AFFORDABLE ALUMINUM, INC. v. JAMES HOWARD COULTER; HON. J. LANDON OVERFIELD, ADMINISTRATIVE LAW JUDGE; WORKERS' COMPENSATION BOARD
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RENDERED:
OCTOBER 12, 2001; 10:00 a.m.
NOT TO BE PUBLISHED
C ommonwealth O f K entucky
C ourt O f A ppeals
NO.
2001-CA-000389-WC
AFFORDABLE ALUMINUM, INC.
APPELLANT
PETITION FOR REVIEW OF A DECISION
OF THE WORKERS' COMPENSATION BOARD
WC-98-70185
v.
JAMES HOWARD COULTER;
HON. J. LANDON OVERFIELD,
ADMINISTRATIVE LAW JUDGE;
WORKERS' COMPENSATION BOARD
APPELLEES
OPINION
REVERSING AND REINSTATING
** ** ** ** **
BEFORE:
BARBER, BUCKINGHAM, AND MILLER, JUDGES.
BARBER, JUDGE:
Appellant, Affordable Aluminum, Inc.
(“Affordable”), seeks review of the Workers’ Compensation Board’s
decision, reversing the ALJ’s average weekly wage calculation,
and remanding.
For the reasons set forth below, we reverse the
Board and reinstate the ALJ’s decision.
The Appellee, James Howard Coulter (“Coulter”),injured
his ankle on August 6, 1998, while installing siding for
Affordable.
The parties stipulated that Coulter was an
independent contractor and there was workers’ compensation
coverage on the date of injury.
At the time of the injury,
Coulter had worked for Affordable for less than 13 weeks.
Affordable contends that the Board erroneously
interpreted and applied KRS 342.120, thereby miscalculating the
average weekly wage.
Coulter advises this appeal is Affordable’s
“fourth bite at the apple,” his wage having been determined
sufficient for maximum benefits at the arbitrator level, upon de
novo review by the ALJ and upon appeal to the Board.
Prior to working for Affordable, Coulter had worked for
Jason Maxwell.
Maxwell was a subcontractor doing siding work for
Affordable in the Bowling Green area following a hail storm.
Subcontractors were paid $65.00 per square of siding -- $50.00
for installation of new siding and $15.00 for removal of damaged
siding.
Coulter worked for Maxwell on a 40-60 split.
worked for Maxwell for a couple of weeks.
Coulter
Thereafter, Coulter
subcontracted directly with Affordable through one of its owners,
Greg Tucker.
Coulter put together a crew and worked for
Affordable for 3 weeks before he was injured.
The ALJ found that:
Plaintiff presented evidence that he had paid
a [helper] . . . named Jerry Field [sic]
$493.00 for the week ending July 31, 1998,
and $325.00 for the week ending August 6,
1998. This total of $818.00 was paid to Mr.
Fields out of the payments made to Plaintiff
by Defendant Employer. This figure . . . is
not in dispute. Plaintiff also agreed with
wage records filed by Defendant Employer that
he had been paid a total of $3,748.02, and
after the payment to Fields, was left with
$2,940.02 for the work he did as a
subcontractor for the Defendant-Employer.
This appears to have been payment for the
period from July 17, 1998 through August 7,
1998. From the totality of the evidence,
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however, it appears that $535.97 of this, for
the week ending July 17, 1998, was
Plaintiff’s portion of the amount paid to
Jason Maxwell.
Plaintiff testified that prior to working for
the Defendant Employer as a subcontractor he
had done siding work in the Glasgow/Bowling
Green area. He did this work by himself and
apparently much of what he earned was in
cash.
Defendant Employer deposed Greg Tucker
. . . . [H]e agreed that subcontractors were
paid $65.00 per square for removal of damaged
siding and installation of new siding. He
also agreed that Plaintiff had been paid
$460.62 for the week ending August 7, 1998,
$1,760.40 for the week ending July 31, 1998
and $1,001.03 for the week ending July 24,
1998. Plaintiff was paid $535.97 for the
week ending July 17, 1998, but that was paid
to Plaintiff by Mr. Maxwell after Maxwell had
received payment from Defendant Employer.
However, the figure does not coincide with
40% of the amount paid to Maxwell.
Introduced as exhibits to Mr. Tucker’s
deposition were . . . checks payable to
Plaintiff from Defendant Employer . . . as
follows:
July 27, 1998
August 03,1998
August 03, 1998
August 10, 1998
-
$1,001.03
$1,000.00
$ 760.40
$ 460.62
. . . .
[At hearing], Plaintiff was . . . [asked if]
he had gone to work for Defendant Employer in
April [1998] and . . . [he responded] that he
believed he hauled away some shingles . . .
for which he was paid cash.
. . . .
Plaintiff testified that for the four 13
weeks periods [sic] immediately preceding his
August 6, 1998 injury, siding work would have
been available in the Bowling Green/Glasgow
area but not in the quantity that resulted
from the hail storm which caused the damage
Defendant Employer was repairing. He
testified that in the four quarters
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immediately preceding the injury he had been
working for a contractor doing siding work
for which he was paid $40.00 a square and was
doing 20 to 25 squares per week. Plaintiff
testified that was merely putting siding on
and was not taking it off . . . . This [sic]
gist of Plaintiff’s testimony was that he
would have earned this type of money had he
been employed as a siding installer for the
full 13 week calendar weeks immediately
preceding the injury. There is no evidence
in the record to contradict this.
