SSR 64-61c: SECTION 210(j)(2). -- EMPLOYER-EMPLOYEE RELATIONSHIP -- PERFORMANCE OF HOUSEHOLD TASKS AND GENERAL MAINTENANCE WORK ON FAMILY PREMISES BY MEMBER OF FAMILY

20 CFR 404.1104(c)

SSR 64-61c

DOMANSKI v . CELEBREZZE, 323 F.2d 882 (6th Cir., 1963), cert.

denied, 84 S.Ct. 980, March 23, 1964

WEICK, Circuit Judge:

This appeal is from an order of the District Court setting aside a

decision of the Secretary of Health, Education and Welfare denying old-age

insurance benefits, under the Social Security Act, to appellee Domanski

and directing the Secretary to allow and pay his claim.

The Secretary had denied the claim on the ground that no genuine

employer-employee relationship existed between Domanski and his

son-in-law, who was his alleged employer.

Upon denial of his claim, Domanski filed an action in the District Court

to review the decision of the Secretary. Motions for summary judgment were

filed by both parties. The District Court adopted findings of fact and

conclusions of law and granted Domanski's motion for summary judgment. The

District Court ruled as a matter of law, on the facts found by the

Secretary, that Domanski was an employee of his son-in-law during the

period involved and ordered that he be paid social security benefits. The

Secretary filed his appeal.

The basic facts were not in dispute.

Domanski, a native of Germany, came to the United States in 1949 with his

wife, his daughter, and his son-in-law, William M. Gougeon. Gougeon met

and married Domanski's daughter while Gougeon was on duty in Germany as an

American soldier. Domanski had, for a while, been a shoemaker in Germany,

but for most of his adult life was a postal employee there. He was in his

late fifties when he came here in 1949, and became 65 years old on April

14, 1957.

9 with his

wife, his daughter, and his son-in-law, William M. Gougeon. Gougeon met

and married Domanski's daughter while Gougeon was on duty in Germany as an

American soldier. Domanski had, for a while, been a shoemaker in Germany,

but for most of his adult life was a postal employee there. He was in his

late fifties when he came here in 1949, and became 65 years old on April

14, 1957.

Gougeon and his wife provided a home for and supported the senior

Domanskis after their arrival here. In 1950, the Gougeons and the

Domanskis moved to Onaway in Michigan's upper peninsula. Gougeon acquired

some land on the shores of Black Lake and originally planned to construct

and operate a resort camp there. The commercial plan was not carried out.

Through the years 1950 to 1954, the land owned by Gougeon was, by the

efforts of Gougeon, Domanski and some contracted help, cleared and a house

and cabin built thereon. Until the cabin was built, the Domanskis shared

the house with the Gougeons. Thereafter, they lived in the cabin. Domanski

performed needed chores in and about the Gougeon premises. In his

statement to the agency, he stated that he "helped with clearing and

filling the land, construction, painting, shingling, building fences,

etc." There was evidence of other work done by Domanski -- cutting logs

for and aiding in the construction and maintenance of a breakwater,

wheeling with a wheelbarrow many truck loads of sand for a road, and like

work.

the Gougeon premises. In his

statement to the agency, he stated that he "helped with clearing and

filling the land, construction, painting, shingling, building fences,

etc." There was evidence of other work done by Domanski -- cutting logs

for and aiding in the construction and maintenance of a breakwater,

wheeling with a wheelbarrow many truck loads of sand for a road, and like

work.

Gougeon, the son-in-law and alleged employer, was himself employed as a

representative of an insurance company. He worked along with his

father-in-law in the general maintenance of his property. In 1956, the

increase in his insurance work prevented his giving as much time to his

property as he had, up to that time, been accustomed to give. More work

then fell to the father-in-law, Domanski. Domanski and Gougeon both

testified that at this time in 1956, Domanski felt that he should have

some money in addition to his keep and it was agreed that thereafter he

should be paid $5.00 per week. Until July 1, 1959, he received these cash

payments. At that time, the involved application for old-age benefits was

made. The payments were then stopped, as it was assumed that he would

begin receiving the payments for twelve quarters, the minimum number

required to make him eligible for such social security benefits.

At no time prior to the application for social security benefits were any

deductions for social security tax taken from the money paid to Domanski.

Likewise, neither Domanski nor Gougeon applied for a social security

account number. Domanski and wife were both claimed as dependents by

Gougeon for income tax purposes.

