Present: Hassell, C.J., Lacy, Keenan, Kinser, Lemons, and
Agee, JJ., and Carrico, S.J.
UNINSURED EMPLOYER'S FUND
v. Record No. 060053 OPINION BY JUSTICE DONALD W. LEMONS
November 3, 2006
ANNE GABRIEL, ET AL.
FROM THE COURT OF APPEALS OF VIRGINIA
In this appeal, we consider whether the Court of Appeals
erred in its judgment that the Workers' Compensation
Commission (the "Commission") had jurisdiction over this case.
For the reasons discussed herein, the judgment of the Court of
Appeals will be reversed in part and vacated in part, and
final judgment will be entered in favor of the Uninsured
Employer's Fund.
I. Facts and Proceedings Below
On September 11, 2001, Richard Gabriel ("Gabriel")
boarded an airplane for a business meeting. The airplane was
hijacked by terrorists and crashed into the Pentagon in
Arlington County, Virginia. Gabriel did not survive the
crash. Gabriel's estate filed a claim for death benefits
under Code § 65.2-512 of the Virginia Workers' Compensation
Act (the "Act"). In order for the Commission to have
jurisdiction over this claim, Gabriel's employer, Stratin
Consulting, Inc. ("Stratin"), would be required to have three
employees "regularly in service" in the Commonwealth at the
time of Gabriel's death. Code § 65.2-101.
On October 20, 1999, Gabriel and Edward Preble ("Preble")
formed Stratin, which is a Virginia corporation. Stratin
provides management consulting services to businesses
throughout the world. Gabriel was president and treasurer of
the company, and Preble served as vice president and
secretary. Stratin had two offices. The principal office was
located in Virginia where Gabriel resided in Fairfax County.
Another office was maintained in Massachusetts where Preble
resided.
Gabriel frequently traveled on airplanes in the course of
Stratin's business. At the time of Gabriel's death, in
addition to Gabriel and Preble, Stratin employed Gabriel's
wife in Virginia and Susan Petralia ("Petralia") in
Massachusetts.
On January 30, 2002, Gabriel's estate filed a claim for
benefits under the Act. A deputy commissioner (the "deputy")
denied the claim. The deputy held that because Stratin did
not employ the requisite three employees pursuant to Code
§ 65.2-101, Stratin was not subject to the Act and that the
Commission was without jurisdiction to adjudicate the claim.
Gabriel's widow and two sons (the "claimants") appealed the
deputy's decision to the full Commission.
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On April 16, 2004, the Commission reversed the decision
of the deputy and ruled that it did have jurisdiction over the
claim. The Commission also ruled that Gabriel's death arose
out of his employment with Stratin. The Commission remanded
the case to the Deputy "for an award of benefits." Stratin
and the Uninsured Employer's Fund (the "Fund") appealed the
Commission's decision to the Court of Appeals. By order, the
Court of Appeals held that the Commission's decision to remand
the case "to the deputy commissioner for further proceedings
to award benefits" was "not a final decision in the case."
Stratin Consulting, Inc. v. Gabriel, Record No. 1191-04-4,
slip op. at 1 (June 21, 2004). The Court of Appeals held
"that the commission's order [was] interlocutory and not
determinable of the controversy" and that the court was
"without jurisdiction to entertain the appeal." Id. at 2.
The appeal was dismissed without prejudice. Id.
On remand, the deputy granted an award on August 13,
2004. Both the Fund and Stratin requested review of the
award. On March 14, 2005, the Commission declined to
reconsider its April 16, 2004, decision. The Fund again
appealed the decision to the Court of Appeals. The Court of
Appeals affirmed the Commission's decision holding that the
Commission had jurisdiction and that the claim arose out of
Gabriel's employment.
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The Fund appeals to this Court based on four assignments
of error. The Fund argues that the Court of Appeals "erred in
affirming the opinion" of the Commission. The Fund also
argues that the Court of Appeals "erred in finding that
credible evidence in the record supported the [C]ommission's
decision that it had jurisdiction." The Fund next argues that
the Court of Appeals "erred by declining to address the
presumption adopted by the [C]ommission." Finally, the Fund
argues that the Court of Appeals erred in finding that
Gabriel's death arose out of his employment.
II. Analysis
"What constitutes an employee is a question of law; but,
whether the facts bring a person within the law's designation,
is usually a question of fact." Baker v. Nussman, 152 Va.
293, 298, 147 S.E. 246, 247 (1929). The standard of review we
must employ is familiar and well-settled. "We review
questions of law de novo, including those situations where
there is a mixed question of law and fact." Westgate at
Williamsburg Condo. Ass'n v. Philip Richardson Co., 270 Va.
566, 574, 621 S.E.2d 114, 118 (2005).
