Hodges v. Home Mortgage Co.

BeogdeN, J. Is an executive vice-president and managing head of a corporation an employee thereof within the contemplation of the Workmen’s Compensation Act? Section 2(b) of the compensation act provides: “The term ‘employee’ means every person engaged in an employment under any appointment or contract of hire or apprenticeship, express or implied, oral or written, including aliens, and also including minors, whether lawfully or unlawfully employed, but excluding persons whose employment is both casual and not in the course of the trade, business, profession or occupation of his employer,” etc. This definition must be interpreted in the light of the entire act. In the first instance, the title and theory of the act import the idea of compensation for workmen and their dependents. The awards provided in the statute are based upon a per centum of average weekly wages.” These terms and terms of similar significance, interpreted according to their ordinary meaning, point out and designate working men as the beneficiaries of the act, and would not ordinarily be deemed to refer to executive officers receiving large salaries and engaged exclusively in designing and executing the general policies of the business. The courts of various states have debated the question and arrived at different conclusions. The divergence of conclusion upon the subject *705 has resulted from different theories of interpretation as well as from differences in the wording of particular statutes providing compensation. For instance, the Oklahoma Court in Southern Surety Company v. Childers, 209 Pac., 927, said: “Obviously, where the claimant was the chief executive officer of a large corporation and his duties did not require that he perform manual or mechanical labor, he could not be regarded as the employee within the meaning of the act or the terms of the policy, and if he sustained injuries while performing manual or mechanical labor, which was no part of his duties, but in which he acted as a mere volunteer, he would not be entitled to compensation. On the other hand, although the claimant was the owner of the majority of the stock and was the chief executive officer of a corporation, yet if he performed manual or mechanical labor as a part of his duties, such an official in his capacity as a workman might measure up in all respects to the conception of an employee within the meaning of the act.” The Pennsylvania Court in Eagleson v. Harry G. Preston Co., 109 Atlantic, 154, allowed compensation to a salesman, but remarked: “This is not the case of a higher executive officer of a corporation claiming an award under the compensation act; that point will be met and decided when we come to it, and not before.” The Court of Appeals of New York, in Skouitchi v. Chic Cloak & Suit Co., 130 N. E., 299, allowed compensation to the president-treasurer and manager of a small corporation. The Court, however, stated “that the claimant performed ordinary detail and manual work, such as would be required of a typical employee.” Distinguishing Browne v. Browne Co., 116 N. E., 364, the Court further said that the Browne case simply held that “higher executive officers of a corporation are not, as such, its employees in the ordinary use of the word.” Likewise, the Supreme Judicial Court of Maine, in Higgins v. Bates Street Shirt Co., 149 Atlantic, 147, said: “When the president of a corporation acts only as such, performing the regular executive duties pertaining to his office, he is not an employee within the meaning of the statutory definition.” The Wisconsin Court in Milwaukee Toy Co. v. Industrial Commission, 234 N. W., 748, allowed compensation to the president, manager and general manager of the corporation. The decision was based upon the language of the compensation act in force in that state, which provided that an injured person, in order to recover, must be performing “services of another under any contract of hire, express or implied.” The opinion proceeds upon the theory that the corporation was a separate entity from its officers, and, therefore, whether a person was an officer or not, he was in the “service of another.” Beeovery was also permitted in the case of Columbia Casualty *706 Co. v. Industrial Commission, 227 N. W., 292. In that ease the injured pers'on was secretary and treasurer of the corporation, but at the time of the injury the claimant was running a can-capping machine. Other cases discussing the question are: In re Raynes, 118 N. E., 387; Millers' Mutual Casualty Co. v. Hoover, 235 S. E., 863; Zurich Accident & Liability Ins. Co. v. Industrial Commission, 213 N. W., 630; Cleveland Commercial Auto Body Co. v. Frank, 155 N. E., 567; Emery's case, 170 N. E., 839; Erickson v. Furniture Co., 229 N. W., 101; Donaldson v. Donaldson Co., 223 N. W., 227. See 44 A. L. R., 1213. The majority of the decided cases adhere to what may be called the dual capacity doctrine; that is to say, that executive officers of a corporation will not be denied compensation merely because they are executive officers if, as a matter of fact, at the time of the injury they are engaged in performing manual labor or the ordinary duties of a workman. Hence, one of the fundamental tests of the right to compensation is not the title of the injured person, but the nature and quality of the act he is performing at the time of the injury. This theory is undoubtedly sound. Certainly, it is supported by the weight of authority. Hence, the remaining inquiry is whether at the time of his death Sam T. Hodges was engaged in the performance of such duties as bring him within the purview of the compensation act. A few days prior to his death he had gone to Hendersonville, North Carolina, for the avowed purpose of lining up “salesmen who would produce mortgage loans for the company,” and also to institute plans for efficient handling of distressed property. While engaged in the performance of these duties he is requested to go to New York “to complete the work in connection with the trust with the Metropolitan Casualty Insurance Company.” On his way to New York for such purpose, he met his death by accident. Manifestly, the duty of negotiating trust contracts or assisting in solving the complications and complexities of a trust business would not lie within the field of the duties of an ordinary employee or workman. Such duty requires a highly specialized knowledge and efficiency, and pertains exclusively to the function of setting up and supervising the policies of the employer rather than executing the routine work of the business. Therefore, upon a consideration of the entire record, the Court is of the opinion that the trial judge properly interpreted the law, and the judgment is upheld. Affirmed.