Court Opinion

ID: 4164247
Source: CourtListenerOpinion
Date Created: 2017-04-28 01:14:52.920256+00
Date Added: 2024-06-11T14:37:59.803955
License: Public Domain

IMPOR 'ANT NOTICE
      AWT-TO BE-PUBLISHED-OPINION

THIS OPINION IS DESIGNATED "NOT TO BE
PUBLISHED. " PURSUANT TO THE RULES OF
CITAIL PROCED URE PROMUL GATED BY THE
SUPREME COURT, CR 76.28 (4) (c), THIS OPINION
IS NOT TO BE PUBLISHED AND SHALL NOTBE
CITED OR USED AS A UTUORITYINANY OTHER
CASE INANY COURT OF THIS STATE.
                                                         RENDERED : AUGUST 24, 2006
                                                              NOT TO BE PUBLISHED

                                 9   Courf of
                                     2005-SC-0863-WC      f -

DAVID RANCK                                                                  APPELLANT

                        APPEAL FROM COURT OF APPEALS
V.                             2005-CA-0529-WC
                      WORKERS' COMPENSATION NO . 03-01362

BRIAN GRAY;
UNINSURED EMPLOYERS' FUND;
HON. R. SCOTT BORDERS,
ADMINISTRATIVE LAW JUDGE ; AND
WORKERS' COMPENSATION BOARD                                                  APPELLEES

                      MEMORANDUM OPINION OF THE COURT

                                       AFFIRMING

       An Administrative Law Judge (ALJ) determined that the claimant was working as

an independent contractor at the time of his injury and dismissed his application for

benefits . At issue is whether the finding was erroneous as a matter of law. Also at

issue is whether the decision must be vacated and further proceedings held on remand

because a successor considered and overruled the claimant's petition for

reconsideration . The Workers' Compensation Board (Board) and the Court of Appeals

have affirmed, and we affirm.

       David Ranck, the claimant, worked as a painter. After Neil Sulier accepted his

bids, he painted part of the interior of a residence that Sulier owned, a room in a

storage shed, and the basement. Sulier hired Brian Gray to renovate the exterior of the
 house, which included repairing, bleaching, and staining the wood shake roof. After

 finishing his own work, the claimant reached an agreement with Gray to bleach and

 stain the roof. On June 28, 2003, the claimant fell from the roof and was injured .

        The claimant's application for benefits listed Gray as being his employer. Gray

 did not have workers' compensation insurance, so the Uninsured Employers' Fund

 (UEF) was made a party . It maintained that Sulier was the employer and made him a

 party. Like Gray, he did not have workers' compensation insurance . The ALJ

 bifurcated the claim to consider whether the claimant was working as an employee or

 independent contractor when he fell and, if he was an employee, which defendant was

his employer.

        The claimant testified that he had been a painter for 35 years . His practice was

to bid on jobs, estimating the amount of time it would take and charging $15 .00 to

$20.00 per hour plus materials . He had his own brushes and rollers and sometimes

provided the paint. He testified :

              I paint whenever I feel like painting . If I'm tired, I go to sleep .
               And when I'm awake, if I got something to paint, I paint.
              That's what I like to do with my time . . . . I don't necessarily
              worry about how many days it's gonna take to do this or how
              many days its gonna take to do that. I do it for the project .

The claimant stated that Sulier paid him directly for the work that he bid, and he paid

part of that amount to a helper. After finishing the interior painting on Sulier's house, he

recommended bleaching the deck to kill mold before painting it, and Sulier and Gray

agreed . He did not submit a bid for bleaching the deck but did perform the work and

thought Sulier paid him directly.

