COURT OF APPEALS OF VIRGINIA
Present: Judges Elder, Annunziata and Senior Judge Duff
Argued at Alexandria, Virginia
FALLS CHURCH CONSTRUCTION
CORPORATION, ET AL.
OPINION BY
v. Record No. 0550-95-4 JUDGE LARRY G. ELDER
DECEMBER 12, 1995
RAPHAEL VALLE
FROM THE VIRGINIA WORKERS' COMPENSATION COMMISSION
Dawn E. Boyce (Trichilo, Bancroft, McGavin,
Horvath & Judkins, P.C., on brief), for
appellants.
Jack T. Burgess (Jack T. Burgess & Associates,
P.C., on brief), for appellee.
Falls Church Construction Corporation, the statutory
employer, and West American Insurance Company, its insurer,
appeal the commission's award of benefits to Raphael Valle
(claimant) for a work-related injury by accident. Falls Church
Construction contends: (1) claimant's immediate employer was not
uninsured and therefore the immediate employer's insurer, the
Maryland Injured Workers' Insurance Fund, should have been added
as a party to the proceedings; (2) claimant did not establish an
injury by accident; (3) claimant did not adequately market his
residual work capacity; and (4) claimant obstructed medical
treatment. Finding no error, we affirm the commission's
decision.
I.
FACTS
The commission awarded claimant benefits for an injury by
accident arising out of and in the course of his employment with
American Inner Wall, Inc., claimant's immediate employer.
American Inner Wall is a subcontractor of Falls Church
Construction. Claimant commenced work with American Inner Wall
in 1987, performing duties as a carpenter and a foreman.
American Inner Wall hired claimant in Maryland, and he initially
worked only in that state. On June 23, 1993, the date of
claimant's injury by accident, American Inner Wall possessed a
workers' compensation policy issued by the Maryland Injured
Workers' Insurance Fund (Maryland Fund), which American Inner
Wall believed insured its employees who temporarily worked in
other states. Falls Church Construction required American Inner
Wall to maintain such a policy pursuant to the
contractor/subcontractor agreement it reached with American Inner
Wall.
On June 23, 1993, claimant performed carpentry duties on a
four to five foot high scaffold at an elementary school in
Herndon, Virginia. While screwing wire mesh into the ceiling,
claimant attempted to prevent himself from falling off the
scaffold by springing forward to grab a column. As he did so, he
felt a snap in his back and a burning sensation. Claimant
promptly reported the injury to his foreman and received
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permission to seek medical treatment. Claimant received
emergency room treatment within twenty minutes at Access of
Reston/Fairfax Hospital and later at Fairfax Hospital. The
examining physician diagnosed acute back strain and prescribed
medication and rest for two days with restriction to light
activities.
The following day, claimant returned to work medicated with
an over-the-counter aspirin, and he presented the foreman with a
disability slip detailing his work restrictions. The foreman
told claimant "just to lay back," yet claimant performed work
duties for five and one-half hours. A coworker testified that
claimant performed regular duties without complaint or
difficulty. Witnesses observed claimant shooting basketball for
approximately fifteen to twenty minutes during a work break.
On June 30, 1993, Dr. Denis O'Brien examined claimant and
diagnosed degenerative disc disease at the L5-S1 disc with lumbar
radiculopathy. On August 4, 1993, Dr. O'Brien offered a
diagnosis of a herniated disc at the L5-S1 disc and opined that
the symptoms were directly related to claimant's work injury.
On January 20, 1994, claimant was released to light duty
work status, but he continued to complain of pain. Claimant
applied for unemployment benefits in Maryland, which he received
for twenty-six weeks. Claimant supplied the Maryland Employment
Commission with lists of job contacts he made, and he testified
as to the jobs he applied for from March to August of 1994, the
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month of the deputy commissioner's hearing. Claimant worked as
an announcer on a Spanish speaking radio station for three weeks
in September and October 1993 and also delivered newspapers with
his family.
Claimant's compensation claim, filed on July 26, 1993,
alleged various degrees of work incapacity from June 24, 1993 to
July 31, 1994, not counting certain periods during which he
secured employment. After Falls Church Construction and its
insurer were added as defendants, but prior to the deputy
commissioner's hearing, Falls Church Construction asserted that
it was improper to proceed without American Inner Wall's insurer,
the Maryland Fund. The commission overruled Falls Church
Construction's request to join the Maryland Fund as a party.
The deputy commissioner and the full commission found: (1)
claimant sustained an injury by accident on June 23, 1993, (2) he
was entitled to benefits, (3) he adequately marketed his residual
work capacity, (4) he did not obstruct medical treatment, and (5)
American Inner Wall was uninsured for claimant's compensable
injury. On the issue of insurance, the commission noted that
American Inner Wall did not demonstrate coverage by an insurance
carrier authorized and licensed to do business in Virginia over
which the commission could exercise jurisdiction, as required by
Code § 65.2-801. Therefore, Falls Church Construction was liable
for claimant's injuries as his statutory employer.
