FROHLICK CRANE SERVICE

OSHRC Docket No. 890

Occupational Safety and Health Review Commission

June 20, 1974

[*1]

Before MORAN, Chairman; VAN NAMEE and CLEARY, Commissioners

OPINIONBY: CLEARY

OPINION:

CLEARY, COMMISSIONER: On November 27, 1972, Administrative Law Judge John J. Morris issued a decision and order in this case that, among other things, affirmed a serious citation issued to respondent and assessed a penalty therefor.

Thereafter, on December 8, pursuant to section 12(j) of the Occupational Safety and Health Act of 1970 (29 U.S.C. 651 et seq., hereinafter referred to as "the Act"), review of the Judge's decision and order was directed. Submissions were invited on the following issues. First, whether the operator of the leased construction equipment who was paid by the lessor was an employee of the lessee within the meaning of the Occupational Safety and Health Act of 1970 while operating equipment on a construction site where such operations are under the general direction and control of the lessee. n1 Second, whether under the particular circumstances of this case, the Judge erroneously dismissed the citations set forth in paragraphs VIII, IX, X, XI, XII, XIII, and XIV of his decision. These are items 2, 4, 5, 6, 10, 11, and 13 of the citation for non-serious violations.

- - - [*2] - - - - - - - - - - - - - - -Footnotes- - - - - - - - - - - - - - - - - -

n1 What is critical here, however, is whether the operator remains an employee of the lessor for purposes of the Act.

- - - - - - - - - - - - - - - - -End Footnotes- - - - - - - - - - - - - - - - -

Having reviewed the record the Commission adopts the Judge's decision to the extent that it is consistent with this opinion.

Respondent is engaged in the business of selling, servicing, and leasing cranes. Respondent had leased the crane, with an operator, to U.S. Elevator Corporation, a subcontractor at a construction site, for use in placing elevator parts into the partially completed structure. As a result of an accident on April 14, 1972, in which a 15 ton Pettibone hydrocrane, owned by respondent and operated by a man on its payroll, made contact with an uninsulated 7,620 volt electric power line resulting in the electrocution of a laborer (not employed by respondent), an inspection was made by a compliance officer for occupational safety and health. Following the inspection, the Secretary of Labor issued two citations to respondent.

The lessee of the crane, U.S. Elevator Corporation, did [*3] not consider the crane operator to be its employee. The lessee had no choice as to the operator. It was required to use the operator provided by the respondent. The operator was paid by the respondent. The lessee was generally responsible for the movement of the crane and completion of its job. But agents of the respondent had on occasion inspected jobsites where its rented cranes were located and had assumed control over the operations of the cranes when they determined that hazards existed involving safety or danger to a crane. The crane operators used by the respondent came from a hiring hall and were assigned in numerical order. Respondent as lessor supplied both the crane and the operator. The fee for the crane rental included the operator's time.

The lease contract contained an indemnification clause whereunder the lessee agreed that the equipment and lessor's employees were under the lessee's exclusive supervision and control, and further agreed to indemnify and save harmless the lessor from all claims arising from the lessee's operation.

Respondent was issued the two citations and notification of proposed penalties on May 2, 1972. One citation for serious [*4] violation alleged that respondent had failed to comply with the standard published at 29 CFR 1918.550(a)(15)(i) n2 and proposed a penalty of $500. The other citation alleged that respondent had committed 13 non-serious violations of the Act. The following penalties were proposed for these violations; Item No. 3, $30; Items No. 1, 7, 8, 9, and 12, $25 each. No penalty was proposed for items 2, 4, 5, 6, 10, 11, and 13.

- - - - - - - - - - - - - - - - - -Footnotes- - - - - - - - - - - - - - - - - -

n2 The standard was subsequently redesignated at 29 CFR 1926.550(a)(15)(i), and requires a minimum clearance of 10 feet between energized, uninsulated power lines rated 50 kv. or below and any part of a crane.

- - - - - - - - - - - - - - - - -End Footnotes- - - - - - - - - - - - - - - - -

The Judge properly concluded that the respondent was not relieved of its statutory responsibilities as an employer to provide a safe workplace for the employee involved (the crane operator). Although the crane operator may be considered a "borrowed employee" of the lessee between the parties, the lessor did actually retain some control over the crane's operator for safety purposes. Moreover, [*5] the indemnification clause contained in the lease contract has no significance here, even though it may have significance in a private action for damages. Cf. REA Express Co. v. Brennan & O.S.H.R.C., (No. 73-1468, April 18, 1974).

We think the Judge went too far, however, in taking up how the employer should comply with section 1926.550(a)(4). But since he raised the subject, we note that we see no reason why hand signals could not be provided by the lessee. n3 Cf. Southeast Contractors, Inc. No. 1445 (May 8, 1974).

- - - - - - - - - - - - - - - - - -Footnotes- - - - - - - - - - - - - - - - - -

n3 The lessee has an independent duty to comply with the standard in affording protection to his employees. Indeed, it was the lessee's policy to assist the operator when his view was obscured.

- - - - - - - - - - - - - - - - -End Footnotes- - - - - - - - - - - - - - - - -

In our view the Administrative Law Judge improperly vacated items 2, 4, 5, 6, 10, 11, and 13 of the citation for non-serious violations concerning which no penalties had been proposed by the Secretary. The respondent's contest was facially addressed to proposed penalties. In light of [*6] the respondent's answer, his contest has been read to include citations concerning which penalties have been assessed. In doing so, we have also taken into consideration the fact that the respondent, a layman, drafted his own contest. But, we think the Judge goes too far in saying that there was a contest concerning the items for which no monetary penalty was assessed. This is in effect saying that "night is day" or that "black is white," and exceeds the bounds of the Commission's wide discretion. Brennan v. O.S.H.R.C. & Bill Echol's Trucking Co., 487 F.2d 230, 234 & n. 6 (5th Cir. 1973). With respect to penalties, section 10(a) of the Act is concerned with monetary penalties rather than something less tangible. This is clear from the multiple use of the term "assessment." Accordingly, it is ORDERED:

(1) The Judge's decision and order concerning the serious violation and penalty are affirmed.

