Summary
holding that a contractor who painted a power company's metal power poles every two years was a statutory employee because "it was necessary that the poles be protected from the weather" (cleaned up)
Summary of this case from Zeigler v. Eastman Chem. Co.Opinion
14876
May 9, 1939.
Before OXNER, J., Greenville, January, 1939. Affirmed.
Action by Charlie Jefferson Marchbanks against the Duke Power Company for injuries sustained by the plaintiff while he was engaged in painting a pole which was the property of the named defendant. From a judgment dismissing the complaint without prejudice to right of plaintiff to file a claim under the Workmen's Compensation Act, the plaintiff appeals.
The order of Judge Oxner follows:
This action was commenced by the plaintiff on September 13, 1938, seeking the recovery of damages for injuries sustained by him on June 29, 1938, while painting a pole belonging to Duke Power Company. The Power Company was, and is, engaged extensively in the business of generating, transmitting and selling electric current in the Piedmont section of the Carolinas, including the City of Greenville, this business necessitating the erection and maintenance of numerous poles and transmission lines throughout the City of Greenville. It entered into a contract with one Coln for the painting of 170 of its metal poles located in the business district of Greenville, the Power Company furnishing the paint and Coln doing the painting at the rate of One ($1.00) Dollar, per pole. Plaintiff was employed by Coln to assist him in this work. While so engaged he came in contact with what he alleges was a defectively insulated wire, resulting in the injuries complained of.
The pleadings and the stipulation show that the Power Company was operating under the Workmen's Compensation Act, Act July 17, 1935, 39 Statute at Large, page 1231, and that the maintenance of its poles and transmission lines was a part of its regular business, ordinarily performed by its regular employees; further, that the painting of said poles was an essential part of the maintenance work but that it "has been done by Coln under substantially the same arrangements as involved in this case, this having been done approximately four times," prior to this occurrence, at intervals of approximately two years each.
The Power Company, among other defenses, set up the defense that any claim which the plaintiff might have would necessarily come under the provisions of the Compensation Act. To this defense the plaintiff demurred on the grounds that it appeared that plaintiff was not an employee of the Power Company, but an agent and servant of the independent contractor Coln. Further, that the work being done was not part of the Power Company's trade, business or occupation.
At this point the parties to the action agreed upon a settlement and entered into a stipulation submitting the matter to the Court to determine: (1) Whether the plaintiff had the right to maintain the action at common law. (2) Whether a settlement of said action would bar any further claim by plaintiff or his dependents. It was agreed that if the Court answered these questions in the affirmative judgment should be rendered in favor of the plaintiff in the sum of Seven Thousand ($7,000.00) Dollars; otherwise, that the action would be dismissed and the plaintiff would file claim under the Compensation Act.
The only question, therefore, for determination by me is whether or not plaintiff's claim for damages against Duke Power Company comes within the terms of the Workmen's Compensation Act. The portion of the Act in controversy is as follows:
"§ 19. Rights of Employees of Sub-Contractors — Rights and Liability of Contractor and Sub-Contractors. — (a) Where any person (in this section referred to as `owner'), undertakes to perform or execute any work which is a part of his trade, business or occupation and contracts with any other person (in this section referred to as `sub-contractor') for the execution or performance by or under such sub-contractor of the whole or any part of the work undertaken by such owner, the owner shall be liable to pay to any workman employed in the work any compensation under this Act which he would have been liable to pay if the workman had been immediately employed by him.
"Where any person (in this section referred to as `contractor') contracts to perform or execute any work for another person, which work or undertaking is not a part of the trade, business or occupation of such other person and contracts with any other person (in this section referred to as `subcontractor') for the execution or performance by or under the subcontractor of the whole or any part of the work undertaken by such contractor, then the contractor shall be liable to pay to any workman employed in the work any compensation under this Act which he would have been liable to pay if that workman had been immediately employed by him.
"Where the subcontractor, as the term is hereinbefore used, in turn contracts with still another person (in this section also referred to as `subcontractor') for the performance or execution by or under such last subcontractor of the whole or any part of the work undertaken by the first subcontractor, then the liability of the owner or contractor, as those terms are hereinbefore used, shall be the same as the liability imposed by the preceding paragraphs of this subsection.
"Where compensation is claimed from or proceedings are taken against the owner or contractor, as those terms are hereinbefore used, then, in the application of this Act reference to the owner or contractor shall be substituted for reference to the subcontractor, except that the amount of compensation shall be calculated with reference to the earnings of the workman under the subcontractor by whom he is immediately employed.
"(b) Where the principal contractor is liable to pay compensation under this section he shall be entitled to indemnity from any person who would have been liable to pay compensation to the workman independently of this section or from an intermediate contractor, and have a cause of action therefor.
"(c) Nothing in this section shall be construed as preventing a workman from recovering compensation under this Act from a subcontractor instead of from the principal contractor, but he shall not collect from both.
"(d) A principal contractor when sued by a workman of a subcontractor shall have the right to call in that subcontractor or any intermediate contractor or contractors as defendant or co-defendant."
The plaintiff contends that he does not come within the terms of the Act for the following reasons (using the language of plaintiff's counsel):
"(1) That the first paragraph of section 19 of the Act is not applicable as making the `owner' liable where such `owner' contracts to have the work done by an independent contractor, and the employee of an independent contractor is injured. The plaintiff further contends that the second paragraph of said section is not applicable, in that said section does not purport in any wise to fix liability upon the `owner', but merely provides that an injured employee of a subcontractor may go against the independent contractor for his compensation. In that connection, it is contended by the plaintiff that for the second paragraph of said section to apply, as fixing liability on the independent contractor there must be four persons in interest: An `owner,' an independent contractor, a subcontractor under the independent contractor, and an injured employee of the subcontractor.
