Logan-Cache Knitting Mills v. Industrial Commission

MOFFAT, Chief Justice. This case is before us on certiorari, pursuant to the statute, to determine the validity of a decision under the Utah Unemployment Compensation Law, Chapter 43, Laws Utah 1937. On the 30th day of January, 1939, the appeal tribunal entered its decision wherein it was determined that Charles F. Hull, the claimant, was, under the statute, in the “employment” of the Logan-Cache Knitting Mills and the Logan-Cache Knitting Mills was “directed to pay into the Utah Unemployment Compensation Fund the necessary contributions on wages earned by claimant while in the company’s employ. Benefits will be allowed accordingly.” From this decision, the plaintiff company appealed to the Industrial Commission. Without hearing by the Industrial Commission, the decision of the Appeal Tribunal was affirmed. Two questions are submitted and argued by plaintiff. We state them as plaintiff and defendants state them. Plaintiff’s statement: 1. “Was Mr. Hull, the claimant, at the time of his application for benefits unemployed and entitled to benefits under Section 4, Chapter 43, Laws of Utah, 1937?” *3 2. “During the previous year was he employed by the plaintiff under the provisions of Section 19 of the Utah Unemployment Compensation Law, Chapter 43, Laws of Utah, 1937?” Defendants’ statement: 1. “The claimant at the filing of his claim for benefits was eligible for compensation under the provisions of the Unemployment Compensation Law.” 2. “The Industrial Commission was authorized by the terms of the unemployment compensation law to conduct proceedings to determine the validity of the claimant’s application for benefits. The proceedings conducted before the Appeal Tribunal and the Industrial Commission on the claim were proper and fully in accord with the provisions of the law.” The foregoing statements are the interrogative and the affirmative, with some variations in scope of the same propositions. The Logan-Cache Knitting Mills is a Utah corporation engaged in the knitting of woolen and other goods in Logan, Utah. The company operates a knitting factory where it knits wool and other materials into blankets, ladies’ dresses and other varieties of knit goods. Charles F. Hull, claimant, was engaged in selling the products. There were two written contracts entered into between the claimant and the company. One was dated August 9, 1937, and the other March 3,1938. It is the position of both the claimant and the plaintiff that the contract, be it what may, has never been terminated and that the claimant may continue the exercise of the rights anl privileges accorded him under the contract whenever he sees fit. The claimant maintains his relationship with the plaintiff company has not changed. Plaintiff agrees and the record establishes this fact. The commission found the contract “had never been formally terminated.” At the time claimant’s application for unemployment benefits was filed and for several months prior thereto, the *4 claimant had not been performing under the contract with the company, any service which brought him remuneration. Briefly state, the case presents three questions for determination: (1) Was claimant ineligible for benefits because claimant failed to prove he was not in the class of claimants excluded from benefits by the provisions of subsections (a) and (c) of Section 5, Chapter 1, Laws Utah 1936, Special Session; (2) Was the service performed by the claimant within the definition of the term “Employment” as defined in subsection (2) of Section 19(j), Laws Utah 1937; and (3) Was plaintiff shown to be an “employer” within the definition set forth in Section 19 (i), Laws Utah 1937? (1) Claimant is not exercising the rights and privileges granted him under his contract with the company. There is no “cause” given why the rights and privileges are not being exercised or why there has been no remuneration. The company still offers the claimant everything granted him by his contract with the company. The claimant is ineligible for benefits for the period set forth in subsection (a) of Section 5 when it is not shown by evidence that he left his employment for good cause and the claimant will remain ineligible for benefits so long as he fails, without good cause, to accept suitable work when offered him by his employer, Section 5 (c). (2) Subsection (2) of Section 19 (j), Laws Utah 1937, reads: “The term ‘employment’ shall include an individual’s entire service, performed within or both within and without this state if— “(a) the service is localized in this state; or “(b) the service is not localized in any state but some of the service is performed in this state and “(I) the base of operations, or, if there is no base of operations, then the place from which such service is directed or controlled, is in this state; or *5 “(II) the base of operations or place from which such service is directed or controlled is not in any state in which some part of the service is performed but the. individual’s residence is in this state.” It was stipulated by counsel “That the question of whether or not, claimant, Charles F. Hull, performed services within the State of Utah is not an issue in the above proceedings and that therefore, that portion of the briefs submitted in the above entitled matter relating fo such issue is waived and need not be considered by the court in arriving at its decision.” That is a fact which must be proved to bring claimant within the act. It is a necessary element to make a case. See Crowell v. Benson, 285 U. S. 22, 52 S. Ct. 285, 76 L. Ed. 598. The service of the claimant was not “localized in this state” as required by subparagraph (a) nor could it be said that “some of the service is performed in this state” as required by subparagraph (b). There is nothing in the evidence to show that any of the service was performed in this state. All services mentioned in the record are affirmatively shown to have been performed outside of the state. (3) We have examined the record carefully to ascertain whether the company was an “employing unit” under the statute. Aside from the forty or fifty persons bearing the same relation to the company as claimant, we have found no reference to “any employing unit which for some portion of a day, but not necessarily simultaneously, in each of twenty different weeks, whether or not such weeks are or were consecutive, within either the current or preceding calendar year, has or had in employment four or more individuals.” Until such facts are shown, the employing unit is not brought within the provisions of the act. Section 19 (i) (1). Roberts v. Industrial Commission, 97 Utah 434, 93 P. 2d 494. The order of the commission is vacated.