IMPOR 'ANT NOTICE AWT-TO BE-PUBLISHED-OPINION
THIS OPINION IS DESIGNATED "NOT TO BE PUBLISHED. " PURSUANT TO THE RULES OF CITAIL PROCED URE PROMUL GATED BY THE SUPREME COURT, CR 76.28 (4) (c), THIS OPINION IS NOT TO BE PUBLISHED AND SHALL NOTBE CITED OR USED AS A UTUORITYINANY OTHER CASE INANY COURT OF THIS STATE. RENDERED : AUGUST 24, 2006 NOT TO BE PUBLISHED
9 Courf of 2005-SC-0863-WC f -
DAVID RANCK APPELLANT
APPEAL FROM COURT OF APPEALS V. 2005-CA-0529-WC WORKERS' COMPENSATION NO . 03-01362
BRIAN GRAY; UNINSURED EMPLOYERS' FUND; HON. R. SCOTT BORDERS, ADMINISTRATIVE LAW JUDGE ; AND WORKERS' COMPENSATION BOARD APPELLEES
MEMORANDUM OPINION OF THE COURT
AFFIRMING
An Administrative Law Judge (ALJ) determined that the claimant was working as
an independent contractor at the time of his injury and dismissed his application for
benefits . At issue is whether the finding was erroneous as a matter of law. Also at
issue is whether the decision must be vacated and further proceedings held on remand
because a successor considered and overruled the claimant's petition for
reconsideration . The Workers' Compensation Board (Board) and the Court of Appeals
have affirmed, and we affirm.
David Ranck, the claimant, worked as a painter. After Neil Sulier accepted his
bids, he painted part of the interior of a residence that Sulier owned, a room in a
storage shed, and the basement. Sulier hired Brian Gray to renovate the exterior of the house, which included repairing, bleaching, and staining the wood shake roof. After
finishing his own work, the claimant reached an agreement with Gray to bleach and
stain the roof. On June 28, 2003, the claimant fell from the roof and was injured .
The claimant's application for benefits listed Gray as being his employer. Gray
did not have workers' compensation insurance, so the Uninsured Employers' Fund
(UEF) was made a party . It maintained that Sulier was the employer and made him a
party. Like Gray, he did not have workers' compensation insurance . The ALJ
bifurcated the claim to consider whether the claimant was working as an employee or
independent contractor when he fell and, if he was an employee, which defendant was
his employer.
The claimant testified that he had been a painter for 35 years . His practice was
to bid on jobs, estimating the amount of time it would take and charging $15 .00 to
$20.00 per hour plus materials . He had his own brushes and rollers and sometimes
provided the paint. He testified :
I paint whenever I feel like painting . If I'm tired, I go to sleep . And when I'm awake, if I got something to paint, I paint. That's what I like to do with my time . . . . I don't necessarily worry about how many days it's gonna take to do this or how many days its gonna take to do that. I do it for the project .
The claimant stated that Sulier paid him directly for the work that he bid, and he paid
part of that amount to a helper. After finishing the interior painting on Sulier's house, he
recommended bleaching the deck to kill mold before painting it, and Sulier and Gray
agreed . He did not submit a bid for bleaching the deck but did perform the work and
thought Sulier paid him directly.
The claimant stated that after he finished the deck he approached Gray about
going to work for him and that Gray paid him for doing some odd jobs (cleaning gutters and painting a doorjamb and small soffit). He learned that Gray had a number of jobs
for which he planned to hire a painter and approached him . Gray agreed to pay $12.00
per hour and supply the beer if he would bleach and stain the roof. Sulier and Gray
both purchased bleach, and Gray provided the stain . The claimant stated that no one
told him what hours to work or when to take breaks . He generally worked as long as he
wanted and as many days in a row as he wanted, keeping track of his hours . He stated
that Gray paid him $100 .00 on Friday, June 27, and encouraged him to finish the job
over the weekend so that Gray could paint the deck on the following Monday . On
Saturday, June 28, he worked alone from about 8:00 A.M. until about 6:00 P.M ., when
he slipped on some wet stained shingles and fell off the roof.
