COURT OF APPEALS OF VIRGINIA
Present: Chief Judge Fitzpatrick, Judge Benton and
Senior Judge Duff
Argued at Alexandria, Virginia
UNINSURED EMPLOYER'S FUND
OPINION BY
v. Record No. 0991-99-4 JUDGE CHARLES H. DUFF
MARCH 28, 2000
DEREK M. KRAMER
FROM THE VIRGINIA WORKERS' COMPENSATION COMMISSION
Gaye Lynn Taxey, Assistant Attorney General
(Mark L. Earley, Attorney General; John J.
Beall, Jr., Senior Assistant Attorney
General, on brief), for appellant.
Derek M. Kramer, pro se.
The Uninsured Employer's Fund ("the Fund") appeals a
decision of the Workers' Compensation Commission (commission)
awarding benefits to Derek M. Kramer (claimant). The Fund
contends the commission erred in finding that (1) the issue of
jurisdiction was res judicata because the Fund did not appeal
the commission's April 14, 1998 decision; and (2) the commission
had jurisdiction over claimant's claim on the ground that
employer regularly employed three or more persons. Although we
find the commission erred in ruling that its April 14, 1998
decision was res judicata with respect to the jurisdiction
issue, we affirm the commission's finding that it had
jurisdiction over the claim.
I. Res Judicata
In its April 14, 1998 opinion, the commission affirmed the
deputy commissioner's October 3, 1997 finding that the
commission had jurisdiction over the claim because employer
regularly employed three or more employees. The commission also
affirmed the deputy commissioner's average weekly wage
determination and the award of medical benefits and temporary
total disability benefits, but it remanded the case to the
deputy commissioner for a ruling on claimant's permanent partial
disability ("PPD") claim. Claimant included his PPD claim in
his original claim for benefits, but the deputy commissioner did
not address it at the time of the hearing.
On October 28, 1998, the deputy commissioner issued an
opinion granting claimant PPD benefits. The Fund appealed that
decision to the full commission, contending the deputy
commissioner erred in awarding PPD benefits and erred in finding
that employer regularly employed three or more employees.
On March 26, 1999, the commission issued a decision
affirming the deputy commissioner's ruling awarding claimant PPD
benefits. The commission also held that it no longer had
jurisdiction over the issue of whether employer regularly
employed three or more employees. The commission found that
"[t]he [April 14, 1998 decision] was an Award and final order as
to those issues considered by both the Deputy Commissioner and
Full Commission, and was not an interlocutory decision." The
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commission noted that the Fund did not appeal the April 14, 1998
decision to this Court and, therefore, reasoned that the issues
decided in the April 14, 1998 opinion were res judicata and the
commission no longer had jurisdiction to hear those issues.
Our holding in Uninsured Employer's Fund v. Harper, 26 Va.
App. 522, 495 S.E.2d 540 (1998), controls this issue. In
addressing a similar situation in Harper, we stated:
Code § 65.2-706 provides that "[n]o
appeal shall be taken from the decision of
one Commissioner until a review of the case
has been had before the full Commission, as
provided in Code § 65.2-705, and an award
entered by it. Appeals shall lie from such
award to the Court of Appeals . . . . "
"[T]he words 'such award' . . . [contained
in § 65.2-706] mean final award, that is, a
decision of the . . . Commission granting or
denying, or changing or refusing to change,
some benefit payable or allowable under the
. . . Act and leaving nothing to be done
except to superintend ministerally the
execution of the award."
Id. at 527, 495 S.E.2d at 543 (citation omitted).
The commission's April 14, 1998 opinion affirming the
deputy commissioner on the jurisdiction issue and its
accompanying remand of the case to the deputy commissioner for a
determination of claimant's entitlement to PPD benefits did not
constitute a final award appealable to this Court. See id.
While an award existed which determined claimant's average
weekly wage and granted medical benefits and temporary total
disability benefits, it was not an award that left "nothing to
be done." Under our holding in Harper, the Fund was not
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required to appeal the jurisdiction issue until after the PPD
issue was fully determined on the merits by the commission on
remand. In this case, the PPD claim was filed as part of the
original claim and not as a claim separate and apart from the
original claim for benefits. The commission's March 26, 1999
opinion was a final, appealable order because it disposed of the
entire claim "leaving nothing to be done except to superintend
ministerally the execution of the award." Id. The Fund filed a
timely appeal from that decision and, therefore, we will address
the issue of whether the commission erred in finding that it had
jurisdiction over claimant's claim.