"(2) It is further contended by the plaintiff that, in the event it should be held that plaintiff is included in said Section 19, it would not be applicable in the present case because the work on which plaintiff was engaged was not a part of the trade, business or occupation of Duke Power Company. Further, that the Company was not undertaking `to perform or execute' the work, but was `having the work executed.'
"(3) Lastly, it is contended by the plaintiff that in any event, the remedy under the Compensation Act under the circumstances here involved is not exclusive and that, even though the foregoing Section of the Act should be considered applicable, the plaintiff can, nevertheless, maintain an action at common law."
These three contentions on the part of the plaintiff will be disposed of in the order stated.
Taking up the plaintiff's first contention as above set out, it seems to me that the intention on the part of the General Assembly in including Section 19 in our Compensation Act was to extend the benefits of said Act so as to cover workers who otherwise would not be entitled to the protection thereof. In an annotation found in 58 A.L.R., at page 872, it is said:
"Although many of the workmen's compensation acts did not originally include them, provisions are rapidly being added in the different jurisdictions making `principals,' `principal employers,' `general contractors,' etc., liable for compensation to employees of independent contractors and subcontractors. Such provisions vary in different jurisdictions, appearing in nearly as many forms as there are jurisdictions.
"It would seem that the chief purpose of the provisions of this type is to protect the employees of subcontractors who are not financially responsible and to prevent employers from relieving themselves from liability by doing through independent contractors what they would otherwise do through direct employees."
It is well settled, as was stated by the Supreme Court of this State in the case of Rudd v. Fairforest Finishing Company, 189 S.C. 188, 200 S.E., 727, 729, decided January 3, 1939, that "Compensation laws should be given a liberal construction in furtherance of the munificent purpose for which they were enacted * * *." Applying this rule of construction to the section in question there can be no doubt that the plaintiff's first contention is not well founded.
It is not contended by defendant that this controversy is controlled by the second paragraph of this Section. Defendant does contend, and I think properly so, that the second paragraph as well as the remaining paragraphs of this section, is important in determining the proper construction of the first paragraph.
One of the principal arguments advanced by plaintiff's counsel was that before an employee is entitled to compensation against the owner under Section 19, there must exist between such an employee and owner the common law relation of master and servant, and such a relationship does not exist where such employee is working for an independent contractor who is doing work for the owner. If such a contention is sound, there certainly could not have been any purpose in the enactment of the first paragraph of Section 19, for the reason that other general provisions of the Act fix liability for compensation under the usual relationship of master and servant. The General Assembly, it will be assumed, had some purpose in mind in the enactment of this Section, and it is clear to me that it was intended to bring within the terms of the Act employees who otherwise could not claim compensation because of lack of the common law relation of master and servant.
If the common law relation of master and servant existed in this case between the plaintiff and defendant, plaintiff would be entitled to compensation under the general provisions of the Act and entirely independently of Section 19.
Plaintiff's counsel fails to give any explanation of the purpose or the effect of the first paragraph of Section 19. If it does not apply to an employee of an independent contractor, where such independent contractor is engaged in the trade, business or occupation of the owner, to what does it apply? Does it only apply where such employee is the servant of the owner? Surely not, because such a situation has already been covered by the general provisions of the Act. This paragraph must be construed to have been enacted for some purpose.
The reason for the enactment of Section 19 is clear and no ambiguity exists when properly construed.
It was evidently realized by the General Assembly that it would not be fair to relieve the owner of compensation to employees doing work which was a part of his trade or business by permitting such owner to sub-let or sub-contract some part of said work. Doubtless in many instances such contractor would be financially irresponsible, or the number of employees under him would be so small, as in this case, that such contractor would not be required under the Act to carry compensation insurance. It was therefore, provided under the first paragraph that where such work in which the employee was engaged was a part of the owner's trade or business, the owner would be responsible in compensation to all employees doing such work, whether employees of an independent contractor or not.
The General Assembly evidently did not wish to extend the above rule to a case where such work was not a part of the trade or business of the owner. To illustrate, if a merchant wished to construct an apartment house, the General Assembly did not desire to hold him responsible in compensation for injuries to employees of the contractor to whom the contract had been awarded for the construction of such an apartment house. However, the General Assembly did intend under such circumstances to give some measure of protection to employees of any sub-contractor under such contractor. By the second paragraph it was intended that where the work was not a part of the owner's trade or business, the principal contractor would be liable in compensation to all employees of sub-contractors doing such work.
The various Workmen's Compensation Acts are so different in terms that few of them afford any help in determining the issue in controversy. For instance, a great number of the states provide that the contractor or owner is only responsible in the event he fails to require the sub-contractor to carry compensation insurance. After a careful examination of the cases, it appears that the sections of the various compensation acts that are more analogous to ours are those contained in the compensation acts of Kansas, Louisiana and Virginia.
The foregoing construction was applied by the Kansas Court in Purkable v. Greenland Oil Company, 122 Kan., 720, 253 P., 219. In that case the defendant was engaged in developing mineral resources. In the prosecution of its business it was necessary to erect certain derricks. As the mineral resources would be exhausted in a particular place, the existing derrick would be torn down and the salvaged material would be used in another place in the erection of another derrick. The work of tearing down and rebuilding the derricks was left to a derrick builder, F.J. Hedges, who furnished his own tools, employed his own workmen and did the work according to his own plan and method for a standard price, free from control by the defendant. He had been so engaged in building derricks for the defendant for a year and a half previous to the accident. The plaintiff, an employee of Hedges, was injured while engaged in the erection of one of said derricks. The Court said:
"Liability of the company to pay compensation is predicated on the subcontracting section of the Workmen's Compensation Act. The section provides that when any person, called principal, undertakes to execute any work `which is a part of his trade or business,' and contracts with another person, called contractor, for execution of the whole or any part of the work, the principal shall be liable to pay to a workman employed in execution of the work any compensation for which the principal would have been liable if the workman had been employed directly by the principal. * * *
"The Company contends Hedges was the independent contractor, and because Purkable was employed by Hedges, the company is not liable. The statute was enacted for the very purpose of giving employees of the contractor remedy against the principal, and the Court has so held."
