RENDERED: SEPTEMBER 27, 2018 TO BE PUBLISHED i----- »
2017-SC-000377-WC
ACTIVE CARE CHIROPRACTIC, INC.
ON APPEAL FROM COURT OF APPEALS V. CASE NO. 2017-CA-00469-WC WORKERS’COMPENSATION BOARD NO. 14-WC-81319
KATHERINE RUDD; APPELLEES HONORABLE JEANIE OWEN MILLER, ADMINISTRATIVE LAW JUDGE; WORKERS’ COMPENSATION BOARD AND KENTUCKY COURT OF APPEALS
OPINION OF THE COURT BY JUSTICE VANMETER
AFFIRMING
KRSi 342.730(l)(c)2 states: “During any period of cessation of . . .
employment, temporary or permanent, for any reason, with or without cause,
payment of weekly benefits for permanent partial disability during the period of
cessation shall be two (2) times the amount otherwise payable[.]’’2 The sole
issue for this Court on appeal, an issue of first impression, is whether the two-
1 Kentucky Revised Statutes. 2 We note that the General Assembly amended KRS 342.730 this past legislative session. 2018 Ky. Acts ch. 40, § 13. But these amendments do not affect this case in any way. multiplier under KRS 342.730(l)(c)2 applies to a claimant’s benefits when that
claimant returns to work and later retires for reasons not solely related to the
work-related injury itself. We hold that in such circumstances the two-
multiplier must be applied to comply with the unambiguous language of KRS
342.730(l)(c)2. Accordingly, we affirm.
I. FACTUAL BACKGROUND.
The facts in this case are not in dispute. Active Care Chiropractic
employed Katherine Rudd part-time. One day, while taking out the trash at
work, she slipped and fell, injuring her shoulder. After three shoulder
surgeries, she returned to work. About a year after her return to work, she
voluntarily retired, for reasons not solely related to the work-related injury. At
her Formal Hearing Rudd stated:
It was not due to the accident, not directly. I was turning sixty, and I’d never had any medical problems before. This kind of made me re-evaluate things. I decided I wanted to spend what quality years I have left doing things that provide the greatest satisfaction, and decided that being a secretary just wasn’t doing it for me anymore. So I retired.
At Rudd’s Benefit Review Conference, the parties agreed that the only
issue before the ALJ was the correct multiplier to be applied to Rudd’s benefits.
The ALJ acknowledged that the parties originally agreed that no multiplier
would apply. But Rudd argued that changes in the caselaw placed the modifier
application at issue.
Rudd referred to our recent decision in Livingood v. Transfreight, LLC,
467 S.W.3d 249 (Ky. 2015), which overruled the holding in Chrysalis House,
Inc. V. Tackett, 283 S.W.3d 671 (Ky. 2009), that a work-related disability must be the reason for an employee’s cessation of employment in order to afford
application of the two-multiplier. Instead, Livingood held that “KRS
342.730{l)(c)2 permits a double income benefit during any period that
employment at the same or a greater wage ceases ‘for any reason, with or
without cause,’ except where the reason is the employee’s conduct shown to
have been an intentional, deliberate action with a reckless disregard of the
consequences either to himself or to another.” 467 S.W.3d at 259 (quoting KRS
342.730(l)(c)2).
Rudd argued that, since her cessation from work was not due to
intentional or reckless misconduct, that being the only restriction on a
claimant’s ability to recover under the statute, she should be entitled to the
two-multiplier. In other words, because voluntary retirement constitutes a
“cessation of employment ... for any reason” and does not constitute
intentional or reckless misconduct under Livingood, she qualified for the two-
multiplier.
The ALJ agreed, concluding she was “bound by the plain wording” of the
statute and this Court’s holding in Livingood, with the only purported
restriction on application of the two-multiplier being the employee’s intentional
or reckless misconduct. The Workers’ Compensation Board (“Board”) and the
Court of Appeals affirmed the ALJ’s decision. Active Care Chiropractic’s
(“Active Care”) appeal to this Court followed. See Ky. Const. § 115. IL STANDARD OF REVIEW.
We review statutory interpretation de novo. Cumberland Valley
Contractors, Inc. v. Bell Cty. Coal Corp., 238 S.W.3d 644, 647 (Ky. 2007). The
well-established standard for reviewing a workers’ compensation decision is to
“correct the Board only where the Court perceives the Board has overlooked or
misconstrued controlling statutes or precedent, or committed an error in
assessing the evidence so flagrant as to cause gross injustice.” W. Baptist
Hasp. V. Kelly, 827 S.W.2d 685, 687-88 (Ky. 1992). Finally, review by this
Court “is to address new or novel questions of statutory construction, or to
reconsider precedent when such appears necessary, or to review a question of
constitutional magnitude.” Id. at 688.
