FLORIDA INDUSTRIAL COMMISSION, AN AGENCY OF THE STATE OF FLORIDA, APPELLANT,
v.
PHIL SCHOENBERG, APPELLEE

Fla. 3d DCA | 1960-01-28
No. 59-150
HORTON, C. J., and MILLEDGE, STANLEY, Associate Judge, concur.
117 So. 2d 538 Florida District Court of Appeal, Third District (1960) Positive Treatment
Cited by 5 cases

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Synopsis

The Florida Industrial Commission challenged a declaratory decree holding that a real estate broker's salesmen were independent contractors exempt from workers' compensation coverage. The court affirmed the lower court's decision, holding that real estate salesmen working under the described circumstances are independent contractors under Florida law and not subject to the Workmen's Compensation Act.


Holding

Real estate salesmen are independent contractors excluded from workers' compensation coverage under Florida law. The court held that the absence of control by the broker over the manner and method of performance, combined with the salesmen's freedom of movement, independence in allocating their time, and compensation based on results rather than wages, establishes independent contractor status.


Key Quotes

“the principal facts as to the status of the salesmen and the degree of control of the broker are largely the same in these real estate salesman cases”

Establishes that the court's analysis would rely on common patterns across real estate salesman cases in other jurisdictions.

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Facts & Procedural History

Schoenberg, a licensed real estate broker, contracted with nine licensed real estate salesmen under oral agreements. The broker provided office space,…

The full statement of facts, procedural history, and disposition for this case are member content.

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Opinion of the Court
CARROLL, CHAS., Judge.

CARROLL, CHAS., Judge.

By this appeal the Florida Industrial Commission challenges the correctness of a declaratory decree which ruled that the appellee, a real estate broker, was not an employer of the real estate salesmen affiliated with him in his business, held that the salesmen were independent contractors and did not come within the provisions for employees under the Florida Workmen’s Compensation Law, Ch. 440, Fla.Stat., F.S.A., and enjoined appellant from .requiring appellee to secure workmen’s compensation insurance for the subject salesmen.1

Appellee is a licensed real estate broker. Under oral agreements, he utilizes the serv*540ices of some nine registered and licensed real estate salesmen. He maintains two offices, provides desks and telephones therein to the salesmen, and pays all incident rents and utilities. All sales are solicited and consummated in appellee’s name, and all checks and payments are in his name. The salesmen collect no money, and have no authority to close transactions in their individual identities. The association between appellee and his salesmen can be terminated by either party at any time without liability. The salesmen draw no wages or salaries as such, but are compensated by becoming entitled to 60% of the commissions accruing to the broker through their efforts. The salesmen have no expense accounts, provide their own means of transportation, and use their own judgment in contacting and negotiating with prospects. In all other respects the salesmen are independent of the broker, and not accountable to him for their time or activities. The broker exercises no control over the manner, method and performances of their services and he does not concern himself with the details of their work, but only in the results thereof.

The term “employee” is defined in the Florida Workmen’s Compensation Law (§ 440.02(2), Fla.Stat., F.S.A.), as follows:

“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 independent contractors and excluding persons whose employment is both casual and not in the course of the trade, business, profession or occupation of his employer.”

It will be noted that in defining employees, the statute expressly excludes independent contractors. But the statute does not define independent contractors. We are left, therefore with the necessity of using the common law definition and meaning of independent contractors, in determining the status of real estate salesmen under this act. See Gentile Bros. Co. v. Florida Industrial Commission, 151 Fla. 857, 10 So.2d 568; Florida Industrial Commission v. Peninsular Life Ins. Co., 152 Fla. 55, 10 So.2d 793.

The determinative question of whether the legal relationship of an employer and employee exists between the ap-pellee and the real estate salesmen is one which does not appear to have been passed on by an appellate court in this state, but the question has been considered numerous times in other jurisdictions as will be noted from the authorities cited herein. We are *541inclined to decide this question, as did the learned chancellor, in accordance with the weight of authority on the point. While each such case must depend upon the particular facts there presented, a .reading of the cases shows that the principal facts as to the status of the salesmen and the degree of control of the broker are largely the same in these real estate salesman cases.