(2) Items 2, 4, 5, 6, 10, 11, and 13 of the citation for non-serious violation are affirmed. n4

- - - - - - - - - - - - - - - - - -Footnotes- - - - - - - - - - - - - - - - - -

n4 Respondent's motion to withdraw its notice of contest as to items 1, 3, 7, 8, 9 and 12 was granted by the Administrative Law Judge.

[*7]

- - - - - - - - - - - - - - - - -End Footnotes- - - - - - - - - - - - - - - - -

CONCURBY: VAN NAMEE

CONCUR:

VAN NAMEE, COMMISSIONER, concurring: I concur in Commissioner Cleary's disposition of this case. Judge Morris ruled correctly on the employment issue raised in the case. Accordingly, I view Commissioner Cleary's statements concerning the "borrowed employee" doctrine and duties of the lessee to be obiter dictum, and I do not join therein.

DISSENTBY: MORAN

DISSENT:

MORAN, CHAIRMAN, dissenting: The respondent in this case clearly and specifically limited his contest to the proposed penalties. It did not contest the citation or any item thereof. Consequently, the citation became an enforceable order by operation of law some two years ago pursuant to 29 U.S.C. 659(a).

The procedural situation in this case is virtually identical to the one involved in the Bill Echols case, supra, where the court stated:

Because the letter requested that the penalty be abated, and because the regulation requires that a complainant specify whether it is contesting the citation or the penalty, 29 C.F.R. 1903.17 . . ., the inescapable conclusion is that the letter could only have been a [*8] notice of contest of the penalty . . . [emphasis supplied by the court].

Furthermore, the record of trial does not convince me that justice requires any modification of this rule simply because respondent was not represented by counsel.

Respondent did make a convincing case, however, for modification of the amount of the proposed penalty. n5 Although its employee was involved in the failure to observe the safety regulations, that employee was carrying out the work of the U.S. Elevator Company at the time. The record shows no culpability on respondent and I fail to see how the penalty assessed herein can be justified.

- - - - - - - - - - - - - - - - - -Footnotes- - - - - - - - - - - - - - - - - -

n5 The phrasing of this sentence should not be interpreted as a reflection of my views on the burden of proof or the status to be given a penalty proposal when contested. It is complainant's burden to establish that the amount of its penalty proposal is warranted.

- - - - - - - - - - - - - - - - -End Footnotes- - - - - - - - - - - - - - - - -

[The Judge's decision referred to herein follows]

MORRIS, JUDGE, OSAHRC: This is a proceeding pursuant to Section 10 of the [*9] Occupational Safety and Health Act of 1970 (29 USC 651, et seq., hereafter called the Act) contesting certain Citations issued by the Complainant against the Respondent under the authority vested in Complainant by Section 9(a) of that Act. The Citations allege that as the result of the inspection of work place under the ownership, operation or control of the Respondent, located in Denver, Colorado, and described as follows: Place of business, 1595 South Acoma Street, Denver, Colorado; and Construction Project, 3703-3705 West 68th Street, Westminster, Colorado. The Respondent has violated Section 5(a)(2) of the Act by failing to comply with certain occupational safety and health standards promulgated by the Secretary of Labor pursuant to Section 6 thereof.

The Citations which were all issued May 2, 1972 allege that the Violations result from failure of Respondent to comply with standards promulgated by the Secretary by publication in the Federal Register and subsequent recodification in the Code of Federal Regulations as hereinafter described.

I

The description of the alleged violation contained in said Citation for serious violation states as follows:

A 15 ton Pettibone [*10] hydrocrane, license tag number AA 1194 (Colorado) was operated within the minimum clearance of a 7,620 volt electric power line. Contact was made that resulted in an electrocution.

The citation alleges that the standard violated was 29 CFR 1518.550(a)(15)(i).

The standard as promulgated by the Secretary provides as follows:

1518.550 -- Cranes and derricks. (a) General requirements. (1) The employer shall comply with the manufacturer's specifications and limitations applicable to the operation of any and all cranes and derricks. Where manufacturer's specification are not available, the limitations assigned to the equipment shall be based on the determinations of a qualified engineer competent in this field and such determinations will be appropriately documented and recorded. Attachments used with cranes shall not exceed the capacity, rating or scope recommended by the manufacturer.

1518.550(a)(15) Except where electrical distribution and transmission lines have been de-energized and visibly grounded at point of work or where insulating barriers, not a part of or an attachment to the equipment or machinery, have been erected to prevent physical contact with the lines, [*11] equipment or machines shall be operated proximate to power lines only in accordance with the following;

(i) For lines rated 50 kV, or below, minimum clearance between the lines and any part of the crane or load shall be 10 feet;

Pursuant to the enforcement procedure set forth in Section 10(a) of the Act, the Respondent was notified by letter dated May 2, 1972 from J. J. Williams, Area Director of the Denver, Colorado area, Occupational Safety and Health Administration of the U.S. Department of Labor; the Area Director proposed to assess a penalty for the violation alleged in this paragraph in the amount of $500.

II

The description of the alleged violation contained in the Citation (Citation 2, Item 1) for other than serious violations states as follows:

A carbon dioxide, dry chemical or equivalent fire extinguisher was not provided for the cabs of the cranes observed in the yard.