The Louisiana Statute was construed by the Circuit Court of Appeals of the Fifth Circuit in Wisinger v. White Oil Corporation, 24 F.2d 101, 102. The Louisiana Statute Act La. No. 38 of 1918, as disclosed by said case, was as follows: "Section 6. Be it further enacted, etc., That where any person (in this section referred to as principal) undertakes to execute any work, which is a part of his trade, business or occupation or which he had contracted to perform, and contracts with any person (in this section referred to as contractor) for the execution by or under the contractor of the whole or any part of the work undertaken by the principal, the principal shall be liable to pay to any employee employed in the execution of the work or his dependent any compensation under this act which he would have been liable to pay if that employee had been immediately employed by him. * * *"
It appeared that the defendant was the owner of certain oil leases which obligated it to drill wells and to develop the property and pay royalties to the owners of the land. After a number of paying wells had been brought in, the defendant entered into a written contract with C and B to operate the property for 75 per cent. of the residue of the oil produced after paying the royalties. The equipment on the property belonging to defendant, including a steam boiler, was turned over to C and B and was used by them in operating the oil leases. The boiler referred to exploded and plaintiff's husband, an employee of C and B, was injured to such an extent that he subsequently died. Claim was made under the Compensation Act above set forth. It was contended that the contract between the defendant and C and B was a lease and not an agreement constituting C and B independent contractors and that, therefore, the deceased was not covered by the compensation law. The Court said: "Had Wisinger (the deceased) been defendant's employee, plaintiff's recovery would have depended entirely on the Compensation Law. * * * It is certain that defendant was in the business of drilling and operating oil wells, and was obligated to develop and operate the field turned over to C * * * and B * * *. There is no doubt they were doing for defendant the work it was obligated to do, and it is therefore immaterial whether they be classed as sublessees or independent contractors. Under the above-quoted section of the Compensation Laws, the liability to plaintiff is the same."
Counsel for plaintiff contends that this section of our Act was taken from and is identical with the Virginia Act and that under the case of Fulghum v. Bleakley, 177 S.C. 286, 181 S.E., 30, our legislature must be presumed to have intended the interpretation of the Virginia Courts to form a part of the Act as adopted. It might not be amiss to point out that in the Fulghum case our legislature had adopted a complete Connecticut Statute. It is not contended that our Compensation Act is identical with that of the Virginia Act but merely that one isolated section is identical with the same section contained in the Virginia Act. It is unnecessary to decide whether these facts would affect the rule as laid down in the Fulghum case since in my opinion the Virginia decisions do not sustain the plaintiff's contention. Furthermore, it could just as logically be argued that our Act was taken from the Kansas and Louisiana Act and, therefore, that the decisions of those states should govern. In view, however, of the stress placed on the Virginia decisions I think it would be well to review the same.
The first case cited is that of Bamber v. City of Norfolk, 138 Va., 26, 121 S.E., 564. A reading of the Virginia Act as it stood at the time of this decision shows that it was entirely different from the Act as it now stands. This fact is emphasized by the Court in its opinion. The Act then in force (Acts Va., 1918, c. 400, pp. 641, 642), read as follows: "Sec. 20. (a) Where any person (in this section referred to as principal contractor) undertakes to execute any work, which is a part of his trade, business or occupation or which he has contracted to perform, and contracts with any other person (in this section referred to as sub-contractor) for the execution by or under the subcontractor of the whole or any part of the work undertaken by such principal contractor, the principal contractor shall be liable to pay to any workman employed in the work any compensation under this act which he would have been liable to pay if that workman had been immediately employed by him; and where compensation is claimed from or proceedings are taken against the principal contractor, then, in the application of this act, reference to the principal contractor shall be substituted for reference to the subcontractor, except that the amount of compensation shall be calculated with reference to the earnings of the workman under the subcontractor by whom he is immediately employed."
It will be noted that the Act as it then stood referred to "a principal contractor" rather than "owner," and that the Court in its decision placed considerable stress upon this particular wording. It is also significant that the Act apparently contained no such provision as is now incorporated in the second paragraph of our Act.
It is apparent, therefore, that the Bamber case cannot be relied upon to sustain plaintiff's contention in this case. It might not be amiss to further state that it appears in that case that the contractor had undertaken to erect a standpipe which was not a part of the city's business, and even under the views hereinafter expressed, the claimant in that case could not have received compensation from the city.
The next case is that of City of Portsmouth v. Daniels, 162 S.E., 324, 325. When this decision was rendered the amendment to the Virginia Act had been made and it stood exactly as our Act. The Court refused to hold the city liable in compensation principally upon the ground that a municipality did not come within the term "any person" used in Section 20 (a) of the Virginia Act. The Court said: "The general term `any person' we do not think applies to municipal corporations and political subdivisions of the state. We think that as Section 20 (a) of the Act does not expressly include municipal corporations or political divisions of the state, it is not applicable to them."
The next case is that of Perkinson v. Thomas, 164 S.E., 561. That case is not applicable because the Court held that the relationship between the parties was that of buyer and seller of a commodity. Certainly, under these circumstances the buyer could not be held responsible in compensation to an employee of the seller.