Domanski, during the period from 1955 through 1959, had a small income of

less than $400 from other sources such as shoe repairing and odd jobs. The

alleged payments for wages made by Gougeon to Domanski during the twelve

quarter period amounted only to $780.00.

ed for a social security

account number. Domanski and wife were both claimed as dependents by

Gougeon for income tax purposes.

Domanski, during the period from 1955 through 1959, had a small income of

less than $400 from other sources such as shoe repairing and odd jobs. The

alleged payments for wages made by Gougeon to Domanski during the twelve

quarter period amounted only to $780.00.

Domanski's duties after July 1959 when the $5.00 payment for weekly wages

ceased were no different than they were during the twelve quarter coverage

period. Gougeon continued after July 1, 1959 to furnish food, free rent

and utilities to Domanski and his wife as he had during the coverage

period and prior thereto since 1949. Domanski took care of his spending

money from his small income for shoe repairing and odd jobs.

At the hearing Domanski testified in part as follows:

The District Judge in his findings of fact quoted in part from the

findings of the Secretary as follows:

In addition to the findings quoted by the District Judge, the Hearing

Examiner also found:

The District Judge in his findings of fact also quoted the following from

the findings of the Hearing Examiner:

We should first point out that in an action to review the decision of the

Secretary the case is not tried de novo in the District Court. The review

is limited to the record of the proceedings before the Secretary. In

reviewing this record the Court is not authorized to adopt findings of

fact of his own, but must accept the Secretary's findings of fact if they

are supported by substantial evidence. When so supported, they are

conclusive. 42 U.S.C. § 405; Hobby v. Hodges , 215 F.2d 754 (C.A.

10). The finality of the Secretary's findings extends also to inferences

drawn by him from the evidence. Walker v. Altmeyer , 137 F.2d 531

(C.A. 2); Sherrick v. Ribicoff , 300 F.2d 494 (C.A. 7).

own, but must accept the Secretary's findings of fact if they

are supported by substantial evidence. When so supported, they are

conclusive. 42 U.S.C. § 405; Hobby v. Hodges , 215 F.2d 754 (C.A.

10). The finality of the Secretary's findings extends also to inferences

drawn by him from the evidence. Walker v. Altmeyer , 137 F.2d 531

(C.A. 2); Sherrick v. Ribicoff , 300 F.2d 494 (C.A. 7).

Whether Domanski was an "employee" receiving "wages" for the requisite

period was not, in our judgment, a question of law, but of fact to be

determined from all the evidence in the case. Irvin v. Hobby , 131

F.Supp. 851, 863.

The Hearing Examiner found from the evidence that "no genuine

employer-employee relationship existed between claimant and his

son-in-law." We think there was ample basis in the record to support this

finding of fact. This may be gleaned from the family relationship between

the parties; from the fact that Domanski and his wife were members of the

household of the son-in-law receiving free board and lodging from 1949 to

1956; from the nature of the service rendered; from the fact that the

payments were not wages but an allowance in cash for spending money; from

the fact that the payments were made only during the twelve quarter

qualifying period and ceased upon its expiration although presumably

Domanski continued to render his alleged services for nothing; from the

fact that the son-in-law took his father-in-law and mother-in-law as

dependents on his income tax returns; from the fact that no social

security return was made and the alleged wages were not reported until

after Domanski made his claim for benefits.

ualifying period and ceased upon its expiration although presumably

Domanski continued to render his alleged services for nothing; from the

fact that the son-in-law took his father-in-law and mother-in-law as

dependents on his income tax returns; from the fact that no social

security return was made and the alleged wages were not reported until

after Domanski made his claim for benefits.

The District Court could reach the conclusion which he did only by giving

no effect to the inferences drawn by the Secretary from the evidence, but

as we have shown, the Court is bound by such inferences. The District

Court was also bound by the finding of the ultimate fact that no genuine

employer-employee relationship existed as this was, in our opinion,

supported by substantial evidence.

This case is similar to Folsom v. O'Neal , 250 F.2d 946 (C.A. 10)

which reversed the judgment of the District Court overturning the decision

of the Secretary involving an alleged employment of a brother by his

sister. In that case the brother was paid $300 a month for duties

performed at the sister's hotel. See also: Stevenson v. Ribicoff ,

297 F.2d 811 (C.A. 2).

The judgment of the District Court is reversed and the cause is remanded

with instructions to dismiss the complaint.

Judge O'Sullivan dissenting in a separate opinion.