
129 S.E.2d 610 (1963)
259 N.C. 16
Mary Sawyer WEAVER, Administratrix of the Estate of Jackie Weaver
v.
R. J. BENNETT and Weldon O. Parrish.
No. 387.
Supreme Court of North Carolina.
March 6, 1963.
*612 Deal, Hutchins & Minor and W. Scott Buck, Winston-Salem, for plaintiff appellant.
Hudson, Ferrell, Petree, Stockton, Stockton & Robinson, Winston-Salem, for defendant appellees.
BOBBITT, Justice.
Careful consideration impels the conclusion that the evidence, when considered in the light most favorable to plaintiff, is sufficient to require submission for jury determination of issues as to the alleged negligence of Parrish and as to the alleged contributory negligence of Weaver. Having reached this conclusion, we deem it appropriate to refrain from further discussion of the evidence (relevant to said issues) presently before us. Tucker v. Moorefield, 250 N.C. 340, 342, 108 S.E.2d 637, and cases cited.
Even so, defendants contend that, under the provisions of G.S. § 97-9 and G.S. § 97-10, plaintiff's exclusive remedy is against her intestate's employer and its insurance carrier for compensation as provided in our Workmen's Compensation Act and Parrish is immune from suit.
In this jurisdiction, an employee subject to the provisions of our Workmen's Compensation Act, "whose injury arose out of and in the course of his employment, cannot maintain an action at common law against his coemployee whose negligence caused the injury." Warner v. Leder, 234 N.C. 727, 732, 69 S.E.2d 6, 9; Bass v. Ingold, 232 N.C. 295, 60 S.E.2d 114; Essick v. Lexington, 232 N.C. 200, 60 S.E.2d 106. In Warner, the factual situation in each pertinent prior decision is discussed.
In Warner, this Court, in opinion by Denny, J. (now C.J.), said: "We hold that an officer or agent of a corporation who is acting within the scope of his authority for and on behalf of the corporation, and whose acts are such as to render the corporation liable therefor, is among those conducting the business of the corporation, within the purview of G.S. § 97-9, and entitled to the *613 immunity it gives; (citations) and that the provision in G.S. § 97-10 which gives the injured employee or his personal representative `a right to recover damages for such injury, loss of service, or death from any person other than the employer,' means any other person or party who is a stranger to the employment but whose negligence contributed to the injury. And we further hold that such provision does not authorize the injured employee to maintain an action at common law against those conducting the business of the employer whose negligence caused the injury. To hold otherwise would, in a large measure, defeat the very purposes for which our Workmen's Compensation Act was enacted. Instead of transferring from the worker to the industry, or business in which he is employed, and ultimately to the consuming public, a greater proportion of the economic loss due to accidents sustained by him arising out of and in the course of his employment, we would, under the provisions for subrogation contained in our Workmen's Compensation Act, G.S. § 97-10, transfer this burden to those conducting the business of the employer to the extent of their solvency. The legislature never intended that officers, agents, and employees conducting the business of the employer, should so underwrite this economic loss."
Under our Workmen's Compensation Act, as held in the cited decisions, where an employee's injury or death is compensable the sole remedy against the employer and "those conducting his business" (G.S. § 97-9) is that provided by its terms. As noted in Warner, in jurisdictions where the Workmen's Compensation Act does not contain a similar immunity clause, fellow workmen are generally treated as third parties within the meaning of the Act. See 30 N.C.L.R. 474. Thus, in Nepstad v. Lambert, 235 Minn. 1, 50 N.W.2d 614, 624, discussed below, this statement appears: "It is clear under the Wisconsin law that if one coemploye negligently injures his fellow employe it is no defense in a suit against him to assert that both were employed under one master."
The rule stated in Warner has been applied and recognized in subsequent decisions: McNair v. Ward, 240 N.C. 330, 82 S.E.2d 85; Johnson v. Catlett, 246 N.C. 341, 98 S.E.2d 458; Wesley v. Lea, 252 N.C. 540, 114 S.E.2d 350; Jackson v. Bobbitt, 253 N. C. 670, 117 S.E.2d 806. In each decision based on the rule stated in Warner, the person who was conducting the employer's business and whose negligence caused the injury was an officer or otherwise in the general employment of the employer of the injured person.