The case of Crowder v. Haymaker, 178 S.E., 803, is not applicable. Section 20 (a) of the Virginia Act is not referred to or discussed, and the case turns wholly on the question as to whether or not the claimant was a servant of the party against whom he sought compensation.
The last case is that of Waugh Co. v. Rollison, reported in 192 S.E., at page 694. This case is not applicable because Section 20 (a) was not discussed and the fact that compensation was allowed because the claimant was found to be an employee.
So that the only cases by the Supreme Court of Virginia where the question in controversy was passed upon are the Bamber case, which is no authority in view of the subsequent amendment, and the Portsmouth case, which is no authority because a municipality was held not to come within the terms of those designated as "principal" under Section 20 (a).
In addition to the above, it appears that the Virginia Compensation Act contains the following provision: "Nothing in this act contained shall be construed to make, for the purposes of this act, the employees of an independent contractor the employees of the person or corporation employing or contracting with such independent contractor." Code Va. 1936, § 1887 (12).
The Court, in the Bamber case, supra, placed emphasis on the above provision, and it must necessarily have affected the decisions of the Court in the other cases. I have been unable to find any similar provision in the South Carolina Act; consequently the Virginia cases could not be followed as precedents in this instance.
The next question is whether or not the work in which plaintiff was engaged was a part of the trade, business or occupation of Duke Power Company. On that question there are numerous decisions, and it should be frankly stated that all of them cannot be reconciled. It would serve no useful purpose to undertake to review them, but illustrative of a number of such decisions are the following:
In Fox v. Fafnir Bearing Company, 107 Conn., 189, 139 A., 778, 58 A.L.R., 861, the plaintiff, an employee of a window cleaning concern, was injured while cleaning the windows of the defendant company under a contract between said defendant and his employer. The Court held that such work was a part of the business of the defendant corporation and held it liable in compensation.
In Purkable v. Greenland Oil Company, supra, the Court held that an employee of an independent contractor erecting derricks for the independent company was engaged in the business of the defendant while working on such derricks, and that the defendant corporation was liable in compensation to him for injuries sustained.
In Olsen v. Canter, 93 Ind. App. 150, 176 N.E. 27, the defendant, who operated a dry goods and grocery store, employed the plaintiff to paint his buildings. The Court held that such painting was in the usual course of the defendant's business and held him liable for compensation.
In Sherlock v. Sherlock, 112 Neb. 797, 201 N.W. 645, the defendant operated a wholesale drug store. It entered into a contract with an independent contractor to paint the exterior parts of its building. Plaintiff, an employee of the independent contractor, was injured during the course of the work. The Court sustained an award of compensation against defendant upon the ground that the painting was in the usual course of its trade or profession.
Similar cases are those of: Klumpp v. Industrial Acc. Commission, 107 Cal.App. 733, 291 P., 456; Johnson v. Asheville Hosiery Co., 199 N.C. 38, 153 S.E., 591; National Cast Iron Pipe Company v. Higginbotham, 216 Ala., 129, 112 So., 734.
The Court well said in the case of Fox v. Fafnir Bearing Company, supra ( 107 Conn., 189, 139 A., 779): "No general rule is deducible from the authorities, and it is often a matter of extreme difficulty to decide whether the work in a given case falls within the designation of the statute. It is in each case largely a question of degree and of fact, and it was with that in mind doubtless that in Manton v. Cantwell, supra ((1920) A.C. 781), the Lord Chancellor said that it was `neither convenient nor proper to travel beyond the facts of a particular case to lay down general rules to govern cases which may or may not arise hereafter.'"
In the present case it is conceded that the maintenance of the defendant's transmission lines was an important and essential part of its trade or business and it is not disputed that such maintenance work was ordinarily performed by defendant's regular employees. To my mind the painting of these poles was a part of such usual and necessary maintenance work. It appears that in connection with said work it was necessary to scrape the rust from the bases of said poles and to apply a coat of some rust preventive thereto, this part of the work being done by the defendant's regular employees. I can see no material difference between the work being done by the plaintiff and that being performed by defendant's regular employees, which unquestionably was a part of defendant's business, trade or occupation. No particular skill or special equipment was necessary to paint these poles.
The specifications of negligence in plaintiff's complaint clearly indicate that the work upon which he was engaged was a part of defendant's business. I am of the opinion, therefore, that the plaintiff's second contention cannot be sustained.
I now come to plaintiff's third and last contention to the effect that his remedy under the Compensation Act is not exclusive. Most of the cases cited as sustaining this contention involve acts which are materially different from that in force in this State in that no direct liability is imposed upon the principal or owner, These acts require such owner or principal to see that the contractor carries compensation insurance for the protection of his employees and only in instances where he fails to do this does liability on his part arise.
The best reasoned case that I have found on this question is that of State v. Benjamin F. Bennett Bldg. Co., 154 Md., 159, 140 A., 52, 53. It involves an act similar in principle to that of this State. The Court, in referring to the section analogous to our Section 19, said:
"The effect of this provision, when brought into operation through the designated state of circumstances, is to impose the absolute liability of an employer upon the principal contractor when he was not in law the employer of the injured workman. The result, then, is that, where the prescribed conditions exist, the principal contractor becomes by the act the statutory employer of any workman employed in the execution of the work. * * *
"This primary liability so imposed by statute upon the principal contractor is not based upon contract, since the legislation is predicated upon the fact that no contractual relation, as master and servant, exists between the principal contractor and the workman; nor does it flow from a breach of duty, because the liability arises independently of the existence of fault on the part of the principal contractor. This legislation, however, finds its constitutional support in the consideration that the general welfare is promoted and conserved by requiring the employer and the workman to yield something of their respective rights toward the establishment of a principle and plan of compensation for their mutual protection and advantage. * * * The reasons for the enactment of this section of the act, and some of its advantages to the workmen, have already been noted in this opinion, and its corresponding special benefits to the principal contractor are that, with the imposition of a new statutory liability to a class of workmen who are not his servants, he is yet relieved of any liability at common law to any member of this class injured in the course of his employment within the act through the negligence of the principal contractor; and that, unless the injury to the workman be through the principal contractor's neglect, the latter may recover against the subcontractor the compensation paid. if these beneficial provisions did not exist in favor of the employer, the section here under consideration might be difficult to support on constitutional grounds."
