OPINION.
Goodeich:
In these proceedings, which were consolidated upon motion, petitioner contests respondent’s determinations of deficiencies in income tax as follows:
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The sole issue is whether payments received by petitioner during these years from certain Ohio municipalities are exempt from Federal tax. Petitioner contends that they are so exempt because he was an officer of each of these municipalities, and, as such, was engaged in carrying out an essential function of government. Respondent determined and maintains that petitioner was an independent contractor, and has laid a tax on his receipts. Petitioner does not claim to be a servant of the municipalities; respondent does not dispute that the municipalities were political subdivisions of the state.
As our findings of fact we adopt the stipulation of counsel, but do not here repeat it since a briefer statement is sufficient for the purposes of this report.
It appears that, under ordinances providing for the employment of an engineer adopted by their respective councils, petitioner was “ employed and appointed ” village engineer for each of eight villages in Ohio and served as such during the period here material. During this period also he served as city engineer for the city of Cleveland Heights, having been “ employed and appointed ” as such by the city manager, with the approval of the council, by written contract. Generally, his duties for all these municipalities were to supervise “ the improvement and repair of streets, avenues, [18]*18alleys, lands, bridges, viaducts, sidewalks, sewers, drains and water courses” within them. He passed on subdivision plats; he verified the list of property owners concerned under petitions for improvements. He, or his representative, attended council meetings and supplied requested information as to matters of engineering. He made surveys for improvements, prepared the plans, specifications, and estimates; and assisted, with his information, the solicitor in drafting ordinances pertaining to improvements. The proposal blanks and advertisements for bids on projects were prepared by him, and he received and tabulated the contractors’ bids. After council awarded the work, he drafted the contract specifications and supervised its performance. He directed, inspected, and supervised the construction, tested materials (in the laboratory of his own corporation) and made monthly reports of the progress of the work on which the contractors received their pay, and issued certificates of completed contracts. After analyzing the cost of the completed improvements he prepared the assessment rolls and specified the amount to be levied against each property. In the performance of his duties he was responsible to the several village councils and, with respect to Cleveland Heights, to the city manager. He took no oath of office.
During this time petitioner was free to accept professional engagements other than his work for these municipalities. He was president and principal stockholder of the Pease Engineering Co., did some work for it and received from it a salary of $16,500 annually. Some of petitioner’s work for the municipalities was done with the facilities and employees of this company. He employed also an assistant (H. C. Gallimore). Petitioner’s compensation from the municipalities was based upon a percentage of the cost of the projects undertaken, except as to Cleveland Heights, which paid him a fixed salary. Respondent allowed as deductions from income expenses paid by petitioner to the Pease Co. for use of its employees, laboratory, office, and an allowance for overhead, as well as the salary of his assistant; in short, all of his expenses in connection with these employments. His gross receipts from the municipalities, the expenses allowed, and the net amounts included in income (against which petitioner protests) are as follows:
[19]*19In advertisements for bids, in correspondence, in certification of invoices, and in reports of examinations made by the Auditor and by the Bureau of Public Offices of Ohio, petitioner was designated and described as “ village ” or “ city engineer ” of these municipalities and was so listed (with respect to Cleveland Heights) in a directory of city officials compiled by a department of the State University.
In attempting to determine petitioner’s status, whether officer of a political subdivision or independent contractor, we are met by contradictions of evidence, a situation not unusual in cases involving this problem. Upon analysis the evidence in part supports petitioner’s claim that he was an officer; in part it supports the view that he was an independent contractor, as respondent maintains. For instance, the designation of petitioner as village or city engineer (an office for which the state statute provides) by ordinance duly adopted and in official lists and directories; the assignment to him of important duties (some of which were prescribed by statute) and the reliance upon his skill and discretion in the performance of them; the right of the municipalities to call upon him for information and advice, to demand his time; and, in general, the acceptance of him by the public as an officer of these several municipalities, all tend to prove that such was his status. On the other hand, the fact that he took no oath (though the statute so required) ; the fact that he was not, and could not be, a qualified elector (another statutory requirement of a municipal officer in Ohio) of each of these several municipalities; the indefiniteness of his tenure in his various engagements, some of which could be terminated at the pleasure of the respective councils; the contractual characteristics of the various ordinances under which he was “ appointed and employed ”; the fixing (but not by statute), except in one instance, of his compensation upon a percentage basis, rather than as a definite salary; and the furnishing of his supplies, equipment, and assistants at his own, instead of the public expense — these aspects tend to characterize him as an independent contractor.
