Ozark Minerals Co. v. Murphy

51 N.E.2d 197, 384 Ill. 94
CourtIllinois Supreme Court
DecidedSeptember 24, 1943
DocketNo. 26961. Judgment affirmed.
StatusPublished
Cited by13 cases

This text of 51 N.E.2d 197 (Ozark Minerals Co. v. Murphy) is published on Counsel Stack Legal Research, covering Illinois Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ozark Minerals Co. v. Murphy, 51 N.E.2d 197, 384 Ill. 94 (Ill. 1943).

Opinions

Mr. Justice Stone

delivered the opinion of the court:

Appellant, Director of Labor of the State of Illinois, made an assessment of $403.95 against appellee for delinquent contributions which he found due and owing by appellee under the Unemployment Compensation Act, with respect to persons he found employed by it as prospectors, miners and drillers (hereinafter referred to as prospectors and miners) for the period from July 1, 1937, to October !, 1939. On writ of certiorari the circuit court found those persons to be independent contractors and not employees of appellee, declined to pass on constitutional questions raised • by appellee, ordered the assessment set -aside and quashed the record filed in the cause. The Director here seeks review of the judgment of the lower court. No cross errors have been filed.

The facts are not in dispute. Appellee, Ozark Minerals Company, operates a silica processing mill at Elco, Alexander county, Illinois, obtaining its entire supply of crude silica from lands owned or controlled by it near the mill. The company denies liability under the act to make unemployment-compensation contributions for men engaged under individual contracts with it as prospectors and miners, though it is admitted that the work performed by such men is in the usual course of the company’s business and upon company land. It further appears that of the men so engaged, most were farmers who did farm work in the summer, and others who engaged in odd jobs, and that they were at liberty to engage in other occupations during the existence of their contract. All the contracts in this record were in the name of and signed by each of two prospectors and miners. The two men worked together and employed no helper, except on rare occasions when one wished to be away from the work for a day or less. The contracts for such occupation are essentially the same. Each provided a scale of payment based on results actually completed, either as prospector or miner. Tools were to be furnished by the company, the workers to maintain and keep the same in good repair at their own expense, and on termination of the contract they were to return them in as good condition as when received, the usual wear excepted. The contractors agreed to mine, prepare and maintain at said mines an ample supply of crude silica as requested from time to time by the company, and on failure so to do the company had the right to make other arrange; ments for mining and preparing an ample supply of crude silica and charge the expense thereof to the contractors, or the company could elect to do such mining and preparing of crude silica upon its own account. The contract provided that the crude silica should be of a quality and grade ordinarily acceptable to the company for milling and manufacture into finished material at its mill in Elco, Illinois. The company had the right to reject any crude silica not of acceptable quality and grade and no payment was to be made for any rejected silica, one half the cost of handling such rejected silica to be paid by the contractors. The contracts were cancellable by either party after prescribed notice. The company had the sole right to assign its contracts and reserved the right to make agreements and contracts with other persons to perform work or conduct operations similar to those covered by the agreement. Certain requirements specified in the contract were to be followed by the contractors in performing their contract, vis., size of holes drilled, grade of silica mined and location of work on premises. In these contracts the contractors were given the right to employ additional help to fulfill the contracts. They assumed liability for damages for injuries or disease arising out of employment, to their employees, the public, and employees of others as well as property damage', and accepted exclusive liability for contributions under the Federal Social Security Act, Illinois Unemployment Compensation Act, and all similar acts. The contracts further provided that the contractors have full control of the manner, means and method of carrying out contracts and they were not barred from performing like services for others. Appellee states similar contracts have been used since 1932. The decision of the trial court was that those persons so contracting were not employees within the meaning of the act. Appellant assigns as error the court’s ruling in that respect.

The pertinent provisions of the Unemployment Compensation Act are sections 2(d), 2(f)(1), and 2(f)(5). (Ill. Rev. Stat. 1937, chap. 48, par. 218, and as amended in 1939.) Subparagraph (d) o,f section 2 defines “employing unit.” Subparagraph (f)(i) defines “employment” as follows: “Subject to the other provisions of this subsection, ‘employment’ means service, including service in interstate commerce, performed for wages or under any contract of hire, written or oral, express or implied.” Sub-paragraph (f)(5) of section 2 provided: “Services performed by an individual for wages shall be deemed to be employment subject to this Act, unless and until it is shown to the satisfaction of.the Director that — (A) Such individual has been and will continue to be free from control or direction over the performance of such services, both under his contract of service and in fact; and (B) Such service is either outside the usual course of the business for which such service is performed or that such service is performed outside of all the places of business of the enterprise for which such service is performed; and (C) Such individual is engaged in an independently established trade, occupation, profession or business.” Subparagraph (f)(i) was amended in 1939 by eliminating “for wages or under any contract of hire, written or oral, express or implied,” and by inserting in lieu of the words eliminated “by an individual for an employing unit, and including all services performed by an officer of a business corporation.” The words “for wages” were eliminated from subparagraph (f)(5) by the 1939 amendment. In 1941 the General Assembly amended section 2(f)(5) by striking out the language “shown to the satisfaction of the Director,” and inserted in lieu thereof, “proven in any proceeding where such issue is involved.” Ill. Rev. Stat. 1941, chap. 48, par. 218, sec. 2(f)(5), p. 1616.

The primary question is whether these prospectors and miners were employees or independent contractors. If they were not employees under the Unemployment Compensation Act, the judgment should be affirmed. If it be determined that they were employees, then it will be necessary to determine whether, as such, they were exempted under subparagraphs A, B, and C of section 2(f)(5) of the act. Appellee, to sustain the judgment, insists the workers were independent contractors, hence not covered by the act, and appellant insists they were employees, not exempt under subparagraph (f) (5) of section 2. In determining whether a workman is an employee or an independent contractor, the principal consideration, under the general rule pertaining to employer and employee, is the right to control the manner of doing the work. Not the actual exercise of the right by interfering with the work, but the right to control, constitutes the test. (Amalgamated Roofing Co. v. Travelers Ins. Co. 300 Ill. 487.) "An independent contractor is one who undertakes to produce a given result without being in any way controlled as to the method by which he attains that result.” (Jaggard on Torts, sec. 73.) The fact that payment is to be made by the piece, the job, the day, the hour, or the ton, does not necessarily control, where the workman is subject to the control of the employer as an employee and is not a contractor.

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Bluebook (online)
51 N.E.2d 197, 384 Ill. 94, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ozark-minerals-co-v-murphy-ill-1943.