed t he H um p hrey s Fa rm t o G eral d ’ s p o l i cy wi t h t he o t her f arm l and rat her t han ad d i ng i t t o K ent ’ s p o l i cy. T he t ri al co urt

r ej ec t ed t h i s a r g u men t a n d t h e Che r r y s h av e n ot appe al ed t h i s f i n di n g

. T h er ef

or e, ou r r ev i ew i s l i mi t ed t o t h e i s s u e of

w h e the r G e ra ld w a s a “far m e m p lo ye e ” w ithin the m e a n ing o f K e n t’s p o licy.

-4- Company

. A benc h trial was he ld on J anuar y 18 an d 19, 2007, befor e Judge Joseph Walker. 2 Se ve ra l w itn e sse s te sti fi e d, and the pa rt ie s intr od

uc e d the de po sit ion

te sti mony

of va ri ou s w itn e sse s, along with numerous exhibit s.

At the conc lusion of the trial, the judg e took the matter under a dvisement and a llowed the pa rt ie s to su

bmi t a dd iti on al mem orandum s in su pp or t of the ir po sit ion s. Th e jud g e ult imate ly conclude d that Ger ald was a “fa rm employ ee” within the meaning of the policy and orde red Tennes s ee Fa rm ers to def end and inde mnify

the insureds in the unde rlying la wsuit. The cour

t

e nte re d a fi na l or de r t

hat in c lud e d th e fo llo wi ngfi nd ing s r e le va nt t o th is a

pp e a l:

The Complaint for De clar at o ry J udg ment came on for consideration on J anuar

y 18 and 19, 2007, up o n the testimony of wi tne sse s and

e xhibi ts f

ro m w hic h th e c ourt

fi nd s a s f oll ow s: Ger ald Cherr

y , fathe r of Kent and Doug Cherry , retire d from the c a ttl e bu sin e ss i n th e 19 90 ' s. Hi s so n K e nt c on tin ue d in the c a ttl e business, operating sometim es under the name of Cherry Cattle and L and Company . Fr om t i m e to t ime Ger ald would help in the operation, as neede d. . . .

. . . On Dec embe r 22, 2003, Ger ald Cherr y was injured on the 3

a c re Humphre y

pr op e rty by

a g ri nd e r m a c hin e ow ne d b y Ke nt. Ger ald has sued K ent. Tenne ssee F arme rs de nies cove rag e, and de nie s th e y

have to d e fe nd

the su it. Ge ra ld h a d n o o wn e rshi p in te re st i n th e bu sin e ss o f K e nt. Ge ra ld r e tir e d f

ro m hi s o wn

c a ttl e bu sin e ss ye ars be fo re the a c c ide nt. Kent had a

cattle business of his own. Ger ald would help Ke nt from tim e to tim e and wa s pa id fo r wo rk
, a s he ne e de d mon ey . Ge ra ld tes ti f ie d h e w a s p a id

f o r th e w o r k d o n e f o r K e n t b y th e p ay me n t of

some of hi s expenses. Ger ald was on social security and did not draw

a sa lary pe r se

. Ke nt te sti fi e d that his fa the r did no t own a

n inte re st in Kent’s cattle business. Gera ld would do some work for him when-5- he nee ded a d d i t i onal help. Ke nt would pay Ger ald for the work by pa y ingso me bil ls o r o the rw ise c omp e ns a tin g him

.

. . . There are a number

of exclusions in the pol icy . I ncorpor ated int o th e po lic y

are fa r m e nd or se me nts wh ic h c ha ng e so me e xclu sio ns

. I n the po lic y , e xclu sio n 8 is b od ily inj ur y to a fa rm e mpl oy e e . T his exclusion i s removed by

an endor sement to t h e policy . Under the far m endorseme nt TF 36, pe rsonal liability is amended to e x tend liability cover ag e to i n s u reds for occ urre nces to fa rm employ ees while eng ag ed i n t h e farming ope rations of a n insured at or

awa y from the insure d premises. Ke nt’s policy included such a

n endorse me n t. T h e e f

f e c t is to e xte n d li a

b il it y c o v e r a g e to K e n t f

or injuries to farm e mploy ees notwithstanding the exclusion from liability cover ag e of bodily