III. ANALYSIS.
KRS 446.080(1) directs that “[a]ll statutes of this state shall be liberally
construed with a view to promote their objects and carry out the intent of the
legislature).]” This Court’s goal, in construing statutes, “is to give effect to the
intent of the [legislature]. We derive that intent. . . from the language the
[legislature] chose, either as defined by the [legislature] or as generally
understood in the context of the matter under consideration.” Livingood, 467
S.W.3d at 256 (internal quotations and citations omitted). “General principles
of statutory construction hold that a court must not be guided by a single
sentence of a statute but must look to the provisions of the whole statute and
its object and policy.” Cty. of Harlan v. Appalachian Reg’I Healthcare, Inc., 85
S.W.3d 607, 611 (Ky. 2002). However, when construing provisions to match objectives of whole statutes, “[w]e have a duty to accord to words of a statute
their literal meaning unless to do so would lead to an absurd or wholly
unreasonable conclusion.” Livingood, 467 S.W.Sd at 257-58 (internal citations
and quotations omitted). Moreover, “‘it is neither the duty nor the prerogative
of the judiciary to breathe into the statute that which the Legislature has not
put there.”’ WUson v. SKWAlloys, Inc., 893 S.W.2d 800, 802 (Ky. App. 1995)
(quoting Gateway Constr. Co. v. Wallbaum, 356 S.W.2d 247, 248-49 (Ky.
1962)).
The plain language of KRS 342.730(l)(c)2 unquestionably supports
Rudd’s position: “During any period of cessation of. . . employment, temporary
or permanent, for any reason, with or without cause,” a claimant shall be
awarded permanent-partial disability benefits as modified by the two-
multiplier. (emphasis added). Taken at face value, Rudd’s argument, that
voluntary retirement and removal from the workforce for reasons not solely
related to the workplace injury qualifies as “cessation of . . . employment. . .
for any reason” and affords the application of the two-multiplier to benefits
received, is supported by the language of the statute.
Active Care argues that this Court should disregard this unambiguous
language and carve out an exception akin to the intentional misconduct
exception from Livingood. In Livingood, we noted the “legislative intent in KRS
Chapter 342 that an employee should not benefit from his own wrongdoing.”
467 S.W.3d at 258. The many examples throughout Chapter 342 barring
compensation due to wrongdoing by the employee exemplify this legislative intent and support the exception fashioned in Livingood. See KRS 342.035(3)
(denying compensation for unreasonable failure to follow medical advice);
342.165(2) (denying compensation when employee knowingly and willingly
makes a false representation regarding physical condition at time of
employment); 342.610(3) (denying compensation when injury occurs due to
voluntary intoxication or willful intent to injure oneself or another).
In the present case, absent any evidence of Rudd’s intentional or reckless
wrongdoing, no exception to the unambiguous language of KRS 342.730(l)(c)2
precludes the recovery of the two-multiplier. Indeed, voluntary retirement
cannot possibly be construed as “an intentional, deliberate action with a
reckless disregard of the consequences.” Livingood, 467 S.W.3d at 259.
Instead, voluntary retirement falls squarely within the statute as a “cessation of
. . . employment ... for any reason, with or without cause).]” KRS
342.730(l)(c)2.
As stated previously, we have a “duty to accord to words of a statute
their literal meaning unless to do so would lead to an absurd or wholly
unreasonable conclusion.” Livingood, 467 S.W.3d at 257-58. In Livingood, we
determined that allowing an employee to “benefit from his own wrongdoing”
would lead to such a wholly unreasonable result based upon the whole of
Chapter 342. Id. at 257. Here, however, a literal construction of KRS
342.730(l)(c)2 prescribes that Rudd receive the two-multiplier because
voluntary retirement is a “cessation of . . . employment... for any reason,” and
does not lead to an absurd or unreasonable result in conjunction with the rest of Chapter 342, unlike intentional misconduct, even if the purpose of the
statute is to “encourage continued employment,” as Livingood noted in dicta.
Id.
Thus, when an individual voluntarily chooses to retire, a decision made
for reasons not solely related to that individual’s work-related injury, that
individual is entitled to the two-multiplier listed in KRS 342.730(l)(c)2. Such a
conclusion complements our decision in Livingood, a case in which we
recognized an appropriate limitation on the use of KRS 342.730(l)(c)2’s two-
multiplier in accordance with other provisions of KRS Chapter 342.
rv. CONCLUSION.
A workers’ compensation claimant is entitled to a two-multiplier under
KRS 342.730(l)(c)2 when that individual voluntarily chooses to retire.
Accordingly, the judgment is affirmed.
All sitting. Cunningham, Hughes, Keller, VanMeter, Venters, and
Wright, JJ., concur. Minton, C.J., dissented with opinion.