Our research of the authorities, while by no means complete, disclosed that the question has been answered by appellate courts in eight states and in two federal circuits, in cases presenting substantially similar circumstances, by holding that real estate salesmen are independent contractors and are not employees of the broker with whom they are affiliated;2 and that appellate courts in four states have held real estate salesmen to be employees and within the scope of compensation acts.3

In determining whether a real estate salesman, under the Florida Workmen’s Compensation Law, is an employee or is excluded from coverage as being an independent contractor, we must observe the established rule that “the Workmen’s Compensation Act should be liberally construed in relation to those it was designed to reach but the rule of liberal construction can not be strained to the point of extending it to employments not within its scope or intent4.”

*542Those cases which, under substantially similar statutory provisions, hold real estate salesmen to be independent contractors, reach that conclusion through application of generally accepted common law definitions of such a status. They rely heavily on the presence or absence of supervisory power to control the method and detail of performance of the services rendered. Thus, absence of immediate control of such a real estate salesman, freedom of movement and activity in his work, and a free choice in the allocation and disposition of his time, have been held to establish the salesman’s status as an independent contractor. See Louis A. Demute, Inc. v. Michigan Employment Security Comm., supra, 339 Mich. 713, 64 N.W.2d 545, 550. The broker’s right to terminate the salesman’s services at any time is not per se indicative of an employee-employer status when other evidence fully supports the presence of an independent contractor relationship. California Employment Stabilization Comm. v. Morris, supra, 28 Cal.2d 812, 172 P.2d 497, 501.

Florida cases dealing with the problem of determining whether one is an employee or independent contractor reveal the following: In Magarian v. Southern Fruit Distributors, 146 Fla. 773, 1 So.2d 858, 861, the Supreme Court said:

“It appears generally conceded that no hard and fast rule may be stated to control the determination of the question as to whether one occupies the status of an employee or that of an independent contractor and that each case must stand on its own facts and, therefore, no useful purpose may be served by citing particular cases involving different factual conditions.”

In Baya’s Bar & Grill v. Alcorn, Fla.1949, 40 So.2d 468, 469, it was said:

“Of course independent contractors are excluded from the operation of the Workmen’s Compensation Law. Section 440.02(2), Florida Statutes 1941, and F.S.A. In the case of Gulf Refining Company v. Wilkinson, 94 Fla. 664, 114 So. 503, text 505, it was stated that the right of control as to the manner of doing work was the principal test in determining whether one engaged was an independent contractor or a servant and that another ‘test is whether the employee represents his employer as to the result of the work only, or as to the means as well as the result.’ So, if an employee is subject to the control or direction of the owner only as to the result, he is an independent contractor, but if controlled by the employer as to the means used, he is not. That case was decided in 1927, before the adoption of the Workmen’s Compensation Law, but in Gentile Bros. Co. v. Florida Industrial Commission, 151 Fla. 857, 10 So.2d 568, 570, we recognized the same definition when we said that an independent contractor was one who pursued an individual employment or occupation and represented ‘his employer as to the results of his work but not as to the means by which the results [were] accomplished.’ ”

Appellant directs our attention to an opinion of the Attorney General (056-54, 1955-1956 Ops. Att’y Gen. 520, February 27, 1956) holding that real estate salesmen are not independent contractors, but are employees under the Florida Workmen’s Compensation Law. In that opinion the Attorney General cites several instances in Ch. 475, Fla.Stat, F.S.A., the Real Estate License Law, where real estate salesmen are referred to as being employees of brokers and where a real estate broker is mentioned as employer of his salesmen. While some consideration should be given to the designation in the real estate licensing statute of salesmen as being the em*543ployees of the broker, or of the broker being an employer of a real estate salesman, it is generally held that such references in real estate licensing acts are not determinative of the status of a real estate salesman and do not of themselves create a new employer-employee relationship under a workmen’s compensation law or an unemployment insurance act, and are of little influence in that connection. Koehler v. Myers, supra, 3 Cir., 1927, 21 F.2d 596; California Employment Stablization Comm. v. Morris, supra, 28 Cal.2d 812, 172 P.2d 497; Louis A. Demute, Inc. v. Michigan Employment Security Comm., supra, 339 Mich. 713, 64 N.W.2d 545; In re Wilson Sullivan Co., supra, 289 N.Y. 110, 44 N.E.2d 387.