injury arising out o f t he owne rship, maintena n ce or use of

any premises whic h is not the insured pr e mis e s. F arm em ployee: “F arm Employ ee” is defined in the po l i cy as “your e m p l o y ee , under the direc tion of an insured, w hose duties and ac ts are in c onnection with y our fa rming operations.” K e nt testified he re quested Ge rald to g o to the Humphrey far m to h e lp a no the r fa rm ha nd us e the g ri nd e r t o ma

ke c a ttl e fe e d. Ge ra ld

was wor king f or Ke nt using the g rinder when he w as injured. He was
a t th a t ti me c on sid e re d Ke nt’ s e mpl oy e e , un de r t he dir e c tio n o f K e nt, doing a cts in connec tion with Kent’s far ming ope ration. Susa n M ashburn testified she does ac counting for Cher ry Cattle Co mp an y , w h ic h is o w n e d b y K e n t Ch e r r y , a n d p r e p ar e d the tax returns. Some business expenses for the pr oprietorship included pay ments to G era ld Che rry

. The W-3 did not inc lude Ger ald Cherr y
as an e mploy ee f

or income ta x purposes. Gerald Cher ry was dra wing

so c ia l se c ur ity

and the y di d no t w ant t o a ff

e c t hi s so c ia l se c ur ity benef its. That purpose wa s so no deductions we re made f or the

e mpl oy e r’ s p art

fo r s oc ia l se c ur ity . T he re wa s on ly on e ind ivi du a l, Mr. Fisk, who w as listed on the W3. She also did Gerald Cher ry ’s return a nd he did not ear

n enoug h money to file a F orm 1040. When he did file a

return, h e did not list i ncome f rom Kent’s f

arming operation separately . Some of the pay ments to Ger ald by

Kent Cherr

y
we re e xpe ns e d a s f

arm inge xpe ns e s. I n the area of

Worker’s Compensation law, to c ome under the definition of employ ee, the plaintiff “must prove that, at the time of the injury , there was a

n expressed or implied ag ree ment that the worke r wa s to be compensated for his ser vices by the alleg ed employ er.” See, e .g. Hubble v. Dy er, 188 S.W.3d 525 at 533, citing Bla ck v. Da

nce, 643 S.W.2d 6 5 4 (T en n

. 1982). In this case, ther e-6- was a n expressed or implied a g ree ment that Ger ald would be paid for

wo rk do ne in t

he fa rm ingop e ra

tio ns . T he re wa s b oth

an e xpres s
a g re e me nt t

hat he wo uld

be pa id, and

an imp lie d fr om pa st c on du c t. Part of the testimony

of Ke nt included a s s er t i o ns that Gera ld got standard bills paid ea ch month for his work on K ent’s fa rming op e ratio ns . M os t e ve ry

mon th h e re c e ive d th e same thing . T he se pay ments were considere d wag es and not a g ift. The pa y ments were de du c te d b y Ken t on

the ta x re tur

n, and c on sid e re d a s e xpe ns e s. Ger ald did not rec ei v e a W-2 beca use he w as re ceivingsocial

secur ity . At the time of the injury Ger ald was usingKent’s mac hine t o p e r f o r m f ar m i n g w o r

k f o r K e n t

. H i s p ay

w a s n o ta l w a ys
c on sis te nt, bu t he wa s p aid

. Ap ply ingthe Hu

bb le ana ly sis , G e ra ld

wo uld be c on sid e re d a

n e mpl oy e e un de r t

he po lic y of Ke nt. The fa ctors to be c on s i dere d in determining whether an individual is an employ ee or an indepe ndent contra ct o r ar e: 1) the rig ht to c ontrol the conduct of work. I n this c ase K ent had the r ight to c on tr ol t

he c on du c t of wor

k. Ge ra ld did no t wor

k unle ss Ke nt t old him what n e e d e d to b e d o n e

. O n th e d ay o f th e in ju r y , K e nt had direc ted what wor

k neede d to be done a

nd Ger ald and a

nother fa rm hand we re c arr

y ing out the w ork whe n Ger ald wa s i n jured; 2) the ri g ht o f t e rm inatio n. Ke nt c ould us e Gera ld’ s h e lp o r n ot u se it. Ge ra ld d id n ot h a ve the a

uth or ity to h ir e or

fi re oth e r p e op le fo r K e nt. I n a sense , Ke n t could fire his dad by not reque sting he perf