We fully recognize that no single one of the considerations mentioned, nor of the other evidentiary bits disclosed in the record and not here set out, is controlling in an attempt to classify petitioner, but that all must be weighed together and the determination made upon the whole view. So doing, and following as best we can the few clear guides emerging from the welter of decision upon this highly controversial subject, and adding our unwillingness to believe that, for the purpose of exempting his earnings from the necessary burden of taxation, one may be deemed an “ officer ” of nine different municipalities at one and the same time — officering at wholesale so to speak — we conclude that respondent was right in his [20]*20determination that petitioner was an independent contractor. See Metcalf & Eddy v. Mitchell, 269 U.S. 514; Mesce v. United States, 64 Ct. Cls. 481; Lucas v. Reed, 34 Fed. (2d) 263; reversed, 281 U.S. 699; Roberts v. Commissioner, 44 Fed. (2d) 168; affirming 13 B.T.A. 438.
In support of the opposite view, petitioner relies heavily upon the decision of the Supreme Court of Ohio in Wright v. Clark, 164 N.E.
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OPINION.
Goodeich:
In these proceedings, which were consolidated upon motion, petitioner contests respondent’s determinations of deficiencies in income tax as follows:
[[Image here]]
The sole issue is whether payments received by petitioner during these years from certain Ohio municipalities are exempt from Federal tax. Petitioner contends that they are so exempt because he was an officer of each of these municipalities, and, as such, was engaged in carrying out an essential function of government. Respondent determined and maintains that petitioner was an independent contractor, and has laid a tax on his receipts. Petitioner does not claim to be a servant of the municipalities; respondent does not dispute that the municipalities were political subdivisions of the state.
As our findings of fact we adopt the stipulation of counsel, but do not here repeat it since a briefer statement is sufficient for the purposes of this report.
It appears that, under ordinances providing for the employment of an engineer adopted by their respective councils, petitioner was “ employed and appointed ” village engineer for each of eight villages in Ohio and served as such during the period here material. During this period also he served as city engineer for the city of Cleveland Heights, having been “ employed and appointed ” as such by the city manager, with the approval of the council, by written contract. Generally, his duties for all these municipalities were to supervise “ the improvement and repair of streets, avenues, [18]*18alleys, lands, bridges, viaducts, sidewalks, sewers, drains and water courses” within them. He passed on subdivision plats; he verified the list of property owners concerned under petitions for improvements. He, or his representative, attended council meetings and supplied requested information as to matters of engineering. He made surveys for improvements, prepared the plans, specifications, and estimates; and assisted, with his information, the solicitor in drafting ordinances pertaining to improvements. The proposal blanks and advertisements for bids on projects were prepared by him, and he received and tabulated the contractors’ bids. After council awarded the work, he drafted the contract specifications and supervised its performance. He directed, inspected, and supervised the construction, tested materials (in the laboratory of his own corporation) and made monthly reports of the progress of the work on which the contractors received their pay, and issued certificates of completed contracts. After analyzing the cost of the completed improvements he prepared the assessment rolls and specified the amount to be levied against each property. In the performance of his duties he was responsible to the several village councils and, with respect to Cleveland Heights, to the city manager. He took no oath of office.
