Case Name: SWANSEA LEASE, INCORPORATED, Appellant, v. ANNA C. MOLLOY, Administratrix of the Estate of JAMES CHAPMAN, Deceased, Appellee
Court: Arizona Supreme Court
Jurisdiction: Arizona
Decision Date: 1919-09-22
Citations: 20 Ariz. 531
Docket Number: Civil No. 1678
Parties: SWANSEA LEASE, INCORPORATED, Appellant, v. ANNA C. MOLLOY, Administratrix of the Estate of JAMES CHAPMAN, Deceased, Appellee.
Judges: 
Reporter: Arizona Reports
Volume: 20
Pages: 531–543

Head Matter:
[Civil No. 1678.
Filed September 22, 1919.]
[183 Pac. 740.]
SWANSEA LEASE, INCORPORATED, Appellant, v. ANNA C. MOLLOY, Administratrix of the Estate of JAMES CHAPMAN, Deceased, Appellee.
1. Constitutional Law — Master and Servant — Employers’ Liability Law does not Violate Protection of Law Clause. — The employers’ liability law is not violative of Const. TJ. S. Amend. 14.
2. Master and Servant — Plaintiff must Show That He was Servant When Injured. — In action under employers’ liability law, defendant cannot be held liable unless the injured person was an employee, and the burden rests upon the plaintiff to prove that relationship.
3. Master and Servant — Injured Party not a Servant, but Independent Contractor. — A contract by which plaintiff’s intestate and others agreed to sink a shaft for defendant according to specifications and at a price per foot, they to have full control over the manner and method of doing the work, reserving to defendant a right to inspect and direet changes of work not done according to agreement, nor in workmanlike manner, requiring continued maintenance of three shifts and providing against employment of persons objectionable to defendant, held to make intestate an “independent contractor,” and not a servant, within employers’ liability law.
4. Appeal and Error — Evidence Admitted Without Objection Considered. — In a personal injury action, where there was an agreement establishing the relation of independent contractor, and parol testimony was admitted practically without objection for the purpose of showing what was done under the contract, and that the real contract was one of employment, such evidence must be considered in determining the appeal, regardless of its competency.
5. Master and Servant — Injured Party Independent Contractor, not Servant. — Plaintiff's intestate, who with others contracted to sink a shaft for defendant at a price per foot, held to be an independent contractor, and not a servant, within employers’ liability law, notwithstanding defendant’s deduction of hospital fees and the violent act of its superintendent in running away two of intestate’s employees, not done under lawful power to discharge, its insuring against injuring intestate, its agreement to do the hoisting, its payment for the work at time of paying employees, and its action in ordering waste dumped in another place, although not directing manner of work in extending a trestle necessitated by the change of dumping place of waste in doing which latter intestate was killed.
APPEAL from a judgment of the Superior Court of the county of Yuma. Frank Baxter, Judge.
Reversed.
STATEMENT OF PACTS BY THE COURT."
Action to recover the damages given by the employers’ liability law (Civ. Code 1913, pars. 3153-3162) for personal injuries suffered by James Chapman, which resulted in his death. The plaintiff alleges that the said deceased was in the employ of the defendant, and that he was injured by accident arising out of and in the course of his said employment, which resulted dn his death. The defendant denied that deceased, when injured, was in defendant’s service, but alleges that deceased was engaged with two other persons in the performance of a contract-which deceased, with two other persons had entered into with defendant, and while so occupied as independent contractor the deceased was injured and died therefrom. The plaintiff replies to such defense and alleges as follows:
“ . . . That said Chapman with two other miners, was hired and employed by the defendant to sink a certain shaft in and upon the mining properties of the defendant, at Swansea, Arizona, at the agreed price of $34 per foot, which said hiring and employment was evidenced by a certain instrument in writing, a copy of which, marked Exhibit A, is annexed hereto and made a part of this reply, which said instrument in writing was executed on the day of its date, by said Chapman and said other two miners, on their own behalf, and by one Ernest Lane, the superintendent and manager of the defendant corporation, thereunto duly authorized by the defendant, on behalf of the said defendant; but that said contract and instrument in writing was, and is, a device and means con trived and put into effect by the defendant for the purpose and with the intent of enabling the defendant, to exempt itself from the liability created by chapter 6, title 14, Bevised Statutes of Arizona of 1913, and said contract is, and was at all times, void to that extent.”
The reply further sets forth that in its dealings with Chapman under said contract it treated him as its employee, by compelling him to pay hospital fees and ground rent as its other employees were required to pay; that it insured the said Chapman against accident, and upon his death it reported such death to the indemnity insurance company, and presented a claim against such company for the death of said Chapman as an employee of said defendant; that it paid to said Chapman wages. Consequently:
“The defendant is, and by right ought to be, estopped to assert that said Chapman was not an employee of the defendant, and is estopped to assert that said Chapman was an independent contractor at the time of the fatal accident which resulted in the death of said Chapman. ’ ’
The contract is dated June 13, 1917, and is an agreement between defendant and F. Y. Johnson, James Chapman, and M. D. Burris, by which the said second parties agree to sink a mining shaft a depth of 500 feet, for which they were promised a compensation of $34 per foot of depth. The contract specifies the duties and obligations of the parties in detail. Clauses added to the contract provide for the time of commencement of the work and its continuous prosecution until completed; also for the deposit of 15 per cent of the contract price, to be held as a guaranty for the faithful performance of the agreement by the parties of the second part, and in ease of their failure “to faithfully perform and comply with all of the terms and conditions of this agreement, the amount so deposited shall be forfeited to the party of the first part as liquidated damages. It is understood and agreed, however, that if the failure to perform and comply with the terms and conditions of this agreement by the parties of the second part is due to any fault of the party of the first part, the said parties of the second part are thereby unable to complete said shaft, the said moneys so deposited shall be paid over to the parties of the second part.”