This question is presented: Does the evidence, when considered in the light most favorable to plaintiff, disclose affirmatively that Parrish, at the time Weaver was fatally injured, was conducting the business of Reynolds within the meaning of G.S. § 97-9 and therefore, under the provisions of our Workmen's Compensation Act, immune from suit? The alleged liability of Bennett, if any, rests solely on the doctrine of respondeat superior.
It is noted: The record contains no evidence or stipulation that Weaver and Reynolds on October 17, 1958, were subject to and bound by the provisions of our Workmen's Compensation Act and that plaintiff has been paid full compensation in accordance with its terms. However, since these facts underlie contentions advanced by both plaintiff and defendants in their briefs, our further discussion assumes the existence of such facts.
Pertinent evidential facts are as follows:
The Unit Backhoe was one of some twenty pieces of equipment covered by a "purchase order" dated June 18, 1958, from Reynolds to Bennett. By its terms, Bennett agreed to furnish the equipment listed therein at locations in Forsyth and Stokes Counties specified by Reynolds during the period of one year beginning July 1, 1958. Bennett agreed to furnish a competent operator and *614 all fuel for each piece of equipment. Bennett also agreed to keep in force at all times "(s)ufficient public liability and property damage insurance to protect the R. J. Reynolds Tobacco Company against any and all claims for damage in connection with use of said equipment * * *" Reynolds agreed to pay a specified amount per hour for each piece of equipment, the operator and the fuel. For the period October 16-October 22, 1958, the amount paid by Reynolds to Bennett under this contract exceeded $6,000.00.
The rental of such equipment upon such terms was in the regular course of Bennett's business. The equipment was operated over an extended period on the premises of Reynolds and for the benefit of Reynolds.
The Unit Backhoe was a complicated machine. Operation thereof required skill and experience. Its two clutches and seven levers required "* * * a certain rhythm, like playing a piano, to run a unit backhoe." Parrish operated the Unit Backhoe and did the field maintenance. He was a competent operator of long experience.
Parrish had worked for Bennett for nearly twenty years. Bennett paid him by the week, after first deducting taxes, insurance, and social security. Bennett gave him his W-2 form on taxes withheld by Bennett. Reynolds never paid Parrish. Parrish turned in his time to Bennett's foreman on the Brook Cove project and not to Reynolds. When Parrish wanted time off, Bennett (not Reynolds) granted such permission. He was hired by Bennett and could be fired by Bennett. Bennett's foreman checked Parrish daily and Bennett himself came around at regular intervals. Bennett "* * * wasn't interested in the work, it was the machine, more or less."
Defendants, in supplemental brief, cite and stress our decision in Peterson v. Trucking Co., 248 N.C. 439, 103 S.E.2d 479. This is in the line of decisions in which this Court has held that an interstate carrier, which exercises its franchise rights by transporting freight in leased equipment under leases providing that such equipment during the term of the lease shall be solely and exclusively under the direction and control of the lessee, is liable in damages for injuries to third parties caused by the negligent operation of such equipment in the prosecution of such carrier's business. Wood v. Miller, 226 N.C. 567, 39 S.E.2d 608; Jocie Motor Lines v. Johnson, 231 N.C. 367, 57 S.E.2d 388; Eckard v. Johnson, 235 N.C. 538, 70 S.E.2d 488; Hill v. Freight Carriers Corp., 235 N.C. 705, 71 S.E.2d 133; Newsome v. Surratt, 237 N.C. 297, 74 S.E.2d 732; McGill v. Bison Fast Freight, 245 N.C. 469, 96 S.E.2d 438.
And, with specific reference to the Workmen's Compensation Act, this Court has held: (1) The dependents of a lessor-operator, who was transporting freight for the lessee, an interstate carrier, under authority of the lessee's I.C.C. franchise and license plates, were entitled to recover death benefit compensation from the lessee. Brown v. Truck Lines, 227 N.C. 299, 42 S.E.2d 71. (2) The dependents of the lessor's driver, whose death occurred while operating the leased equipment under like circumstances, were entitled to death benefit compensation from the lessee. Roth v. McCord, 232 N.C. 678, 62 S.E.2d 64. (3) The dependents of an assistant driver, who was fatally injured when the leased equipment was being operated by the owner-lessor under like circumstances, were entitled to death benefit compensation from the lessee. McGill v. Bison Fast Freight, supra.
