RE MAX OF NEW JERSEY INC v. WAUSAU INSURANCE COMPANIES (1998)

Superior Court of New Jersey,Appellate Division.

RE/MAX OF NEW JERSEY, INC., a Corporation of the State of New Jersey; Re/Max Results Real Estate, Inc.; Laden Corp. t/a Re/Max Realty Experts, Re/Max Future Real Estate Professionals, Inc., O'Herrera, Inc., t/a Villa Realtors, Plaintiffs-Appellants, v. WAUSAU INSURANCE COMPANIES; Aetna Life & Casualty and New Jersey Re-Insurance Company and Pennsylvania National Insurance Company, Defendants-Respondents.
The TRAVELERS INSURANCE CO., Plaintiff-Respondent, v. COMPREHENSIVE REALTY CO., t/a Re/Max Tri County, Defendant-Appellant.1

Decided: December 08, 1998

Before Judges HAVEY, SKILLMAN and PAUl G. LEVY.

Mark G. Schwartz, West Atlantic City, for plaintiffs-appellants (Westmoreland, Vesper & Schwartz, attorneys; Mr. Schwartz and Katherine M. Morris, on the brief). Robert J. Kelly, Morristown, for defendant-respondent New Jersey Re-Insurance Company (McElroy, Deutsch & Mulvaney, attorneys; Mr. Kelly and John T. Coyne, on the brief). Jonathan M. Kuller, Woodbridge, for defendants-respondents Aetna Life & Casualty, the Travelers Insurance Company and Employers Insurance of Wausau (L'Abbate, Balkan, Colvita & Contini, Short Hills, attorneys; Mr. Kuller, on the brief). James E. Patterson, Iselin, for amicus curiae New Jersey Association of Realtors (Greenbaum, Rose, Smith, Ravin, Davis & Himmel, attorneys; Mr. Patterson, on the brief). Defendant-respondent, Pennsylvania National Insurance Company did not file a brief.

The opinion of the court was delivered by

Judge Gibson held that plaintiffs were liable for payment of premiums for workers' compensation insurance coverage benefitting its real estate sales agents. Re/Max of New Jersey, Inc. v. Wausau Ins. Cos., 304 N.J.Super. 59, 697 A.2d 977 (Ch.Div.1997). He applied the “relative nature of the work” test, as explained in Kertesz v. Korsh, 296 N.J.Super. 146, 154, 686 A.2d 368 (App.Div.1996), and held that the Re/Max agents are economically dependent on the Re/Max broker, lacking “the ability to act independently.” In the course of his opinion, Judge Gibson clearly demonstrated the economic and functional dependence of the sales agents on Re/Max, “mak[ing] any further claim of independence difficult to sustain.” Re/Max, supra, 304 N.J.Super. at 68-69, 697 A.2d 977. We affirm for the reasons stated therein.

In doing so, we reject plaintiffs' contention that the sales agents are independent contractors pursuant to the dictates of MacDougall v. Weichert, 144 N.J. 380, 677 A.2d 162 (1996). MacDougall was not concerned with workers' compensation issues; instead it dealt with a real estate agent's claim for wrongful discharge under Pierce v. Ortho Pharm. Corp., 84 N.J. 58, 417 A.2d 505 (1980). In MacDougall, Justice Handler analyzed the differences between an employee and an independent contractor in terms of control. There was no reliance on the “relative nature of the work test” under either Kertesz v. Korsh, supra, 296 N.J.Super. at 154, 686 A.2d 368, or Marcus v. Eastern Agric. Ass'n, Inc., 58 N.J.Super. 584, 603, 157 A.2d 3 (App.Div.1959)(Conford, J.A.D., dissenting); rev'd on dissent 32 N.J. 460, 161 A.2d 247 (1960). We deem these two cases more appropriate than MacDougall in resolving the issue presented here.

Affirmed.

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