       The claimant stated that after he finished the deck he approached Gray about

going to work for him and that Gray paid him for doing some odd jobs (cleaning gutters
 and painting a doorjamb and small soffit). He learned that Gray had a number of jobs

for which he planned to hire a painter and approached him . Gray agreed to pay $12.00

per hour and supply the beer if he would bleach and stain the roof. Sulier and Gray

both purchased bleach, and Gray provided the stain . The claimant stated that no one

told him what hours to work or when to take breaks . He generally worked as long as he

wanted and as many days in a row as he wanted, keeping track of his hours . He stated

that Gray paid him $100 .00 on Friday, June 27, and encouraged him to finish the job

over the weekend so that Gray could paint the deck on the following Monday . On

Saturday, June 28, he worked alone from about 8:00 A.M. until about 6:00 P.M ., when

he slipped on some wet stained shingles and fell off the roof.

       Paul Young was an electrician at the worksite . He testified that he overheard

parts of conversations between Gray and Sulier and between Gray and the claimant .

He had the impression that Gray agreed to provide beer and pay the claimant $12.00

per hour to perform some type of work but never saw Sulier or Gray pay him any

money. He did not know whether the work was on the same house or another property .

Young stated that he never asked the claimant to do any work for him but that Sulier did

give him a check and instructed him to pay the claimant and another individual for

painting the basement. He explained that Sulier told him the funds were tied up in a

financial management company that would only disburse them "through somebody that

was a legal contractor."

       In December, 2003, the Uninsured Employers Fund (UEF) deposed Sulier. He

stated that he intended to use the house as his residence and that he hired the

claimant to paint the interior but provided the paint. He did not remember how much he

paid the claimant but did not think it was enough to require a Form 1099 to be filed for
tax purposes. He testified that he hired the claimant to bleach the roof but later stated

that he did not recall whether bleaching the roof was tied in to the work that Gray was

doing . In any event, he did not ask Gray to hire the claimant or have him stain the roof.

He stated that he did not pay the claimant directly for work on the roof. Instead, Gray

billed him when each project was completed, and payments came from a trust fund .

When cross-examined by Gray, Sulier stated that he did not recall a conversation with

Gray about having the claimant bleach the roof but that they might have discussed it

after the claimant finished the interior painting .

       James Sherrow testified that he went to the house initially to work for an

electrician . When he arrived, the claimant asked him to help him paint, instead . He

stated that he and the claimant split $400.00 for painting the basement. Because he

was supposed to be working for the electricians, Sulier paid them, and they paid him .

He did not know who paid the claimant .

       When deposed by the UEF, Gray testified that Sulier hired him to perform

various projects to renovate the house . He asked Gray to pay for materials and labor

and then to be reimbursed upon completion of each project. Gray testified that he did

not hire anyone else to work with him and that he was a "one-man operation ." After he

had completed some of the work, Sulier asked him to purchase materials so that the

claimant could stain the roof, to pay the claimant for his labor, and to be reimbursed for

both. He insisted that he never hired the claimant and that it was Sulier who arranged

for him to bleach and stain the roof.

      When cross-examined by the claimant, Gray testified that he performs most

renovation work himself but calls others when he needs help. When he does so, he

generally pays them by the job rather than the hour. He stated that he billed Sulier
$5997.00 for bleaching, staining, and repairing the roof. He paid a portion of that

amount to the claimant and two others but would not specify how much he paid to each.

He estimated that the claimant would have received $880.00 if he had completed his

portion of the work and that the amount was not based on an hourly rate .

       When deposed by Sulier on April 24, 2004, Gray testified that he hired someone

else to finish the job after the claimant fell . He testified that he used a number of

"subcontractors" on the job for Sulier and paid them on completion of the job, some by

the job and others by the hour. When he negotiated a price with a subcontractor, he

would build an amount for his services into the estimates he gave Sulier. He arrived at

the $880 .00 estimate for the claimant based on the amount of time he thought it would

take multiplied by $12.00 per hour. He instructed the claimant "to keep his hours" in the

event that the work took more time than he had estimated . Gray also testified that he

was working as a crew leader for John James at that time, with the authority to hire and

fire employees. He had discussed with the claimant the hourly rate that he would earn

if he, too, worked for James. He thought that Young probably overheard that

conversation .