Reference has been made to the hybrid nature of these lease agreements. Employment Security Comm. v. Freight Lines, 248 N.C. 496, 501, 103 S.E.2d 829; Watkins v. Murrow, 253 N.C. 652, 657, 118 S.E.2d 5.
The bases for the decisions relating to these lease agreements are well stated by Barnhill, J. (later C. J.), in Roth v. McCord, supra, as follows:
"(1) Roth, at the time of his injury and death, was operating a vehicle being used by the Motor Lines to haul freight in the course of its business as a common carrier *615 under franchise from the Interstate Commerce Commission. The vehicle was being operated under its identification plate. `The operation of the truck was in law under the supervision and control of the interstate franchise carrier and could be lawfully operated only by those standing in the relationship of employees to the authorized carrier.' Brown v. L. H. Bottoms Truck Lines, 227 N.C. 299, 42 S.E.2d 71, 75.
"(2) It is stipulated in the lease contract that while they are in the service of the Motor Lines, the vehicle and its driver shall be under the exclusive supervision, control, and direction of the lessee. The all-inclusive extent of this right of control is spelled out in the lease in detail. As the Motor Lines has contracted, so is it bound."
The bases of said decisions relating to the lease of equipment, including operator(s), to an interstate carrier for use in the exercise of its franchise rights, are not present in the case now before us.
In Shapiro v. Winston-Salem, 212 N.C. 751, 194 S.E. 479, the City of Winston-Salem, as sponsor of the W.P.A. project for improving Hanes Park, agreed to furnish a truck and driver, or trucks and drivers, "for an equivalent of 400 hours." While at work on said project, a city truck operated by a city employee backed into and fatally injured the plaintiff's intestate. It was held the truck driver was not, at the time the plaintiff's intestate was fatally injured, an employee of the city within the meaning of the doctrine of respondeat superior. The basis of decision was that the truck driver was working under the supervision and direction of the W.P.A. officials.
In Wadford v. Gregory Chandler Co., 213 N.C. 802, 196 S.E. 815, the defendant rented a tractor and driver to the North Carolina Employment Relief Administration. The plaintiff alleged he was injured by the negligence of the driver of the defendant's tractor. The evidence was to the effect that the "E.R.A. supervisor had full authority to direct the operation of the Gregory Chandler equipment, tell them what to do, when to start to work, how to do it and where to go. * * * Mr. Matthews, the E.R.A. supervisor, directed the work; gave orders to the foreman." In a per curiam opinion judgment of nonsuit was affirmed on authority of Shapiro v. Winston-Salem, supra and Liverman v. Cline, 212 N.C. 43, 192 S.E. 849.
In Leonard v. Transfer Co., 218 N.C. 667, 12 S.E.2d 729, this Court upheld a verdict and judgment in a personal injury action based on the alleged negligence of the defendant's employee while operating the defendant's truck on a public highway. The defendant had furnished the Bryant Electric Company with the truck and a driver at the price of $1.25 per hour. The Bryant Electric Company was to furnish the gas and oil and load the poles. The Bryant Electric Company had a contract with the R.E.A. and the truck was used to transport poles over the highway to the locations where the poles were to be placed. This Court held the evidence was sufficient to support a finding that the defendant retained sufficient control over the driver (his employee) to subject the defendant to liability for his negligence. This Court, in opinion by Seawell, J., said: "A person, natural or corporate, may lend or let a servant to another in such a way as to be relieved from liability arising out of injury to another through the negligence of the servant. But to bring this about, the control of the original employer over the acts of the employee must be so completely surrendered as to virtually suspend, temporarily, at least, any responsibility which might reasonably be associated with control."
In Hodge v. McGuire, 235 N.C. 132, 69 S.E.2d 227, this Court upheld a verdict and judgment in a property damage action based on the alleged negligence of McGuire's employee while operating a bulldozer on plaintiffs' premises. Plaintiff Hodge had rented a bulldozer from McGuire at a rental of $10.00 per hour, which included the wages of the operator and fuel. McGuire provided the bulldozer and an experienced operator but did not go upon the Hodge premises. *616 Hodge gave general directions as to what he wanted done in his land-clearing project but worked elsewhere and was not present when the damage occurred. While Haley, the operator, was working on it, a big red oak fell across the top of the Hodge house and caused the damages for which the action was brought. This Court held the evidence was sufficient to support a finding that the defendant retained sufficient control over the driver (his employee) to subject the defendant to liability for his negligence.