orm
cer tain jobs; 3) the method of pay ment. Ger ald was pa id fo r work do ne . K e nt b e lie ve d h e wa s p a id a bo ut the same e a c h mo nth . G e ra ld was of a dvance d y ear s and re tired fr om other e m p l oy ment, and draw ing s o ci al secur ity . He wa s paid as nee ded. I t is not de te rm inativ e wh e the r G e ra ld l ist e d th a t in c ome se pa ra te ly on his

re tur n. Te sti mony

e sta bli sh e d h e wa s atte mpt ingto p re se rv e his social security
, and ex pecte d to be paid for work done, and in fac t was paid; 4) the fr eedom to sele ct and hire helper s. This duty was Ke nt’s

and no t Ge ra ld’ s; 5) the fu rn ish ing of too ls and e qu ipm e nt. Gera ld

was working with Kent’s tools and equipment. 6) se lf-sche duling of work hours. K ent sche duled the work hours and the work f or Ge rald, when he wanted Ger ald to w ork; and 7) the fr eedom to off er se rvice s to othe r entities. Ger ald worke d for Kent, who was a family member. Th e re wa s n o p ro of

that he wo rk e d f

or oth e rs

. Whil e all the f

actor s are important, the “r ight to contr ol” is the primary test. Masiers v. Arrow Transfe r & Storag e C o., 639 S.W .2d 654, 656 (Tenn. 1982)

. This fac tor is strong in favor of Ger ald being

c on sid e re d mo re e mpl oy e e tha n in de pe nd e nt. Ke nt had th e ri g ht t o control what work wa s d o n e, an d when he neede d Ger ald’s help. Howeve r, none of

these tests, st anding alone, is conclusive. I d. Eac h-7- particula r re lationship must be exam ined and the c ircumstance s wei g h e d

. L in d s e y

v

. Jo h n s o n , 6 0 1 S. W. 2 d

9 2 3 , 9 2 5 ( T e n n

. 1 9 80). Apply ing the fac tors, the cour t finds that Gera ld is a n employ ee of K e n tu n d e r

t h e p o l i c y. Ge ra ld C he rr

y wa s an e mpl oy e e of Ke nt ( db a Che rr y Ca ttl e
an d L an d C o mp an y) u n d e r

t h e d e f i n i t i o ni nt h e p o l i c y.

. . . Ba sed on the for eg oing f indings, the c ourt dec lare s that Tenne ssee F arme rs has a duty to defe nd Kent Cherr

y and Cathy Cherry in the lawsuit filed ag ainst them by Ger ald Cherr y and Shirley Cherry ; that Tennesse e F arme rs has a duty to indemnify

Kent Cherr

y
and Ca thy Che rr y fo r d a ma g e s c la ime d in

the laws uit

fi le d a g a ins t t h e m b y G e r a l d

C h e r r y an d C a t h y C h e r

r y. Te nn e sse e F arm e rs fi le d a tim e ly no tic e of a pp e a l to thi s Co ur

t.

II. I SS U E P R ESENTED

On a pp e a l, T e nn e sse e F arm e rs c on te nd s th a t “ [t]he tr ia l c ourt erred in f ind ingthat G e ra ld Che rr y wa s an ‘e mpl oy e e ’ of Ke nt Che rr y a t the tim e Ge ra ld w a s in jur e d w he n h is c lot

hin g be c a me caug ht up in a ‘powe r take off’ running from a c orn g rinder to a far m tractor.”

III

. S TA N D A R D O F R EVIEW
On appe al, a tria l court’s fa ctual finding s are presumed to be corr ect, and we will not over turn those fac tual finding s unless the evidenc e preponde rate s ag ainst them. Tenn. R. A pp. P

. 1 3 (d) (2 00 7) ; Bo

ga n v. Bogan , 60 S.W. 3d 72 1, 72 7 ( Te nn . 2 00 1) . F or the e vid e nc e to p re po nd e rate ag ainst a trial cour

t’s finding of fact, i t must support another finding of fa ct with g reater c onvincing eff ect. W a ts o n v. Watson , 1 9 6 S