II. Jurisdiction
On appeal, the Fund contends the commission erred in
holding that employer regularly employed three or more employees
within the Commonwealth and, therefore, erred in its April 14,
1998 finding that employer was subject to the commission's
jurisdiction. We disagree.
The threshold jurisdictional issue
which the commission had to decide was
whether the employer regularly had in his
service three or more employees so as to
come within the coverage of the Act.
"'Employee' means . . . [e]very person . . .
in the service of another under any contract
of hire or apprenticeship, written or
implied, except . . . one whose employment
is not in the usual course of the trade,
business, occupation or profession of the
employer." Both full-time and part-time
employees who are regularly employed to
carry out the trade or business of the
employer must be counted in determining the
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number of employees "regularly in service"
to the employer. "Any person hired by the
employer to work in the usual course of the
employer's business is an 'employee' under
the Act regardless of how often or for how
long he may be employed." The number of
employees regularly in service of the
employer is the number "used to carry out
the established mode of performing the work
of the business . . . even though the work
may be recurrent instead of constant."
Smith v. Hylton, 14 Va. App. 354, 356, 416 S.E.2d 712, 714
(1992) (citations omitted). "[O]nce an employee proves that his
or her injury occurred while employed in Virginia, an employer
has the burden of producing sufficient evidence upon which the
commission can find that the employer employed less than three
employees regularly in service in Virginia." Craddock Moving &
Storage Co. v. Settles, 16 Va. App. 1, 2, 427 S.E.2d 428, 429
(1993), aff'd per curiam, 247 Va. 165, 440 S.E.2d 613 (1994).
In affirming the deputy commissioner on the jurisdiction
issue, the commission adopted the deputy commissioner's
findings. The deputy commissioner found as follows:
Although he did not include himself in the
quarterly reports filed during certain
periods, Mr. [Jeffrey D. Stewart] was
clearly an employee of the corporation by
virtue of his status as an officer. The
majority of work performed by the business
was done by him with the assistance of at
least two people. These employees were
listed on quarterly reports. Moreover,
there were other employees named by him that
were not reflected on these reports,
specifically, the claimant and Mr. [Crews].
At the time of the claimant's accident, it
was anticipated that the claimant, Mr.
[Stewart] and Chris [Stewart] would continue
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to perform similar services for the
remainder of the summer break. We find this
sufficient to invoke jurisdiction.
The testimony of Stewart and claimant, and employer's
payroll reports, accounting records, and 1995 W-2 wage and tax
statement copies amply support the commission's findings. That
evidence established that at various times during the year
preceding claimant's injury by accident, employer "'used [three
or more employees] to carry out the established mode of
performing the work of the business . . . even though the work
[might have been] recurrent instead of constant.'" Smith, 14
Va. App. at 386, 416 S.E.2d at 714 (citation omitted). In
addition, the commission was entitled to accept claimant's
testimony that he and Chris Stewart had been hired to work the
remainder of the summer with Jeff Stewart.
Employer argues the deputy commissioner impermissibly
relied upon certain documents filed with the Virginia Employment
Commission in violation of Code § 60.2-623. The commission
found the error to be harmless, stating: "Our review of the
evidence . . . leads us to conclude that the deputy commissioner
did not find that those reports were determinative on the
jurisdictional issue. Indeed, she relates, 'There were other
employees named by [the employer] that were not reflected on
these [quarterly] reports . . . .'" The direct evidence and
inferences drawn from that evidence support the commission's
finding that employer regularly employed three or more persons
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and was, therefore, subject to the commission's jurisdiction.
Accordingly, we find as a matter of law that employer failed to
sustain its burden of proof.
For these reasons, we affirm the commission's decision
finding that it had jurisdiction under the Act over claimant's
claim.
Affirmed.
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Benton, J., concurring, in part, and dissenting, in part.
I concur in Part II and in the judgment affirming the
award. I do not join in Part I because I believe the commission
correctly held that Uninsured Employer's Fund v. Harper, 26 Va.
App. 522, 495 S.E.2d 540 (1998), does not decide the res
judicata issue presented by this case.
Following an evidentiary hearing in Harper, the deputy
commissioner denied the employee's claim for benefits because
her employer did not employ three or more persons. See 26 Va.
App. at 526, 495 S.E.2d at 542. On its review, the commission
found that the employer did employ three or more persons and was
subject to the commission's jurisdiction. See id. Thus, the
commission remanded the case for a determination by the deputy
commissioner regarding the employee's claim for benefits. See
id. The jurisdictional ruling was "interlocutory and not
determina[tive] of the controversy." Id. at 528, 495 S.E.2d at
543. More importantly, the commission's ruling in Harper was
not accompanied by the entry of an award.