The citation alleges that the standard violated was 29 CFR 1910.180(i)(5).

The standard as promulgated by the Secretary provides as follows:

Section 1910.180 Crawler locomotive and truck cranes. (i) Other requirements -- (5) Fire extinguishers. (i) A carbon dioxide, dry chemical, or equivalent [*12] fire extinguisher shall be kept in the cab or vicinity of the crane.

Pursuant to the enforcement procedure as set forth with particularity in paragraph I hereto, the Area Director has proposed to assess a penalty for the violation alleged in this paragraph in the amount of $25.00.

III

The description of the alleged violation contained in the Citation (Citation 2, Item 3) for other than serious violations states as follows:

Storage areas were not kept free from accumulated materials that constitute hazards from tripping or pest harborage in the yard and around the outside of the maintenance shop doors.

The standard allegedly violated was 29 CFR 1910.176(c).

The standard promulgated by the Secretary provides as follows:

Section 1910.176 Handling materials -- general. (c) Housekeeping. Storage areas shall be kept free from accumulation of materials that constitute hazards from tripping, fire, explosion, or pest harborage. Vegetation control will be exercised when necessary.

Pursuant to the enforcement procedure as set forth with particularity in paragraph I hereto, the Area Director proposed to assess a penalty for the violation alleged in this paragraph in the amount [*13] of $30.00.

IV

The description of the alleged violation contained in the Citation (Citation 2, Item 7) for other than serious violations states as follows:

The electrical service receptacles were the two plot type on the west wall of the stop with no provisions for grounding equipment or tools. The pole light west of the shops next to the Diesel pumps were not wired according to the National Electrical Code. The fan at the rear of the shop had no plug on the wire to connect it to a receptacle.

The standard allegedly violated was 29 CFR 1910.309(b), as references the National Electrical Code.

The standard promulgated by the Secretary provides as follows:

Section 1910.309 National Electrical Code. All electrical installation and utilization equipment shall be installed and maintained in accordance with the provisions of the National Electrical Code NFPA 70-1968 (ANSI C-1-1968).

Pursuant to the enforcement procedure as set forth with particularity in paragraph I hereto, the Area Director proposed to assess a penalty for the violation alleged in this paragraph in the amount of $25.00.

V

The description of the alleged violation contained in the Citation (Citation 2, [*14] Item 8) for other than serious violations states as follows:

Toilet and lavatory were not maintained in a sanitary condition. Individual hand towels of cloth or paper were not provided, and receptacles maintained for their disposal.

The standard allegedly violated was 29 CFR 1910.141(d)(1) and (3).

The standard promulgated by the Secretary provides as follows:

Section 1910.141 Sanitation. (d) Washing facilities. (1) General. Adequate facilities for maintaining personal cleanliness shall be provided in every place of employment. These shall be convenient for the employees for whom they are provided and shall be maintained in a sanitary condition.

(3) Towels. Individual hand towels, or sections thereof, of cloth or paper, shall be provided and proper receptacles or other sanitary means maintained for the disposal of used towels. The provision of a towel for general or common use is prohibited.

Pursuant to the enforcement procedure as set forth with particularity in paragraph I hereto, the Area Director proposed to assess a penalty for the violation alleged in this paragraph in the amount of $25.00.

VI

The description of the alleged violation contained in the Citation [*15] (Citation 2, Item 9) for other than serious violations states as follows:

Spraying area was not provided with adequate mechanical ventilation to remove flammable vapors, mists or powders to a safe disposition. Further, the doors to the furnace room were open, thereby exposing spraying area to open flame and spark producing equipment in the rear of the shop and within 20 feet of the spray operation.

The standards allegedly violated with 29 CFR 1910.107(d)(2) and (9), as to the allegations in the first paragraph hereof; and 29 CFR 1910.107(c)(2) as to the second paragraph hereof.

The standards promulgated by the Secretary provide as follows:

Section 1910.107 Spray finishing using flammable and combustible materials. (d) Ventilation. (2) General. All spraying areas shall be provided with mechanical ventilation adequate to remove flammable vapors, mists, or powders to a safe location and to confine and control combustible residues so that life or property is not endangered. Mechanical ventilation shall be kept in operation at all times while spraying operations are being conducted and for a sufficient time thereafter to allow vapors from drying coated articles and drying [*16] finishing material residue to be exhausted.

(9) Air exhaust. Air exhaust from spray operations shall not be directed so that it will contaminate makeup air being introduced into the spraying area or other ventilating intakes, nor directed so as to create a nuisance. Air exhausted from spray operations shall not be recirculated.

Pursuant to the enforcement procedure as set forth with particularity in paragraph I hereto, the Area Director proposed to assess a penalty for the violation alleged in this paragraph in the amount of $25.00.

VII

The description of the alleged violation contained in the Citation (Citation 2, Item 12) for other than serious violations states as follows:

There were no "No Smoking" signs over the gasoline pumps where flammable vapors caused by a hazard to employees at the West end of the maintenance shop and the southwest corner of the office building.

The standard allegedly violated was 29 CFR 1910.106(f)(6). The standard promulgated by the Secretary provides as follows:

Section 1910.106 Flammable and combustible liquids. Subsection(f)(6) Sourcs of ignition. Class I liquids shall not be handled, drawn, or dispensed where flammable vapors [*17] may reach a source of ignition. Smoking shall be prohibited except in designated localities. "No Smoking" signs shall be conspicuously posted where hazard from flammable liquid vapors is normally present.