       When cross-examined by the claimant, Gray testified that Sulier asked him to

pay the claimant for his labor for staining the roof. Sulier had apparently paid the

claimant already for bleaching the roof. Nonetheless, Gray billed Sulier for both

bleaching and staining the roof, and the bank paid him in two installments . Gray

testified that he was to reimburse Sulier for the duplicate payment but that Sulier later

told him to keep the money . He stated that he billed the claimant's time at $20.00 per

hour and paid him $12 .00 per hour.

       Sulier filed his own deposition of April 30, 2004. He testified that generally he
took the claimant's bids to the bank for approval before disbursing funds . He issued a

$400 .00 check to the claimant on June 3, 2003, for painting the basement. On or about

June 18, 2003, he paid the claimant $600.00 for painting the loft and main floor. He

thought he paid $300.00 in cash for exterior prep work bid on June 17, 2003, and was

later reimbursed by the bank. Of that amount, $50.00 was for bleaching the deck, and

$100 .00 was for bleaching parts of the roof. None of the amounts was based on the

amount of time the job took. Sulier stated that he would not have paid the claimant for

bleaching the roof and then had Gray pay the claimant for the same work without

expecting to be reimbursed or credited .

       Cross-examined by the claimant, Sulier testified that he did not remember any

discussion with Gray about double billing for work on the roof. Cross-examined by

Gray, he testified that although he did not remember, it was likely that Gray purchased

the materials and that he paid Gray upon completion of the project . He considered

Gray to be the contractor and relied on him to get the correct people to do the work. He

did not know what arrangement Gray had with the claimant .

       After reciting the nine factors set forth in Ratliff v. Redmon, 396 S .W.2d 320 (Ky.

1965), the four predominant factors as set forth in Chambers v. Wooten's IGA

Foodliner, 436 S .W.2d 265 (Ky. 1969), and analyzing the evidence under each factor,

the ALJ determined that the claimant was working as an independent contractor at the

time of his injury . Sometime thereafter, the ALJ's appointment ended. A different ALJ

considered and overruled the claimant's petition for reconsideration, finding it to be

"nothing more than a reargument of the merits ." The claimant then appealed .

      KRS 342.640 defines various classes of employees . In relevant part, it provides :

             The following shall constitute employees subject to the
              provisions of this chapter, except as exempted under KRS
              342.650 :

              (1) Every person, including a minor, whether lawfully or
              unlawfully employed, in the service of an employer under
              any contract of hire or apprenticeship, express or implied,
              and all helpers and assistants of employees, whether paid
              by the employer or employee, if employed with the
              knowledge, actual or constructive, of the employer;

               (4) Every person performing service in the course of the
              trade, business, profession, or occupation of an employer at
              the time of the injury[.]

       The claimant notes that the statute contains presumptions of employee status

and asserts that Ratliff v. Redmon, supra, and its progeny are inapplicable when the

facts fit one of the presumptions. He admits that he performed the inside work for

Sulier as an independent contractor but asserts that he worked on the roof as Gray's

employee . He argues that Gray was in the business of repairing and remodeling

houses and had a time and materials contract to repair, bleach, and stain Sulier's roof.

Gray hired him to bleach and stain the roof in furtherance of Gray's trade or business

and admitted paying him $12.00 per hour while billing Sulier $20.00 per hour; therefore,

the ALJ should not have considered the Ratliff v. Redmon, supra, factors because KRS

342.640(4) presumed him to be Gray's employee. He distinguishes Chambers v.

Wooten's IGA Foodliner, supra, pointing out that a grocery was not in the business of

repairing roofs, so KRS 342.640(4) did not presume it to be the employer of a worker

that it hired to do so. Therefore, the factors were properly considered .

      The worker has the burden to prove every element of a workers' compensation

claim, including employee status at the time of injury . Roark v. Alva Coal Corporation ,
 371 S .W.2d 856 (Ky. 1963); Wolf Creek Collieries v . Crum, 673 S.W.2d 735 (Ky.