II.
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IMMEDIATE EMPLOYER'S INSURANCE
We hold the commission did not err in deciding that American
Inner Wall was uninsured in Virginia and that Falls Church
Construction was therefore liable as the statutory employer. See
Code § 65.2-302; Sites Constr. Co., Inc. v. Harbeson, 16 Va. App.
835, 434 S.E.2d 1 (1993)(stating employees of an uninsured sub-
contractor may look to the general contractor/statutory employer
for coverage).
Code § 65.2-801 dictates the various methods by which an
employer must insure its employees for injuries covered by the
Virginia Workers' Compensation Act. Code § 65.2-801(A) states:
Every employer subject to this title shall
secure his liability thereunder by one of the
following methods:
1. Insuring and keeping insured his
liability in an insurer authorized to
transact the business of workers'
compensation insurance in this
Commonwealth;
2. Receiving a certificate pursuant to
§ 65.2-808 from the Workers'
Compensation Commission authorizing such
employer to be an individual self-
insurer; or
3. Being a member in good standing of a
group self-insurance association
licensed by the State Corporation
Commission.
Nothing in the record establishes that American Inner Wall met
the requirements of subsections (A)(2) or (3), because American
Inner Wall was neither self-insured nor a member of a group self-
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insurance association. Thus, American Inner Wall was obligated
to meet the requirements of subsection (A)(1)--to insure
"liability in an insurer authorized to transact the business of
workers' compensation insurance" in Virginia.
American Inner Wall did not meet this requirement because,
according to the commission's records, the Maryland Fund is not
an insurer authorized to transact the business of workers'
compensation insurance in Virginia. The State Corporation
Commission/Department of the Bureau of Insurance notified the
commission that the Maryland Fund was not a licensed "carrier"
included in the Bureau of Insurance's list of companies licensed
to transact insurance business in Virginia. See Code
§§ 38.2-1024, 38.2-1027 (stating no insurer shall transact
business in Virginia until it has obtained the appropriate
license from the State Corporation Commission and has met other
requirements concerning company organization). Furthermore, the
commission noted that the Bureau of Insurance said the Maryland
fund is not a commercial insurance company, but rather a Maryland
state agency which acts as an insurer of last resort for
businesses operating in Maryland. Compare Code § 65.2-1203
(setting forth the procedure by which the Virginia Uninsured
Employer's Fund acts as an insurer for uninsured employers).
Falls Church Construction asserts that when an employer
fails to comply with one of Code § 65.2-801's methods of securing
liability, civil or criminal penalties are the appropriate
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methods of redress. See Code § 65.2-805 (assessing civil
penalties); Code § 65.2-806 (assessing criminal penalties). A
close reading of Code §§ 65.2-805 and -806 reveals that the
respective penalty provisions apply when an employer fails to
comply with the record keeping requirements of Code § 65.2-804, 1
not the requirements of Code § 65.2-801. We do not believe, nor
does Falls Church Construction offer support for its contention,
that penalties are also the appropriate method of redress for an
employer that has failed to secure its liability under one of the
three methods prescribed by Code § 65.2-801.
Falls Church Construction also attempts to support its
position with three commission opinions issued twenty years ago,
each of which involved an immediate employer and its insurance
company denying insurance coverage. Priest v. Harrison, 56
O.I.C. 257 (1975); Poston v. Evans, 56 O.I.C. 253 (1975); Johnson
v. Hensil Farlow Constr. Co., Inc., 56 O.I.C. 188 (1975). Not
only are these decisions not binding on this Court, but none
includes facts involving an insurer unauthorized to transact the
business of workers' compensation insurance in Virginia.
Therefore, we cannot say the commission erred in determining
that American Inner Wall was uninsured in Virginia for purposes
1
Code § 65.2-804, entitled "Evidence of compliance with
title; notices of cancellation of insurance," states "[e]very
employer subject to this title shall file with the . . .
[c]ommission, in form prescribed by it, annually or as often as
may be necessary, evidence of his compliance with the provisions
of § 65.2-801 and all other relating thereto."
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of the Virginia Workers' Compensation Act and that the statutory
employer, Falls Church Construction, was liable for claimant's
benefits. Nevertheless, we emphasize that nothing in the
commission's decision, or in this Court's decision, is meant to
foreclose other avenues of redress Falls Church Construction may
have in the Maryland courts or commission or other appropriate
forums. 2
III.
MERITS OF THE CLAIM
Falls Church Construction argues claimant did not suffer an
injury arising out of and in the course of his employment.
On appellate review, we view the evidence in the light most
favorable to the prevailing party below. R.G. Moore Bldg. Corp.
v. Mullins, 10 Va. App. 211, 212, 390 S.E.2d 788, 788 (1990).