The Court then concluded: "This theory would deprive a class of employers within the act of their exemption from all liability save that of compensation, which is an essential part of the general legislative plan. A construction so antagonistic to the fundamental principles underlying the enactment will not be adopted. If an employer is within the act to bear its liabilities, he must remain to be accorded its immunities, in the absence of a clearly expressed legislative intention to the contrary."
It appears that a similar question has been before the Law and Equity Court of the City of Richmond, Virginia, in the case of P.F. Fields v. Wise Granite Construction Company, Inc., et al a report of this case being found in the 1938 edition of the Virginia Workmen's Compensation Act Annotated, by Parke P. Deans, Chairman of the Commission. In this connection the Court said:
"To permit the principal contractor to be held liable under the facts shown by the pleadings in the instant case would be to deprive him of the most valuable right promised him by the act, in return for which he had accepted certain burdens in the forms of liability not otherwise imposed upon him. It would allow the plaintiff to claim both under the act and against it. It would be reasonable and fair that if an employer is within the act to bear its liability, he must remain within the act to be accorded its immunities.
"The most recent case on this subject is State of Maryland, to the uses, etc., against Benjamin F. Bennett Building Company, a corporation, etc. ( 154 Md., 159, 140 A., 52), in which the opinion was handed down on January 11, 1928. * * * The law of Maryland and the facts of that case (on principal) are similar to the instant case. The reasoning of that case is clear and convincing and consonant with our most venerated rules of construction and equities of law."
A similar conclusion was reached in the case of White v. George A. Fuller Company, 226 Mass. 1, 114 N.E., 829. In my opinion it would be grossly unfair to hold the employer bound in compensation without giving him the corresponding limitation of liability as provided in the Act. I am, therefore, of the opinion that the plaintiff's third contention cannot be sustained.
Counsel for plaintiff took the position that to interpret said first two paragraphs of Section 19 as making the "owner" liable for injuries suffered by employees of an independent contractor, would render same unconstitutional as depriving insurance carriers of "owners" of the freedom to contract, without due process of law, in violation of the Fourteenth Amendment of the United States Constitution U.S.C.A. and Article 1, Section 5, of the State Constitution; that such interpretation would be equivalent to legislating upon the insurance company a contract which it did not make.
In the case of Cudahy Packing Company v. Parramore, 263 U.S. 418, 44 S.Ct., 153, 154, 68 L.Ed., 366, 30 A.L.R., 532, the Supreme Court of the United States, speaking through Justice Sutherland, said: "The modern development and growth of industry, with the consequent changes in relations of employer and employee, have been so profound in character and degree as to take away, in large measure, the applicability of the doctrines upon which rest the common-law liability of the master for personal injuries to a servant, leaving of necessity a field of debatable ground where a good deal must be conceded in favor of forms of legislation, calculated to establish new bases of liability more in harmony with these changed conditions. Workmen's Compensation legislation rests upon the idea of status, not upon that of implied contract; that is, upon the conception that the injured workman is entitled to compensation for an injury sustained in the service of an industry to whose operations he contributes his work as the owner contributes his capital — the one for the sake of the wages and the other for the sake of the profits. The liability is based, not upon any act or omission of the employer, but upon the existence of the relationship which the employee bears to the employment because of and in the course of which he has been injured. And this is not to impose liability upon one person for an injury sustained by another with which the former has no connection; but it is to say that it is enough if there be a casual connection between the injury and the business in which he employs the latter — a connection substantially contributory though it need not be the sole or proximate cause. Legislation which imposes liability for an injury thus related to the employment, among other justifying circumstances, has a tendency to promote a more equitable distribution of the economic burdens in cases of personal injury or death resulting from accidents in the course of industrial employment, and is a matter of sufficient public concern * * * to escape condemnation as arbitrary, capricious, or clearly unreasonable."
Section 19 of our Act specifically limits the liability of the owner thereunder to instances in which the work being done at the time of the injury is a part of the owner's trade, business or occupation, and I am satisfied that plaintiff's contention in this respect is without merit.
It appears in this case that plaintiff and defendant have reached an amicable settlement, which settlement could be approved if the Court adopted the contentions advanced by plaintiff. It is undisputed that if the remedy of the plaintiff is under the Workmen's Compensation Act, an effective release could not be procured by the defendant until after the plaintiff had pursued his remedy under the Compensation Act. Ordinarily the Court would be quite willing to approve any settlement made, but the controversy here involves very important principles under the Workmen's Compensation Act, and the decision of this issue is far-reaching. Necessarily the controversy must be decided upon sound principles and independently of how the particular controversy here involved would be affected. Of course, the plaintiff can now pursue his remedy under the Workmen's Compensation Act, which defendant concedes that he has a right to do.
Having reached these conclusions, it is my duty, under the stipulation by which this case was submitted to me, to dismiss the complaint.
It is, therefore, ordered that the complaint in this action be, and the same is hereby, dismissed without prejudice to the right of the plaintiff to file claim under the Workmen's Compensation Act.