During this time petitioner was free to accept professional engagements other than his work for these municipalities. He was president and principal stockholder of the Pease Engineering Co., did some work for it and received from it a salary of $16,500 annually. Some of petitioner’s work for the municipalities was done with the facilities and employees of this company. He employed also an assistant (H. C. Gallimore). Petitioner’s compensation from the municipalities was based upon a percentage of the cost of the projects undertaken, except as to Cleveland Heights, which paid him a fixed salary. Respondent allowed as deductions from income expenses paid by petitioner to the Pease Co. for use of its employees, laboratory, office, and an allowance for overhead, as well as the salary of his assistant; in short, all of his expenses in connection with these employments. His gross receipts from the municipalities, the expenses allowed, and the net amounts included in income (against which petitioner protests) are as follows:
[19]*19In advertisements for bids, in correspondence, in certification of invoices, and in reports of examinations made by the Auditor and by the Bureau of Public Offices of Ohio, petitioner was designated and described as “ village ” or “ city engineer ” of these municipalities and was so listed (with respect to Cleveland Heights) in a directory of city officials compiled by a department of the State University.
In attempting to determine petitioner’s status, whether officer of a political subdivision or independent contractor, we are met by contradictions of evidence, a situation not unusual in cases involving this problem. Upon analysis the evidence in part supports petitioner’s claim that he was an officer; in part it supports the view that he was an independent contractor, as respondent maintains. For instance, the designation of petitioner as village or city engineer (an office for which the state statute provides) by ordinance duly adopted and in official lists and directories; the assignment to him of important duties (some of which were prescribed by statute) and the reliance upon his skill and discretion in the performance of them; the right of the municipalities to call upon him for information and advice, to demand his time; and, in general, the acceptance of him by the public as an officer of these several municipalities, all tend to prove that such was his status. On the other hand, the fact that he took no oath (though the statute so required) ; the fact that he was not, and could not be, a qualified elector (another statutory requirement of a municipal officer in Ohio) of each of these several municipalities; the indefiniteness of his tenure in his various engagements, some of which could be terminated at the pleasure of the respective councils; the contractual characteristics of the various ordinances under which he was “ appointed and employed ”; the fixing (but not by statute), except in one instance, of his compensation upon a percentage basis, rather than as a definite salary; and the furnishing of his supplies, equipment, and assistants at his own, instead of the public expense — these aspects tend to characterize him as an independent contractor.
We fully recognize that no single one of the considerations mentioned, nor of the other evidentiary bits disclosed in the record and not here set out, is controlling in an attempt to classify petitioner, but that all must be weighed together and the determination made upon the whole view. So doing, and following as best we can the few clear guides emerging from the welter of decision upon this highly controversial subject, and adding our unwillingness to believe that, for the purpose of exempting his earnings from the necessary burden of taxation, one may be deemed an “ officer ” of nine different municipalities at one and the same time — officering at wholesale so to speak — we conclude that respondent was right in his [20]*20determination that petitioner was an independent contractor. See Metcalf & Eddy v. Mitchell, 269 U.S. 514; Mesce v. United States, 64 Ct. Cls. 481; Lucas v. Reed, 34 Fed. (2d) 263; reversed, 281 U.S. 699; Roberts v. Commissioner, 44 Fed. (2d) 168; affirming 13 B.T.A. 438.
In support of the opposite view, petitioner relies heavily upon the decision of the Supreme Court of Ohio in Wright v. Clark, 164 N.E. 512, wherein a village engineer, “ appointed and employed ” and serving under facts almost identical with those respecting the situation of petitioner in, the case at bar, was held to be an officer of the municipality and subject to the statutory prohibition against making and profiting from other contracts with the village which employed him. Petitioner urges, of course, that we are bound by this decision, in view of the well established practice of Federal tribunals of following the settled construction of state statutes without further inquiry. But that practice has been disregarded where, as here, the construction by the state court was occasioned upon considerations of law and policy wholly different from those underlying a case concerning Federal taxation. See Frelmort Realty Corp., 29 B.T.A. 181, and cases there cited. Consequently, in determining petitioner’s status in his attempt to save his income from taxation, we are not bound by the view of the state court respecting his relation to the municipalities, determined from a different angle in a different problem.
Our conclusion precludes the necessity of classifying petitioner’s various duties toward the municipalities, and his acts, as between proprietary and essential governmental functions. And, since there is nothing in the record to indicate that the laying of a tax upon petitioner’s compensation as an independent contractor would impair his ability to perform his duties, or interfere with the ability of the municipalities to procure necessary aid to them in their undertakings, that feature need not be considered.
Reviewed by the Board.
Judgment will be entered vmder Rule 50.