Pursuant to the enforcement procedure as set forth with particularity in paragraph I hereto, the Area Director proposed to assess a penalty for the violation alleged in this paragraph in the amount of $25.00.

VIII

The description of the alleged violation contained in the Citation (Citation 2, Item 2) for other than serious violations states as follows:

The non-current carrying parts of the following electrical tools were not grounded with a three or more wire system: warmer cord from the fifteen ton hydro crane (prong broken off). Floor stand drill press in the maintenance shop at the west wall. Disc sander in the maintenance shop on the bench by the south door. Delta mitre saw under the wash bowl in the toilet. Blower over the furnace room in the painting area, black and decker 3/8 in. drill in the shop, on the bench by the south door. Soft drink dispensing machine in the office building.

The standard allegedly violated was 29 CFR 1910.309(a) as reference this section [*18] 250.45(a)(b)(c)(d) National Electrical Code.

The standard promulgated by the Secretary provides as follows: 1910.309 National Electrical Code. All electrical installations and utilization equipment shall be installed and maintained in accordance with the provisions of the National Electrical Code NFPA 70-1968 (ANSI c-1-1968).

Pursuant to the enforcement procedure as set forth with particularity in paragraph 1 hereof, the Area Director proposed to assess no monetary penalty for the violation alleged in this paragraph.

The description of the alleged violation contained in the Citation (Citation 2, Item 4) for other than serious violations states as follows:

The bench grinder in the shop by the south door on the west wall had no side shields, no peripheral protecting member and no tool rest.

The standard allegedly violated was 29 CFR 1910.215(a)2 and 4(b)(9).

The standard as promulgated by the Secretary provides as follows:

Abrasive wheel machinery.

General requirements -- (1) Machine guarding. Abrasive wheels shall be used only on machines provided with safety guards as defined in the following paragraphs of this section, except: (i) Wheels used for internal [*19] work while within the work being ground;

(ii) Mounted wheels used in portable operations 2 inches and smaller in diameter; and

(iii) Types 16, 17, 18, 18R, and 18 cones, plugs, and threaded hole pot balls where the work offers protection.

Guard design. The safety guard shall cover the spindle end, nut, and flange projections. The safety guard shall be mounted so as to maintain proper alignment with the wheel, and the strength of the fastenings shall exceed the strength of the guard, except:

(i) Safety guards on all operations where the work provides a suitable measure of protection to the operator, may be so constructed that the spindle end, nut, and outer flange are exposed; and where the nature of the work is such as to entirely cover the side of the wheel, the side covers of the guard may be omitted; and

(ii) The spindle end, nut, and outer flange may be exposed on machines designed as portable saws.

(3) Flanges. Grinding machines shall be equipped with flanges in accordance with paragraph (c) of this section.

(4) Work rests. On offhand grinding machines, work rests shall be used to support the work. They shall be of rigid construction and designed to be adjustable [*20] to compensate for wheel wear. Work rests shall be kept adjusted closely to the wheel with a maximum opening of one-eighth inch to prevent the work from being jammed between the wheel and the rest, which may cause wheel breakage. The work rest shall be securely clamped after each adjustment. The adjustment shall not be made with the wheel in motion.

Guarding of abrasive wheel machinery. Exposure adjustment. Safety guards of the types described in subparagraphs (3) and (4) of this paragraph, where the operator stands in front of the opening, shall be constructed so that the peripheral protecting member can be adjusted to the constantly decreasing diameter of the wheel. The maximum angular exposure above the horizontal plane of the wheel spindle as specified in subparagraphs (3) and (4) of this paragraph shall never be exceeded, and the distance between the wheel periphery and the adjustable tongue or the end of the peripheral member at the top shall never exceed one-fourth inch. (See Figures 0-18, 0-19, 0-20, 0-21, 0-22, and 0-23.)

Pursuant to the enforcement procedures as set forthwith particularity in paragraph I, hereof, the Area Director proposed to assess no monetary penalty [*21] for the violation alleged in this paragraph.

X

The description of the alleged violation contained in the Citation (Citation 2, Item 5) for other than serious violations states as follows:

The drill press at the west wall of the maintenance shop, in a fixed located, was not as securely anchored to prevent vibration walking or moving.

The standard allegedly violated was 29 CFR 1910.212(b).

The standard as promulgated by the Secretary provides as follows:

1910.212: General Requirements for all machines. (b) Machines designated for a fixed location shall be securely anchored to prevent walking or moving.

Pursuant to the enforcement procedure as set forth with particularity in paragraph I hereof, the Area Director proposed to assess no monetary penalty for the violation alleged in this paragraph.

XI

The description of the alleged violation contained in the Citation (Citation 2, Item 6) for other than serious violations states as follows:

The electric fan at the rear of the maintenance shop was not guarded with a guard that had openings no larger than one half inch and the periphery of the blades was less than seven feet above the floor.

The standard allegedly violated [*22] was 29 CFR 1910.212(a)(5).

1910.212 General requirements for all machines.

(a) Machine guarding -- (1) Types of guarding. One or more methods of machine guarding shall be provided to protect the operator and other employees in the machine area from hazards such as those created by point of operation, ingoing nip points, rotating parts, flying chips and sparks. Examples of guarding methods are -- barrier guards, two-hand tripping devies, electronic safety devices, etc.

(5) Exposure of blades. When the periphery of the blades of a fan is less than seven (7) feet above the floor or working level, the blades shall be guarded. The guard shall have openings no larger than one half (1/2) inch.

Pursuant to the enforcement procedures set forth with particularity in paragraph I hereof, the Area Director proposed to assess no monetary penalty for the violation alleged in this paragraph.