Mr. W.E. Bowen, for appellant, cites: Contractor defined: 13 C.J., 211; 177 S.C. 286; 181 S.E., 30. Employee defined: 106 S.E., 371; 118 S.E., 133; 121 S.E., 564; 149 S.E., 479; 93 S.E., 562; 162 S.E., 324; 164 S.E., 561; 192 S.E., 694. Liability under act: 119 S.E., 921; 131 S.E., 527; 136 S.E., 173; 139 S.E., 832; 146 S.E., 792; 147 S.E., 530; 155 S.E., 77; 157 S.E., 245; 165 S.E., 156; 173 S.E., 737; 173 S.E., 741; 175 S.E., 265; 139 A., 778; 58 A.L.R., 861; L.R.A., 1918-F, 173; 202 S.W., 131; 33 A.L.R., 736; 188 S.C. 233; 198 S.E., 285; 33 A.L.R., 1433; L.R.A., 1917-D, 151. Right to contract: 12 C.J., 1200; 1 Ann. Cas., 936; 208 U.S. 161; 62 P.2d 320; 16 F.2d 469.
Messrs. Haynsworth Haynsworth, for respondent, cite: Construction of statute: 25 R.C.L., 1006; 58 A.L.R., 872; 105 A.L.R., 581. Liability where claimant employee of subcontractor: 253 P., 219; 24 F.2d 101; 193 So., 1; 188 A., 269; 177 S.C. 286; 181 S.E., 30. Review of finding of fact: 172 S.C. 415; 174 S.E., 385; 168 S.C. 516; 167 S.E., 833; 124 S.C. 346; 117 S.E., 594; 105 A.L. R., 594; 140 A., 52; 114 N.E., 829; 138 N.E., 239. Right to question constitutionality of act: 25 R.C.L., 89; 120 S.C. 526; 113 S.E., 335; 263 U.S. 418; 30 A.L.R., 532.
May 9, 1939. The opinion of the Court was delivered by
This action was brought in the Court of Common Pleas for Greenville County to recover damages for injuries received by plaintiff while engaged in painting a pole, the property of Duke Power Company, a corporation, which is extensively engaged in the business of generating, transmitting, selling and furnishing electricity for lighting, heating, and for domestic and industrial purposes. In the accomplishment of these purposes, or some of them, it has erected and maintains in the City of Greenville numerous poles and transmission lines. It finds it necessary, in order to keep them in proper repair for use, to have them painted at certain intervals. It appears from the pleadings and stipulations embodied in the record, that the Power Company entered into a contract with one W.O. Coln, by which the latter undertook to paint 170 of these metal poles at the price of $1.00 per pole, the power company to furnish the paint, etc. Coln employed the plaintiff, who is a competent painter, to do the work. While employed at this work, he came in contact with a wire, which he alleges in his complaint was defectively installed and was heavily charged with electricity, and he suffered severe injuries.
He brought action against Duke Power Company and W. O. Coln. The complaint contains the allegation that W.O. Coln was doing this work of painting the poles, as an independent contractor and that the plaintiff was in his employ as his agent and servant.
The defendant, Duke Power Company, which for brevity we shall call the company, set up, by way of answer, a general denial, contributory negligence on the part of plaintiff, that defendant accepted the provisions of the Act of the General Assembly of South Carolina, Act No. 610 of the Statutes of 1936, 39 St. at Large, p. 1231, and with the approval of the Industrial Commission became a carrier of its own insurance thereunder; that the said Act, known as the Workmen's Compensation Act, furnishes plaintiff his sole and exclusive remedy for the injuries he may have suffered and the defendant is not liable to plaintiff on the cause of action stated in the complaint.
The plaintiff demurred to the answer on the grounds that at the time of his injuries plaintiff was in the employ of W. O. Coln and engaged about the business of the said Coln, who was an independent contractor with reference to Duke Power Company, and plaintiff was not an agent or servant of Duke Power Company; that the painting of the posts is not a part of the "trade, business or occupation" of Duke Power Company.
Before the case came to trial before Judge Oxner, the parties agreed upon a settlement to the effect that if it was found that the plaintiff had the right to maintain this action, "and such settlement could be made as would fully release the defendants from all liability, if any, of whatever nature either at common law or under the Workmen's Compensation Act," the Court shall not only sustain plaintiff's demurrer, but shall render judgment for plaintiff in the sum of $7,000.00; otherwise the complaint shall be dismissed. To determine this question the parties entered into a written stipulation, the principal features of which are thus stated in the record: "1. That the parties to this action have agreed upon a settlement provided it is found (1) that plaintiff has the right to maintain said action and (2) that such settlement will completely and forever bar any further claim by said plaintiff, or, in the event of his death any further or additional claim by his dependents or personal representatives either at common law or under the Workmen's Compensation Act. That the parties hereto will submit these questions to the Court for determination, said issues being substantially raised by plaintiff's demurrer to the defendant's third defense. If the Court finds that the plaintiff has the right to maintain said action, and that such settlement will bar all further claims, as above described, it is agreed that the Court shall not only sustain plaintiff's demurrer but that an order for judgment shall be rendered in favor of the plaintiff in the sum of Seven Thousand ($7,000.00) Dollars in said action. If the Court answers the above questions in the negative, then an order shall be issued dismissing and ending this action and that claim will then be submitted by the plaintiff under the Workmen's Compensation Act."
The matter was fully and ably argued before Judge Oxner, who, on January 26, 1939, filed his order which holds that plaintiff cannot maintain this action. He therefore dismissed the complaint without prejudice to the right of the plaintiff to claim under the Workmen's Compensation Act.