This case arises in a significantly different procedural
posture. The record establishes that Derek Kramer filed his
initial claim alleging he was injured by accident arising out of
and in the course of his employment with Santa's Helpers Chimney
Sweeps. The commission made the following findings concerning
the proceedings:
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[T]he Deputy Commissioner in her Opinion of
October 3, 1997, made findings regarding the
status of [Kramer] and employer under the
Act, calculated [Kramer's] pre-injury
average weekly wage, and found that [Kramer]
sustained a compensable injury on May 15,
1995. Pursuant to those findings [, the
deputy commissioner] entered an Award for
both wage loss benefits and medical
benefits. The jurisdictional and pre-injury
average weekly wage issues were brought
before the Full Commission, and the
Commission affirmed the findings below. The
affirmation was an Award and final order as
to those issues considered by both the
Deputy Commissioner and Full Commission, and
was not an interlocutory decision.
The record supports those findings. Specifically, the
record reflects that the deputy commissioner entered "[a]n award
. . . on behalf of Derek Kramer against Santa's Helpers
providing for payment of temporary total disability benefits
. . . and medical benefits . . . for as long as necessary." On
review, the commission ruled that "[t]he award . . . is AFFIRMED
as MODIFIED: temporary total disability benefits shall be paid
to Derek M. Kramer in the weekly amount of $213.33 for the
period May 15, 1995 through August 31, 1995 . . . [and that]
medical care and treatment . . . shall remain the employer's
responsibility for as long as necessary." On April 14, 1998 the
commission entered its award in favor of Kramer and remanded
only the issue of permanency.
By statute, the commission's award has particular
significance.
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The award of the Commission, as provided in
[Code] § 65.2-704, if not reviewed in due
time, or an award of the Commission upon
such review, as provided in [Code]
§ 65.2-705, shall be conclusive and binding
as to all questions of fact. No appeal
shall be taken from the decision of one
Commissioner until a review of the case has
been had before the full Commission, as
provided in [Code] § 65.2-705, and an award
entered by it. Appeals shall lie from such
award to the Court of Appeals in the manner
provided in the Rules of the Supreme Court.
Code § 65.2-706(A). Applying this statute, the Supreme Court
has held that the term "award" means "a decision of the . . .
Commission granting or denying, or changing or refusing to
change, some benefit payable or allowable under the . . . Act
and leaving nothing to be done except to superintend
ministerially the execution of the award." Jewell Ridge Coal
Corp. v. Henderson, 229 Va. 266, 269, 329 S.E.2d 48, 50 (1985).
The commission's award for temporary total disability
benefits was a ruling on the merits of the case, granting a
benefit to Kramer payable under the Act. Nothing about the
award was interlocutory. Indeed, the award "adjudicat[ed] the
principles of [the] cause." Code § 17.1-405(4), recodifying
Code § 17-116.05(4).
The issue becomes even clearer upon an examination of Holly
Farms Foods, Inc. v. Carter, 15 Va. App. 29, 422 S.E.2d 165
(1992). Addressing the effect of an award, we noted the
following:
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[T]he commission expressly noted that, even
though it found a compensable occupational
disease, it was unable to "enter an award"
due to a lack of evidence identifying
periods of disability. Instead, as the
commission noted, "[t]his decision is not
final until the entry of the award of the
Deputy Commissioner establishing periods of
compensable disability." Especially in
light of the commission's express
recognition that its decision would not
become final until the final determination
of the periods of disability, we will not
conclude that the deputy commissioner's
duties on remand were merely "ministerial."
Id. at 34-35, 422 S.E.2d at 167.
The entry of an award conferring a benefit to Kramer under
the Act is a significant, controlling fact that distinguishes
this case from Harper. When the commission entered its award
for temporary total disability benefits on April 14, 1998, it
remanded the case to the deputy commissioner solely to determine
Kramer's permanency rating. On review of the permanency issue,
the commission correctly ruled as follows:
The issue of whether Santa's Helper
Chimney Sweeps is an "Employer" under the
Act, and [Kramer's] status under the Act
were decided in the Commission's Opinion of
April 14, 1998. No timely appeal of that
final, non-interlocutory, order was noted by
any party. Therefore, that portion of the
Opinion, as well as the findings regarding
[Kramer's] pre-injury average weekly wage,
are binding on the parties.
For these reasons, I would affirm the commission's March
26, 1999 award on all issues.
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