The ALJ concluded that Coulter’s average weekly wage on August 6,
1998 was $800.31:
Plaintiff, as a siding contractor in the
Glasgow/Bowling Green area, was capable of
earning $800.00 per week for the ten weeks
prior to the time he became a subcontractor
for Defendant Employer. This is based on
Plaintiff’s testimony which is unrebutted. I
also have based it on the three weekly
periods during which Plaintiff received
checks in the amount of $3,222.05 . . . from
Defendant Employer and deducted from that
$818.00 which Plaintiff paid to Mr. Fields
. . . . This would give Plaintiff a grand
total for the 13 week period immediately
preceding his injury of $10,404.05 for an
average weekly wage of $800.31. Doubtless
Defendant Employer will argue that Plaintiff
was not earning $800.00 for the two week
period during which he worked with Mr.
Maxwell and that he had paid another employee
$50.00. Plaintiff’s testimony is credible
that the other employee was given $50.00 only
as a parting gift and there is no sum certain
in the evidence . . . as to what Plaintiff
earned while he was working with Mr. Maxwell.
For the amount of evidence at hand for the
determination of this most complicated issue,
this is the best I can do.
Affordable appealed to the Board contending that the ALJ erred in
calculating the wage.
On January 24, 2001, the Board rendered a
unanimous opinion reversing and remanding:
It is well established that the goal of KRS
342.140(1)(d) and (e) governing the
calculation of the average weekly wage of a
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claimant employed for fewer than 13 weeks is
to obtain a realistic reflection of the
workers’ earning capacity. Huff v. Smith
Trucking, Ky., 6 S.W.3d 819 (1999). The
computation of the average weekly wage for
individuals such as Coulter who are employed
for fewer than 13 weeks must take into
consideration the unique facts and
circumstances of each individual case. C & D
Bulldozing v. Brock, Ky., 820 S.W.2d 482
(1991). KRS 342.140(1)(d) and (3) [sic]
specifically stated [sic] as follows:
The average weekly wage of the injured
employee at the time of the injury or last
injurious exposure shall be determined as
follows:
(1) If at the time of the injury which
resulted in death or disability or the last
date of injurious exposure preceding death or
disability from an occupational disease:
* * *
(d) The wages were fixed by the day, hour, or
by the output of the employee, the average
weekly wage shall be the wage most favorable
to the employee computed by dividing by
thirteen (13) the wages (not including
overtime or premium pay) of said employee
earned in the employ of the employer in the
first, second, third, or fourth period of
thirteen (13) consecutive calendar weeks in
the fifty-two (52) weeks immediately
preceding the injury.
(e) The employee had been in the employ of
the employer less than thirteen (13) calendar
weeks immediately preceding the injury, his
average weekly wage shall be computed under
paragraph (d), taking the wages (not
including overtime or premium pay) for that
purpose to be the amount he would have earned
had he been so employed by the employer the
full thirteen (13) calendar weeks immediately
preceding the injury and had worked, when
work was available to other employees in a
similar occupation. (Emphasis added.) [By the
Board.]
The Board held that the ALJ was correct in determining that KRS
342.140(1)(e) is the statutory provision that controls the
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calculation of Coulter’s average weekly wage; however, the Board
disagreed with the manner in which the ALJ applied the statute.
The Board believed that the ALJ had erroneously included
Coulter’s personal earnings before he became a subcontractor with
Affordable.
The Board explained that KRS 342.140(1)(e) required
the ALJ to calculate Coulter’s earnings by extrapolating the
amount he would have earned, had he been employed by Affordable
for the full 13 weeks immediately preceding his injury.
The
Board noted that it was undisputed that Affordable paid
subcontractors, such as Coulter, $65.00 per square.
The Board
stated:
[W]e believe the ALJ was vested with the
authority to project those earnings based
upon the actual earnings by Coulter for the
three weeks he was employed by the
petitioner, especially given the “unique
facts which are present in this case.” Huff
v. Smith Trucking, Ky., 6 S.W.3d at 822. We
therefore believe that the ALJ should have
simply averaged Coulter’s earnings for the
weeks ending July 24, 1998; July 31, 1998;
and August 7, 1998, inferring that said
average, less labor paid by Coulter to
Fields, would properly represent his average
earning capacity for each week for the full
13 weeks prior to his date of injury.
Paramount Foods, Inc. v. Burkhardt, Ky., 695
S.W.2d 418 (1985) and Jackson v. General
Refractories Co., Ky., 581 S.W.2d 10 (1997).
Ironically, Affordable prevailed in its attempt to reverse the
ALJ’s decision only to have the Board propose a slightly higher
average weekly wage figure upon remand.
Affordable now attempts
to persuade us that the Board erred.
Affordable contends that Coulter did not work at all
or - failed to offer proof of earnings - during some of the ten
-6-
weeks before he started working for Affordable.