MINTON, C.J., DISSENTING: Today the Court introduces a strictly textualist
reading of KRS 342.730(l)(c)(2) to give Katherine Rudd, who voluntarily
removed herself from the workforce for reasons completely unrelated to a work-
related injury, enhanced workers’ compensation benefits. In my view, the
majority’s new approach leads to an absurd result, a result contrary to the
legislative purpose of the workers’ compensation statutes that we have
recognized in our recent decisions. Respectfully, I must dissent.
7 The plain language of KRS 342.730(l)(c)(2) undoubtedly supports Rudd’s
and the majority’s position: “During any period of cessation of. . . employment,
temporary or permanent, for any reason, with or without cause,”^ a claimant
shall be awarded permanent-partial disability benefits as modified by the two-
multiplier. Taken at face value, Rudd’s argument, that voluntary retirement
and removal from the workforce for reasons unrelated to the workplace injury
qualifies as “cessation of . . . employment. . . for any reason” and triggers
application of the two-multiplier to benefits received, appears to be supported
by the language of the statute.
But KRS 446.080(1) mandates that “[a]ll statutes of this state shall be
liberally construed with a view to promote their objects and carry out the intent
of the legislature . . ..”4 “In construing statutes, our goal ... is to give effect to
the intent of the [legislature]. We derive that intent. . . from the language the
[legislature] chose, either as defined by the [legislature] or as generally
understood in the context of the matter under consideration.”5 “General
principles of statutory construction hold that a court must not be guided by a
single sentence of a statute but must look to the provisions of the whole statute
and its object and policy.”^
3 (emphasis added). 4 Livingood v. Transfreight, LLC, 467 S.W.3d 249, 256 (Ky. 2015). 5 Id. (quoting Shawnee Telecom Res., Inc. v. Brown, 354 S.W.3d 542, 551 (Ky. 2011)). 6 County of Harlan v. Appalachian Reg’I Healthcare, Inc., 85 S.W.3d 607, 611 (Ky 2002).
8 Even more importantly, “Generally speaking, when interpreting statutes,
this court focuses on ‘giv[ing] the words of the statute their literal meaning and
effectuat[ing] the intent of the legislature.’ But even if the language is clear, we
will not promote an absurd result.”'^ “We have a duty to accord to words of a
statute their literal meaning unless to do so would lead to an absurd or wholly
unreasonable conclusion.”^ Moreover, “The legislature’s intention ‘shall be
effectuated, even at the expense of the letter of the law.’”^
“It has long been established that the purpose of awarding income
benefits to injured workers is to provide an ongoing stream of income to enable
them to meet their essential needs and those of their dependents.”lo “KRS
342.730(1) provides income benefits to replace some of the wages that workers
lose due to the occupational effects of work-related injuries.“Consistent with
. . . KRS 342.710(l)’s goal of encouraging a return to work, KRS 342.730(l)(c)2
focuses on post-injury wages.”12 “The purpose of KRS 342.730(l)(c)2 is to keep
partially disabled workers in the habit of working and earning as much as they
are able. It creates an incentive for them to return to work at which they will
earn the same or a greater average weekly wage by permitting them to receive a
7 Mills V. Department of Corrections Offender Information Services, 438 S.W.3d 328, 330 (Ky. 2014) (quoting Samons v. Kentucky Farm Bureau Mut. Ins. Co., 399 S.W.3d 425, 429 (Ky. 2013)). 8 Bailey v. Reeves, 662 S.W.2d 832, 834 (Ky. 1984). 9 Cosby V. Commonwealth, 147 S.W.3d 56, 58-59 (Ky. 2004) (quoting Commonwealth V. Rosenfeld Bros & Co., 80 S.W. 1178, 1180 (Ky. 1904)). 10 Ball V. Big Elk Creek Coal Co., 25 S.W.3d 115, 117 (Ky. 2000). 11 Toy V. Coca Cola Enterprises, 274 S.W.3d 433, 434-35 (Ky. 2008). 12 Id. at 435. basic benefit in addition to their wage but assuring them of a double benefit if
the attempt proves to be unsuccessful.”
In addition to the above-listed purposes of KRS 342.730(l)(c)(2), in
Livingood, we acknowledged “[KRS 342.730(l)(c)(2)’s] obvious purpose of
encouraging continued employment.”
Awarding an individual who has voluntarily chosen to retire and remove
herself from the workforce a two-multiplier on her permanent-partial disability
benefits is completely inconsistent with the purpose of KRS 342.730(l)(c)(2).
Awarding a voluntary retiree a two-multiplier flies in the face of the purpose of
KRS 342.730{l)(c)(2), which is “to keep partially disabled workers in the habit
of working and earning as much as they are able.”!^ Such a windfall does not
“create[] an incentive for them to return to work,”i® nor does it “encourag[e]
continued employment.” Rather, contrary to these purposes, doubling the
wage-loss benefits of those who choose voluntarily to retire and remove
themselves from the workforce for reasons unrelated to the work-related injuiy
creates the opposite incentive, i.e. to choose to retire rather than to attempt to
work.
