Court Opinion

ID: 6756438
Source: CourtListenerOpinion
Date Created: 2022-07-21 00:27:29.328078+00
Date Added: 2024-06-11T16:02:27.036777
License: Public Domain

Leach, C. J.,
dissenting. Section 35, Article II of the Ohio Constitution, specifically authorizing the passage of laws for the establishment of a state fund for the purpose of providing compensation to workmen, states, inter. alia, that:
“ * * * any employer who pays the premium or compensation provided by law, passed in accordance herewith, shall not be liable to respond in damages at common law * * * for such * * * injuries * *
Pursuant thereto, R. C. 4123.74 provides that:
“Employers who comply with section 4123.35 of the Revised Code shall not be liable to respond in damages at common law or by statute for any injury * * * received * * * by any employee in the course of or arising out of his employment * * * during the period covered by such premium so paid into the state insurance fund * *
R. C. 4123.35, in turn, provides that every employer shall “pay into the state insurance fund the amount of premium fixed by the' industrial commission, ’ ’ such amount *177being “determined by the classifications, rules, and rates made and published by said commission.”
In my opinion the amount of premium required to be paid by an individual employer under R. C. 4123.35 is necessarily predicated “upon the amount of wage expenditure.” R. C. 4123.23. By the terms of R. C. 4123.24,■ every employer is required to “keep, preserve, and maintain complete records showing in detail all .expenditures for payroll * *
In the instant case, the record clearly establishes that appellee, Central Terminal Warehouse, did not at any time include appellant on its payroll. Thus, the premiums paid by Central did not even: purport to cover appellant as one of its employees. Central likewise did not pay social security, federal or state income withholding tax, or unemployment compensation for appellant. All of these taxes, reflecting appellant as an employee, were paid by Hour Man.
R. C. 4123.46 provides that the Industrial Commission shall disburse the state insurance fund “to employees of employers who have paid into said fund the premiums applicable to the classes to which they belong when such employees have been injured in the course of their employment,” and provides further that “[s]uch payment to such injured employees * * * shall be in lieu of any and all rights of action against the employer of- such * * *employees.”
I believe it clear that the question of whether an employer has complied with R. C. 4123.35 necessarily involves a consideration of the provisions of R. C. 4123.23, 4123.24, 4123.46, as well as those of R. C. 4123.29, the latter section authorizing the commission to fix premiums based upon “the total payroll” of a specific employer in different classes of occupation or industry,
Under this set of facts to conclude that, with respect to the appellant. Central had complied with the require-*-ménts of R. C. 4123.35, is to conclude that Centré!’s compliance with such' requirements as to those persons admittedly employed by it and included within Central’s payroll *178■upon which, premium payments are based, would: constitute full compliance under.B. 0. 4123.74.
In effect, this rationale was asserted but rejected in Trumbull Cliffs Furnace Co. v. Shachovsky (1924), 111 Ohio St. 791.2
In Coviello v. Indus. Comm. (1935), 129 Ohio St. 589, this court held in the fifth paragraph of the syllabus that “[i]t is impossible to have, a ‘contract for hire’ without an obligation that the person denominated the employer pay the person employed.” Such holding was repeated and approved in the first paragraph of the syllabus of Drexler v. Labay (1951), 155 Ohio St. 244.
I fully recognize that the instant cause can not logically be distinguished from Daniels v. MacGregor Co. (1965), 2 Ohio St. 2d 89. From, a detailed study of that case, however, it appears to me that the issue of what, in fact, constitutes compliance with B. 0. 4123.35 was not discussed and such compliance merely assumed. .
The- question involved herein, of course, is not whether Central would be liable to third persons under the doctrine of respondeat superior, such doctrine involving the elements of direction and control. Instead, the basic question is whether Central was an employer of appellant within the purview of the Workers’ Compensation Act. To conclude that Central was the employer would mean that, pursuant to the provisions of- B. C. 4123.518, Central would have to be notified of a hearing in considering the granting or rejection of an application for compensation and that, under the terms of B. C. 4123.519, Central, as an *179“employer,” would be accorded the right to appeal a decision of the Industrial Commission in any injury case other than the decision as to the extent of disability. That Central could not possibly be considered an “employer” under R. C. 4123.519 is evidenced by the fact that this same section provides that, in the event of an appeal by the employer, payment of an award shall be made to the claimant and if, upon such appeal, it is determined that'payments “should not have been made * # * the amount thereof shall be charged to the surplus fund.” This, of course, is a recognition, that an employer’s premium is affected by payments made to his employees.
In a case such as involved here, and such as was involved in Daniels, the “customer of the employer” (see syllabus of Daniels) is not under any obligation to include the injured party, an employee of a separate legal entity, within its payroll or to compute premium payments upon such basis; thus, any attempted appeal by the “customer of the employer” (even if permitted and successful) could not possibly have any bearing upon the “custom-1 er’s” premium rate.
Based upon the foregoing analysis of the Ohio Constitution and the Ohio Workers’ Compensation Act, I would reverse the judgment of the Court of Appeals and overrule Daniels v. MacGregor Co., supra (2 Ohio St. 2d 89). On this basis, therefore, I respectfully dissent.
Celebbezze, J., concurs in the foregoing dissenting opinion.

I recognize that Daniels v. MacGregor Co. (1965), 2 Ohio. St. 2d 89, distinguishes Trumbull Cliffs on the basis that the plaintiff in Trumbull Cliffs was the employee of an independent contractor. In Daniels, however, MacGregor and Manpower were separate and distinct corporations, each of whom had employees and each of whom “ ‘had complied with the provisions .of the Ohio workmen’s compensation law’” by payment of premiums for their respective employees (which is also true in the instant case). This distinction, in my opinion, overlooks the method of computation and payment of premiums required of a particular employer under the Act.