XII

The description of the alleged violation contained in the Citation (Citation 2, Item 10) for other than serious violations states as follows:

The belts and pullies of the compressor in the maintenance and paint shop were not guarded as required.

The standard allegedly violated was [*23] 29 CFR 1910.212(a)(1).

The standard as promulgated by the Secretary provides as follows:

1910.212 General requirements for all machines.

(a) Machine guarding -- (1) Types of guarding. One or more methods of machine guarding shall be provided to protect the operator and other employees in the machine area from hazards such as those created by point of operation, ingoing nip points, rotating parts, flying chips and sparks. Examples of guarding methods are -- barrier guards, two-hand tripping devices, electronic safety devices, etc.

(5) Exposure of blades. When the periphery of the blades of a fan is less than seven (7) feet above the floor or working level, the blades shall be guarded. The guard shall have openings no larger than one half (1/2) inch.

Pursuant to the enforcement procedure as set forth with particularity in paragraph I hereof, the Area Director proposed to assess no monetary penalty for the violation alleged in this paragraph.

XIII

The description of the alleged violation contained in the Citation (Citation 2, Item 11) for other than serious violations states as follows:

Fire extinguishers in the rear of the maintenance shop and the office building [*24] were not mounted so that they would not be obscured from view. Fire extinguisher by the south door of the maintenance was used to hang hoses and a hard hat.

The standard allegedly violated was 29 CFR 1910.157(a)(5)(6).

The standard as promulgated by the Secretary provides as follows:

1910.157 Portable fire extinguishers.

(a) General requirements -- (1) Operable condition. Portable extinguishers shall be maintained in a fully charged and operable condition, and kept in their designated places at all times when they are not being used.

(5) Mounting of extinguishers. Extinguishers shall be installed on the hangers or in the brackets supplied, mounted in cabinets, or set on shelves unless the extinguishers are of the wheeled type.

(6) Height of mounting. Extinguishers having a gross weight not exceeding 40 pounds shall be installed so that the top of the extinguisher is not more than 5 feet above the floor. Extinguishers having a gross weight greater than 40 pounds (except wheeled types) shall be so installed that the top of the extinguisher is not more than 3 1/2 feet above the floor.

Pursuant to the enforcement procedure as set forth with particularity in paragraph I hereof, [*25] the Area Director proposed to assess no monetary penalty for the violation alleged in this paragraph.

The description of the alleged violation contained in the Citation (Citation 2, Item 13) for other than serious violations states as follows:

Formica contact cement, a highly inflammable material, was stored next to the furnace room and in the spray area.

The standard allegedly violated with 29 CFR 1910.107(e)(2).

The standard as promulgated by the Secretary provides as follows:

(e) Flammable and combustible liquids -- storage and handling -- (1) Conformance. The storage of flammable or combustible liquids in connection with spraying operations shall conform to the requirements of 1910.106, where applicable.

(2) Quantity. The quantity of flammable or combustible liquids kept in the vicinity of spraying operations shall be the minimum required for operations and should ordinarily not exceed a supply for 1 day or one shift. Bulk storage or portable containers of flammable or combustible liquids shall be in a separate, constructed building detached from other important building or cut off in a standard manner.

Pursuant to the enforcement procedure as set forth with [*26] particularity in paragraph I hereof, the Area Director proposed to assess no monetary penalty for the violation alleged in this paragraph.

After Respondent contested this enforcement action, and a Complaint and an Answer having been filed by the parties, the case came on for hearing in Denver, Colorado on September 14, 1972.

STATEMENT OF JURISDICTION

Section 3 of the Act defines "Commerce" as follows:

(3) the term "Commerce" means trade, traffic, commerce, transportation, or communication among the various States, or between a State and a place outside thereof, or within the District of Columbia, or a possession of the United States (other than the trust territory of the Pacific Islands), or between points in the same State but through a point outside thereof.

Further, "employer" is defined under Section 3 of the Act as follows: (5) The term "employer" means a person engaged in a business effecting Commerce who has employees, but does not include the United States or any state or political subdivision of a state.

The Complainant and Respondent stipulated that Respondent's business affects commerce within the meaning of the Act and therefore Respondent is an employer [*27] within the meaning of the Act (R5); specifically Respondent has cranes which were purchased in other states and put into use; further Respondent sells cranes outside of the state, and further rentals occur in other states (R5-6).

It accordingly follows that the undersigned has jurisdiction to hear and determine this cause upon assignment from the Review Commission.

CITATIONS AND PENALTIES NOT IN ISSUE

Citations and penalties ruled not in issue are in two categories. The first category are those Citations and proposed penalties issued by the Occupational Safety and Health Administration which are more specifically set forth in paragraphs VIII, IX, X, XI, XII, XIII, XIV, (supra).

The above citations and proposed penalties were not preserved in the Complaint filed with the Review Commission. Rule 8a F.R.C.P. requires that a petition state a claim for relief; failure to allege facts creates a presumption that they do not exist. Sun Oil Co. v. Blevins, 20 F. Supp. 901. The function of a pleading is to inform court and parties of the facts in issue so that the Court may declare the law and the parties may know what to meet by their proof. Mitchell v. Wright, 154 [*28] F 2d 924, Certiorari denied, 67 S. Ct. 96 329 U.S. 722, 91 L. Ed., 633. The failure of Complainant to preserve in his Complaint the citations and proposed penalties enumerated in paragraphs VIII through XIV, supra, constitutes an abandonment thereof and the citations should be vacated. We note that in each of the citations enumerated above the Area Director for Complainant proposed to assess no monetary penalty. It is our view that no monetary penalty nevertheless constitutes a penalty in that the affirmation of such a penalty can expose Respondent employer to a later willful violation penalty under Section 17(a) of the Act.