. W

. 3 d 6 9 5 , 7 0 1 (T en n

. C t

. Ap p

. 2 0 0 5 ) ( ci t i n g W alker v . Sidney Gi lre ath & As so c s. , 4 0 S. W.3 d 6 6, 71 (T e nn . Ct . App . 2 00 0) ; T h e Re alty Shop, Inc. v . R.R. W estminster Holding, Inc. , 7 S.W .3d 581, 596 (Tenn. Ct. App. 1999)). I ssues relating to the sc ope of i nsuranc e covera g e pre sent questions of law. V ic toria I ns. Co. v . Ha wki ns , 31 S.W .3d 578, 580 (T e nn . Ct . App . 2 00 0) . We re vie w a tr ia l c ourt ’s int e rp re tatio n o f c on tr a c t la ngua g e de no vo wi th no presumption of cor

rec tness. Travele rs Indem

. C o . o f A m eri ca v. Moore

& Assocs., In c. , 216 S

. W

. 3 d 3 0 2 , 3 0 5 (T en n

. 2 0 0 7 ) ( ci t i n g A l l s t a t e In s. Co. v. W

atson , 195 S.W .3d 609, 611 (Tenn. 2006)). In g ener al, cour ts should construe i n s u ra n ce policies in the same manne r as a ny other contra ct. Am erican Justi ce Ins. Reciprocal v. Hutchison , 15 S.W .3d 811, 814 (Tenn. 2000) . “An insurance policy

must be int erpr eted fairly and reasonably
, g iving the lang uag e it s usual and ordina ry meaning .” Naifeh v. V

alley Forge Life Ins. Co. , 2 0 4 S

. W

. 3 d 7 5 8 , 7 6 8 (T en n

. 2 0 0 6 ) ( ci t i n g Parker v. Provide nt Lif

e &Acc . Ins. Co. , 5 82 S.W. 2d 38 0, 38 3 (T e nn

. 19 79 ))

. Th e po lic y langua g e mus t be take n and under stood in it s plain, ordi n ar y , an d popular sense

. Hutchi son , 15 S.W .3d at 814; Drexe l Ch emi cal Co. v. Bitum inou s Ins. C o. , 933 S.W .2d 471, 477 (Tenn. Ct. App. 1996).-8-

Whether a duty

to defe nd arises depends solely on the alleg ations contained in the unde rlying

c o mplaint. T

ravele rs Indem . Co. , 2 1 6 S

. W

. 3 d at 3 0 5 (c i t i n g St. Paul Fire & Marine Ins. Co. v. Torpoco , 879 S.W .2d 831, 835 (Tenn. 1994) ). The insure r has a duty to defe nd when the unde rlying complaint alleg es dama g es that ar e within the risk covered by the i nsuranc e contract and for whic h there is a potential basis for rec overy

. Id. An insurer may not pr operly ref use to de fend an ac tion

a g a ins t it s ins ure d unle ss i t is pla in f ro m th e fa c e of

the c omp la int

that th e a lle g a tio ns fa il t o s tate fac ts that bring the case within or potentially within the policy ’s cove rag e. Drexe l Ch emi cal Co. , 933 S.W .2d at 480. The duty to indemnify

is based upon the fac ts ultimately found by the trier of fac t. Travele rs Indem . Co. , 216 S.W .3d at 305. “Any doubt a s to whether the claimant ha s stated a cause of action withi n the coverag e of the pol icy is resolved in favor of the insure d.” Id. (citing Dempste r Bros. Inc. v . U.S. Fid. & Guar. Co. , 54 Tenn. App. 65, 388 S.W.2d 153, 156 (1964)).

IV. D I S CUS S I ON
As previously

discussed, the policy

at issue provided liability cove ra ge t o Kent and Cathy Cherry for “ occur

renc es to far

m e mploy ees while eng ag ed in the far ming operations of an insured at

or aw ay from the insure d premises.” Simi larly , the policy authorized medica l pay

m en t s t o far

m
e mpl oy e e s in

c e rt a in i ns tanc e s. Th e on ly is su e prese nte d f or our r e vie w i s w he the r G e ra ld w a s a “fa rm employ ee” within the m eaning of t he poli cy

. The poli cy define d a “f

arm e mploy ee” as “your employ ee, unde r the dire ction of an insure d, whose duties an d ac t s are in connec tion with y our f ar m i n g o p e r a t i o n s

. ” H o w e v e r , t h e t e r m “ e mp l o ye e ” i s n o td e f

i n e d i nt h e p o l i c y.

