Opinion ID: 1584476
Heading Depth: 1
Heading Rank: 4

Heading: whether bobby was a statutory employee of twin river homes, inc., thereby entitled to the benefits under the workers' compensation act.

Text: This issue requires a determination of Bobby's employment status on the date of his injury. In other words, we must resolve whether, on October 6, 1987, the date of his injury, Bobby was an employee of an uninsured Twin River subcontractor, or whether he was an independent contractor. If Bobby's status, at the time of the injury, was that of a subcontractor's employee, he would be classified as a statutory employee of the general contractor, Twin River, if the subcontractor did not possess workers' compensation insurance on that day. In that event, Bobby would be eligible for workers' compensation benefits under the workers' compensation insurance policy between Twin River and The Travelers which was in effect on that day. However, contrarily, if Bobby's status on October 6, 1989, was that of an independent contractor, the Workers' Compensation Act would exclude him from workers' compensation benefits. Miss. Code Ann. §§ 71-3-3, 71-3-7 (1989). The Workers' Compensation Act imposes liability upon an employer for payment of compensation to its employees, as defined by, and subject to, the terms and conditions of the Act. Miss. Code Ann. §§ 71-3-1 to 71-3-181. The pertinent section of the applicable statute states that: Every employer to whom this chapter applies shall be liable for and shall secure the payment to his employees of the compensation payable under its provisions. In the case of an employer who is a subcontractor, the contractor shall be liable and shall secure the payment of such compensation to employees of the subcontractor, unless the subcontractor has secured such payment. Miss. Code Ann. § 71-3-7 (1989). In the situation of an employer that is also a general contractor, as is the case with Twin River, the Act also imposes liability upon the general (prime) contractor for payment of compensation benefits to the employees of a subcontractor contracted to perform services for the general (prime) contractor, should the subcontractor fail to secure the payment of such compensation. Miss. Code Ann. § 71-3-7 (1989). Doubleday v. Boyd Construction Co., 418 So.2d 823 (Miss. 1982); see also Mills v. Barrett, 213 Miss. 171, 56 So.2d 485 (1952). Should the subcontractor fail to secure such payment, the employees of that subcontractor may thereby be characterized as the statutory employees of the general (prime) contractor, and the general contractor becomes the statutory employer of such employees. Morris v. W.E. Blain & Sons, Inc., 511 So.2d 945 (Miss. 1987); Nash v. Damson Oil Corp., 480 So.2d 1095 (Miss. 1985). Cf. Falls v. Mississippi Power & Light Company, 477 So.2d 254 (Miss. 1985). 1. The fact that Twin River was the party charged with the construction of Gary Street's house was firmly established as was the fact that the carpentry crew on which Bobby worked had been subcontracted to frame Gary Street's house by the general contractor, Twin River. Also, it was uncontroverted that Bobby's father did not carry workers' compensation insurance on the date of Bobby's accident and that Twin River was aware of that fact prior to the accident. Thus, under the Act, Bobby would be the statutory employee of Twin River, if: (1) Bobby's father was the subcontractor on Gary Street's house; and (2) Bobby was an employee of his father, the subcontractor. We have previously defined the term subcontractor, stating that: [T]he Court defined a subcontractor as one who enters into a contract, express or implied, for the performance of an act with a person who has already contracted for its performance, or who takes a portion of a contract from the principal or prime contractor. Amoco Production Co. v. Murphy, 528 So.2d 1123 (Miss. 1988). The evidence was clear that Twin River had pre-sold the house under construction to Gary Street, and that Twin River had already contracted with him to build the house at the time that Twin River sought to have carpentry services performed on the house. It was also clear that the framing work had been subcontracted by Twin River to either: (a) James, Bobby's father; or (2) Vance Home Improvement Service, a partnership in which Bobby was a partner with his father. Consequently, either Bobby's father or Vance Home Improvement was the subcontractor of Twin River. Twin River argues that it contracted for the carpentry work with Vance Home Improvement Service instead of Bobby's father, individually, and that Bobby is not a statutory employee of Twin River. That conclusion arises, it is argued, by virtue of the fact that Bobby was a partner with his father in Vance Home Improvement Service. We need not decide the question whether Bobby was a statutory employee as a partner in Vance Home Improvement Service because we conclude that Twin River did not contract with a partnership but with James individually. 2. Although the Commission found that Bobby was not a statutory employee of Twin River, the Commission failed to find that Twin River contracted for the carpentry work with Vance Home Improvement Service. Nevertheless, it is quite clear from the language of the order of the Commission denying benefits to Bobby, that the Commission operated under the erroneous assumption that Twin River had entered into a contract with Vance Home Improvement Service for the carpentry work on Gary Street's house. Evidently, on that basis, the Commission determined that Bobby was an independent contractor instead of the statutory employee of Twin River. However, substantial evidence does not support the Commission's assumption that Twin River contracted with Vance Home Improvement Service for the carpentry and framing services. On the contrary, the evidence supports the conclusion that Twin River contracted with Bobby's father, James, in his individual capacity. With regard to the parties to the carpentry subcontract, the record indicates that Bobby was under the impression that Vance Home Improvement Service had the contract on the three Twin River houses on which Bobby worked. But, Bobby's confusion is understandable. He had worked for his father all of his adult life, in one capacity or another. At various times, Bobby had been a foreman for his father, a partner, and an employee. However, it was uncontroverted that Bobby's father was the one who negotiated and consummated the subcontracting arrangement with the representative of Twin River. Accordingly, Bobby's father, James, indicated that Twin River subcontracted with him in his individual capacity for the carpentry work. Supporting and confirming James testimony, the invoice for subcontracted work performed on one of the first two (2) houses framed for Twin River was submitted to Twin River by James W. Vance, individually, not by Vance Home Improvement Service. James also testified that Vance Home Improvement Service had gone out of business before any work was performed for Twin River. Additionally, Ralph Perry, Twin River's superintendent on Gary Street's house construction, testified that Bobby's father had the contract for the carpentry work. Strangely enough, Twin River never introduced a writing of the contract into evidence, and the only documentary evidence on this issue supported the conclusion that the contract was between Twin River and Bobby's father, individually. Consequently, the reliable substantial evidence in the record bearing on the issue of the identity of the contracting parties, was: 1) the prior invoice sent to Twin River by James W. Vance, individually; 2) the testimony of the person who negotiated and consummated the contract, James W. Vance; and 3) the testimony of Twin River's superintendent on Gary Street's house construction. That evidence supports the conclusion that, on the day of Bobby's injury, James W. Vance, individually, was the carpentry subcontractor on Gary Street's house, not Vance Home Improvement Service. Even though his father was the subcontractor on the day of his injury, not Vance Home Improvement Service, in order for his injury to be compensable, the Act requires that Bobby was considered as an employee of his subcontractor/father, as the Act defines the term employee. According to the Act, Bobby was required to have been employed in the service of an employer under any contract of hire or apprenticeship, written or oral, express or implied... . Miss. Code Ann. § 71-3-3(d) (1989); see also Sullivan v. Sullivan, 192 So.2d 277 (Miss. 1966). Here, sufficient evidence exists from which a contract of hire may be implied between Bobby and his father.