In arriving at the foregoing conclusion we should also rule on the adequacy of Respondent's protest in the instant case. (Commission Document 3). A protest is often an informal letter drafted by a layman and mailed to the Area Director. The notification of proposed penalty (Form OSHA -- 3) merely contains a directive that the Respondent must, within fifteen days notify the Area Director of his intent "to contest the citation or this Notification of Proposed Penalty before the Review Commission." The Act itself gives no particular directive [*29] as to the form required for a protest but we note that the fifteen day requirement is less than the twenty days required to file an answer in a normal civil proceeding under Rule 12(a), F.R.C.P. Inasmuch as no particular form is required and considering the fact that the person drafting the protest is a layman and a certain inexactness to formalities might be anticipated we rule that the protest filed in the instant case by Respondent preserved all issues as to the validity of all citations and the proposed penalties. It is our ruling that unless the person filing the written protest specifically admits a citation and proposed penalty thereon then that citation and proposed penalty is vested in the jurisdiction of the Review Commission for adjudication.

The second category of citations and proposed penalties ruled not in issue are those citations and penalties which are more specifically set forth in paragraphs II, III, IV, V, VI and VII, supra. After commencing the trial Respondent admitted the allegations in the complaint as to said paragraphs, (R 10, 11). The Complainant was further granted leave to amend Item 7 of the complaint (paragraph III, supra ) by striking [*30] the monetary penalty of $30 and inserting in lieu thereof the monetary penalty of $25 (R 11). Respondent requested and was granted leave to file a written motion to withdraw its Notice of Contest as to the citations and nature of proposed penalty set forth in paragraphs II, III (as amended), IV, V, VI and VII. The verified motion for leave to withdraw the Notice of Contest (J 6) as to said paragraphs reflects the following:

1. The violations alleged therein have been abated.

2. Continuing compliance with the provisions of the Occupational Safety and Health Act of 1970, 29 USC 651 is affirmed by Respondent.

3. Respondent further tenders payment of the proposed penalties in the amount of $150 which is the total of the penalties set forth under paragraphs II, III as amended, IV, V, VI and VII of the Complaint.

4. All parties have been notified of Respondent's proposed withdrawal of notice of contest and no objection or other response has been received thereto and a reasonable time has passed.

5. The Complainant consents to Respondent's withdrawal of notice of contest and raises no objection or question regarding Respondent's representations in connection therewith (J7). [*31]

It accordingly follows that Respondent's withdrawal of notice of contest to the citations in paragraphs II, III, as amended, IV, V, VI and VII, supra, issued by the United States Department of Labor, Occupational Safety and Health Administration on May 2, 1972, should be granted and the citations and proposed penalty should be affirmed.

The undersigned makes an expressed determination that an order granting the withdrawal of notice of contest as provided herein is fully consistent with the provisions and purposes of the Act as to the allegations in paragraphs II, III (as amended), IV, V, VI and VII, supra.

LEGAL ISSUES PRESENTED AS TO CONTESTED CITATION

The legal issues are two fold as to the contested citation upon which the case was tried. A statement of the facts is necessary in order to place these issues in their proper perspective:

The Respondent is a Colorado Corporation which was, at the time of the alleged violation engaged in the business of renting and repairing cranes (R6). Respondent has 31 average daily employees (R 8). The alleged violation, set forth in paragraph I, supra, occurred at 3703-3705 W. 68th Street, Westminster, Colorado on April [*32] 13, 1972, at which time Respondent had one employee, Wesley Lindsey at a construction site (R 41-49). Employee Wesley Lindsey was initially employed by the Respondent February 29, 1972, up until the time of the trial was an employee of the Respondent (Complainant's Exhibit 2). The Respondent was the owner and Lindsey was the operator of a 15 ton Pettibone hydrocrane license #AA 1194 (Colorado). This crane was operated on the 13th day of April 1972 within ten feet of a 7,620 volt power line in violation of 29 CFR 1926.550(a)(15)(i). The parties stipulated that there was a violation of the above requirement (R7). The evidence establishes that the crane at the time of the agreed violation had been rented from the Respondent by a third party, the United States Elevator Company. The crane operator Lindsey was paid on an hourly basis by Respondent, and standard deductions were taken from the employees pay check by the Respondent (R 20 Complaint's Exhibit 2). The party renting the crane, U.S. Elevator Company, did not consider the crane operator to be its employee (R 44-45). The renter of the crane had no choice as to the operator and was required to use the operator provided [*33] by the Respondent (R 40-47). In a situation where the operator felt that the suggestions of the person renting the crane were either unsafe or would cause damage the operator would refuse to do it (R 46, 47). Officers or agents from the Respondent have on occasion inspected the jobsites where the cranes were located and have assumed control over the operations of the cranes where they determined hazards existed involving safety or damage to the crane (R 36-37). At the time of the violation the crane was on the jobsite and was not en route from the jobsite to Respondent's yard (R 48). In the instant case Respondent supplied the crane and the operator (R 40-41).

The Respondent's President testified that the contractor on the job (U.S. Elevator Corporation) was responsible for the movement of the crane and the completion of the job (R 26). The crane operators come from the union hall (R 29) being assigned in numerical order under their classifications (R 31). The Respondent's company supplies both the operator and the crane on occasion and at other times just the crane (R 40). The fee for the crane rental included the operators time (R 41). No persons in the employ of the [*34] Respondent were killed or injured as a result of the accident on April 13, 1972, but the parties stipulated that an employee of a third party was killed as a result of such an accident (R 6). Respondent has had no previous violations of laws or regulations effecting the health or safety of employees (R 6).

