NOTICE: NOT FOR OFFICIAL PUBLICATION.

UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL

AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.

IN THE

ARIZONA COURT OF APPEALS

DIVISION ONE

STEPHEN H. SMITH dba STEPHEN H SMITH REPAIR AND 

RENOVATIONS, Petitioner Employer,

v.

THE INDUSTRIAL COMMISSION OF ARIZONA, Respondent,

JUAN SANCHEZ, Respondent Employee,

SPECIAL FUND DIVISION/NO INSURANCE SECTION, 

Respondent Party in Interest.

No. 1 CA-IC 17-0050 

Special Action - Industrial Commission

No. 20162-070060

The Honorable Layna Taylor, Administrative Law Judge

AWARD AFFIRMED

COUNSEL

Stephen H. Smith, Phoenix

Petitioner Employer

Industrial Commission of Arizona, Phoenix

By Jason M. Porter

Counsel for Respondent, ICA

Juan Sanchez, Phoenix

Respondent Employee

FILED 5-10-2018
SMITH v. SANCHEZ/SPECIAL FUND

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Industrial Commission of Arizona, Phoenix

By Scott J. Cooley

Counsel for Respondent Party in Interest

MEMORANDUM DECISION

Presiding Judge Randall M. Howe delivered the decision of the Court, in 

which Judge Jennifer M. Perkins and Judge Peter B. Swann joined.

H O W E, Judge:

¶1 This is a special action review of an Industrial Commission of 

Arizona (“ICA”) award and decision upon review for a compensable claim. 

The petitioner employer, Stephen Smith, presents one issue on appeal: 

whether Juan Sanchez was an employee of his business. For the following 

reasons, we affirm.

FACTS AND PROCEDURAL HISTORY

¶2 In July 2016, Sanchez worked with Smith at a client’s house. 

While there, Sanchez used tools that Smith provided to climb up a tree to 

trim it. The branch Sanchez was sitting on snapped and he fell 20 feet, 

landing on his back on the concrete floor below. Sanchez filed for worker’s 

compensation, listing Smith as his employer. The ICA found that Sanchez

had a compensable injury. Smith disagreed and requested a hearing.

¶3 At the hearing before an administrative law judge (“ALJ”), 

Sanchez testified that he worked for Smith for the last ten years and that he 

worked 40 hours a week. He explained that Smith would text him daily 

about jobs and that the two would meet either at the job location or at 

Smith’s home before going together to the job location. Sanchez testified 

that he did not have his own business or his own tools, did not work for 

other people, and did not have climbing equipment because Smith never 

provided safety equipment. He also testified that he did not believe he 

could decline work requests from Smith and that he had to respond when 

Smith called. Sanchez further testified that Smith paid him by the hour in 

cash because Smith did not want to pay him by check. Finally, Sanchez 

stated that Smith sometimes gave him a time frame for projects and that he 

had to complete the work in the manner Smith wanted.
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¶4 Smith testified that he had his current home repair and 

maintenance business since 2003. Regarding employees, Smith stated that 

he worked by himself about 50 percent of the time and either had somebody 

representing him at a job location or had workers with him the other 50 

percent of the time. Smith testified that Sanchez worked only 25–30 hours a 

week on a “fairly consistent” basis and that Sanchez asked him to “take care 

of the money” from the clients and give him cash. Smith also testified that 

he did not provide tools to Sanchez and that Sanchez had his own tools that 

he brought to job sites. Smith further testified that he had no control over 

Sanchez and that Sanchez had told him before that he had other jobs and 

worked for other people. 

¶5 The ALJ found that Smith was an employer under the 

Workers Compensation Act. The ALJ also found that Smith had the right to 

control Sanchez’s work and that Sanchez was Smith’s employee when his 

injury occurred. As such, the ALJ affirmed Sanchez’s worker’s 

compensation claim as compensable. Smith requested review, but the ALJ 

affirmed. Smith timely appealed.

DISCUSSION

¶6 Smith argues that the ALJ erred by finding that Sanchez was 

his employee. “In reviewing findings and awards of the ICA, we defer to 

the ALJ’s factual findings but review questions of law de novo.” Wozniak v. 

Indus. Comm’n, 238 Ariz. 270, 273 ¶ 7 (App. 2015). We view the evidence in 

the light most favorable to upholding the ALJ’s award. Id. Because Sanchez 

was Smith’s employee at the time he became injured, no error occurred. 

¶7 Arizona Revised Statues section 23–902 governs whether a 

worker is an employee or an independent contractor for purposes of 

worker’s compensation claims. It provides in pertinent part that “[w]hen 

an employer procures work to be done for the employer by a contractor 

over whose work the employer retains supervision or control, and the work 

is a part or process in the trade or business of the employer,” then the 

contractor is the employer’s employee. A.R.S. § 23–902(B). On the other 

hand, when the contractor is “independent” of the business and “not 

subject to the rule of control of the business for which the work is done,” 

the worker is an independent contractor. A.R.S. § 23–902(C). A worker’s 

employment status is liberally construed to achieve the remedial purposes 

of the Worker’s Compensation Act. Mitchell v. Gamble, 207 Ariz. 364, 371 

¶ 22 (App. 2004). 
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¶8 Smith does not dispute that the work Sanchez did for him is 

“a part or process” in Smith’s business. Therefore, whether Smith retained 

supervision or control of Sanchez is the only issue. Sanchez testified that he 

worked for Smith 40 hours a week for ten years and that he would learn 

about the jobs each day when Smith would text him. He also testified that 

when Smith would text him about jobs, he had to show up. Sanchez also 

testified that he never had his own business and that Smith provided all the 

tools necessary to complete job projects. He further testified that Smith 

sometimes dictated the time frame that a work project had to be finished 

and that he had to complete the project in the manner Smith wanted. This 

evidence is sufficient to support the ALJ’s determination that Smith had 

control over Sanchez’s work and that Sanchez was Smith’s employee.

¶9 Smith counters that he did not exercise any control over 

Sanchez. But under A.R.S. § 23–902(B), an employer does not need to 

exercise control over the worker for the worker to be an employee. When 

the work is part of the employer’s trade or business, the employer need only 

retain supervision or control over the individual’s work. The ALJ 

specifically found that Smith had the right to control Sanchez’s work even 

if he did not find the need to exercise that control. 

¶10 Smith also challenges certain factual findings that the ALJ 

made, about which the parties provided conflicting testimony. He claims 

that he did not provide any tools to Sanchez, Sanchez worked for other 

people in addition to Smith, and Sanchez was the one who requested that 

payment be made in cash. The ALJ is the sole judge of witness credibility

and the ALJ resolves all conflicts in the evidence and draws all warranted 

inferences. Henderson-Jones v. Indus. Comm’n, 233 Ariz. 188, 191 ¶ 9 (App. 

2013). The ALJ found Sanchez’s testimony to be more credible than Smith’s

and resolved all conflicts in the evidence in Sanchez’s favor. We refuse to 

disturb the ALJ’s conclusions regarding the conflicting evidence because 

the conclusions are reasonable. See id. at 191–92 ¶ 9 (“[T]his court will not 

disturb the ALJ’s conclusion unless it is wholly unreasonable.”). 
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CONCLUSION

¶11 For the foregoing reasons, we affirm the ICA’s award.