Site Oil Company of Missouri, Site Oil Company of Michigan, Inc., and William Vaughn v. National Labor Relations Board

319 F.2d 86, 53 L.R.R.M. (BNA) 2604, 1963 U.S. App. LEXIS 4872
CourtCourt of Appeals for the Eighth Circuit
DecidedJune 24, 1963
Docket17130_1
StatusPublished
Cited by13 cases

This text of 319 F.2d 86 (Site Oil Company of Missouri, Site Oil Company of Michigan, Inc., and William Vaughn v. National Labor Relations Board) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eighth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Site Oil Company of Missouri, Site Oil Company of Michigan, Inc., and William Vaughn v. National Labor Relations Board, 319 F.2d 86, 53 L.R.R.M. (BNA) 2604, 1963 U.S. App. LEXIS 4872 (8th Cir. 1963).

Opinion

SANBORN, Circuit Judge. ■

This cas'e is before this Court under .§ 10(f) and (e) of'the National Labor Relations Act, as amended, 29 U.S.C. § 160(f) and (e), upon a petition of the Site Oil Company of Missouri and its wholly owned subsidiary, Site Oil Company of Michigan, Inc. (herein referred to in the singular as “Site”), which are engaged in the acquisition and distribution of petroleum products and the operation of gasoline service stations, and William Vaughn, a company supervisor and former lessee, to review and set aside an order of the National Labor Relations Board based upon its conclusion that Site, the principal office of which is at Clayton, Missouri, was the employer of the lessees of a new gasoline service station constructed and owned by Site in the City of Detroit, Michigan. This conclusion, from which two Board members dissented, was based upon the Board’s determination that, under the evidence adduced before its Trial Examiner, Site was the operator of the station and the employer of the lessees and of the station attendants hired by the lessees. Site denies that it was the employer of its lessees, denies that the finding of the Board to that effect is sustained by substantial evidence, and asserts that the lessees were, under the evidence, independent contractors who were alone responsible for their relations with the station attendants they employed to assist in operating the service station. The Board has cross-petitioned for enforcement of its order, which, togethei with its decision, is reported in 137 N.L.R.B. 1274. The decision speaks for itself.

The evidentiary facts are virtually undisputed. The Board in its decision, in stating them and in defining the issue presented says (pages 1274-1275 of 137 N.L.R.B.):

' “Site Oil Company, referred to herein as Site, constructed a gasoline service station on West 8 Mile Road in Detroit, Michigan, in August I960.. On August 10 [William] Vaughn, until then a supervisor of Site, began operating the station ás a lessee. On August 13,' four of the five attendants employed at the sta *88 tion signed union authorization cards on behalf of Local 299, Teamsters [International Brotherhood of Teamsters, Chauffeurs, Warehouse-men, and Helpers of America, Ind.], and on August 17 the Union claimed majority representation and requested a meeting for negotiation of a contract. On August 20, Vaughn voluntarily terminated his lease with Site, and Baron Herman, who had not been previously associated with Site, began operating the station under a lease agreement similar to Vaughn’s. Herman refused to rehire one of the station attendants, discharged three others, and hired replacements for them.
“The Board agrees with the Trial Examiner’s finding that the discharge of these employees violated the Act [National Labor Relations Act, as amended] and that there was a refusal to bargain in violation of Section 8(a) (5), if the individual lessee operators were not independent contractors. The paramount issue for which the Board granted oral argument was, therefore, the status of the lessee operators. In determining the status of persons alleged to be independent contractors, the Act requires the application of the ‘right of control’ test. Where the person for whom the services are performed retains the right to control the means by which the result is to be accomplished, the relationship is one of employment; but where control is reserved only as to the result sought, the relationship is that of independent contractor. The resolution of this question depends on the facts of each case, and any one factor alone is not determinative.
“Site owned the gasoline station and equipment which it leased to the lessees for an indefinite period, subject to termination upon 30 days’ notice by either party. The lease also gave Site the additional option of terminating the lease upon 24 hours’ notice if the station was being operated contrary to its terms. The lease required the lessee to devote full time to operating the station and to accept no outside work. The lessee obligated himself to pay a rental of 1 cent per gallon for all gasoline sold; to accept all products delivered by Site on a consignment basis; to keep inventory of all merchandise on hand; to make a daily sales report on Site forms; and to remit daily on all sales of Site products. Other provisions of the lease required the station to be open 24 hours a day and for attendants to wear standard Site uniforms; that the lessee would not sell any other products without the written approval of Site; and that Site would set both the wholesale and retail prices for its gasoline and oil products.
“Herman’s operation of the station conformed to the requirements of the lease. Title to the inventory and supplies remained with Site. He submitted a daily report to Site and deposited a part of the receipts, in payment of his account, to the credit of Site in a local bank. He submitted a weekly inventory report to Site at which time the necessary adjustments in amounts due were computed. Herman also sold a number of items such as cigarettes, packaged coal and wood, and auto accessories. He also owned certain small tools which were used at the station. Site paid all utilities and the cost of a business license while Herman paid the sales tax on all items except gasoline and oil. Herman sold the gasoline at the prices established by Site but was in fact permitted to sell oil at prices which he himself determined. The only identification at the station was that of Site.”

Board members Leedom and Rodgers, in their dissenting opinion, said that the majority had taken too limited a view of the applicable test and had misapplied it, and that the “total picture re- *89 fleets an independent contractor relationship.” They expressed their views, in part, as follows (page 1279 of 137 N.L.R.B.):

“In assessing the total situation, we think it essential to allude to these additional facts, which we deem significant. Thus, it is clear that Site neither exercised nor purported to exercise control over the lessee’s day-to-day operations, inasmuch as Site’s district supervisor visited the station only once every two weeks, and then primarily for the purpose of taking orders for products and distributing promotional materials; and although Site may have been concerned with how the lessee’s employees conducted themselves, the lessee was under no obligation to adhere to Site’s suggestions as to service policy. In addition, it was the lessee, and not Site, who (1) paid the premiums for the fidelity bond and holdup insurance ; (2) assumed any liabilities resulting from the operation of the station; (3) determined the personnel needs of the station, hired and discharged employees, and set the employees’ wages and hours, all without consulting Site; and (4) paid Social Security taxes with respect to their employment. Finally, it was the lessee, and not Site, who ran the risk of operational losses and would benefit from operational profits. These are all elements signifying an independent contractor relationship.

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319 F.2d 86, 53 L.R.R.M. (BNA) 2604, 1963 U.S. App. LEXIS 4872, Counsel Stack Legal Research, https://law.counselstack.com/opinion/site-oil-company-of-missouri-site-oil-company-of-michigan-inc-and-ca8-1963.