Respondent's evidence further shows the existence of an agreement entitled "Standard Short Term Crane Rental Agreement" between Respondent and the U.S. Elevator Company for use on the job location in issue. The terms and condition of the described lease agreement are in part as follows:

The lessor hereby leases the equipment described on the reverse side and furnishes operational personnel to the lessee heretofore named subject to the following terms and conditions:

2. Indemnification: Lessee agrees that the equipment and all persons operating such equipment, including lessor's employees, are under lessee's exclusive jurisdiction, supervision and control and agrees to indemnify and save lessor, its employees and agents harmless from all claims or death or injury to persons, including lessors employees, and from all loss, damage or injury to property, including the equipment, [*35] arising in any manner out of lessee's operation. Lessee's duties to indemnify hereunder shall include all cost or expenses arising out of all claims specified herein, including all court and arbitration costs, filings fees, attorneys fees and cost of settlement.

Lessee shall not be required to indemnify lessor for its own negligence, but, lessor's liability for damage caused by the sole negligence of lessor, in changes in employees, hereunder shall be limited to the amount of lessor's liability insurance. Lessee shall not be liable for the negligence of the employee while said equipment is traveling to and from the lessee's jobsite.

3. Competent Operation by Lessee: Lessee agrees to provide competent and experienced personnel to direct the operation of the equipment and further agrees that the standard crane and dereck signals in accordance with American standard B30.2-1943 shall be used to direct the equipment at all times when applicable (Respondent's Exhibit 1).

The field superintendent of the U.S. Elevator Corporation (R 44) testified that he had no contract of employment with Lindsey (R 44-45). Respondent's exhibit 1 was identified as the work order ticket for [*36] the jobsite in question (R 45). The superintendent at the jobsite generally tells the crane operator what he wants done, where he wants the crane placed and the operator uses his experience in placing it in a safe condition so as to avoid injury or damage (R 47). The mechanic in charge of the U.S. Elevator crew was directing the crane at the time of the alleged violation (R 48); generally they would tell the crane operator what was needed (R 48), and the policy was to assist the crane operator where he could not see but normally on the outside of the building where he has a full view they leave the operation up to the crane operator (R 49).

The first legal issue raised by the factual situation is whether there is a duty upon an employer to provide an employee with a safe place to work when the employee is on the premises of a third party over which the employer has no control.

The second legal issue to be resolved is the effect of the Standard Short Term Crane Rental Agreement, particularly that portion asserted as a defense, namely paragraph 2 pertaining to "indemnification."

Under the terms of the Act as to its application the Congress has mandated under Section 4(4) as follows: [*37]

Nothing in this Act shall be construed to supersede or in any manner effect any workmen's compensation law or to enlarge or diminish or effect in any other manner the common law or statutory rights, duties, or liabilities of employers and employees under any law with respect to injuries, diseases, or death of employees arising out of, or in the course of, employment.

A review of existing case law indicates that ordinarily an employer, whose duty it is to provide a safe place to work for his employees, is ordinarily not liable for injuries to employees on premises of third parties over which employer has no control. However, if the employer knows, or should have known, that the third party premises are dangerous employer may be liable for employees' injuries therein.

The above cited common law principle is stated (rather obliquely) in 56 C.J.S., Master & Servant, Section 210; Rasmus vs. Southern Pac. Co. 301 P. 2nd 23, 144 C.A. 2nd 264 and under Federal Employees Liability Cases (not applicable in these circumstances) there are many such cases cited in section 1, 45 USCA, Section 51.

While the first portion of the above stated common law principle, as quoted [*38] in C.J.S. would appear to exculpate the employer from liability under certain circumstances, the general case law under this proposition indicates that it is the duty of an employer to furnish a safe place to work irrespective of knowledge or constructive knowledge of a dangerous condition on the premises owned and controlled by a third party.

Cronan vs. Armitage 190 N.E. 12; DeMarco vs. Pease, 253 Mass. 499, 506; 149 N.E. 208; Snyder v. American Car and Foundry Company 14 SW2d 603, 322 Mo. 147.

The apparent contradiction noted above need not be resolved in the instant case for the reason that there is ample evidence that a dangerous condition existed which was known to the employer. A fatality occurred from a violation (R 17) on April 13, 1972 (R 15). Investigation by the compliance officer occurred April 14, 1972 (R 16). In the accident involving the fatality Respondent's crane was involved (R 23) apparently while the boom was being retracted (R 38). The operator who was killed was not an employee of Respondent. The Respondent's president went to the site immediately after the accident (R 41), but none of his employees were on the jobsite on the date [*39] of the alleged violation (other than crane operator Lindsey) (R 41, 42).

The fatality was known to the employer, but, nonetheless, a crane with a single operator went on the jobsite the following day.

It is our view that, where the lessee of the crane relies upon the particular expertise of the crane operator and gives no particular direction as to the operation of the crane, then it is the duty of the employer of the operator to comply with minimum safety requirements. Such minimum safety would at the least necessitate the presence of a flagman or a signalman to observe clearance of the equipment and give timely warning such as required by 29 CFR 1926.550(a)(iv). The standard which the parties herein stipulate was violated necessarily involves the placement, movement, and operation of a crane. The issue presented here is the duty owed by the Respondent under the circumstances. We rule that the Respondent owed such a duty at common law and under the terms of the Act to provide a safe workplace for its employee. The Act itself provides no exculpatory situations where that duty is not owned.

