Court Opinion

ID: 5257829
Source: CourtListenerOpinion
Date Created: 2022-01-06 18:33:25.305977+00
Date Added: 2024-06-11T08:28:02.421311
License: Public Domain

John M. Kellogg, P. J. (dissenting):
This was a family corporation, with one thousand two hundred dollars in stock, consisting of 120 shares of ten dollars each, of which the claimant owned 10 shares, one-twelfth of the corporation. The other brothers owned nearly seventy per cent of the stock and the father the balance. The claimant was paid thirty-five dollars a week for his work, the father fifteen dollars. Forty dollars a week was paid to the mother as representing the capital which the other brothers had in the business. The corporation never paid any dividends and employed from five to fifteen people in the business. The claimant was *773president and treasurer, but the father, as manager, signed all the checks and vouchers, and the claimant, as president, did nothing except to preside at the stockholders’ meetings. His services as president were merely nominal. He was treasurer only in name. He was the general all-round man, as he says, working on books, shipping, checking out packages, doing most everything; shipped and cleaned garments, examined garments and things of that kind. He also took orders, but did not work any in manufacturing. The manager and bookkeeper had the control of the cash income and outgo.
This case is not in the same class with Matter of Bowne v. Bowne Co. (221 N. Y. 28). There the injured employee had received in stock dividends $30,000 in the preceding year. The Court of Appeals says, “ practically he was the corporation and only by a legal fiction its servant in any sense.” He was denied compensation upon the ground that he was really the employer. It was not just to apply the broad principle of that case, where the stockholder was really the company and the company was engaged in large affairs, to this little corporation in which the claimant owned but a ten per cent interest and never received, and perhaps never will receive, a dividend. His only substantial interest in the corporation was his wages, thirty-five dollars a week, and he is well within Berman v. Reliance Metal Spinning & Stamping Co. (187 App. Div. 816). Here the other brothers practically owned the corporation and permitted it to be carried on for the benefit of the family. The claimant was injured while performing the general work for which he was paid.
The insurance company audited the payrolls upon which the premium on the policy was fixed, and included in the audit the salary of the claimant and his father. Both parties intended that the father and claimant should be covered by the policy, and it is fairly within the spirit of subdivision 6 of section 54 of the Workmen’s Compensation Law (as added by Laws of 1916, chap. 622). (Hubbs v. Addison Electric Light & Power Co., 191 App. Div. 765.) The proviso added to that subdivision, “ that the estimation of their wage values, respectively, shall be reasonable and separately stated in and added to the valuation of their pay rolls upon which their premium is computed,” has no force here from the fact that the only *774real service the claimant performed for the corporation was as an employee, and there was, therefore, no division of his salary, because the wages received only represented work outside of his office as president and treasurer. Manifestly he received no compensation from the fact that he was named president and treasurer. The wages received by him were only fair compensation for an ordinary employee. The record conclusively shows that the minds of the insurer and the insured contemplated the protection of the claimant as an employee. We cannot review the conclusion of fact that the claimant was an employee, and was insured as such. I favor an affirmance.