The majority’s result is not only absurd, but flies in the face of the intent
of the workers’ compensation statutoiy framework. Livingood is a recent
13 Id. at 435. 1"* Livingood, 467 S.W.3d at 257 (emphasis added). 15 Toy, 274 S.W.3d at 435. 15 Id. 17 Livingood, 467 S.W.3d at 257.
10 unanimous decision by this Court that did exactly what I urge that we do
here—read KRS 342.730(1 )(c)(2) in a way that differs from the plain text to
effectuate the purpose of workers’ compensation. Instead of the employer
voluntarily retiring from the workforce for reasons unrelated to workplace
injury, as in our case today, the employer in Livingood was let go for, in part,
negligent conduct. He made the same claim Rudd makes here—the statute
says a double multiplier shall be applied for any cessation of employment
whatsoever? 9
The Court cited all the statutory canons of construction calling for
effectuating the intent of the legislature that I have, and more, in its analysis.20
The Court then overruled our prior holding in Chrysalis House, Inc. v. Tackett, 21
which stated that a double multiplier shall be applied only if the cessation is
related to the workplace injury.22
Importantly, the Court was very specific as to why it was overruling
Chrysalis House: “Requiring that the cessation of employment at the same or
greater wage must relate to the disabling injury does not promote the statute's
obvious purpose of encouraging continued employment. Moreover, such a
construction does little to discourage employers from taking workers back after
18 Id. at 253. 19 Id. at 255. 20 Id. at 256-58. 21 283 S.W.3d 671 (Ky. 2009). 22 Livingood, 467 S.W.3d at 257 (citing Chrysalis House, 283 S.W.3d at 674).
11 an injury just long enough to avoid liability for a greater award.”23 In other
words, the Court first identified that the Chrysalis House holding should be
overruled, not because of the language of the statute, but because the holding
did not effectuate the intent of the legislature.
The Court then went on to analyze the actual language of the statute,
finding that the language supported its overruling of Chrysalis House. But
most importantly, we said this: “Nevertheless, a literal construction of KRS
342.730(l)(c)(2) would lead to an unreasonable result if an employee ... is
allowed to benefit from his own wrongdoing. ”24 We then went on to find
evidence of legislative intent in other provisions of Chapter 342 that punished
an employee for wrongdoing, and came to the conclusion “that the legislature
did not intend to reward an employee’s wrongdoing with a double benefit.”25
Finally, we held “that KRS 342.730(l)(c)(2) permits a double-income benefit
during any period that employment at the same or a greater wage ceases ‘for
any reason, with or without cause,’ except where the reason is the employee's
conduct shown to have been an intentional, deliberate action with a reckless
disregard of the consequences either to himself or to another.”26 The latter
language of that holding, beginning with “except where the reason is . . .”, was
entirely inserted into the language of the statute by this Court and is nowhere
to be found in KRS 342.730(1)(c)(2).
23 Livingood, 467 S.W.3d at 257. 24 Id. 25 Id. at 259. 26 Id.
12 My point with this detailed discussion of what we unanimously said in
Livingood is to show two very pertinent instances in which this Court departed
from the literal language of the same text at issue today to effectuate the intent
of the workers' compensation statute. By the logic of the majority in this case,
Livingood has been clearly overruled because we added language to KRS
342.730(l)(c)(2) that is not there to effectuate the intent of the statute in that
case.27
The fact of the matter is that the Court in Livingood did not apply a strict
reading of KRS 342.730(l)(c)(2); instead, the Court did literally the same thing 1
am espousing here—read KRS 342.730(l)(c)(2) to effectuate legislative intent
and not render an absurd result. And the fact that the Livingood Court had to
go outside KRS 342.730(l)(c)(2) to piecemeal language from other provisions to
support its holding supports the assertion that effectuating legislative intent is
more important than following the literal words of the statute, when following
the literal words renders an “absurd or wholly unreasonable conclusion.”28
Not only has the majority overlooked our statutory canons, but it has
also completely contradicted itself in this case when compared to Livingood. For
these reasons, I must respectfully dissent. The majority’s result should signal
to the General Assembly that a change is needed to remedy the reach of the
majority’s conclusion.
27 I believe Livingood to be the correct decision. Nothing in this dissent should be construed to make the reader believe that I disagree with Livingood. 28 Bailey, 662 S.W.2d at 834.
13 COUNSEL FOR APPELLANT;
Richard Christion Hutson Whitlow, Roberts, Houston 85 Straub, PLLC 300 Broadway P.O. Box 995 Paducah, KY 42002-0995
COUNSEL FOR APPELLEE: KATHERINE RUDD
Mark Lane Ashburn 535 Broadway P.O. Box 268 Paducah, KY 42002-0268