Paul Young was an electrician at the worksite . He testified that he overheard
parts of conversations between Gray and Sulier and between Gray and the claimant .
He had the impression that Gray agreed to provide beer and pay the claimant $12.00
per hour to perform some type of work but never saw Sulier or Gray pay him any
money. He did not know whether the work was on the same house or another property .
Young stated that he never asked the claimant to do any work for him but that Sulier did
give him a check and instructed him to pay the claimant and another individual for
painting the basement. He explained that Sulier told him the funds were tied up in a
financial management company that would only disburse them "through somebody that
was a legal contractor."
In December, 2003, the Uninsured Employers Fund (UEF) deposed Sulier. He
stated that he intended to use the house as his residence and that he hired the
claimant to paint the interior but provided the paint. He did not remember how much he
paid the claimant but did not think it was enough to require a Form 1099 to be filed for tax purposes. He testified that he hired the claimant to bleach the roof but later stated
that he did not recall whether bleaching the roof was tied in to the work that Gray was
doing . In any event, he did not ask Gray to hire the claimant or have him stain the roof.
He stated that he did not pay the claimant directly for work on the roof. Instead, Gray
billed him when each project was completed, and payments came from a trust fund .
When cross-examined by Gray, Sulier stated that he did not recall a conversation with
Gray about having the claimant bleach the roof but that they might have discussed it
after the claimant finished the interior painting .
James Sherrow testified that he went to the house initially to work for an
electrician . When he arrived, the claimant asked him to help him paint, instead . He
stated that he and the claimant split $400.00 for painting the basement. Because he
was supposed to be working for the electricians, Sulier paid them, and they paid him .
He did not know who paid the claimant .
When deposed by the UEF, Gray testified that Sulier hired him to perform
various projects to renovate the house . He asked Gray to pay for materials and labor
and then to be reimbursed upon completion of each project. Gray testified that he did
not hire anyone else to work with him and that he was a "one-man operation ." After he
had completed some of the work, Sulier asked him to purchase materials so that the
claimant could stain the roof, to pay the claimant for his labor, and to be reimbursed for
both. He insisted that he never hired the claimant and that it was Sulier who arranged
for him to bleach and stain the roof.
When cross-examined by the claimant, Gray testified that he performs most
renovation work himself but calls others when he needs help. When he does so, he
generally pays them by the job rather than the hour. He stated that he billed Sulier $5997.00 for bleaching, staining, and repairing the roof. He paid a portion of that
amount to the claimant and two others but would not specify how much he paid to each.
He estimated that the claimant would have received $880.00 if he had completed his
portion of the work and that the amount was not based on an hourly rate .
When deposed by Sulier on April 24, 2004, Gray testified that he hired someone
else to finish the job after the claimant fell . He testified that he used a number of
"subcontractors" on the job for Sulier and paid them on completion of the job, some by
the job and others by the hour. When he negotiated a price with a subcontractor, he
would build an amount for his services into the estimates he gave Sulier. He arrived at
the $880 .00 estimate for the claimant based on the amount of time he thought it would
take multiplied by $12.00 per hour. He instructed the claimant "to keep his hours" in the
event that the work took more time than he had estimated . Gray also testified that he
was working as a crew leader for John James at that time, with the authority to hire and
fire employees. He had discussed with the claimant the hourly rate that he would earn
if he, too, worked for James. He thought that Young probably overheard that
conversation .
When cross-examined by the claimant, Gray testified that Sulier asked him to
pay the claimant for his labor for staining the roof. Sulier had apparently paid the
claimant already for bleaching the roof. Nonetheless, Gray billed Sulier for both
bleaching and staining the roof, and the bank paid him in two installments . Gray
testified that he was to reimburse Sulier for the duplicate payment but that Sulier later
told him to keep the money . He stated that he billed the claimant's time at $20.00 per
hour and paid him $12 .00 per hour.
