Nordling v. Johnston

On Petition for Rehearing

Before Warner, Chief Justice, and Lusk, Brand and Latourette, Justices.

LUSK, J.

Defendant contends in a petition for rehearing that our decision violates the guaranty of the right to a *339 jury trial found in the first sentence of Article VII § 3 of the State Constitution, which reads:

“In actions at law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved, and no fact tried by a jury shall be otherwise re-examined in any court of this State, unless the court can affirmatively say there is no evidence to support the verdict.”

It is asserted that, contrary to the finding of the jury, we determined that the contract of hiring was joint and not several. It is true that the trial judge instructed the jury that plaintiff could not recover unless separate agreements of employment with the plaintiff and each of his assignors had been proved. But this was an erroneous instruction, both under the complaint and the evidence. Defendant’s counsel contended in the Circuit Court, and urged in argument here, that the proof showed a joint contract, and we agreed. They also argued that the complaint alleged a several contract, but there we were compelled to disagree on the authority of McGinnis v. Keen, 189 Or 445 , 221 P2d 907 . In these circumstances, to sustain the verdict is not to re-examine “otherwise” a fact found by the jury, but is to arrive at the same ultimate conclusion as the jury, though by a somewhat different route. There is no violation of the right of trial by jury in that process, for, with respect to the issue whether the contract was joint or several only one conclusion was possible, and it can be affirmatively said that there was no evidence to support a finding that the contract was several.

It is also urged that we erred in not applying the rule which restricts the parties on appeal to the theory of the case in the trial court. This contention is based upon the fact that in the Circuit Court the plaintiff *340 appears to have claimed that the contract alleged in the complaint was several, whereas in this conrt he conceded that it was joint. The rule invoked by the defendant was thus stated in Edwards, Guardian v. Hoevet, 185 Or 284, 297 , 200 P2d 955 , 6 ALR2d 104:

“This court is a court of review. We can not sustain verdicts and findings upon conceptions of the facts which the disfavored party never had an opportunity of contesting. A familiar rule of appellate practice restricts the appellant to the theory he pursued in the trial court. He can not in this court raise issues that he did not present and rely upon in the circuit court”.

In Stotts v. Johnson and Marshall, 192 Or 403, 420 , 234 P2d 1059 , 235 P2d 560 , we said that this rule “prevents the appellant and the respondent alike from reaching out upon appeal for views concerning the facts and the issues which are inconsistent with or different from those which the party took in the trial court. The rule recognizes that an appellate court is a court of review and thus the operation of the rule restricts the scope of review.”

The Edwards case furnishes an apt illustration of a proper application of the rule. The plaintiff sued on an account stated and the jury returned a verdict in his favor. The Circuit Court entered judgment for the defendant notwithstanding the verdict and the plaintiff appealed, and in this court sought to sustain the verdict on the theory, not of an account stated, but of a promise to pay the debt of another. In re-, fusing to give heed to this contention we said at p. 298:

“Were we to depart from the theory upon which this cause was tried in the circuit court and reinstate the verdict, under a belief that the appellant was entitled to prevail as the party in whose favor the respondent made a promise, it may be that we *341 would thereby deprive the respondent of defenses he would have interposed had the complaint been framed upon the embraced theory.”

There is, of course, no such situation in this case. Had the plaintiff claimed in the Circuit Court that the contract was joint instead of several the result, under a proper interpretation of the evidence and a correct view of the law, would have been no different. Were we to remand the cause for a new trial and should the evidence be the same as before, the judge would be required to instruct the jury that the contract was joint, but that, nevertheless, the jury could find that the relationship was that of employer and employee and not that of independent contractor. No prejudice to the defendant has resulted from the plaintiff’s change of position, and this court, in affirming the judgment, has kept well within the bounds set for it as a court of review. Had the plaintiff adhered to the view which he took on the trial respecting the effect of the evidence, it still would have been our duty to declare the law correctly and to affirm the judgment notwithstanding the error in the instructions, for we are admonished by statute to reverse a judgment only “for errors substantially affecting the rights of the appellant”. ORS 19.120.

The defendant again argues that a joint contract for the performance of services by members of a partnership or joint adventure cannot be a contract of employment. We held that it could be on the authority of two of our own decisions: McGinnis v. Keen, supra; Pitts v. Crane, 114 Or 593 , 236 P 475 . Plaintiff, in a brief filed in answer to the petition for rehearing, calls attention to the case of Case v. Kadota Fig Ass'n of Producers, (Cal App) 207 P2d 86 , 94, 95, affirmed 35 *342 Cal2d 596, 220 P2d 912 , in which the District Court of Appeals said with reference to a similar contention:

‘ ‘ The fact, stressed by appellants, that the agreement with respect to their services was not made with Case and Swayne individually but with their partnership and that the partnership was to receive the compensation does not exclude the existence of an employment relation, even if we should consider in this respect the partnership as an entity separate from the individual members. An employer can lend or hire an employee to another, at least with the employee’s consent, and there will be an employment relation with the general employer, the special employer or both depending on who has control and direction of the employee. Industrial Indemnity Exch. v. Industrial Acc. Comm., 26 Cal. 2d 130, 134 , 156 P.2d 926 , et seq. Whether the borrower pays the employee directly or reimburses the lender is not decisive. Compare 16 Cal. Jur 959; Independence Indemnity Co. v. Industrial Acc. Comm., 203 Cal. 51 , 262 P. 757 . Although those questions as a rule come up in respect to liability for workmen’s compensation, the principles apply also outside that field. See 56 C.J.S., Master and Servant § 2, p. 38. It would seem that in the same manner a partnership can contract to provide the labor of its members with their consent, either under control and direction of the party for whom the work is done or independently. If, as here, the party receiving the services takes control and direction there is an employer-employee relation with the individual workers. The fact that the payments were made by check to the order of Case-Swayne Company and booked in an account ‘Services purchased, Management contract,’ seems in accord with the manner in which the contract was drawn and without separate significance. That no deduction for income tax, social security, etc. were made, cannot be conclusive against an employment relation under the special circumstances, where the unusual *343 set up of the contract caused the question of deductions to be problematic.”

We are not convinced that members of a crew of loggers, hired to log a tract of timber, are not to be regarded as employees entitled to recover the penalty for failure to pay wages prescribed by ORS 652.150, simply because they were hired jointly.

Other matters are urged by the petitioner, but, as they are either reiteration of arguments previously considered or bear only remotely on the legal questions arising out of the issues in this case, they do not call for special comment.

The petition for rehearing is denied.