In California Employment Stablization Comm. v. Morris, supra, 172 P.2d at page 500, in commenting on this feature, the California Supreme Court said:

“The Real Estate Act, supra, does not establish as a matter of law the status of every salesman as being ‘in employment’ within the meaning of the Unemployment Insurance Act. The licensing statute was not promulgated for that purpose; it was designed for the protection of the public, the primary function being to allow only those persons to operate as real estate brokers and salesmen who are honest, truthful, and of good reputation. Riley v. Chambers, 181 Cal. 589, 593, 185 P. 855, 8 A.L.R. 418; Gray v. Horne, 48 Cal.App.2d 372, 119 P.2d 779; Koeberle v. Hotchkiss, 8 Cal.App.2d 634, 640, 48 P.2d 104. The act operates in a comparatively narrow field and the legislation should not be interpreted so as to give a meaning beyond its realm and scope. * * * ”

And in Louis A. Demute, Inc. v. Michigan Employment Security Comm., supra, 64 N.W.2d at page 549, it was said:

“There is no conclusive reason why the terms of the .real estate license law should be read into the Michigan employment security act. The statutes were not designed to effectuate a common result. The terms of the real estate license law must be taken as only one factor along with the many others, in determining whether a common-law employer-employee relationship existed between the broker and salesmen. It is not alone determinative of the relationship. * * * ”

Referring again to the 1956 Attorney General’s opinion giving real estate salesmen an employee status, and the weight to which such opinion is entitled5, we note that it is in conflict with opinions of two prior Florida Attorneys General which express an opposite view on this subject. 0-636, 1939-1940 Ops. Att’y Gen. 360, November 3, 1939; 041-546, 1941-1942 Ops. Att’y Gen. 580, September 3, 1941.

Considering the evidence in this case against the background of the Workmen’s Compensation Law, and applying the rules for construction as outlined above, we hold that the chancellor’s findings were amply supported by the record, and that his conclusions, following as they did the weight of authority on the questions of law involved, resulted in a correct.decree, which we hereby affirm.

Affirmed.

HORTON, C. J., and MILLEDGE, STANLEY, Associate Judge, concur.


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Citator

Cited By

  • Edwards v. Caulfield, 560 So. 2d 364 (Fla. 1st DCA 1990)
    …or time if she could not keep the regularly scheduled time. In addition, the floor time assigned to the claimant was very minimal in comparison to the total hours worked. Analogous to the instant case is Florida Industrial Commission v. Schoenberg, 117 So. 2d 538 (Fla. 3rd DCA 1960). There, the Third District affirmed the trial court’s declaratory decree finding that a real estate broker was not, for workers’ compensation purposes, the employer of a real estate salesman who was affiliated with his business.…
  • Pearson v. Harris, 449 So. 2d 339 (Fla. 1st DCA 1984)
    …or determining whether the relationship is one of employer-employee, or contractee-indepen-dent contractor, under both the workers’ compensation law and under the common law, are virtually identical. See, Florida Industrial Commission v. Schoenberg, 117 So. 2d 538 (Fla.1960). As we said in Brewer v. Cueto, 379 So. 2d 1322, 1323 (Fla. 1st DCA 1980), cert. den. 388 So. 2d 1111 (Fla. 1980), whether or not an individual is an independent contractor “ultimately turns on the power to control.” See, also, Orcutt v.…
  • ABT Corp., Inc. v. City of Fort Lauderdale, 664 F. Supp. 488 (S.D. Fla. 1987)
    …ee 1984 Op. Att’y Gen. 084-63 (July 12, 1984). Attorney General Opinions are not binding on courts in Florida, but such opinions are “ ‘entitled to weight’ ” when construing the Florida Statutes. Florida Industrial Commission v. Schoenberg, 117 So.2d 538, 543 n. 5 (Fla.Dist.Ct.App.1960) (quoting Perry v. Larson, 104 F.2d 728, 729-30 (5th Cir.1939)). The Attorney General Opinion offered by the defendant, however, does not address the issue raised in this action, at least not in any direct w…

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