I n a rguin g that G e ra ld C he rr

y wa s o r w a s n ot a

n e mpl oy e e , th e pa

rt ie s h a ve re lie d e xclu siv e ly

on c a se s d e fi nin g an “ e mpl oy e e ” fo r p ur po se s o f t he wo rk e rs ’ c omp e ns a tio n s tatut e s o r o the r s pe c if ic

are as of the la

w. Tenne ssee Code A nnotated sec tion 50-6-102 provides a leng thy definition, exceedingthree hundred w ords, of the term “employ ee” for pur poses of the Worker s’ Compensation L aw, Te nn. Code Ann. § 50-6- 101, et seq. Ho we ve r, the ins ur anc e po lic y a t is su e do e s n ot r e fe r t o or incorpor ate tha t s t at ute’s def inition of “employ ee.” I n Blu e Diamon d Coal Co. v. HollandAm erica Ins. Co. , 671 S.W .2d 829, 832 (Tenn. 1984) , the Supr em e C o u rt rec og nized that the definition of an “ em p l oy er” for pur poses of a

state’s wor

kers’ compensation laws is not deter minative of whe ther the pe rson or e ntity is an employ er w ithin the meaning of an insurance pol i cy

. I n that case , the Six th Circuit Court of Appeals had pr eviously held that a c erta in pare nt company was not the “ employ er” of dec ease d miners for pu rp o s es of the Kentucky Workmen’s Compensation Act. Id. at 8 3 2

. Ho we v er , t h at fi n d i n g d i d n o tp re cl u d e t h e p ar t i es fr o m l i t i gat i n g, in a se pa rate c a se , wh e the r the pa

re nt c omp any

wa s th e min e rs ’ “ e mpl oy e r” a s th e te rm wa s u se d in an insuranc e policy

. Id. The Te nnessee Supreme Court stated that “ the issues, althoug h simil ar, a re by no means identica l.” Id.

The issue be fore this Court concerns c overa g e for common law liability under the insurance policies in question and not [t he par ent company ’s] relationship to the [] miners as define d by the Kentuc ky Workm en ’s Compensation Act. Resolution of the issues in the prese nt liti g ation require s interpre tation of the languag e of the-9- poli ci es whe rea s the [S ix th Circuit] court wa s fac ed with the

c on str uc tio n o f t

he Ke ntu c ky

Wor km en’s Com

pe ns a tio n A c t w ith reg ard to the relationship of the pare nt corporation to the employ ees of its subsidiary

corpor ation.

Id. Applying the Court’s rea soning to this case , we conclude that the definit i o n o f “ em ploy ee” provided in the W orker s’ C ompensation L aw does not control t he is sues before us. In fac t, there a re
sever al other statutory

definitions of

the term “ employ ee” that are applicable to specific a rea s of the law. See, e .g. , Bredesen v. Te nn. Ju dicial Selection Com m ’n , 214 S.W .3d 419, 430 (Tenn. 2007) (quoting the def

i n i t i on of “e mploy ee” provided in 42 U.S.C. § 2000e(f) for pur poses of the Te nn e sse e Human Rig hts Ac t and Ti tle VI I of the F e de ra l Civ il Ri g hts Ac t) ; Eath erly Constr. C o.
v . T e nn . D e p ’t o f L a b o r a nd W o r k f o r c eD e v. , 2 3 2 S.W .3d 731, 735 (Tenn. Ct. App. 2006) (d isc us sin g the de fi nit ion of “ e mpl oy e e ” in Te nn . Co de Ann. § 5 0- 3- 10 3 f or the Oc c up a tio na l Sa fe ty

and He alt h Ac t and

va ri ou s o the r d e fi nit ion s in c on str uc tio n in du str

y re g ulatio ns ); Hensley v. Fowler , 9 20 S.W. 2d

64 9, 65 2 (T e nn . Ct . App . 1 99 5) (r e fe rr ingto t he Go ve rnme nta l T or

t L ia bil ity Ac t’ s d e fi nit ion

of “ e mpl oy e e ” loc a te d at T e nn . Co de Ann. § 2 9- 20 -1 02 (2 )) . H ow e ve r, a s p re vio us ly discussed, we must a

pply the plain, ordinary meaning of the term “ employ ee” when inter pretingthe policy lang uag e.