In Hodge v. McGuire, supra, the opinion of Johnson, J., states that the Liverman, Shapiro, and Wadford cases are factually distinguishable, and that the Leonard case is more nearly in point. This portion of the opinion of Johnson, J., is significant: "Here, however, it is significant that Hodge gave no direction or instruction as to the mechanical operation of the bulldozer. And, by the great weight of authority, it is held that `a servant of one employer does not become the servant of another for whom the work is performed merely because the latter points out to the servant the work to be done, or supervises the performance thereof, or designates the place and time for such performance, or gives the servant signals calling him into activity, or gives him directions as to the details of the work and the manner of doing it, * * *.' 57 C.J.S., Master and Servant, § 566, pp. 287 and 288." Decisions are cited, and two leading cases are discussed, Standard Oil Co. v. Anderson, 212 U.S. 215, 29 S.Ct. 252, 53 L. Ed. 480, and Driscoll v. Towle, 181 Mass. 416, 63 N.E. 922, which "illustrate the necessity of discriminating between acts of the hirer which denote authoritative control over the servant, as distinguished from mere suggestions in respect to details which amount to no more than incidental or necessary co-operation, such as pointing out the work to be performed." (Our italics)
In Jackson v. Joyner, 236 N.C. 259, 72 S.E.2d 589, the decision was based upon the rule that "where a servant has two masters, a general and special one, the latter, if having the power of immediate direction and control, is the one responsible for the servant's negligence." (Our italics) The evidence was held sufficient to support a finding that a surgeon was liable for the negligence of a nurse, a general employee of the hospital, while acting under the immediate direction and control of the surgeon during the performance of an operation. It was stated by Johnson, J.: "The power of control is the test of liability under the doctrine of respondeat superior."
In Lassiter v. Cline, 222 N.C. 271, 22 S.E.2d 558, and in Harris v. White Construction Co., 240 N.C. 556, 82 S.E.2d 689, the evidence was held sufficient to support a finding that defendant was liable under the doctrine of respondeat superior for the negligence of the owner-operator of a truck engaged in hauling asphalt for the defendant at a stated price per ton.
In Jones v. Aircraft Co., 251 N.C. 832, 834, 112 S.E.2d 257, 259, the opinion states, incident to a consideration of the exception of defendant Douglas to the court's refusal of nonsuit, that there was evidence sufficient to permit but not to compel a jury to find, inter alia, that "Jones, when he left Charlotte Equipment Company with the crane to work for Boyd & Goforth, became, for the period so employed, the servant of Boyd & Goforth. Jackson v. Joyner, 236 N.C. 259, 72 S.E.2d 589." However, for the reasons stated in Jones v. Aircraft Co., 253 N.C. 482, 117 S.E.2d 496, the quoted statement was not the basis of decision on first appeal.
In Griffin v. Blankenship, 248 N.C. 81, 102 S.E.2d 451, the defendant had furnished a bulldozer and an operator for $10.00 an hour. This Court held the evidence insufficient to establish actionable negligence on the part of the operator. Hence, it was unnecessary to determine whether the defendant would be liable if the actionable negligence of the operator of the bulldozer had been established.
"Though well established, the loanedservant principle has proved troublesome in its application to individual fact situations. *617 The criteria for determining when a worker becomes a loaned servant are not precise; as a result, the state of the law on this subject is chaotic. Respectable authority for almost any position can be found, for even within a single jurisdiction the decisions are in conflict." Nepstad v. Lambert, supra, and decisions and articles cited therein. 57 C.J.S. Master and Servant, § 566; 35 Am.Jur., Master and Servant § 541; Annotation: "Liability under respondeat superior doctrine for acts of operator furnished with leased machine or motor vehicle," 17 A.L.R.2d 1388.
In the Restatement, Agency § 227, this appears:
"§ 227. Servant Lent to Another Master.
"A servant directed or permitted by his master to perform services for another may become the servant of such other in performing the services. He may become the other's servant as to some acts and not as to others.