The evidence is without conflict that the contract was fully completed by and in behalf of the parties of the seoond part, and that the defendant company paid to this plaintiff, as administratrix of the estate of James Chapman, deceased, his proportion of the 15 per cent of the contract price, which was retained and deposited in the hank to he paid on the satisfactory completion of the contract work; that said amount so held and so paid out to said three parties was $1,695.75, and plaintiff was paid and she received of said amount the sum of $509.15 ¿s a final settlement of James Chapman’s portion of the contract price for the completion of the mining shaft. The contract has been fully performed by both parties thereto, and ho dispute of that fact appears in the record.
The jury returned a verdict for the plaintiff, and the defendant appeals from the order refusing a new trial and from the judgment.
Mr. George J. Stoneman and Mr. C. O. Whittemore, for Appellant.
Mr. Thomas D. Molloy, for Appellee.

Opinion:
CUNNINGHAM, C. J.
(After Stating the Facts as Above). The action is founded upon the employers' liability law,- and the defendant has demurred to the complaint because and for the alleged reason that said law violates the Fourteenth Amendment of the Constitution of the United States. The demurrer was overruled by the lower court, and the ruling is assigned as error. This court has repeatedly held adversely to appellant's contention, and adheres to the said ruling on the authority of Inspiration Consolidated Copper Co. v. Mendez, 19 Ariz. 151, 166 Pac. 278, 1183, Superior & Pittsburg Copper Co. v. Tomich, 19 Ariz. 182, 165 Pac. 1101, 1185, Superior & Pittsburg Copper Co. v. Davidovitch, 19 Ariz. 402, 171 Pac. 127, and Arizona Copper Co. v. Burciaga, ante, p. 85, 177 Pac. 29, decided December 21, 1918.
Thd vital question presented by this record is whether there is any evidence to sustain the plaintiff's allegations that James Chapman, deceased, was, at the time of the accident which caused his death, engaged in the performance of his duties as an employee of the defendant company, in the meaning.of that relation understood in the employers ' liability law. The question is raised in a number of assignments of error and requires a decision. All parties must concede, if the contract of June 13, 1917, was binding on James Chapman as written at the time of the accident resulting in his death, that his relation to the company defendant, as established by the said contract, was that of independent contractor, and not that of an employee, as understood in the employers' liability law.
The assignments of error deny the existence of any evidence tending to abolish the said contract. The plaintiff sets out the contract, but alleges that the contract was á "device and means contrived and put into effect by the defendant for the purpose and with the intent of enabling the defendant to exempt himself from the liability created" by the employers' liability law. As evidence that such contract was a "device and means contrived and put into effect by the defendant" for such purpose, the plaintiff sets forth in her reply that the defendant "caused and compelled said Chapman to pay hospital fees and ground rent, and paid liability insurance to a certain indemnity company [insuring Chapman] as an employee of the defendant company, . . . and immediately upon the death of said Chapman did report said death to such indemnity company, and presented to the. said company a claim for the death of said Chapman as an employee of said defendant, and did pay wages to said Chapman at the time and in the manner that the other employees of the defendant were paid wages."
Are such circumstances evidence tending to establish as a. fact that the contract of June 13, 1917, was a "device and means" used by defendant to avoid the burdens of an employer ? They are offered for the purpose of establishing, as a fact, that a written contract, which, on its face, creates a relation between the defendant and James Chapman, is in law one other than that of employer and employee, was not a binding contract, and was void for the reason that such paper was a mere device and means contrived to escape liability imposed by statute. In other words-, such circumstances are offered by the plaintiff as sufficient evidence of a fraud practiced by the defendant company to escape a duty imposed by statute, owing to an employee.
Chapman was not misled to his injury by the conduct of the defendant, and no party to the contract makes claim that the contract was abandoned. The plaintiff concedes — at least, does not dispute — that the written contract was fully performed by all parties thereto, 'and that plaintiff, as admin istratrix of the estate of James Chapman, deceased, received from the defendant company, for and in behalf of such estate, final payment of its share of the contract price earned in the performance of the contract in sinking the shaft.
The facts in evidence are convincing to the v effect that all parties to the said contract regarded the contract binding, and so conducted themselves, until after full performance of its terms. Consequently, the plaintiff has wholly failed to sustain by any competent evidence the allegation that said written contract was void, because it was entered into as a device and means contrived by the defendant to escape liability to' an .employee for an accident occurring in its mines, by which such employee was injured. The evidence relied upon by the plaintiff was not sufficient to establish such allegation of fiaud and thereby abrogate said written contract. The trial court erred in refusing to instruct the jury to return a verdict for the defendant, because of such failure of the evidence in such particular.
The judgment is reversed and the cause remanded, with instructions to take such further proceedings in the cause as justice may require, not inconsistent with law.