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Lesniewski v. W.B. Furze Corp.

February 23, 1998


Argued January 22, 1998 Before Judges Shebell, D'Annunzio and Coburn. On appeal from Decision of the Division of Workers' Compensation.

The opinion of the court was delivered by: The opinion of the court was delivered by Shebell, P.j.a.d.

[9]    This is an appeal of a Workers' Compensation judgment that found W.B. Furze Corporation (Furze Corp.) to be the employer of petitioner, Zenon Lesniewski, at the time he was injured in the course of his employment on April 17, 1995. We affirm.

On April 17, 1995, petitioner suffered a catastrophic injury at the construction site of EJ's Grille at 651 North Michigan Avenue, Kenilworth. The injury left him a paraplegic. The first floor of the building under construction was essentially complete, with the exception of an opening in the floor for the basement staircase. To access the basement, workers placed a ladder against the frame of the opening and as petitioner was descending the ladder, it slid out causing him to fall to the concrete floor and sustain his injuries. The facts surrounding petitioner's employment follow.

In 1994, Eugene Lord and Joseph O'Neill formed a corporation called EJ's Grille, Inc. (EJ's) and purchased a building to start a restaurant business. They had planned to renovate the building and hired Four Star Construction to gut the old building, but later decided to raze the old building and construct a new one. They hired a contractor to demolish the structure and excavate the lot. They also hired an architect to design a new building, and engaged subcontractors for the electric, heating and air conditioning, and roofing. Lord, the president of EJ's, obtained all of the necessary local permits. EJ's maintained no workers' compensation insurance during the time that the building was under construction.

In November 1994, Wayne Furze, the principal of Furze Corp., became acquainted with EJ's. Furze Corp. is a contracting company engaging in masonry, carpentry, and construction work. Furze Corp. maintained workers' compensation insurance. O'Neill, vice president of EJ's, asked Furze whether his company would be interested in doing masonry block work. Furze, without a written contract, accepted O'Neill's offer for his company to work as a subcontractor. The verbal agreement was that the company would be paid by the block and by the yard of concrete. Furze billed EJ's for his services by submitting "W.B. Furze Company, General Contractors," invoices. Supplies were purchased by Furze on that company's line of credit. A sign stating that Furze Corp. was the general contractor was placed at the site and remained there throughout construction.

In November 1994, Lesniewski passed the construction site and observed Furze and O'Neill looking at plans. He was unemployed at the time and, therefore, inquired of O'Neill whether they needed a mason. O'Neill told him to speak with Furze. Furze hired Lesniewski and after observing petitioner on the job, told him that he would pay $15.00 per hour.

In November 1994, Furze performed work on the foundation. Upon completion of the foundation work, Furze did not work at the site again until around December 10, 1994 when block work needed to be done on the roof line.

O'Neill worked at an auto body shop located across the street from the construction site. He would frequently visit the job site, but would never tell Furze how his job should be performed, how many hours he should work, or what types of materials to use. Further, he did not instruct Furze on who to hire or fire. O'Neill testified that he did not possess the technical expertise to supervise the site, as he could not read blueprints. Likewise, Lord would visit the site one to three times a week for short periods of time, but would not provide any directions to Furze or his workers. The only supervision Furze received was from the architect, who would review the blueprints to determine whether the specifications were being followed.

The parties appear to agree that until the end of December 1994, Furze was an independent contractor and that petitioner was an employee of Furze. The dispute arises over whether the nature of the relationship between Furze and EJ's, and consequently petitioner's employment status, changed after December 1994. Even though all of the masonry work was completed, Furze stayed on to supervise the carpentry and steel work. Furze was no longer getting paid by the block. Instead, the pay was $200 a day for supervisory services. Lord consulted with Furze on which subcontractors to hire, however, Furze would supervise the subcontractors and answer any of their questions.

Furze testified that as construction progressed, Lord and O'Neill became more active during their visits to the site, including the reviewing of blueprints. Despite these changes, Furze continued to bill for materials and labor on company invoices of Furze Corp. Also, checks were made payable to the Furze Corp. Eugene Lord, president of EJ's, asserted that Furze Corp. was always a contractor, and that the nature of that relationship never changed. In contrast, Furze felt his company was no longer a contractor but that he was an individual employed as a "foreman."

Similar ambiguities surround Lesniewski's employment status. Lesniewski worked two days in November. He then came back when work began again in December, but only worked four or five days in January 1995. Furze would instruct petitioner on his daily assignments. Petitioner used a few of his own tools and the rest were provided by Furze. Furze kept track of petitioner's hours and would personally hand petitioner his pay in cash in an envelope each week. Petitioner did not report the cash and continued to collect unemployment compensation while working at the site. Petitioner was also used on several jobs other than the EJ's job when he was being paid directly by Furze Corp.

In March 1995, petitioner again worked at the site but was paid by EJ's. Furze made up slips of paper with workers' first names, hours worked, and total amounts of pay due. He forwarded the slips to Lord whose secretary drew checks on EJ's account. The payee lines were left blank on the checks, as Furze never gave workers' full names to Lord. Four checks, which were handed to petitioner by Furze, were shown to have been drawn on EJ's account. They were dated March 24, 1995, payable to Rader Lesniewski; April 7, 1995, payable to M. Lesniewski; April 14, 1995, payable to Zenon Lesniewski; and March 31, 1995, payable to Rader. Petitioner's understanding of why he was receiving checks drawn on EJ's account was that Furze Corp. was experiencing a cash flow problem and that EJ's and Furze would settle the matter later. Despite the change in method of payment, petitioner continued to believe that he was employed by Furze Corp.

On June 1, 1995, petitioner filed a Claim Petition with the Division of Workers' Compensation alleging he was injured during and in the course of his employment, naming EJ's as respondent. Since EJ's did not carry workers' compensation insurance, petitioner's claim was classified as an uninsured claim implicating the State of New Jersey, Uninsured Employer's Fund, N.J.S.A. 34:15-120.1, et seq., as a party.

On June 30, 1995, petitioner filed a second petition naming Furze as respondent. On August 28, 1995, Furze filed an answer alleging petitioner was not employed by Furze at the time of the accident but by EJ's. On September 25, 1995, petitioner filed a third petition naming Four Star Construction as respondent.

Trial was held on October 24, 1995, November 14, 1995, December 5, 1995, December 15, 1995, January 16, 1996, and February 6, 1996. On April 30, 1996, the Judge ruled that Furze was petitioner's employer and on May 6, 1996 judgment was entered compelling payment of medical and temporary disability benefits. The claims against EJ's, Four Star Construction, and the Uninsured Employer's Fund were dismissed.

The Judge found that Furze Construction was an independent contractor during the disputed period, stating:

The respondent EJ's Grille, Inc. stated very clearly that Mr. Furze was not his employee, that Mr. Furze had placed a sign...on the construction site advertising himself as a general contractor and that he submitted invoices on W.B. Furze stationary which evidence for work performed after the masonry work was completed, and that supplies were purchased with W.B. Furze Company credit...Further, the respondent EJ's Grille, ...

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