 App. 1984); Snawder v. Stice , 576 S .W.2d 276 (Ky. App . 1979) . Although the claimant

 is correct in asserting that KRS 342.640 contains various presumptions regarding a

worker's status as an employee, his interpretation of KRS 342.640(4) is flawed . KRS

342.640(4) creates a presumption that an individual working in the trade or business of

an employer is an employee, but it does not prohibit an employer from rebutting the

presumption by showing that the individual is actually an independent contractor. In

other words, the presumption is rebuttable and governed by KRE 301 . See Magic Coal

Co . v. Fox, 19 S .W.3d 88, 95 (Ky. 2000) . If an employer fails to go forward with rebuttal

evidence, the presumption allows the worker to prevail as a matter of law. If an

employer does go forward with evidence to rebut the presumption, the AU must weigh

the parties' evidence under the standard found in Ratliff v. Redmon, supra , and its

progeny. In such instances, the worker retains the burden of persuading the AU that

he is an employee. KRE 301 ; Magic Coal Co. v. Fox, supra.

       Gray raised an independent contractor defense and presented evidence to rebut

KRS 342 .640(4); therefore, Ratliff v. Redmon, supra , applied . The nine Ratliff v.

Redmon factors are: 1 .) the extent of control that the alleged employer may exercise

over the details of the work; 2.) whether the worker is engaged in a distinct occupation

or business; 3.) whether the type of work is usually done in that locality under the

supervision of an employer or by a specialist, without supervision ; 4.) the degree of skill

required by the work; 5.) whether the worker or alleged employer supplies the

instrumentalities, tools, and place of work; 6.) the length of the employment ; 7.) the

method of payment, whether by the time or the job; 8.) whether the work is a part of the

regular business of the employer; and 9 .) the intent of the parties. The test was refined
in Chambers v. Wooten's IGA Foodliner, supra, which required consideration of all

relevant factors with a primary focus on four: 1 .) the nature of the work as related to the

business generally carried on by the alleged employer; 2.) the extent of control

exercised by the alleged employer; 3.) the professional skill of the alleged employee;

and 4.) the true intentions of the parties.

       When determining that the control factor favored independent contractor status,

the AU noted the claimant's assertion that Gray urged him to finish the roof over the

weekend but also noted that he worked on his own schedule, that he worked when

Gray would not be present, and that any control was minimal . Regarding the second

factor, the ALJ noted that the claimant had worked as a painter for 35 years but that

Gray had also worked as a painter and that such work was part of renovation and

remodeling . Therefore, the claimant's occupation was not distinct from Gray's, which

favored employee status . Based on evidence that painting was done locally by either

employees or independent contractors, the ALJ found the third factor to favor employee

status . Likewise, although the claimant worked for 35 years as a painter, Gray

acknowledged that it was not a skill that required substantial training; therefore, that

factor favored employee status . Noting the mixed evidence regarding who supplied

tools, the ALJ found the effect of the evidence to be neutral . The ALJ considered the

possibility that the claimant would be hired for future work for John James to be

unrelated to the roof project . Both parties testified that the claimant would only be

working for Gray until the roof was stained, which favored independent contractor

status . The ALJ did not find it unusual for a general contractor to bid a job at a higher

rate than he would have to pay sub-contractors and concluded that the extensive

evidence regarding method of payment was neutral . Acknowledging that

                                              -9-
 painting/staining was a regular part of Gray's business renovating and repairing houses,

 the AL found that factor to indicate employee status . Finally, the AL characterized

the claimant's belief that he was an employee as being "unrealistic," noting that he

would have expected to be paid by check and to have had taxes and social security

withheld if he truly considered himself to be an employee. Weighing all of the factors,

the AL determined that he was an independent contractor at the time of his injury.