"Comment:
"a. Service in relation to a specific act. Whether or not the person lent or rented becomes the servant of the one whose immediate purposes he serves depends in general upon the factors stated in § 220(2). Starting with a relation of servant to one, he can become the servant of another only if there are the same elements in his relation to the other as would constitute him a servant of the other were he not originally the servant of the first. Since the question of liability is always raised because of some specific act done, the important question is not whether or not he remains the servant of the general employer as to matters generally, but whether or not, as to the act in question, he is acting in the business of and under the direction of one or the other. It is not conclusive that in practice he would be likely to obey the directions of the general employer in case of conflict of orders. The question is as to whether it is understood between him and his employers that he is to remain in the allegiance of the first as to a specific act, or is to be employed in the business of and subject to the direction of the temporary employer as to the details of such act. This is a question of fact in each case.
"b. Inference that original service continues. In the absence of evidence to the contrary, there is an inference that the actor remains in his general employment so long as, by the service rendered another, he is performing the business entrusted to him by the general employer. There is no inference that because the general employer has permitted a division of control, he has surrendered it.
"c. Factors to be considered. A continuation of the general employment is indicated by the facts that the general employer may at any time substitute another servant, that the time of employment is short, and that the lent servant has the skill of a specialist.
"A continuance of the general employment is also indicated in the operation of a machine where the general employer rents the machine and a servant to operate it, particularly if the instrumentality is of considerable value. Normally, the general employer expects the employee to protect his interests in the use of the instrumentality and these may be divergent from the interests of the temporary employer. If the servant is expected only to give results called for by the temporary employer and to use the instrumentality as the servant would expect his general employer would desire, the original service continues. Upon this question, the fact that the general employer is in the business of renting machines and men is relevant, since in such case there is more likely to be an intent to retain control over the instrumentality. A person who is not in such business and who, gratuitously or not, as a matter not within his general business enterprise permits his servant and instrumentality to assist another, is more apt to intend to surrender control."
In our view, this statement correctly sets forth the pertinent general principles *618 and appears to be gaining widespread approval.
The subject, "Lent Employees and Dual Employment," is discussed fully in Larson, Workmen's Compensation Law, § 48.00. It is there stated: "When a general employer lends an employee to a special employer, the special employer becomes liable for workmen's compensation only if (a) The employee has made a contract of hire, express or implied, with the special employer; (b) The work being done is essentially that of the special employer; and (c) The special employer has the right to control the details of the work."
In discussing "Transfer of Right of Control" (§ 48.30), the author states: "The factor that seems to play the largest part in lent-employee cases is that of furnishing heavy equipment. Many cases have found continuing liability in the general employer when he furnishes operators together with road equipment, excavating equipment, steam and truck shovels, trucks, air drills, air riveters and barges. Although there are contra cases, the majority of the decisions have been influenced by the arguments both that the general employer would naturally reserve the control necessary to ensure that his equipment is properly used, and that a substantial part of any such operator's duties would consist of the continuing duty of maintenance of the equipment." In this connection, see Insurors Indemnity & Insurance Co. v. Pridgen, 148 Tex. 219, 223 S.W.2d 217, involving the rental of a "fully operated" dragline, in which it is held that the control of the machine, not the determination of what is to be done, is the decisive factor. See also, Goodwin v. Wilhelm Steel Construction Co. (Tex. Civ.App.), 311 S.W.2d 510.
True, whether Parrish, if injured, would be entitled to compensation from Bennett and his insurance carrier, if any, or from Reynolds and its insurance carrier, if any, is not presented. However, the legal principles applicable in such case and in the present case would seem to bear close resemblance.