The plaintiff appeals from this order upon ten exceptions and assignments of error, but not so many questions are thereby made for our determination. We shall consider all of them and decide those which, in our judgment, are determinative of the issues involved.
Counsel for both parties have filed able briefs and arguments.
Judge Oxner in his order, or decree, stated this: "The only question, therefore, for determination by me is whether or not plaintiff's claim for damages * * * comes within the terms of the Workmen's Compensation Act. The portion of the Act in controversy is as follows: * * *."
He then sets out Section 19 of the Act. For convenience, we reproduce the applicable portions of Section 19 of the Act:
"(a) Where any person (in this section referred to as `owner'), undertakes to perform or execute any work which is a part of his trade, business or occupation and contracts with any other person (in this section referred to as `subcontractor') for the execution or performance by or under such subcontractor of the whole or any part of the work undertaken by such owner, the owner shall be liable to pay to any workman employed in the work any compensation under this Act which he would have been liable to pay if the workman had been immediately employed by him.
"Where any person (in this section referred to as `contractor') contracts to perform or execute any work for another person, which work or undertaking is not a part of the trade, business or occupation of such other person and contracts with any other person (in this section referred to as `subcontractor') for the execution or performance by or under the subcontractor of the whole or any part of the work undertaken by such contractor, then the contractor shall be liable to pay to any workman employed in the work any compensation under this Act which he would have been liable to pay if that workman had been immediately employed by him."
The whole appeal presents to us these questions:
What was the intent of the Legislature in passing the Workmen's Compensation Act?
What is the proper interpretation of Section 19 of the Act?
Is one whose claim brings him within the provisions of that Act, confined to that remedy or may he bring action under the common law for damages?
Is the Act unconstitutional?
At the time of his injury, was the work in which plaintiff was engaged the work of Duke Power Company which it was undertaking to perform, or which it was undertaking to have performed, "a part of its trade, business or occupation"?
In the case of Rudd v. Fairforest Finishing Co., 189 S.C. 188, 200 S.E., 727, 728, Mr. Justice Fishburne, for the Court, said:
"The governing principles find general concurrence in other jurisdictions. See note in Ann. Cas., 1918-B, 647.
"Compensation laws should be given a liberal construction in furtherance of the beneficent purpose for which they were enacted, and if possible, so as to avoid incongruous or harsh results. Baltimore Philadelphia Steamboat Company v. Norton, 284 U.S. 408, 414, 52 S.Ct., 187, 189, 76 L.Ed., 366."
Counsel for both parties have gone extensively into the consideration of the compensation acts of other states, and the citation of authorities of the decisions of the Courts of other states in the exposition thereof. The large majority of the states have workmen's compensation acts; some of them have features similar to ours, but we find it impossible to deduce from all of them, and the many authorities cited, a rule general in its application. In the case of Fox v. Fafnir Bearing Co., 107 Conn., 189, 139 A., 778, 779, 58 A.L.R., 861, we find this expressive utterance: "No general rule is deducible from the authorities, and it is often a matter of extreme difficulty to decide whether the work in a given case falls within the designation of the statute. It is in each case largely a question of degree and of fact, and it was with that in mind doubtless that in Manton v. Cantwell, supra, the Lord Chancellor said that it was `neither convenient nor proper to travel beyond the facts of a particular case to lay down general rules to govern cases which may or may not arise hereafter.' The decision was not difficult in the Pulambo [ Pallumbo v. George A. Fuller Co., 99 Conn., 353, 122 A., 63] and Pallanck [ Pallanck v. Donovan, 105 Conn., 591, 136 A., 471] cases which we have cited."
After all, we are governed by the Act of our own State. It behooves us then to consider it and determine what that Act means, and to that end we must determine the intent of the Legislature, as it is disclosed by the language used in the Act. It is our task to discover the sense in which the words were used when the section was passed.
"In construing a statute, effect should be given to manifest intention of Legislature." Second syllabus in Fulghum v. Bleakley, 177 S.C. 286, 181 S.E., 30.
"The Workmen's Compensation Act was adopted to protect industrial workers against the hazards of their employment, and to cast upon the industry in which they are employed a share of the burden resulting from industrial accidents." Walters v. Eagle Indemnity Co., 166 Tenn., 383, 61 S.W.2d 666, 667, 88 A.L.R., 654; citing Partee v. Memphis Concrete Pipe Co., 155 Tenn., 441, 444, 295 S.W., 68.
The elaborate and able argument of counsel for appellant seemed to find unnecessary ambiguities in the Workmen's Compensation Act for this State. In the first paragraph of Section 19 of the Act, which is that with which we are chiefly concerned, it does not appear to us that the intent of the Legislature in making the law, and its purpose, are hidden under verbose language, but is couched in plain language not hard to understand. It is in these words: "Where any person (in this section referred to as `owner'), undertakes to perform or execute any work which is a part of his trade, business or occupation and contracts with any other person (in this section referred to as `subcontractor') for the execution or performance by or under such subcontractor of the whole or any part of the work undertaken by such owner, the owner shall be liable to pay to any workman employed in the work any compensation under this Act which he would have been liable to pay if the workman had been immediately employed by him."
To us the plain interpretation of this language is that the law-makers intended the term "owner" to be synonymous with the principal contractor, that is to say the party of the first part to the contract with the "subcontractor" who is the second party to the contract for the execution or performance of the work to be done by the owner. The primary purpose of a workmen's compensation act is to protect the workman who actually does the work. It is easily conceivable that a contractor or subcontractor other than the owner may let a part of the work to be done to others who are financially irresponsible, and that the employee of such contractor or subcontractor who is injured while doing the work is left without remedy. It is the clear purpose of the Act to make the "owner," the person who is interested in having the work done, liable to the employee so injured.