Sulier filed his own deposition of April 30, 2004. He testified that generally he took the claimant's bids to the bank for approval before disbursing funds . He issued a
$400 .00 check to the claimant on June 3, 2003, for painting the basement. On or about
June 18, 2003, he paid the claimant $600.00 for painting the loft and main floor. He
thought he paid $300.00 in cash for exterior prep work bid on June 17, 2003, and was
later reimbursed by the bank. Of that amount, $50.00 was for bleaching the deck, and
$100 .00 was for bleaching parts of the roof. None of the amounts was based on the
amount of time the job took. Sulier stated that he would not have paid the claimant for
bleaching the roof and then had Gray pay the claimant for the same work without
expecting to be reimbursed or credited .
Cross-examined by the claimant, Sulier testified that he did not remember any
discussion with Gray about double billing for work on the roof. Cross-examined by
Gray, he testified that although he did not remember, it was likely that Gray purchased
the materials and that he paid Gray upon completion of the project . He considered
Gray to be the contractor and relied on him to get the correct people to do the work. He
did not know what arrangement Gray had with the claimant .
After reciting the nine factors set forth in Ratliff v. Redmon, 396 S .W.2d 320 (Ky.
1965), the four predominant factors as set forth in Chambers v. Wooten's IGA
Foodliner, 436 S .W.2d 265 (Ky. 1969), and analyzing the evidence under each factor,
the ALJ determined that the claimant was working as an independent contractor at the
time of his injury . Sometime thereafter, the ALJ's appointment ended. A different ALJ
considered and overruled the claimant's petition for reconsideration, finding it to be
"nothing more than a reargument of the merits ." The claimant then appealed .
KRS 342.640 defines various classes of employees . In relevant part, it provides :
The following shall constitute employees subject to the provisions of this chapter, except as exempted under KRS 342.650 :
(1) Every person, including a minor, whether lawfully or unlawfully employed, in the service of an employer under any contract of hire or apprenticeship, express or implied, and all helpers and assistants of employees, whether paid by the employer or employee, if employed with the knowledge, actual or constructive, of the employer;
(4) Every person performing service in the course of the trade, business, profession, or occupation of an employer at the time of the injury[.]
The claimant notes that the statute contains presumptions of employee status
and asserts that Ratliff v. Redmon, supra, and its progeny are inapplicable when the
facts fit one of the presumptions. He admits that he performed the inside work for
Sulier as an independent contractor but asserts that he worked on the roof as Gray's
employee . He argues that Gray was in the business of repairing and remodeling
houses and had a time and materials contract to repair, bleach, and stain Sulier's roof.
Gray hired him to bleach and stain the roof in furtherance of Gray's trade or business
and admitted paying him $12.00 per hour while billing Sulier $20.00 per hour; therefore,
the ALJ should not have considered the Ratliff v. Redmon, supra, factors because KRS
342.640(4) presumed him to be Gray's employee. He distinguishes Chambers v.
Wooten's IGA Foodliner, supra, pointing out that a grocery was not in the business of
repairing roofs, so KRS 342.640(4) did not presume it to be the employer of a worker
that it hired to do so. Therefore, the factors were properly considered .
The worker has the burden to prove every element of a workers' compensation
claim, including employee status at the time of injury . Roark v. Alva Coal Corporation , 371 S .W.2d 856 (Ky. 1963); Wolf Creek Collieries v . Crum, 673 S.W.2d 735 (Ky.
App. 1984); Snawder v. Stice , 576 S .W.2d 276 (Ky. App . 1979) . Although the claimant
is correct in asserting that KRS 342.640 contains various presumptions regarding a
worker's status as an employee, his interpretation of KRS 342.640(4) is flawed . KRS
342.640(4) creates a presumption that an individual working in the trade or business of
an employer is an employee, but it does not prohibit an employer from rebutting the
presumption by showing that the individual is actually an independent contractor. In
other words, the presumption is rebuttable and governed by KRE 301 . See Magic Coal
Co . v. Fox, 19 S .W.3d 88, 95 (Ky. 2000) . If an employer fails to go forward with rebuttal
evidence, the presumption allows the worker to prevail as a matter of law. If an
employer does go forward with evidence to rebut the presumption, the AU must weigh
the parties' evidence under the standard found in Ratliff v. Redmon, supra , and its
progeny. In such instances, the worker retains the burden of persuading the AU that
he is an employee. KRE 301 ; Magic Coal Co. v. Fox, supra.
