Boruff v. CNA Insurance Co.

795 S.W.2d 125, 1990 Tenn. LEXIS 277
CourtTennessee Supreme Court
DecidedJuly 16, 1990
StatusPublished
Cited by14 cases

This text of 795 S.W.2d 125 (Boruff v. CNA Insurance Co.) is published on Counsel Stack Legal Research, covering Tennessee Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Boruff v. CNA Insurance Co., 795 S.W.2d 125, 1990 Tenn. LEXIS 277 (Tenn. 1990).

Opinion

OPINION

COOPER, Justice.

Calaman, Inc. and its insurance carrier have appealed from a judgment awarding workers’ compensation benefits to Jerry Boruff. Appellants insist that Boruff was never an employee of Calaman, Inc., that his relationship was that of an independent contractor. They also insist that the award of permanent partial disability benefits was excessive. On review of the record, we find that the evidence supports the findings of the trial court on both issues, and affirm the judgment.

Calaman, Inc. is in the business of leasing highway tractors to various freight carriers, and furnishing drivers for the tractors. It admits to having only two [126]*126employees, the vice president of operations and his secretary. One of the several responsibilities of the vice president of operations is to recruit drivers of the leased highway tractors. One such driver was Jerry Boruff, who contracted with Calaman on March 3, 1987, to operate a highway tractor leased to the Cheyenne Express, Inc. Mr. Boruff sustained a severe neck injury on December 14, 1987, while unloading cargo in Knoxville, Tennessee. The injury necessitated the excision of an inter-vertebral disc at C6 and a fusion of the C6 and C7 verterbrae. Calaman, Inc. declined to pay medical expenses or weekly workers’ compensation benefits, first taking the position in pleadings filed in the trial court that Boruff was an employee of Cheyenne Express, and then that Boruff was an independent contractor.

The record shows that Calaman requires each driver it recruits to enter into a written contract. Both parties rely on the contract, and the actual mode of operation under the agreement, in arguing several of the indicia generally considered by a trier of fact in determining the existence or nonexistence of an independent contractor relationship. See Hosiers v. Arrow Transfer & Storage Company, 639 S.W.2d 654 (Tenn.1982). Needless to say the parties arrive at different conclusions.

The contract required by Calaman defines Mr. Boruff as an independent contractor, and is designed to emphasize that relationship. However, a detailed analysis of the contract and the practical effect of its requirements indicate to us that, in fact, the relationship between Calaman and Bo-ruff is that of employer-employee.

Under the contract, Boruff was to operate a Calaman highway tractor leased to Cheyenne Express. Calaman was to pay all costs of operation and maintenance of the equipment, and to pay Jerry Boruff eighteen cents for each mile driven “less Workmen’s Comp.” The workers’ compensation premium to be deducted was to be calculated on Jerry Boruff’s earnings. There is nothing in the contract to indicate directly who would be within the workers’ compensation coverage paid from earnings of Mr. Boruff and other drivers recruited by Calaman. The contract does provide that the driver shall obtain worker’s compensation insurance for himself and any helper used by him. James McFerrin, the operations vice president of Calaman who recruited Mr. Boruff, testified he assumed that Mr. Boruff was within the coverage paid from salary deductions. Mr. Boruff testified he was told he was within the coverage.

The term of the contract was stated to be one year and, on its face, could be terminated only for cause. We note, however, that the inability of Calaman to terminate the contract other than for cause was more apparent than real. The contract gave Ca-laman the right to take possession of its tractor from Mr. Boruff at any time for any reason without any concomitant requirement that Calaman give Boruff another tractor to drive or make payment to Boruff for down time. The practical effect of this was that Calaman could effectively terminate its relationship with Mr. Boruff at will without liability by merely demanding the return of its tractor.

We also note that the contract provides that Mr. Boruff “is free to contract for similar services to be performed for others while he is under contract with Calaman.” The only services to be performed by Mr. Boruff was to drive a tractor owned by Calaman. It is difficult to see how he could drive for two firms at the same time, especially since he had no tractor of his own. Needless to say, Mr. Boruff never exercised this contractual right, nor was he ever in a position to do so.

Under Calaman’s contract with Cheyenne Express, cargo pickup and delivery places, dates and times were to be decided by Cheyenne’s dispatcher. However, Calaman retained the responsibility for selecting the routes to be driven. Calaman required Bo-ruff, in making pickups and deliveries, to take the most commercially reasonable route and offset any equipment operating costs due to a deviation in route against Boruff’s earnings. Calaman also penalized Boruff five cents a mile if he failed to meet pickup or delivery times. Calaman re[127]*127quired Boruff, when on a trip, to report to it daily and to mail a completed settlement package within seventy-two hours of the delivery of the cargo on each trip. Cala-man also required Boruff to report to it immediately any exception noted by a consignee on a pickup or delivery receipt and any accident that might occur. Failure on the part of Boruff to comply with any of Calaman’s rules subjected him to a reduction in compensation of $25.00 for each violation. Boruff also testified, and it was not disputed by Calaman, that he could not take any time off from work without first clearing it with Calaman and then with the Cheyenne dispatcher.

This Court has pointed out repeatedly that there is no single element of a relationship that is determinative of the status of a particular worker, and has emphasized that the trier of fact must examine all relevant factors and circumstances of a particular relationship in deciding whether the status of the worker is that of independent contractor or employee. See Masiers v. Arrow Transfer and Storage Co., 639 S.W.2d 654 (Tenn.1982); Jackson Sawmill v. West, 619 S.W.2d 105 (Tenn.1981); Lindsey v. Smith and Johnson, Inc., 601 S.W.2d 923 (Tenn.1980); Barnes v. National Mortgage Co., 581 S.W.2d 957 (Tenn.1979). While no single factor is infallible or entirely indicative it has generally been recognized by this Court that “the primary test for determining claimant’s status as employee or independent contractor is the ‘right to control.’ ” Lindsey v. Smith & Johnson, Inc., 601 S.W.2d 923 (Tenn.1980). Another factor that has gained controlling significance in the cases is the right of termination. Wooten Transports, Inc. v. Hunter, 535 S.W.2d 858 (Tenn.1976). As noted in Masiers v. Arrow Transfer and Storage Company, 639 S.W.2d 654, 656 (Tenn.1982), “the power of a party to a work contract to terminate the relationship at will is contrary to the full control of work activities usually enjoyed by an independent contractor.”

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Cite This Page — Counsel Stack

Bluebook (online)
795 S.W.2d 125, 1990 Tenn. LEXIS 277, Counsel Stack Legal Research, https://law.counselstack.com/opinion/boruff-v-cna-insurance-co-tenn-1990.