"In determining whether credible evidence exists, the appellate
court does not retry the facts, reweigh the preponderance of the
evidence, or make its own determination of the credibility of the
witnesses." Wagner Enters., Inc. v. Brooks, 12 Va. App. 890,
894, 407 S.E.2d 32, 35 (1991)(citation omitted). To recover
benefits, the claimant must establish by a preponderance of the
evidence that he suffered an injury by accident "arising out of
2
We note that under Maryland workers' compensation law, an
employee is entitled to compensation while working for an
employer even where that employee was injured while working
outside of Maryland "on a casual, incidental, or occasional basis
if the employer regularly employs the individual within
[Maryland]." Md. Code Ann., Labor & Employment § 9-203 (1991);
compare Virginia Code § 65.2-508.
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and in the course of [his] employment," Code § 65.2-101, and
"that the conditions of the workplace . . . caused the injury."
Plumb Rite Plumbing Serv. v. Barbour, 8 Va. App. 482, 484, 382
S.E.2d 305, 306 (1989). Unless we can say as a matter of law
that claimant failed to meet his burden of proof, the
commission's findings are binding and conclusive upon us. See
Tomko v. Michael's Plastering Co., 210 Va. 697, 699, 173 S.E.2d
833, 835 (1970).
After reviewing the record, we hold the commission did not
err in finding that claimant sustained an injury by accident
arising out of and in the course of work. Testimony revealed
that claimant fell from a scaffold at the workplace as he was
performing regular work duties. As he fell, claimant felt a snap
in his back and a burning sensation. Claimant promptly reported
his injury to his foreman, received permission to seek medical
treatment, and received emergency room treatment within twenty
minutes. The examining physician first diagnosed acute back
strain and later a herniated disc. The medical records do not
indicate any other possible cause for claimant's back injury, and
there is no indication of prior back ailments.
IV.
RESIDUAL WORK CAPACITY
A partially disabled claimant has the burden of proving
entitlement to benefits and that he made a reasonable effort to
procure suitable work and to market his remaining work capacity.
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Great Atl. & Pac. Tea Co. v. Bateman, 4 Va. App. 459, 463-64,
359 S.E.2d 98, 100 (1987). "In determining whether a claimant
has made a reasonable effort to market his remaining work
capacity, we view the evidence in the light most favorable to . .
. the party prevailing before the commission." National Linen
Svc. v. McGuinn, 8 Va. App. 267, 270, 380 S.E.2d 31, 33 (1989).
We hold that the commission did not err in determining claimant
adequately marketed his residual work capacity.
On January 20, 1994, claimant was released to light duty
work status. Claimant applied for unemployment benefits in
Maryland, which he received for twenty-six weeks. Claimant
supplied the Maryland Employment Commission with lists of job
contacts he made, and he testified as to jobs applied for from
March to August of 1994, the month of the deputy commissioner's
hearing. Claimant worked as an announcer on a Spanish speaking
radio station for three weeks in September and October 1993,
earning eighty dollars per week, delivered newspapers with his
family, and made attempts to gain computer skills to enhance his
marketability. As the commission correctly recognized,
claimant's efforts qualified as reasonable within the parameters
set forth in National Linen Svc., 8 Va. App. at 272, 380 S.E.2d
at 34.
V.
OBSTRUCTION OF MEDICAL TREATMENT
Under some circumstances, failure to follow a physician's
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instructions may be unjustified and lead to a suspension of
benefits. See generally Holland v. Virginia Bridge & Structures,
Inc., 10 Va. App. 660, 662, 394 S.E.2d 867, 868 (1990)(holding
employee who unjustifiably refuses reasonable and necessary
medical treatment should be penalized); Code § 65.2-603(B)
(stating employee may not unjustifiably refuse to accept medical
or rehabilitative services). In this case, Falls Church
Construction asserts that claimant failed to follow the examining
physician's June 23, 1993 order to rest for two days, when
claimant performed work duties and briefly played basketball the
day after his injury. Falls Church Construction contends that
these actions aggravated any underlying injury, adversely
affected claimant's recovery, and prevented claimant from proving
that his disability arose from a work-related cause.
We hold that although claimant failed to follow the
attending physician's orders, Falls Church Construction presented
no evidence that claimant's activities on June 24, 1993 adversely
affected his recovery. Without such evidence, the commission
properly determined that it could not find that claimant
obstructed his medical treatment or that his condition arose from
a non-work-related cause. See Shelton v. Ennis Business Forms,
Inc., 1 Va. App. 53, 55, 334 S.E.2d 297, 299 (1985)(holding
compensation is denied where it is just as probable that
disability arose from non-work-related cause as a work related
cause).
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Accordingly, we affirm the commission's decision.
Affirmed.
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