I n Americ an Sur. Co. of

N. Y. v . Ci ty of Cla rk sv ill e , 204 Tenn. 67, 77, 315 S.W .2d 509, 513 (1958 ), our Supreme Court wa s simil arly fac ed with interpre ting the te rm “e mploy ee” in an ins u r an c e p o li c y w h e n th e p o li c y it s e lf d id n o t d e f in e th e te r

m. T h e Co u rt f

o u n d the term unambig uous, expl aining that “[t] he ordina ry and usual meaning of t he word ‘employ e’ is one w ho is emplo y ed b y another and works f or wa g es or sa lary

without reg ard to whe ther the e mploy ment be leg al or illeg al.” Id.
Although Am erican Surety Co. is an old e r c a se , it s c on str uc tio n o f t

he te rm “ e mpl oy e e ” is consistent with the ordinary understanding of t he word today

. “When called upon to interpre t a term

us e d in an in sura

nc e po lic y

that is no t de fi ne d th e re in, c ourt s in Te nn e sse e so me tim e s r e fe r t o dictionary d e f in it io n s .” Am erican Justice Ins. R eciproc al v. Hutchis on , 15 S.W .3d 811, 815 (Tenn. 2000). W

ebs ter ’s II NewCol le

geDi c tio na ry

(1995) de fines an “ employ ee” as “[a] person who works for another in exchang e for

financ ial compensation.” Blac k ’s Law D ic tio na ry (8th ed. 2004) define s an“ e mp lo y e e ” a s “ [a ] p e r s o nw h o w o r k s in th e s e r v ic e o f an o th e r p e r s o n( th e e mploy er) under a n express or implied c ontrac t of hire, under which the employ er has the rig ht to control the details of wor

k perf ormanc e.”

I n the ca se at ba

r, it is undisput ed that Ge rald wa s working for Kent and/or Cherry Cattle and L and Com pa ny wh e n h e wa s in

jur e d, and

he wa s b e ingcom pen sate d f ro m th e bu sin e ss a c c ount. Kent had instruc ted Ger ald to g rind the cor n, which would be used t o fee d cattle owne d by Cherry Cattle and L and C ompany

. Ger ald was working along side Marvin F isk, who was indisputably an employ ee of Cherry Cattle and L and C ompany , using e quipment owned by Cherry Cattle and L and Com pa ny . T he land

wh e re the a c c ide nt o c c ur

re d w a s o wn e d b y Ke nt a

nd his br oth e r D ou g . G e ra ld had no owne rship interest in the business, the land, or the equipment. Nev er t h el ess, Tenne ssee-10-

F arm e rs po int s to var iou s asp e c ts o f t he re latio ns hip be tw e e n G e ra ld a nd Ke nt C he rr

y to s up po rt

its contention that Ger ald was not a n employ ee of

Kent or Cher

ry Cattle and L and Company

.

F ir st o f a ll, Te nn e sse e F arm e rs argue s th a t Ge ra ld wa s not an e mpl oy e e be c a

us e Ge ra ld d id

n o th a v e s p e c i f

i c a l l y s e tw o r

k i n g h o u r s an d K e n t d i d n o th a v e “ c o n t r o l ” o v e r G e r a l d

. C a t h y C h e r

r y, Kent’s wif

e, testified that “ [y ]ou don’t really have se t hour s wh en i t comes to l ivestock.” F or
e xamp le , M arv in F isk

wa s p a id “ ho ur ly

wi th a mi ni mum,” me anin g that he wa s p a id a c e rt a in

a m o u n tp e r

w e e k w h e t h e r h e w o r k e d o r n o t

. K e n ts t a t e d t h a t h e r e l i e d o nG e r a l d

e v e r y d ay. Acc ording to Kent, the par ties would simply

discuss what nee ded to be done eac h morning and see that those tasks wer e complete d. Kent explained that it wa s not nece ssary to give Ger ald par

ticular instructions for ea ch task, a nd that Ger ald could perf

orm duties better than any one else. Reg arding the par ties’ authority

or control ove r ea ch other, Kent acknowledg ed that he would obey his father ’s instr u c ti o n s , s tati n g , “ h e is my f a th e r

. ” H o w e v e r , b o th K e n t an d G e r a ld a g r e e d th a t K e n t w as the bo ss and ha d the “ ult imate say so ” in the bu sin e ss. Ke nt c ou ld c on tr ol the wo rk an d u lti mate ly te rm inate the wo rk re latio ns hip wi th Ge ra ld if he wi sh e d. Cou

ns e l f or Te nn e sse e F arm e rs did

a sk Ger ald whethe r Ke nt had “the pow er to make [Gerald] do things for him,” and Ge rald re plied that he did no t th ink Ke nt h a d th e “ po we r” to ma ke him do thi ng s tha t he d id n ot w ant t o d o. Ge ra ld s a id that if he did not want to do something, he wouldn’t do it. Gera ld went on to explain that working in the cattle busines s was “ something that Ilike to do. I ’ve done it all of my life, so I just keep a doing it, y ou know.” Tennessee Fa rmers c ontends that this testim ony demonstrates K ent’s lac k of “contr ol” over

Ger ald, but we disag ree . We interpret Ge rald’s state ment as simply rec og nizi ng that he wa s an at-w ill employ ee w ho could qui t working if and whe n he desire d. This does not mean that Ger ald was not a

n employ ee.

