Cajiao v. Arga Transp., Inc.

30 Neb.App. 700

972 N.W.2d 433

Oscar CAJIAO, appellant,

v.ARGA TRANSPORT, INC., employer, and United States Fire Insurance Co., workers’ compensation insurance carrier, appellees.

No. A-21-384.

Court of Appeals of Nebraska.

Filed March 1, 2022.

James E. Harris and Britany S. Shotkoski, of Harris & Associates, P.C., L.L.O., Omaha, for appellant.

Lindsey E. Mills, of Smith, Mills, Schrock & Blades, P.C., for appellees.

Pirtle, Chief Judge, and Riedmann and Welch, Judges.

Riedmann, Judge.

INTRODUCTION

Oscar Cajiao appeals the order of the Nebraska Workers’ Compensation Court, which rejected his claim that he was an employee of Arga Transport, Inc. (Arga), determining instead that he was an independent contractor and therefore not entitled to any workers’ compensation benefits. Finding no error by the compensation court, we affirm.

BACKGROUND

Cajiao was injured in a motor vehicle accident that occurred on November 2, 2017, while he was driving a semi-tractor trailer leased by Arga. Cajiao alleged that he was an employee of Arga and entitled to workers’ compensation benefits for his injuries. Arga claimed that Cajiao was an independent contractor at the time of the accident and therefore not entitled to benefits.

Cajiao filed a petition in the compensation court in October 2019, and trial was held in April 2021. The parties stipulated that the accident occurred on November 2, 2017, in York County, Nebraska, and that Cajiao gave timely notice of his injury to Arga and its insurer. The issue at trial was whether Cajiao was an employee of Arga.

Cajiao's video deposition was received into evidence at trial. He testified that he previously owned his own semi-tractor and used it in his business as an over-the-road truckdriver. To acquire work, he would search online trucking broker companies to find loads that were convenient for him to haul. The companies that needed freight hauled provided the details of the job, including the pickup and delivery locations, the number of miles between locations, and the weight of the load. Once the delivery was complete, Cajiao would send a bill of lading to the company and it would send him payment.

Cajiao sold his truck in approximately 2010 but continued working as a truckdriver. He continued to use the same search and application process to find loads to haul, and the companies would provide a truck for him to use to complete their delivery. After he finished hauling a load, he, again, would submit a bill of lading to the company and await payment. When the companies provided a truck for him to drive, the truck displayed the name of the company on it, because, as he explained, "[t]hat's the law."

Cajiao explained that while he drove for one company, he could not drive for another company, but that he could, and did, move back and forth among companies at any time. He worked for many companies in the 15 years prior to the accident, including Arga. In the 6 months prior to the accident, however, he was driving loads for only Arga. He was paid by the mile for Arga, and if he did not drive any miles, he did not get paid. He did not receive any other compensation or benefits from Arga, except a yearend bonus that was entirely "up to them."

The compensation court entered a written order after trial. It recognized that Cajiao sustained injuries in an accident on November 2, 2017, while driving a semi-tractor trailer leased by Arga and that the issue before it was whether Cajiao was an employee of Arga. After applying the applicable law to its factual findings, the court determined that Cajiao was an independent contractor and dismissed his petition. Cajiao timely appeals.

ASSIGNMENTS OF ERROR

Cajiao assigns, summarized and consolidated, that the compensation court erred in (1) finding him to be an independent contractor and failing to award workers’ compensation benefits, (2) admitting affidavits of witnesses over his objection, and (3) failing to issue a reasoned decision under Workers’ Comp. Ct. R. of Proc. 11 (2021).

STANDARD OF REVIEW

Pursuant to Neb. Rev. Stat. § 48-185 (Cum. Supp. 2020), an appellate court may modify, reverse, or set aside a compensation court decision only when (1) the compensation court acted without or in excess of its powers; (2) the judgment, order, or award was procured by fraud; (3) there is not sufficient competent evidence in the record to warrant the making of the order, judgment, or award; or (4) the findings of fact by the compensation court do not support the order or award. Aboytes-Mosqueda v. LFA Inc. , 306 Neb. 277, 944 N.W.2d 765 (2020).

