December 10, 2010
DENNIS BURGOS, PETITIONER-APPELLANT,
RJS ASSOCIATES LANDSCAPING, INC., RESPONDENT-RESPONDENT, AND ROBERT VAUGHN AND ELIZABETH VAUGHN, RESPONDENTS.
On appeal from the New Jersey Department of Labor, Division of Workers' Compensation. Wendy S. Bornstein argued the cause for appellant.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued September 27, 2010 -- Decided Before Judges Rodriguez and Grall.
Petitioner Dennis Burgos appeals from the dismissal of his workers' compensation claim against respondent RJS Associates Landscaping, Inc. (RJS). We affirm.
On January 26, 2008, Burgos was injured when he fell from a tree that he was trimming at the home of Robert Vaughn and Elizabeth Vaughn. Prior to this date, Burgos had contacted Robert Sonner, the owner of RJS, on numerous occasions, seeking tree work because Burgos' employer, Nature's Hands tree service, was out of work. Burgos had met Sonner while Burgos was working for Nature's Hands. Sonner was unable to help Burgos because RJS had one full-time employee and hired additional employees only for snow removal. RJS preferred to subcontract tree services when necessary on RJS projects. In fact, Burgos had worked for Nature's Hands on an RJS project. The facts are sharply disputed from this point on.
According to Burgos, on January 26, 2008, he met Sonner at the latter's house because Sonner had hired him to remove or trim approximately fourteen trees at the Vaughn residence. Burgos brought his "professional equipment," which included "[a] saddle, a body lanyard, climbing line, lowering line, snaps, [and] a handsaw." Sonner and Burgos did not speak about compensation, or from whom Burgos was to receive payment.
Burgos testified that all that Sonner said was that "[h]e was going to take care of me." Burgos believed that RJS employees would also be working at the Vaughn residence as part of a larger "overall job." Therefore, he assumed that RJS would be paying him.
On the scheduled day, Sonner walked Burgos over to the Vaughns' residence. After introducing Russell Vaughn, Sonner explained the work that Burgos was to perform on the trees that Sonner had previously marked. Before leaving, Sonner supplied Burgos with a chainsaw and said that RJS employees would be there to assist Burgos. Burgos used his personal climbing equipment. Shortly after beginning work, Burgos "slipped out of a tree," and sustained injuries.
According to Sonner, the Vaughns were his friends. In early 2008, Robert Vaughn approached Sonner about tree services. Because RJS's expertise was in "gardening, planting, grading, soil manipulation, [and] grade manipulation," Sonner contacted Burgos to offer him the work. Sonner believed that he was not paying anyone, nor receiving any compensation. Rather, Sonner believed that he was doing Vaughn and Burgos a favor.
Burgos filed a workers' compensation petition. RJS answered, denying that Burgos had been its employee. Subsequently, RJS moved to implead the Vaughns and dismiss the petition. The Vaughns, in turn, moved to dismiss on the same grounds. Burgos did not oppose the Vaughns' motion.
The judge of compensation found that Burgos was not an employee of the Vaughns, and was a casual employee of RJS or an independent contractor. Drawing a parallel to Swillings v. Mahendroo, 262 N.J. Super. 170 (App. Div. 1993), the judge alternatively found that Burgos was an independent contractor due to his "special expertise [and] certain skills," and because he "was brought to work on a specific job and not to become involved in a continuing relationship [with RJS or the Vaughns]." Therefore, the judge found Burgos ineligible for benefits pursuant to N.J.S.A. 34:15-6 and N.J.S.A. 34:15-7, and dismissed the petition with prejudice.
On appeal, Burgos contends that he "was not a casual employee as defined by N.J.S.A. 34:15-36 and, thus, not excluded from receiving workers' compensation benefits from [RJS]." We disagree.
To obtain benefits pursuant to the New Jersey Workers' Compensation Act (WCA), N.J.S.A. 34:15-1 to 128, a petitioner must prove that he or she was an "employee" within the meaning of the WCA. N.J.S.A. 34:l5-36 defines an employee as being "synonymous with servant, and includes all natural persons . . . who perform service for an employer for financial consideration." "The term 'employee' is to be defined liberally in order to bring as many cases as possible within the scope of the [WCA] . . . ." Sloan v. Luyando, 305 N.J. Super. 140, 147 (App. Div. 1997).