       The claimant continues to assert that the AL failed to understand that his

arrangements with Sulier and Gray were separate and that although he was an

independent contractor when working for Sulier, he was Gray's employee. He asserts

that the AL misunderstood the evidence regarding some of the Ratliff v. Redmon ,

supra , factors and points to certain favorable evidence. He argues in particular that the

AL erred by failing to consider his testimony showing that Gray had the right to control

his work. We note, however, that the AL was not required to give any particular weight

to the claimant's testimony that Gray told him to perform various odd jobs, particularly

when faced with evidence to the contrary . See Grider Hill Dock v. Sloan , 448 S.W .2d

373 (Ky. 1969). Like the Board and the Court of Appeals, we are not convinced that the

AL misunderstood the evidence or the claimant's arguments . The recitation of the

evidence reveals a clear understanding that his arrangement with Gray to bleach and

stain the roof was separate from his arrangement with Sulier to do painting . The AL

weighed the evidence under each of the Ratliff v. Redmon factors and found that the

claimant was working as an independent contractor when he was injured . Therefore,

the claimant's burden on appeal is to show that the evidence of an employee

relationship with Gray was so overwhelming that the decision was unreasonable . KRS

342.285; Special Fund v. Francis, 708 S .W.2d 641, 643 (Ky. 1986).

                                           -1 0-
       The Board conducted an exhaustive review of the evidence and considered each

of the claimant's arguments carefully. It determined that the favorable evidence was

not so overwhelming as to compel a decision in the claimant's favor, and the Court of

Appeals affirmed . Having reviewed the evidence and the parties' arguments, we agree.

       The claimant's second argument is that no statute or regulation permits a

stranger to a case to rule on a petition for reconsideration and that due process

prohibits the practice. He argues that it would be impossible for a subsequent AU to

step into the predecessor's mindset, particularly regarding a petition that asserts a

finding is the product of confusion and a misunderstanding of the facts. Moreover, to

permit a stranger to rule on a petition would effectively grant the individual appellate

powers or invite the individual to "rubber-stamp" the initial decision . He urges the court

to adopt a procedural rule that "he who decides the case must also hear the case" and,

on that basis, to set aside the decisions below, declare a "mistrial," apply CR 63, and

remand his claim for "a new trial."

       This argument is based on the misconception that the "trial" in a workers'

compensation claim continues after the AU renders the decision . Although KRS

342.281 permits a party to petition for reconsideration, it states that the AU "shall be

limited in review to the correction of errors patently appearing on the face of the award,

order, or decision ." Granted this limited scope of review, an AU may not re-weigh the

evidence on a factual issue decided in the initial opinion . Wells v. Ford , 714 S .W.2d

481 (Ky. 1986); Eaton Axle Corporation v. Nally, 688 S .W .2d 334 (Ky. 1985); Beth-

Elkhorn Corp. v. Nash, 470 S .W.2d 329 (Ky. 1971). Contrary to the claimant's

argument, the same AU both heard this claim and decided it. A successor AU

determined only that the claimant's petition for reconsideration showed no patent error
in the decision .

        The claimant relies on Wells v. Ford, supra , in which the court determined that

expiration of the 10-day period for review found in KRS 342.281 does not divest the

fact-finder of authority to decide a petition for reconsideration . The court did not

consider whether the same fact-finder must decide both the initial claim and a petition

for reconsideration, and the claimant has pointed to nothing that would require as

much. Moreover, this court has determined that nothing in the statutes or regulations

requires a claim to be decided by the same AU throughout its life. See Tuttle v. O'Neal

Steel, Inc. , 884 S.W.2d 661, 663 (Ky. 1994).

       CR 63 permits a successor judge to perform "the duties to be performed by the

court under these rules after a verdict is returned or finding of fact and conclusions of

law are filed ;" however, it gives the successor discretion to grant a new trial if satisfied

that the failure to preside over the trial would prevent performing those duties . In the

present case, the successor AU determined that the circumstances did not warrant a

new proceeding . Considering the scope of review afforded by KRS 342.281, we are

convinced that the successor did not err or violate the claimant's due process rights by

ruling on his petition.

       The decision of the Court of Appeals is affirmed .

       All concur.
COUNSEL FOR APPELLANT :

David B . Allen
P .O. Box 93
Versailles, KY 40383

COUNSEL FOR APPELLEE,
BRIAN GRAY, PRO SE :

Brain Gray
109 Crest Court
Nicholasville, KY 40356