KRS
342.140(1)(e) does not require a showing that a claimant actually
worked, or intended to work, in the thirteen weeks preceding the
injury.
Central Ky. Steel v. Wise, Ky., 19 S.W.3d 657 (2000).
Affordable also argues that earnings Coulter would have made
before the injury as an independent contractor cannot be included
in his average weekly wage under Hale v. Bell Aluminum, Ky., 986
S.W.2d 152 (1998), on the theory that such earnings would be from
“non-covered” employment.
Despite some superficial factual
similarities, Hale deals with a different issue of law and does
not control.
Hale, a siding installer, subcontracted with Bell
Aluminum to provide labor at $52.00 a square.
Hale maintained
workers’ compensation coverage for himself through Bell Aluminum
via a paycheck deduction.
Bell Aluminum was aware that Hale had
his own siding business, Stephan & Son.
Hale did not carry
workers’ compensation coverage on Stephan & Son.
Hale worked on
his own jobs in between those for which he was hired by Bell
Aluminum.
Hale was injured working for Bell Aluminum.
was his average weekly wage.
At issue
KRS 342.140(5) provides that “when
the employee is working under concurrent contracts with two (2)
or more employers and the defendant employer has knowledge of the
employment prior to the injury, his wages from all the employers
shall be considered as if earned from the employer liable for
compensation.”
The court held that Hale’s earnings from his own
business, Stephan & Son, were not from “covered employment”;
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thus, they could not be considered concurrent wages.
sub judice does not involve concurrent wages.
The case
KRS 342.140(5) is
not at issue here.
We agree with the Board that the ALJ was correct in
determining that KRS 342.140(1)(e) is the applicable statutory
provision for calculating Coulter’s average weekly wage; however,
we believe that the Board erred by misconstruing the ALJ’s
calculation.
We do not agree that the ALJ included Coulter’s
actual personal earnings before he started working as a
subcontractor for Affordable.
worked for Jason Maxwell.
Before Affordable, Coulter had
The ALJ did not include Coulter’s
personal earnings with Maxwell:
Plaintiff’s average weekly wage on August 6,
1998, was $800.31 . . . . Doubtless
Defendant Employer will argue that Plaintiff
was not earning $800.00 for the two week
period during which he worked with Mr.
Maxwell . . . [however]there is no sum
certain in the evidence for a determination
as to what Plaintiff earned while he was
working with Mr. Maxwell.
The ALJ based his wage calculation on the three weeks immediately
preceding the injury that Coulter actually worked for Affordable,
evidence concerning the availability of work and what a siding
installer could have earned in the area for the ten weeks before
that:
In making this finding I have determined that
Plaintiff, as a siding contractor in the
Glasgow/Bowling Green area, was capable of
earning $800.00 per week for the ten weeks
prior to the time he became a subcontractor
for the Defendant Employer. This is based on
Plaintiff’s testimony which is unrebutted.
(Emphasis added.)
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In Huff v. Smith Trucking, supra at 822-23, the Supreme Court
discussed the application of the statute and the sufficiency of
wage evidence:
KRS 342.140(1)(e) applies to injuries
sustained after fewer than 13 weeks'
employment. It utilizes the averaging method
set forth in KRS 342.140(1)(d) and attempts
to estimate what the worker's average weekly
wage would have been over a typical 13-week
period in the employment by referring to the
actual wages of workers performing similar
work when work was available . . . the goal
of KRS 342.140(d) and (e) is to obtain a
realistic estimation of what the injured
worker would be expected to earn in a normal
period of employment . . . .
. . . .
[T]he computation of average weekly wage
pursuant to KRS 342.140(1)(e) must take into
consideration the unique facts and
circumstances of each case . . . .
In view of the unique facts which are present
in this case, we conclude that the Board
properly construed KRS 342.140(1)(e) as
authorizing a consideration of evidence
concerning the wages earned by timber cutters
who worked for other employers in the area
where claimant lived and concerning the
availability of such work. We are persuaded
that claimant's uncontradicted testimony
sufficiently demonstrated that timber cutting
work was available at $75.00 per day in the
area in which he resided. (Emphasis added.)
Here, Coulter’s injury was sustained after fewer than 13 weeks of
work for Affordable.
stipulated.
Workers’ compensation coverage was
The ALJ properly considered evidence concerning the
wages of siding installers for other employers in the area where
Coulter lived and the availability of such work.
We are
persuaded that Coulter’s unrebutted testimony sufficiently
-9-
demonstrated that siding work was available at $40 per square,
20-25 squares a week, in the area in which he resided for the
period in question.
The ALJ’s determination of the average
weekly wage is based upon the correct statutory provision and has
a substantial evidentiary foundation.
The Board erred in
reversing the ALJ’s decision.
Accordingly, we reverse the decision of the Workers’
Compensation Board and reinstate the opinion and award of the
ALJ.
ALL CONCUR.
BRIEF FOR APPELLANT:
BRIEF FOR APPELLEE, JAMES
HOWARD COULTER:
Douglas A. U’sellis
Louisville, Kentucky
Thomas W. Davis
Glasgow, Kentucky
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