In Mature v. Angelo, 373 Pa. 593, 97 A.2d 59, a closely analogous factual situation was considered. Based on decisions cited, including Standard Oil Co. v. Anderson, supra, and in accord with Restatement, Agency § 227, Stern, C.J., for the Supreme Court of Pennsylvania, stated "(t)he law governing tort liability arising from the negligence of a `borrowed' employee" as follows:
"1. One who is in the general employ of another may, with respect to certain work, be transferred to the service of a third person in such a way that he becomes, for the time being and in the particular service which he is engaged to perform, an employe of that person. (citations)
"2. The crucial test in determining whether a servant furnished by one person to another becomes the employe of the person to whom he is loaned is whether he passes under the latter's right of control with regard not only to the work to be done but also to the manner of performing it. (citations)
"3. A servant is the employe of the person who has the right of controlling the manner of his performance of the work, irrespective of whether he actually exercises that control or not. (citations)
"4. Where one is engaged in the business of renting out trucks, automobiles, cranes, or any other machine, and furnishes a driver or operator as part of the hiring, there is a factual presumption that the operator remains in the employ of his original master, and, unless that presumption is overcome by evidence that the borrowing employer in fact assumes control of the employe's manner of performing the work, the servant remains in the service of his original employer. (citations)
"5. Facts which indicate that the servant remains the employe of his original master are, among others, that the latter has the *619 right to select the employe to be loaned and to discharge him at any time and send another in his place, that the lent servant has the skill of a technician or specialist which the performance of the work requires, that the hiring is at a rate by the day or hour, and that the employment is for no definite period. (citations)
"6. The mere fact that the person to whom a machine and its operator are supplied points out to the operator from time to time the work to be done and the place where it is to be performed does not in any way militate against the continuance of the relation of employe and employer between the operator and his original master. (citations)"
Nothing in the written contract suggests that Bennett agreed to surrender or that Reynolds agreed to assume control of the Unit Backhoe or of the operator. Indeed, the provision that Bennett was to provide sufficient public liability and property damage insurance to protect Reynolds against any and all claims for damage "in connection with the use of said equipment" would seem to negative any idea that it was intended that Reynolds should assume any control whatsoever as to the manner in which the Unit Backhoe was to be operated.
Reynolds had no right to discharge Parrish. If displeased by the conduct of Parrish, the sole remedy of Reynolds was to terminate its relationship with Bennett or to require Bennett to provide a different operator.
Without repeating the evidential facts set forth above, it is sufficient to say there is evidence tending to show, in the language of Mature v. Angelo, supra, "that this is an ordinary, typical case of the renting of a machine with an operator specially skilled for the purpose from one who is in the business of renting out such machines and operators, where neither the person renting such machine and operator, nor his own employes, are competent to run such a machine and merely direct the operator concerning the work to be done,not the manner of performing it."
In Nepstad v. Lambert, supra, it appeared conclusively (as stated in syllabus by the Court) "that the special employer alone had such right of control over the act of the servant which negligently caused plaintiff's injury" and that the special employer and not the general employer was liable therefor under the doctrine of respondeat superior. There is no conflict between the general legal principles stated in the opinion of Christianson, J., and those set forth in Restatement, Agency § 227. The basis of decision, factual in nature, is stated as follows: "The application of these principles to the instant case compels the conclusion that Pasma, the crane operator, was under the detailed authoritative control of the Arnold company (plaintiff's employer) exclusively with respect to the act which caused the injury. Every movement of the crane while it was being used on the job was directed through hand signals by an Arnold company employe. Signals were given indicating when and how far to swing the boom of the crane, when to stop the movement, when and how far to raise or lower the boom, and when and how far to slacken or tighten the hoisting cable. Without these signals, Pasma lacked the knowledge or authority to make a move, because only Morris, the Arnold company's steel foreman, with the aid of his blueprints, knew the pattern and progress the work was to take. More detailed control can hardly be conceived. The crane operator was virtually an automatic eye which caused the machinery of the crane to respond to signals given by the Arnold company's employes."
Too, a sound distinction may exist when the operator inflicts the damage complained of by doing what the lessee directs him to do. Thus, the lessee of a backhoe and operator was held liable to the adjoining landowner when the operator as directed by the lessee removed a boundary wall. Van Gorder v. Eastchester Estates, 207 Misc. 335, 137 N.Y.S.2d 789.
*620 Applying the legal principles stated above, the conclusion reached is that plaintiff's evidence does not disclose affirmatively that Parrish, at the time Weaver was fatally injured, was conducting the business of Reynolds within the meaning of G.S. § 97-9. Moreover, the evidence, when considered in the light most favorable to plaintiff, was sufficient to support a finding that Parrish, on the occasion of Weaver's fatal injury, was operating Bennett's Unit Backhoe in the course of and within the scope of his employment by Bennett.
For the reasons stated, the judgment of involuntary nonsuit is reversed.
Reversed.