"Code § 65.2-700 vests the Commission with jurisdiction
to determine all questions 'arising under' the Virginia
Workers' Compensation Act," however, "[t]he jurisdiction is
not unlimited." Bogle Dev. Co. v. Buie, 250 Va. 431, 434, 463
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S.E.2d 467, 468 (1995). The threshold question in this case
is whether the Commission had jurisdiction. Code § 65.2-101
states that under the Act " '[e]mployee' shall not mean . . .
[e]mployees of any person, firm or private corporation,
including any public service corporation, that has regularly
in service less than three employees in the same business
within this Commonwealth."
The Commission held in relevant part that:
We find that as a matter of law, Mr. Preble is,
for workers' compensation purposes, deemed to be an
employee regularly in service in Virginia, because
he is an officer of a Virginia corporation. Under
§ 65.2-101 of the Code of Virginia, an individual is
deemed an employee by virtue of being an officer of
a corporation. While not every employee of a
Virginia corporation is regularly in service in the
state, we adopt the presumption that a corporate
director assumes certain responsibilities with
regards to that corporation that constitute
rendering regular service in the Commonwealth. We
therefore REVERSE the finding that the Commission
does not have jurisdiction over this claim.
Gabriel v. Stratin Consulting, Inc., VWC File No. 208-43-28
(Apr. 16, 2004)(emphasis added). There is not a presumption
in Virginia that by virtue of holding the position of a
corporate director of a Virginia corporation, that corporate
director renders regular service in Virginia. The Commission
based its decision on a presumption that does not exist in
Virginia law.
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The Court of Appeals did not address the Commission's
adoption of a presumption. Rather, the Court of Appeals based
its decision on the Commission's "findings of fact."
Uninsured Employer's Fund v. Gabriel, 47 Va. App. 95, 102, 622
S.E.2d 273, 276 (2005). The Court held that "[t]he facts of
this case constituted credible evidence in the record that
supported the commission's decision that it had jurisdiction."
Id. We have previously held that this Court is bound by the
Commission's factual finding that a company lacks, on or
immediately prior to the date of the accident prompting a
claim for benefits, a number of employees sufficient to bring
it within the ambit of the Act. Vanzant v. Southern Bending
Co., 143 Va. 244, 248-49, 129 S.E. 268, 269 (1925). However,
such findings of fact are "conclusive and binding" only to the
extent that they are "predicated upon evidence introduced or
appearing in the proceedings." Id. at 246, 129 S.E. at 268.
In other words, "[i]f . . . there is no credible evidence on
which the Commission's findings of fact are based, its
findings [of fact] are not binding and the question presented
becomes one of law." Great Atlantic & Pacific Tea Co. v.
Robertson, 218 Va. 1051, 1053, 243 S.E.2d 234, 235 (1978).
We hold that the evidence in the record does not support
a finding that the Commission had jurisdiction. At the time
of Gabriel's death, Stratin had four employees. Only two of
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the four employees, however, were "regularly in service" in
Virginia as required by Code § 65.2-101.
It is undisputed that Mr. and Mrs. Gabriel were
"regularly in service" in the Commonwealth. However,
Stratin's other two employees Preble and Petralia, were not
"regularly in service" in Virginia. Petralia served as
Preble's administrative assistant. She worked and lived in
Massachusetts. Petralia's only contact with Virginia was
through limited phone calls and emails made to Gabriel who
worked in the Virginia office. Consequently, Petralia was not
regularly in service in Virginia. Thus, whether the
Commission had jurisdiction over this case depends on whether
Preble was an employee regularly in service in Virginia.
At the time of Gabriel's death, Preble served as vice
president and secretary of Stratin. Preble's office was in
Concord, Massachusetts. Preble testified that most of the
work for his clients was performed "on the site of the
client." Stratin had no clients in Virginia. While Stratin
was headquartered in Virginia where its financial affairs were
handled, Preble was in charge of Stratin's business
development of marketing and sales and did not handle
financial matters. Additionally, from 1999 to 2001, Preble
was only in Virginia four times. The evidence does not
support a finding that Preble was regularly in service in the
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Commonwealth. The fact that Preble may have had certain
statutory duties as an officer of Stratin does not render him
regularly in service in Virginia. Because Stratin did not
have three employees regularly in service within the
Commonwealth at the time of the cause of action, the
Commission had no jurisdiction over this matter. See Code
§ 65.2-101. Because we have determined that the Commission
had no jurisdiction in this case, the Court of Appeals and
this Court have no jurisdiction over this matter, except to
decide that there is no jurisdiction. Morrison v. Bestler,
239 Va. 166, 170, 387 S.E.2d 753, 755 (1990) (holding that "a
court always has jurisdiction to determine whether it has
subject matter jurisdiction").
III. Conclusion
Because the Commission and the Court of Appeals had no
jurisdiction to hear this case, we will reverse the Court of
Appeals' holding concerning jurisdiction and vacate the
remaining portion of the Court of Appeals' judgment, and enter
final judgment for the Uninsured Employer's Fund.
Reversed in part,
vacated in part,
and final judgment.
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