The WCA specifically exempts from this broad definition "casual employees." Casual employment is defined as "employments . . .  if in connection with the employer's business, as employment the occasion for which arises by chance or is purely accidental; or  if not in connection with any business of the employer, as employment not regular, periodic or recurring . . . ." N.J.S.A. 34:15-36.
Here, the judge found that either definition of a casual employee applied. Noting that tree services were not part of RJS business, the judge determined that there was "no question that the employment was neither regular, periodic, or recurring." Alternatively, if tree services were part of RJS's ordinary business, the judge found that Burgos was a casual employee because RJS hired Burgos "on one occasion to do a job" similar "to an instance in which you bring in a person with special expertise to fix a plumbing or toilet problem."
Thus, the judge made a credibility finding that credited Sonner's version of the facts and rejected Burgos'. We review to determine "whether the findings reasonably could have been reached on the basis of sufficient credible evidence in the record, considering the proofs as a whole." Close v. Kordulak Bros., 44 N.J. 589, 599 (1965) (internal quotations omitted); Lombardo v. Revlon, Inc., 328 N.J. Super. 484, 488 (App. Div. 2000). This deferential standard affords "due regard to the opportunity of the one who heard the witnesses to judge their credibility," and "to the agency's expertise where such expertise is a pertinent factor." Close, supra, 44 N.J. at 599. Thus if there is "sufficient credible evidence in the record to support the agency's conclusions, [we] must uphold [the] findings, even if [we] believe that [we] would have reached a different result." Sager v. O.A. Peterson Constr., Co., 182 N.J. 156, 164 (2004).
A "determination of [a] legal question," however, is not entitled to any deference. Smerling v. Harrah's Entm't., Inc., 389 N.J. Super. 181, 186 (App. Div. 2006). Instead, we review "[a] trial court's interpretation of the law and the legal consequences that flow from establish facts" de novo. Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1995). Thus, if a judge misapplies the law to the facts of a case, the reviewing court "must grant appropriate relief." Verge v. Cnty. of Morris, 272 N.J. Super. 118, 123 (App. Div. 1994).
Here, we must accept the judge's findings of fact because they are supported by the proofs. Close, supra, 44 N.J. at 599. Our analysis is therefore focused on the application of the legal principles to these findings.
Despite what appears to be clear statutory language in N.J.S.A. 34:15-36, the Supreme Court long ago recognized that the "statutory definition [of a casual employee is] not . . . serviceable . . . ." Graham v. Green, 31 N.J. 207, 210 (1959). Thus, the Court was unwilling to "venture a precise interpretation . . . that [would] meet the sundry situations which will arise." Ibid. According to the cases following Graham, "the term 'casual' at least connotes a relationship relatively brief and passing, coming without regularity." Berkeyheiser v. Woolf, 71 N.J. Super. 171, 175 (App. Div. 1961). Where the petitioner's work was part of the respondent's business "[t]he extent or duration of petitioner's employment is irrelevant." Kertesz v. Korsch, 296 N.J. Super. 146, 156 (App. Div. 1996). Rather, the relevant issue in these cases is "[w]hether the work arose by chance or was purely accidental . . . ." Ibid. When the chance or accident giving rise to the petitioner's work was inherent to the respondent's business, petitioner cannot be a casual employee. Graham, supra, 31 N.J. at 213-14. Accordingly, in Kertesz, we held that petitioner's employment, although brief, was not "accidental" because the work was in the regular course of the respondent's business. 296 N.J. Super. at 157.
When the petitioner's work is not part of the respondent's ordinary business, however, it is logically more likely to be casual. Consequently, the statute imposes a correspondingly higher burden on the petitioner, requiring the work to have been "regular, periodic or recurring." N.J.S.A. 34:15-36. In DeMarco v. Bouchard, 274 N.J. Super. 197, 199 (Law Div. 1994), the court used a two-step approach to decide whether a babysitter could be considered the employee of a family. The court first noted that baby-sitting "was not in connection with any business of [the] defendants . . . ." Ibid. Therefore, because the work was only for one night, with no agreement to work again in the future, the babysitter was a casual employee. Id. at 200; see also Balmforth v. McMurray, 81 N.J. Super. 109, 116-17 (Law Div. 1963) (finding babysitter was not casual employee where babysitter worked for respondent three days a week for a period of four years).