On appellate review, the factual findings made by the trial judge of the compensation court have the effect of a jury verdict and will not be disturbed unless clearly wrong. Id. In testing the sufficiency of the evidence to support the findings of fact in a workers’ compensation case, an appellate court considers the evidence in the light most favorable to the successful party, every controverted fact must be resolved in favor of the successful party, and the appellate court gives the successful party the benefit of every inference reasonably deducible from the evidence. Id.

ANALYSIS

Cajiao asserts that the compensation court erred in determining that he was an independent contractor of Arga rather than its employee. We disagree.

A person's status as an employee or an independent contractor is a question of fact; however, where the facts are not in dispute and where the inference is clear that there is, or is not, a master and servant relationship, the matter is a question of law. Aboytes-Mosqueda v. LFA Inc., supra .

There is no single test for determining whether one performs services for another as an employee or as an independent contractor; rather, the following factors must be considered: (1) the extent of control which, by the agreement, the employer may exercise over the details of the work; (2) whether the one employed is engaged in a distinct occupation or business; (3) the kind of occupation, with reference to whether, in the locality, the work is usually done under the direction of the employer or by a specialist without supervision; (4) the skill required in the particular occupation; (5) whether the employer or the one employed supplies the instrumentalities, tools, and the place of work for the person doing the work; (6) the length of time for which the one employed is engaged; (7) the method of payment, whether by the time or by the job; (8) whether the work is part of the regular business of the employer; (9) whether the parties believe they are creating an agency relationship; and (10) whether the employer is or is not in business. Id.

The extent of control is the chief factor distinguishing an employment relationship from that of an independent contractor. Sparks v. M&D Trucking , 301 Neb. 977, 921 N.W.2d 110 (2018). In examining the extent of the potential employer's control over the worker in this context, it is important to distinguish control over the means and methods of the assignment from control over the end product of the work to be performed. Id. An independent contractor is one who, in the course of an independent occupation or employment, undertakes work subject to the will or control of the person for whom the work is done only as to the result of the work and not as to the means or methods used. Id. Even the party contracting with an independent contractor may, without changing the status, exercise such control as is necessary to assure performance of the contract in accordance with its terms. Id.

In arguing that Arga exerted control over him, Cajiao relies heavily upon the fact that he had to abide by federal regulations related to trucking and interstate commerce. As the compensation court found, however, Cajiao would have been required to follow all state and federal laws whether he was an employee or an independent contractor. The Nebraska Supreme Court has also recognized this fact, observing that compliance with then-existing Interstate Commerce Commission regulations would be required whether or not the plaintiff's status was that of employee or independent contractor. See Stephens v. Celeryvale Transport, Inc. , 205 Neb. 12, 286 N.W.2d 420 (1979).

Cajiao also asserts that because the lease agreement between Arga and its lessor provided that Arga shall have exclusive possession, control, and use of the equipment and shall assume responsibility for the operation of the equipment, we must find that he was an employee of Arga. He also correctly recognizes that 49 C.F.R. § 376.12(c)(1) (2017), part of the Federal Motor Carrier Safety Regulations, mandates this language. The Supreme Court has likewise recognized that § 376.12 and 49 C.F.R. § 376.22 (2020) require that a lease contain the following provisions: provide the lessee exclusive possession, control, and use of the equipment for the duration of the lease and provide that the lessee shall assume complete responsibility for the operation of the equipment for the duration of the lease; clearly specify the legal obligation of the lessee to maintain insurance coverage for the protection of the public; and provide that control and responsibility for the operation of the equipment shall be that of the lessee from the time possession is taken until possession is returned. See Sparks v. M&D Trucking, supra .

However, federal regulations, and compliance therewith, do not determine whether an employer-employee relationship exists. See Choto v. Consolidated Lumber Transport , 82 A.D.3d 1369, 1370, 918 N.Y.S.2d 268, 270 (2011) (stating federally regulated requirement that lessee have " ‘exclusive possession, control, and use of the equipment for the duration of the lease’ " is not dispositive of employee-employer relationship). In fact, § 376.12(c)(4) provides that "[n]othing in the provisions required by paragraph (c)(1) of this section is intended to affect whether the lessor or driver provided by the lessor is an independent contractor or an...