Tenne ssee F arme rs also conte n d s that Gera ld was not being paid for his wor k, as an

e mpl oy e e wo uld

be , b e c a us e he wa s n ot p a id a

sp e c if ic ho ur ly rate or sa lary . Ins te a d, Ge ra ld o r h is wife w rote c hecks f

or “w hat he ne eded” from the business a ccount f or bills, and Ger ald i nformed Ke nt o f h is e xpend itur e s. Te nn e sse e F arm e rs po int s to the fa c t th a t K e nt’ s b ro the r, Do ug , a lso

rec eived m o n ey

from the business a ccount, e ven thoug h he wa s not considere d an employ ee of Cherry Cattle and L and Company . I n addition, Kent continued to pay Ger ald’s bil ls from the business acc ount during the time th at Ge ra l d wa s injured and una ble to work, but it is not clear whether these pa y ments wer e treated as persona l or busi ness ex penses. Tenne ssee Far mers conte nds that K e nt simp ly g a ve mon e y to h is f a mil y me mbe rs a s g if

ts, and Ge ra ld w a s n ot r e a lly

be ingpa id fo r h is w or

k. We w ou ld f

ir st n ote , w ithre g ard

to t he mon ey th at Doug re c e ive d f ro m th e c a ttl e business, Tennesse e F arme rs fa ils to m ention that Doug and Ke nt were joint owne rs of much of the proper ty wher e Cherr

y Cattle and L and kept its cattle and equipment. I t is not at all clear that Doug

rec eived the mone y

simply as a g i ft

. I n fac t, Kent testified that Dougrec eived money from the business beca

use the business wa s profiting off land that Doug owned. Althoug h the ar rang ement betwee n Kent and G era ld w as not a ty pical method of c ompensation, both parties, a long w ith Kent’s wife, te stified that the money Ger ald rec eived from the a ccount wa s compensation for the work he perf ormed for Kent’s c attle business. Kent denied the sug g estion that Gera ld’s compensa tion had nothing to do with the amount of w ork t h at he did, and he stated that he sometimes de clined pe rm iss ion

wh e n G e ra ld as ke d to spe nd mon e y

. I n ess e nc e , Te nn e sse e F arm e rs a sk s u s to dis c re dit-11-

the testimony

from Ke nt, Cathy , and Ge rald Cherry that the pay ments to G era ld were compensation fo r h i s wo rkan d

i n fe r t h at t h e p ay

m en t s we re gi ft s

. T h e t ri al co u rt s p ec i fi ca l l y fo u n d t h at al t h o u gh Ge ra ld did no t re c e ive a “ sa lary pe r se ,” he wa s c omp e ns a te d fo r his wo rk by the pa y me nt o f c e rt a in bills. The court’s fina l order sta ted: “In this case, there was an expressed or implied ag ree ment that Ge ra ld wo ul d be paid

fo r w or k d on e in t

he fa rm ingop e ratio ns . T he re wa s b oth an e xpre ss ag ree ment that he would be pa id, and an impli ed fr o m p as t conduct. . . . The se pay ments were considere d wag es and not a g ift.” When the trial cour t has seen the wi t n es ses and he ard the testimony , espec ially

wher e iss u es of credibility and the we ight of

testimony

are involved, the appellate court must extend considerable defe renc e to the tria l co u rt ’s fac tual finding s. Richards v. Liberty Mut. Ins. Co. , 70 S.W .3d 729, 732 (Tenn. 2002). The e vidence supports the trial cour t’s fi nd in g that G e ra ld a

nd Ke nt h a d a g re e d to have so me of Ge ra ld’ s b ill s p a id b y

the c omp any

a s a substitut e for

wag es.