The second legal issue presented under the factual situation calls for a resolution of [*40] the legal effect of the Standard Short Term Crane Lease Agreement between the Respondent employer and U.S. Elevator Company, the lessee of the crane. A ruling as to the duty under the factual situation of the employer to furnish a safe place to work on premises owned and controlled by another party is, to a degree, determinative of the second issue. The duty as outlined above to furnish a safe place to work is a duty personal to the employer and cannot be avoided by delegation to another ( Cronan vs. Armitage 190 N.E. 12, 14 Snyder vs. American Car and Foundry Co. 14 S.W. 2d 603; 322 Mo. 147. The rule of law is well stated in Corpus Juris Secundum, Master & Servant, Section 196, et seq; Section 204 holding as follows:

The duty to furnish safe tools, machinery, appliances, and places to work is a positive duty resting on the master and cannot be delegated to another, so as to relieve the master of his primary liability.

We find against Respondent on both legal issues.

Compliance officer Kay testified as to the manner in which the proposed penalty was determined (R 17). The testimony indicates that the serious violation, according to established policy, begins [*41] at $1,000.00 (R 17). A serious violation is one that could cause serious physical harm or death. In the instant case, a death did result on the day prior to the inspection by the compliance officer (R 17). The penalty was reduced by 20% for good faith; 10% for size of the Respondent; and 20% for a lack of history of previous violations (R 18). Using this formula, the proposed penalty was established at $500.00. The proposed penalty is reasonable and proper and should be affirmed.

FINDINGS OF FACT

1. The Respondent is now and was at all times herein mentioned a Colorado corporation engaged in the crane rental business both within the State of Colorado and in other states (R 5, 6).

2. The citations and notice of proposed penalties set forth in paragraph VIII, IX, X, XI, XII, XIII and XIV, supra (being also items 2, 4, 5, 6, 10, 11 and 13 of citation number 1) were not pleaded in the Complaint filed with the Review Commission, and Respondent's notice of contest did not specifically admit said violations and proposed penalties (Complaint; Commission documents 1, 2 and 3).

3. Respondent filed a proper motion to withdraw its notice of contest as to the citations [*42] and proposed penalties as set forth in paragraphs II, III, IV, V, VI and VII, supra (being also items 1, 3, as amended, 7, 8, 9 and 12 of citation number 1). The motion of Respondent to withdraw its notice of contest (J 6) and the consent of complaint (J 7) meets the criteria established by the Review Commission.

4. Respondent's crane was being operated by Respondent's employee (R 41, 49; Complainant's Exhibit 2) on April 14, 1972 at a time when the crane was leased to U.S. Elevator Company and located on premises under the control of a person other than Respondent (R 24, 25, 28, 31; Respondent's Exhibit Number 1).

5. The same 15-ton Pettibone hydrocrane, Colorado license number AA-1194, was operated within the minimum clearance of a 7,620 volt electric power line on April 14, 1972 by Respondent's employee (Stipulation R 7; Complainant's Exhibit 2).

6. The Respondent's President knew, or should have known, that a dangerous condition existed on the premises where Respondent's crane was being operated by Respondent's employee, for the reason that Respondent's President, on the day prior to the agreed violation, was at the scene of a fatal accident at said location; said fatality [*43] involved the movement of Respondent's crane (but did not involve an employee of Respondent) (R 6, 15, 23, 42).

CONCLUSIONS OF LAW

1. The Respondent is, and was at all time relevant to the issues herein, engaged in a business affecting commerce within the meaning of Section 3(3) of the Occupational Safety and Health Act of 1970.

2. The Respondent is, and was at all times herein mentioned, an employer within the meaning of Section 3(5) of the Act and subject to its provisions under Section 4(a) and 5(a) of the Act and standards authorized by Section 6.

3. The citations and notice of proposed penalties, as set forth in paragraphs VIII, IX, X, XI, XII, XIII and XIV, supra (being also items 2, 4, 5, 6, 10, 11 and 13 of the citation number 1), but not pleaded in the Complaint, should be vacated.

4. Respondent's motion to withdraw its notice of contest as to the citations and notice of proposed penalties, as set forth in paragraphs II, III, IV, V, VI and VII, supra (being also items 1, 3, as amended, 7, 8, 9 and 12 of citation number 1, should be granted.

5. The citation and proposed penalties, as set forth in the preceding paragraph 4, should be affirmed.

6. [*44] Respondent violated Section 5(a)(2) of the Act by reason of the violation of a certain Occupational Safety and Health Standard, specifically 29 CFR 1518.550(a)(15)(i), and the citation should be affirmed.

7. The proposed penalty for the violation in the preceding paragraph, in the amount of $500, is appropriate, giving due consideration to the size of the business of Respondent, its good faith, and Respondent's prior history; accordingly, said proposed penalty should be affirmed.

ORDER

Based on the foregoing findings of facts and conclusions of law, it is hereby ORDERED:

1. The citations set forth in paragraphs VIII, IX, X, XI, XII, XIII, XIV, supra (being also items 2, 4, 5, 6, 10, 11 and 13 of citation number 1), and not pleaded in the Complaint, are hereby vacated.

2. The proposals of no monetary penalties for the citations set forth in paragraph 1 of this Order are hereby vacated.

3. Respondent's motion to withdraw its notice of contest as to the citations set forth in paragraphs II, III, IV, V, VI and VII supra, (being also items 1, 3, as amended, 7, 8, 9 and 12 of citation number 1) is granted.

4. The citations set forth in paragraph 3 of this [*45] Order are affirmed, and the proposed penalties thereon in the total sum of $150 are affirmed.

5. The citation for serious violation, as set forth in paragraph I hereof for the violation of 29 CFR 1518.550(a)(15)(i), is affirmed.

6. The proposed penalty for serious violations as set forth in paragraph 5 of this Order, in the sum of $500, is affirmed.