In the matter of the contribution liability,
or status, under Chapter 108, Stats., of


Account No. 278789, Hearing No. S9200074HA

Pursuant to the timely petition for review filed in the above-captioned matter, the commission has considered the petition and all relief requested. The commission has reviewed the applicable records and finds that the appeal tribunal's findings of fact and conclusions of law are supported thereby. The commission therefore adopts the findings and conclusions of the appeal tribunal as its own.


The decision of the appeal tribunal is affirmed. Accordingly,  BRUCE HENDRICKS  is liable for past due and delinquent unemployment contributions, late filing fees and interest in regard to those wage payments made to individuals, except as was found in the appeal tribunal decision.

Dated and mailed July 30, 1993
101 : CD0329   EE 411

/s/ Pamela I. Anderson, Chairperson

/s/ Richard T. Kreul, Commissioner

/s/ James R. Meier, Commissioner


In his decision, the appeal tribunal first found that certain carpenters worked in an employment relationship for the construction company for whom they worked, rather than for individual customers. The appeal tribunal reached his decision by giving collateral estoppel effect to a 1985 decision of the commission involving  the appellant which was eventually affirmed by the Court of Appeals.  The appeal tribunal in this case found that no evidence presented at the hearing established that the employment relationship between the carpenters and the appellant had changed since the earlier decision.  Consequently, the appeal tribunal concluded that that the earlier decision precluded the parties from relitigating that issue.

The commission accepts the appeal tribunal's application of doctrine of collateral estoppel in this case.  However, the record supports a finding that the carpenters worked for the construction company, independent of any reliance on the decision issued in the earlier case affirmed by the Court of Appeals.  Admittedly, the record establishes that neither the appellant nor Maple Trust paid the carpenters directly; rather, the carpenters would bill the customers.  However, sec. 108.02 (12)(b), Stats., which defines the word "employe," does not require direct payment by the employer.  Further, the record does indicate that on one occasion involving a dissatisfied customer, the appellant did pay the carpenters directly.

One of the carpenters (Jensen) testified at the hearing and he indicated that approximately 70 percent of the work he did during the years in question came from jobs connected with the appellant.  Jensen testified, however, that he did not consider himself to be an employe of the appellant and could not recall the appellant ever telling a worker on a job that the worker did not do something correctly.  Nonetheless, even if the appellant exercised only limited direction and control over the carpenters, the commission believes that the appellant has not established that the carpenters were involved in an independently established trade or business under the guidelines set out in Keeler v. LIRC, 154 Wis. 2d 626, 633-34 (Ct. App., 1990) and Princess House Inc., v. DILHR, 111 Wis. 2d 246, 69-77 (1983). The factors listed in those cases are integration, advertising or holding oneself out, entrepreneurial risk, economic dependence and proprietary interest.

Jensen's work was obviously integrated to the construction business and the record indicates that he did little if any advertising of his own services. Further, he testified that he did the majority of work for the appellant, suggesting that he (or his putative independently established trade or business) was economically dependent on the appellant. The record also indicates that Jensen had very little entrepreneurial risk, especially given the fact the that in the past the appellant himself bore the risk of indemnifying his carpenters when a dissatisfied customer refused to pay.  While a argument could be made that Jensen had a proprietary interest in a separately established trade or business based on his substantial investment in tools, the commission concludes that that factor alone is not enough to satisfy the appellant's burden under sec. 108.02 (12)(b), Stats.

The second issue in the appeal tribunal decision involves the question of whether the carpenters work for the appellant or for the entity known as. "Maple Trust ." Citing the reluctance of the appellant or his wife to provide much information about Maple Trust, the appeal tribunal drew the negative inference that either no trust was established or that, if it was established, there was no transfer of business from the appellant as an individual to Maple Trust.

The commission notes that the appellant did indicate that the trust was established for the benefit of his children and that his wife was one of the trustees. However, the appeal tribunal is absolutely correct in finding that there is no real evidence at the hearing that the trust employed the carpenters.  Further, it appears from the record that even after the trust was established in 1988, the appellant continued to operate under the trade of Hendricks Construction.  Simply, stated, the purported transfer of the appellant's construction business to Maple Trust is unsupported.

In his petition, the appellant raises a number of arguments. First, he contends that since Bruce Hendricks Construction no longer exist, he should not be liable. However, the fact remains that no transfer to Maple Trust was established at the hearing. The appellant next contends that he should not be liable for unemployment contributions because no document making him liable bears his signature. In support of his theory, the appellant cites sec. 1403.505, Stats., a provision in Wisconsin's version of the uniform commercial code dealing with commercial paper. That section provides that a person who is requested to pay a negotiable instrument may require the person presenting the instrument to show the instrument to the payor, provide identification, and present a signed receipt for any partial or full payment. If the person presenting the negotiable instrument for payment does not or cannot do any of those things, the person to whom the negotiable instrument is presented may refuse to pay it "without dishonor."

However, the department is not presenting the appellant with a negotiable instrument, such as a check or draft, and requiring him to pay on it. Sect ion 403.505 (2), Stats., simply does not apply in this case.  While that section does describe the circumstances under which a person may be required to pay a note or check that he has written, it does not set out the only means by which a person may become liable to pay money. In this case, the appellant is liable for unemployment contributions under the relevant provisions of the state unemployment compensation statutes, and nothing in sec. 1403.505, Stats., cancels or overrides that obligation.

Next, the appellant states in its petition that he is an American, but a non-resident alien to the corporate United States and does not inhabit the state of the forum. He also states that he had no agreement or contract with the corporate State of Wisconsin.  The commission assumes that the employe is asserting that the department has no jurisdiction over him.  However, the commission is satisfied that the department does have jurisdiction and that the appellant is an employer subject to ch. 108, Stats., under sec. 108.02 (13), Stats. The fact that the appellant (who lists his address in his petition as Route 2, Frederic, Wisconsin) simply asserts that he is not a resident of Wisconsin does not change his liability in this case.

cc: Attorney Peter W. Zeeh

Appealed to Circuit Court.  Affirmed, August 28, 1995.   [Summary of Circuit Court decision]

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