Judged by that standard, it is clear to us that Burgos was a casual employee. He did not dispute Sonner's testimony that RJS did not conduct tree services as part of its regular course of business. Thus, Burgos did not meet the burden of proving that his work was "regular, periodic or recurring." N.J.S.A. 34:15-36.
Burgos also contends that he is not an independent contractor pursuant to the "right to control" or the "relative nature of the work" tests. Addressing the control test, Burgos argues that because of his expertise, "there was no need for [Sonner] to direct him" as to the tree work, but that Sonner "directed [Burgos] in all other aspects of the job." In addition, Burgos argues that the "relative nature of the work" test is satisfied because Burgos "demonstrated substantial economic dependence upon RJS[, and] the tree work was an integral part of the regular business of RJS." We disagree.
The judge found that Burgos was an independent contractor for several reasons. First, Burgos "was a person of special expertise with certain skills," who was hired on one occasion to perform a specific job, and not "to become involved in a continuing relationship requiring the same labor to be performed for an indefinite duration." Second, proof that this was Burgos' only work at the time was insufficient to demonstrate financial dependence on RJS. Rather, the judge explained that "economic dependence relates to a continuing relationship in which one's livelihood is dependent upon a series of activity and not just on one occasion."
New Jersey courts have defined an independent contractor as: one who, carrying on an independent business, contracts to do a piece of work according to his own methods, and without being subject to the control of his employer as to the means by which the result is to be accomplished, but only as to the result of the work. [Cappadonna v. Passaic Motors, Inc., 136 N.J.L. 299, 300 (Sup. Ct. 1947), aff'd, 137 N.J.L. 661 (E. & A. 1948). ]
To determine whether a party qualifies as an independent contractor, courts employ two different tests: the "control test," and the "relative nature of the work test." Lesniewski v. W.B. Furze Corp., 308 N.J. Super. 270, 280 (App. Div. 1998). The control test "considers whether the employer had 'control' over the worker." Sloan, supra, 305 N.J. Super. at 148. The crucial analysis is whether the employer directed "'the manner in which the . . . work [should] be done, as well as the results to be accomplished.'" Kertesz, supra, 296 N.J. Super. at 153 (quoting Brower v. Rossmy, 63 N.J. Super. 395, 404-05 (App. Div. 1960), certif. denied, 34 N.J. 65 (1961)). The control test focuses on four factors:
(1) the degree of control exercised by the employer over the means of completing the work;
(2) the source of the worker's compensation;
(3) the source of the worker's equipment and resources; and
(4) the employer's termination rights.
Lowe v. Zarghami, 158 N.J. 606, 616 (1999); see also Buchner v. Bergen Evening Record, 81 N.J. Super. 121, 129-30 (App. Div. 1963) (affirming workers' compensation award for paperboy over whom the respondent paper company exercised no direct control, save for the power to terminate the boy at will).
Whether a claimant was on the respondent's payroll is not dispositive. See Sloan, supra, 305 N.J. Super. at 150. For example, in Sloan this court found that even though a petitioner was "no longer . . . on [respondent's] payroll as a regular employee," he was an employee within the meaning of the WCA.
Id. at 150. There, the court identified the requisite indicia of control noting that the petitioner was not paid by the job; did not bid on projects; and did not have the power to "accept or reject" work that respondent provided for him. Id. 150-51. Instead, the respondent paid petitioner on an hourly basis, and retained the power to direct how and what was to be done. Id. at 151.
We reached a similar result in Martin v. Pollard, 271 N.J. Super. 551, 557 (App. Div.), certif. denied, 137 N.J. 307 (1994). There, the respondent owned two houses, one of which the petitioner rented. Id. at 552-53. Respondent offered the petitioner $10.00 per hour to apply water seal to the other house. Id. at 553. The respondent did not demand that the petitioner work certain hours or finish on a specific date. Ibid. On appeal, we explained that the relationship failed the control test because petitioner "chose the time when he would perform the work and the manner in which it would be accomplished." Id. at 557.