Te nn e sse e F arm e rs a lso po int s to the fa c t tha t Che rr y Ca ttl e and

L and Com pa ny did no t f ile For ms W -2 and W-3 tre ating Ger ald as an employ ee f or fe dera l income tax purposes, and there wer e no Social Security

and Medic are taxes withheld from his co mp e nsation. Howeve r, Cherr y Cattle and L and Company

did not file For

ms 1099 treating Ger ald as a n independe nt contrac tor either. Che rry Ca ttl e and L and Com

pa ny on ly su

bmi tte d F or

ms W-2 fo r M arv in F isk . Pa y me nts ma de on

be ha lf of Ge ra ld C he rr

y we re so me tim e s d e du c te d a s busi ne ss expe ns e s, de pe nd ing on the c ir c ums tanc e s. Ke nt tes ti fie d th a t G e ra ld’ s c omp e ns a tio n w a s tr e a te d d if fe re ntl y be c a us e he wa s “ te c hn ic a lly

re tir e d” and

dr awi ngso c ia l se c ur ity . O n th e a mbu lanc e re po rt , G e ra ld’ s w if e Shi rl e y lis te d h is occupation as “self-employ ed,” and Gerald di d not report a ny income fr om Cherry

Cattle and L and Company on his inc ome tax re turns. I n sum, f or tax purposes, Ger ald was not tre ated a s an employ ee
or an in de pe nd e nt contra c tor of Che rr y Ca ttl e and

L and be c a us e he wa s r e c e ivi ngso c ia l se c ur ity retire ment benef

its. However , he wa s undoubtedly perf orming work for

Cherry Ca t t l e and L and Company and beingpaid from the business acc ount. We r ecog nize that the parties’ f ailure to c lassify Ge ra ld a s a

n e mpl oy e e in s ome ins tanc e s ma y be e vid e nc e of

the tr ue e mpl oy

me nt r e lations hip betwee n the par

ties. Howeve r, we do not believe that the pa rties’ tax returns are conclusive of whether Ger ald was, in fac t, an employ ee of Cherry Cattle and L and. In Am erican Surety Co. , the Supreme Court def

ined an employ ee as “one who is e mploy ed by another and wor ks for wa g es or salary without reg ard to whe ther the e mploy ment be leg al or illeg al.” 204 Te nn. at 77, 315 S.W.2d at 513. I n that case , a four teen- y ear -old boy

was found to be an “e mploy ee” within the meaning of an ins uranc e poli cy even though he was employ ed in violation of t he child labor statutes. Id. at 72, 315 S.W .2d at 511. Her e, the leg ality of how the pa

rties t re ated Ge rald’s c ompensation for ta x purposes doe s not prevent Ge rald fr om being an employ ee w ithin the meaning of the insura nce p o l i c y.

Th is ca se c e rt a inl y inv olv e s an unu su a l w or k r e la tio ns hip , a

nd the re are fa c ts i n th is c a se to support both parties’ positions. From our ca ref ul reviewof the re cord, c onsidering all the fa cts and circ umstances involved, we conclude that Ger ald Cherr y was a “fa rm employ ee” within the meaning of the insura

nce policy . I t is undisput ed that Ge rald c ontinued to work in the cattle business a fter he beg an re ceivingretire ment benef its, and Kent bec ame the boss of the company . On the day Ge ra ld w a s in

jur e d, he wa s g ri nd ingc or n, un de r Ke nt’ s d ir e c tio n, us inge qu ipm e nt b e lon g ingto-12-

Cherry Cattle and L and Company for the c ompany ’s bene fit. Ger ald ex pecte d to be paid for working and wa s, in fact, pa id. We hold that the alleg ed dama g es ar e within the risk cove red by the policy Te nn e sse e F arm e rs iss ue d to Ke nt and Ca thy Che rr y , and a c c or din g ly
, Te nn e sse e F arm e rs ha s a du ty to d e f e n d t h e i n s u r e d s i n t h e u n d e r l yi n g l aw s u i t

. T e n n e s s e e F ar m e r s i s f u rt h e r o b l i g a te d to indemnify

the insureds for

damag es that may be awa rded ag ainst them to the extent that the policy provides for

indemnification of suc h damag es for occur renc es to far

m employ ees.

V. C ONCL US I ON

F o r t h e a f o r e m e n t i o n e d r e a s o n s , w e a f f i r m t h e d e c i s i o n o f t h e c i r c u i t c o u rt

. C o s ts o f t his appea l are taxed to the appellant, Tenne ssee F arme rs Mutual I nsuranc e Company , and its surety , for

w h i c h e x e c u t i o nm ay i s s u e i f n e c e s s ar y.

___________________________________

ALANE. HI GH ERS , P. J., W.S

.