Hunt Building Corp. v. Industrial Commission

713 P.2d 297, 148 Ariz. 96, 1985 Ariz. App. LEXIS 766
CourtCourt of Appeals of Arizona
DecidedMay 14, 1985
DocketNo. 1 CA-IC 3122
StatusPublished
Cited by4 cases

This text of 713 P.2d 297 (Hunt Building Corp. v. Industrial Commission) is published on Counsel Stack Legal Research, covering Court of Appeals of Arizona primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hunt Building Corp. v. Industrial Commission, 713 P.2d 297, 148 Ariz. 96, 1985 Ariz. App. LEXIS 766 (Ark. Ct. App. 1985).

Opinions

OPINION

BROOKS, Judge.

In this special action review of an Industrial Commission award, the issue is whether the administrative law judge erred in finding that claimant was a statutory employee of Hunt Building Corporation (Hunt).

Jesus Villaescusa (claimant) severely injured his left leg while operating his augar curbing machine. He filed a claim for benefits alleging Hunt and Richard McGuckin as employers. The claim was denied by the State Compensation Fund and a hearing was requested.

Claimant then filed a second claim alleging “The McGuckin Co.” as his employer. The State Compensation Fund also denied this claim alleging that it was not the carrier for “R.L. McGuckin & Co.” (“McGuckin” hereafter refers to either Richard McGuckin or his company). Subsequently, the commission entered an award finding that McGuckin had no worker’s compensation insurance and finding the claim noncompensable. Claimant protested the award.

Claimant filed a third claim for benefits alleging “Jesse’s Concrete, Inc.” as his employer. The State Compensation Fund denied the claim and claimant requested a hearing.

A consolidated hearing was conducted and the sole issue litigated was whether claimant was an independent contractor or an employee of either Hunt, McGuckin or Jesse’s Concrete, Inc. at the time of the injury. The administrative law judge found claimant to be a statutory employee of Hunt but not of McGuckin. He also found insufficient evidence that claimant was an employee of Jesse’s Concrete, Inc. The award was affirmed on administrative review and Hunt brought this special action.

FACTS

Hunt, a business engaged in the construction of large housing projects, contracted with Quechan Tribal Housing Au[98]*98thority to build 94 single family dwellings on the Fort Yuma Indian Reservation near Winterhaven, California. By the terms of the contract, Hunt was to supervise all construction of the project. As was its usual course of business, Hunt contracted out virtually every facet of actual construction. Hunt subcontracted the curb and gutter work to Frontier Concrete and the paving and earth work to McGuckin. McGuckin also subcontracted out to various contractors all the work it was to perform under the Hunt-McGuckin contract.

When it appeared that Frontier Concrete was not meeting the construction schedule, Hunt’s general superintendent over the project sought a substitute curb subcontractor. McGuckin suggested that claimant be considered for the job and proceeded to contact him on Hunt’s behalf. Frontier Concrete was then released from its contract, and claimant met with Hunt’s superintendent and McGuckin to negotiate payment for the work. Because the Quechan Tribal Housing Authority required approval of all subcontractors and Hunt did not want to delay the curbing work in order to obtain the necessary approval, no written subcontract was entered into directly with claimant. To circumvent the subcontractor approval requirements, the Hunt-McGuckin contract was simply amended to make curb work a part of McGuckin’s responsibility. The price for this work, as orally agreed upon by Hunt and claimant, was added to the total amount of the revised HuntMcGuckin contract.

Claimant provided his own equipment and brought several men to work with him on the curbing project. The work was anticipated to take less than two weeks. Although claimant was previously the president and general manager of Jesse’s Concrete, Inc., he negotiated this particular curbing work on his own behalf. Claimant was injured his first day on the job prior to any curbing actually being installed.

ANALYSIS

In determining whether Hunt was claimant’s statutory employer, the administrative law judge considered A.R.S. § 23-902(B), which provides:

When an employer procures work to be done for him by a contractor over whose work he retains supervision or control, and such work is a part or process in the trade or business of the employer, then such contractors and the persons employed by him, and his sub-contractor and persons employed by the sub-contractor, are, within the meaning of this section, employees of the original employer.

The term “statutory employer” refers to one compelled by law to pay compensation benefits to remote employees, i.e., employees of another. Young v. Environmental Air Products, 136 Ariz. 158, 665 P.2d 40 (1983). Two elements are necessary for the application of A.R.S. § 23-902(B): first, the employer must procure work to be done by a “contractor” 1 over whose work he “retains supervision or control”, and, second, the work entrusted to the contractor must be a “part or process in the trade or business of the employer.” The administrative law judge found that claimant’s work was a part or process of both Hunt’s and McGuckin’s business but that Hunt, and not McGuckin, was a statutory employer because it procured the work to be done and retained supervision over claimant.

In analyzing the “supervision or control” requirement of A.R.S. § 23-902(B), the administrative law judge applied the traditional “right to control” test for distinguishing an employee from an independent contractor under A.R.S. § 23-902(C).2

[99]*99The test of the usual employer-employee relationship is the employer’s right to control the methods of doing the work. Home Ins. Co. v. Industrial Commission, 123 Ariz. 348, 599 P.2d 801 (1979). The right to control the methods of doing the work is often an inference made after analyzing such factors as:

the duration of the employment; the method of payment; who furnishes necessary equipment; the right to hire and fire; who bears responsibility for workmen’s compensation insurance; the extent to which the employer may exercise control over the details of the work, and whether the work was performed in the usual and regular course of the employer’s business.

123 Ariz. at 350, 599 P.2d at 803. If the right to control or supervise goes no further than is necessary to ensure a satisfactory end result, it does not establish an employer-employee relationship.

Hunt argues that these factors indicate that claimant was an independent contractor. In that regard, the administrative law judge found that the curbing work was anticipated to take less than two weeks; that this work required special equipment, skill and expertise possessed only by claimant and his crew on this job; that claimant furnished his own equipment; that claimant negotiated a lump sum fee as payment for the work; that the lump sum was calculated on the basis of lineal footage of curbing installed and included an amount for the use of equipment; and that neither Hunt nor McGuckin actually controlled the execution of the details of claimant’s work.

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Bluebook (online)
713 P.2d 297, 148 Ariz. 96, 1985 Ariz. App. LEXIS 766, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hunt-building-corp-v-industrial-commission-arizctapp-1985.