Where a petitioner has some expertise, it is the right of the employer to control that becomes "more determinative than the actual exercise of control." Lesniewski, supra, 308 N.J. Super. at 280. In Kertesz the court held that because the petitioner had sheet-rocking expertise, the respondent did not actually control the petitioner. 296 N.J. Super. at 153. Instead, the respondent maintained the right to control the petitioner by placing a foreman on the job who could accept or reject the petitioner's work. Ibid.
Applying the control test here, it appears that Burgos was an independent contractor. Burgos did not present any evidence that Sonner controlled or had the right to control the means of completing the tree work; retained any right to terminate Burgos; or intended to pay Burgos on an hourly basis. The only circumstance supporting Burgos' contention that he was under RJS's control is that Sonner provided a chainsaw. This, however, is negated by the fact that Burgos brought with him his professional equipment. Finally, neither party testified that there was a specific time for completion of the project. Instead, it appears that Burgos was free to reject the job, or complete it when he preferred. Thus, the factors of the control test balance in favor of finding that Burgos was an independent contractor.
In cases where the control test is not dispositive, our courts also apply the "relative nature of the work" test to determine whether a petitioner is an independent contractor. Marcus v. E. Agric. Ass'n., 58 N.J. Super. 584, 597 (App. Div. 1959) (Conford, J.A.D. dissenting), rev'g on dissent, 32 N.J. 460 (1960). Indeed, as of late, "[t]he courts have placed a greater reliance upon the relative nature of the work test." Pollack v. Pino's Formal Wear & Tailoring, 253 N.J. Super. 397, 407 (App. Div.), certif. denied, 130 N.J. 6 (1992). This test examines the "extent of the economic dependence of the worker upon the business he serves and the relationship of the nature of his work to the operation of that business." Marcus, supra, 58 N.J. Super. at 603. Therefore, if a petitioner is financially dependent on the respondent and plays an active role in the business of the respondent, he will be considered an employee within the purview of N.J.S.A. 34:15-36. See Caicco v. Toto Bros., Inc., 62 N.J. 305, 310 (1973) (finding that petitioner was an employee under relative nature of the work test because petitioner was "a cog in the wheel of respondent's operation").
Applying this test, the court in Brower found the petitioner to be an employee of the respondent despite the fact that the respondent did not pay or otherwise control the petitioner. 63 N.J. Super. at 407. There, the petitioner operated a salon within respondent's building where the respondent also conducted hair-styling. Id. at 399. As clients visited the respondent, he referred them to the petitioner for skin treatment. Ibid. The petitioner received seventy-five percent of the revenue from these referrals, and the respondent the remaining twenty-five percent. Ibid. The majority of the petitioner's clients were respondent's referrals. Id. at 400. The court held that the petitioner satisfied the relative nature of the work test, explaining that "in the economic and functional sense, petitioner became respondent's employee by reason of her dependence upon him for appointments made; by his supply of the bulk of the customers; [and] by her utilization of his facilities on those days and those hours only when he chose to keep his salon open . . . ." Id. at 407.
The extent of a petitioner's economic dependence on a respondent is particularly relevant. For example, we have found sufficient dependence where the petitioner received "approximately 30% of his income from respondent." Auletta v. Bergen Ctr. for Child Dev., 338 N.J. Super. 464, 473 (App. Div.), certif. denied, 169 N.J. 611 (2001). Similarly, in Kertesz, we held that the petitioner was economically dependent on the respondent where the petitioner performed sheet-rocking for the respondent three days a month at a rate of $120 dollars per day. 296 N.J. Super. at 156.
Here, Burgos does not meet either standard. Even if one concedes that the Vaughn project was an RJS job, it is undisputed that RJS did not perform any tree services as part of its day-to-day business. Thus, Burgos' work was not an integral part of RJS's ordinary business. Further, Burgos was not economically dependent on Sonner or RJS. Although the standard for economic dependence is not strict, neither RJS nor Sonner agreed to pay Burgos, nor did Burgos receive any pay from those parties. Additionally, Burgos depended exclusively on Nature's Hands tree service, which had employed him on a full-time basis.
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