We shall not cite the many authorities from other jurisdictions which might be presented in support of this view. This is our construction of our own Act, which we hold to be supported by logic and reason.
Does this interpretation of our statute deprive an injured employee of his right to sue for damages under the common law?
If the facts bring the case within the terms of the Compensation Act, the employee is restricted to his right of claim for compensation under the Act. The very purpose of the Act is to assure the employee of redress for his injuries, if the facts show that he is entitled thereto, and to relieve him of the uncertainties of a trial in a suit for damages.
"The right to workmen's compensation is wholly statutory, not existing except under the circumstances provided in the Workmen's Compensation Acts. It is not a common law right for the reason that the Acts are in derogation of, or departures from, the common law, and are not amendatory, cumulative or supplemental thereto, nor declaratory thereof, but wholly substitutional in character; * * *." 71 C.J., pages 229-231.
"The compensation acts, as was well said in one of the earlier opinions on the constitutional questions involved, form a legislative response to an emphatic, if not peremptory, public demand that a system be afforded whereby employers and employed might escape from personal injury litigation, and every employee not guilty of wilful misconduct might receive at once a reasonable recompense for injuries accidentally received in his employment under certain fixed rules and without friction. The principles of the common law, governing the right of an employee to recover against his employer for personal injuries, are the outgrowth of the conditions surrounding the small shop and the use of simple or no machinery, and its remedies are regarded as failing to give to injured employees relief adequate or suited to, and commensurate with, modern conditions, * * *." 71 C.J., 242 et seq.
Section 10 of our Act provides that the employer shall be liable only when he elects to come in under the Act.
Section 11 provides that: "The rights and remedies herein granted to an employee where he and his employer have accepted the provisions of this Act, respectively, to pay and accept compensation on account of personal injury or death by accident, shall exclude all other rights and remedies of such employees, his personal representative, parents, dependents or next of kin, as against employer at common law, or otherwise, on account of such injury, loss of service, or death: * * *."
In his exceptions to the Circuit Judge's order the appellant suggests that there was error on the part of the Circuit Judge in not holding that such an interpretation of Section 19 of the Workmen's Compensation Act as would make the "owner" liable for injuries suffered by the employee of an independent contractor would render the Act unconstitutional.
We do not think it may rightly be held that the Circuit decree holds that the owner is liable, under Section 19 of the Act, for injuries suffered by employees of an independent contractor. If, however, such holding may be deduced from any language in the decree, it works no harm to the appellant. This Court distinctly holds in this opinion that the question of independent contractor does not arise in this case; therefore, the question of the constitutionality of the Act as suggested by the appellant need not be considered.
The exceptions challenge the correctness of the holding that the appellant, when injured, was engaged in work which "is a part of the trade, business or occupation" of the defendant Duke Power Company.
We think that appellant is hardly in position to raise this issue. The statements of its complaint would seem to preclude it from doing so. Paragraph II thereof sets forth the following: "That the defendant, Duke Power Company, for compensation, furnishes to the City of Greenville electricity for lighting and power purposes, operates for hire in the City of Greenville and surrounding vicinity busses propelled by electricity transmitted by it, and, for compensation, furnishes to private citizens and corporations electricity for lighting and other purposes in and about the City of Greenville; that, in order to carry on its business as dispenser and vender of electricity as aforesaid, and for the operation of its electric busses as hereinabove stated, it is necessary for the said defendant corporation to construct and maintain many wires over which electric current is transmitted, many of which wires carry high voltage; that, at regular intervals, by and alongside the principal streets of the City of Greenville, the defendant corporation has erected metal posts to which said wires are attached; that in order to protect said posts from the weather and to give a more pleasing appearance thereto, the defendant corporation has, from time to time, caused said posts to be painted." (Italics added.)
If this language of the complaint be true, and the appellant may not deny it, it is difficult to see how the power company could carry on its business if its lines of wires were not kept in sound condition, or how this could be done if the posts to which they are attached were not kept in safe and sound condition. Evidently it was necessary to this end that the poles be "protected from the weather," and the appellant was engaged about this work. He was employed by Coln to do it, and Coln had been employed by the power company. Surely it cannot be seriously argued that the unfortunate employee was not engaged in work "which is a part of the trade, business or occupation" of the power company which it was undertaking to have performed.
The answer sets up this defense in Paragraph III: "That as a part of its trade, business, or occupation it is necessary for the defendant to maintain its equipment including poles and transmission lines, all of such maintenance, with the exception of an occasional painting, being performed by its own employees as a part of its regular business. That the painting of said poles was a necessary and proper part of its business of transmitting and selling electricity."
Moreover, the stipulation set out in the record contains this statement: "The facts in the case are set forth by the admissions in the defendant's answer of certain allegations in the complaint and the admissions as to the truth of the allegations contained in the defendants' third defense by reason of defendants' demurrer thereto, * * *."
We do not think it is necessary to add anything to the authorities cited in the Circuit decree on this point. The contention is without merit.
An exception charges error in the Circuit decree which finds as follows: "No particular skill or special equipment was necessary to paint these poles."
What reference to the issues involved in this case has the reported language of the Circuit Judge? We see none; such finding did appellant no harm.
This is a case of novel impression in this jurisdiction. It is one of much importance. The Circuit decree goes more fully into the elaboration of the authorities than does this opinion, and it will be of especial interest to the profession. Let it be reported.
Judgment affirmed.
MR. CHIEF JUSTICE STABLER and MESSRS. JUSTICES BAKER and FISHBURNE and MR. ACTING ASSOCIATE JUSTICE L.D. LIDE concur.
MR. JUSTICE CARTER did not participate on account of illness.