In re Mitchell, 220 N.C. 65 (1941)

Sept. 24, 1941 · Supreme Court of North Carolina

220 N.C. 65

In the Matter of GEORGE MITCHELL, Claimant, Employee, and BROWN & CRAWLEY, a Partnership; and BROWN & CRAWLEY OIL COMPANY, INC., WILSON, NORTH CAROLINA, Employing Units.

(Filed 24 September, 1941.)

1. Master and Servant § 57—

Where a partnership and a later formed corporation are controlled by the same parties but the businesses are wholly unrelated and are kept separate and distinct as to location, finance and employment, and the work required of the employees of the two concerns are not of the same character, the two concerns do not constitute a single employing unit, and, neither concern having in its employ as many as eight employees, neither is subject to the Unemployment Compensation Act.

2. Appeal and Error §§ 3a, 30h—

Where the real party in interest does not appeal from judgment in favor of an adverse party, the judgment of the court below becomes res judicata as to all justiciable issues presented, and there being nothing for determination on the appeal of a formal party, the appeal will be dismissed.

3. Master and Servant § 62—

The Unemployment Compensation Commission is not entitled to appeal from judgment of the Superior Court, entered in a proceeding by an employee for compensation, that defendant employer does not come within the purview of the Compensation Act, and that therefore claimant is not entitled to Unemployment Compensation Insurance. If the Commission desires to have the liability of the employer for unemployment compensation contributions judicially determined on its contentions that the employer and another concern controlled by the same interests constituted but a single employing unit, it must follow the procedure prescribed by sec. S (m), ch. 27, Public Laws 1939.

Appeal by Unemployment Compensation Commission from Bone, J., in Chambers, Y June, 1941.

From WilsoN. Appeal dismissed.

Proceeding under sec. 6, ch. 1, Public Laws, Extra Session, 1936, to determine the right of the claimant to benefits under the provisions of the Unemployment Compensation Act.

Claimant filed claim for benefits for unemployment as an employee of Brown & Crawley Oil Company, Inc. The Commission advised that the company had no wage credits for the year 1938. The claimant protested. Thereupon a hearing was had before a claims deputy. The deputy found as a fact that claimant was employed by Brown & Crawley, a partnership; that Brown & Crawley and Brown & Crawley Oil Company, Inc., are controlled directly and indirectly by the same interest and jointly constitute a single employing unit covered by the Act, and that the claimant was entitled to recover compensation to be charged to wage credits created by the collection of taxes from such employing unit. The appeals deputy affirmed.

Upon an appeal by Brown & Crawley and Brown & Crawley Oil Company, Inc., tbe Full Commission reviewed tbe finding of fact and conclusions of tbe claims deputy and tbe appeals deputy, beard argument and rendered judgment tbat tbe claim of Mitcbell be allowed and tbat be receive sucb benefits to wbicb be is entitled under tbe law. As a basis for its judgment it concluded tbat Brown & Crawley and Brown & Crawley Oil Company, Inc., constitute an employing unit covered by tbe Unemployment Compensation Act. Tbe respondents filed certain exceptions to tbe findings of fact and to tbe failure of tbe Commission to find certain other facts. It was thereupon agreed tbat tbe exceptions should be withdrawn and tbat tbe additional findings of fact as set out in tbe exceptions filed should be incorporated as' findings of fact of tbe Commission in tbe cause. Tbe respondents appealed, agreeing tbat tbe cause should be submitted to tbe resident judge upon tbe facts found by tbe Commission as amended by tbe stipulations.

When tbe cause came on to be beard in tbe court below on tbe appeal tbe court, being of tbe opinion tbat tbe facts found do not support tbe Commission’s decision and tbat upon said facts tbe defendants are not liable for contributions under said Act, entered judgment reversing tbe judgment of tbe Unemployment Commission. Tbe Unemployment Compensation Commission excepted and appealed.

Finch, Rand & Finch and Wade A. Gardner for Brown <& Grawley and Brown & Grawley Oil Company, Inc., respondents, appellees.

Adrian J. Newton, Ralph Moody, and W. D. Holoman for Unemployment Compensation Commission, appellant.

BabNiiill, J.

It is conceded tbat Brown & Crawley is a copartnership founded in 1926 and is “exclusively engaged in tbe meat packing industry and in tbe wholesale processing and distribution of meat products”; tbat Brown & Crawley Oil Company is a corporation organized in 1936 and is “exclusively engaged in tbe wholesale distribution of petroleum products”; and tbat neither employs as many as eight employees. It is further agreed tbat “tbe two businesses are wholly unrelated businesses. They occupy separate real estate. Each owns bis own real estate. They occupy separate plants. Each owns its own plant. Tbe nature of tbe duties of their employees is not identical. The work required of tbe employees of tbe two concerns are not of tbe same character. They have never engaged in any exchange of employees, or of tbe employees’ duties. They have always maintained separate books, records, bank accounts and business transactions of every nature and description. Neither business has ever loaned, or advanced, any money, property or equipment to tbe other. Their identities have always been maintained entirely separate and distinct. No property or money of tbe copartnership was used in the formation of the corporation and the two businesses were formed in good faith and not because of any attempt to evade the provisions of the Unemployment Compensation Act.”

These admitted facts make Unemployment Compensation Commission v. Coal Co., 216 N. C., 6, 3 S. E. (2d), 290, and Unemployment Compensation Commission v. Willis, 219 N. C., 709, easily distinguishable and fully sustain the conclusion of the court below. Apparently the claimant so understood. He did not appeal.

The real party in interest not having appealed, the judgment of the court below becomes res judicata as to all justiciable issues presented. Nothing remains for our consideration.

We are not inadvertent to the provisions of sec. 6 (h), ch. 1, Public Laws, Extra Session, 1936, which makes the Commission a party to any judicial action involving any such decision. Under this statute the exact status of the Commission as a party to the action is not defined and the part it is to play as such is left somewhat in the realm of speculation. Suffice it to say that we find nothing in the provision which constitutes the Commission guardian or trustee for a claimant or which would warrant the conclusion that it is authorized to prosecute an appeal from a judgment against a claimant when the claimant is content. Nor may it do so for the purpose of adjudicating issues which are merely incidental to the claimant’s cause of action.

If, as the Commission contends, Brown & Crawley and Brown & Crawley Oil Company, Inc., jointly constitute a single employing unit liable for the payment of unemployment compensation contributions and it wishes to have this liability judicially adjudged, it must follow the procedure prescribed by the statute which gives it life and defines its rights and duties. Sec. 8 (m), ch. 27, Public Laws 1939; sec. 14 (b), ch. 1, Extra Session, Public Laws 1936.

Appeal dismissed.