Gray raised an independent contractor defense and presented evidence to rebut
KRS 342 .640(4); therefore, Ratliff v. Redmon, supra , applied . The nine Ratliff v.
Redmon factors are: 1 .) the extent of control that the alleged employer may exercise
over the details of the work; 2.) whether the worker is engaged in a distinct occupation
or business; 3.) whether the type of work is usually done in that locality under the
supervision of an employer or by a specialist, without supervision ; 4.) the degree of skill
required by the work; 5.) whether the worker or alleged employer supplies the
instrumentalities, tools, and place of work; 6.) the length of the employment ; 7.) the
method of payment, whether by the time or the job; 8.) whether the work is a part of the
regular business of the employer; and 9 .) the intent of the parties. The test was refined in Chambers v. Wooten's IGA Foodliner, supra, which required consideration of all
relevant factors with a primary focus on four: 1 .) the nature of the work as related to the
business generally carried on by the alleged employer; 2.) the extent of control
exercised by the alleged employer; 3.) the professional skill of the alleged employee;
and 4.) the true intentions of the parties.
When determining that the control factor favored independent contractor status,
the AU noted the claimant's assertion that Gray urged him to finish the roof over the
weekend but also noted that he worked on his own schedule, that he worked when
Gray would not be present, and that any control was minimal . Regarding the second
factor, the ALJ noted that the claimant had worked as a painter for 35 years but that
Gray had also worked as a painter and that such work was part of renovation and
remodeling . Therefore, the claimant's occupation was not distinct from Gray's, which
favored employee status . Based on evidence that painting was done locally by either
employees or independent contractors, the ALJ found the third factor to favor employee
status . Likewise, although the claimant worked for 35 years as a painter, Gray
acknowledged that it was not a skill that required substantial training; therefore, that
factor favored employee status . Noting the mixed evidence regarding who supplied
tools, the ALJ found the effect of the evidence to be neutral . The ALJ considered the
possibility that the claimant would be hired for future work for John James to be
unrelated to the roof project . Both parties testified that the claimant would only be
working for Gray until the roof was stained, which favored independent contractor
status . The ALJ did not find it unusual for a general contractor to bid a job at a higher
rate than he would have to pay sub-contractors and concluded that the extensive
evidence regarding method of payment was neutral . Acknowledging that
-9- painting/staining was a regular part of Gray's business renovating and repairing houses,
the AL found that factor to indicate employee status . Finally, the AL characterized
the claimant's belief that he was an employee as being "unrealistic," noting that he
would have expected to be paid by check and to have had taxes and social security
withheld if he truly considered himself to be an employee. Weighing all of the factors,
the AL determined that he was an independent contractor at the time of his injury.
The claimant continues to assert that the AL failed to understand that his
arrangements with Sulier and Gray were separate and that although he was an
independent contractor when working for Sulier, he was Gray's employee. He asserts
that the AL misunderstood the evidence regarding some of the Ratliff v. Redmon ,
supra , factors and points to certain favorable evidence. He argues in particular that the
AL erred by failing to consider his testimony showing that Gray had the right to control
his work. We note, however, that the AL was not required to give any particular weight
to the claimant's testimony that Gray told him to perform various odd jobs, particularly
when faced with evidence to the contrary . See Grider Hill Dock v. Sloan , 448 S.W .2d
373 (Ky. 1969). Like the Board and the Court of Appeals, we are not convinced that the
AL misunderstood the evidence or the claimant's arguments . The recitation of the
evidence reveals a clear understanding that his arrangement with Gray to bleach and
stain the roof was separate from his arrangement with Sulier to do painting . The AL
weighed the evidence under each of the Ratliff v. Redmon factors and found that the
claimant was working as an independent contractor when he was injured . Therefore,
the claimant's burden on appeal is to show that the evidence of an employee
relationship with Gray was so overwhelming that the decision was unreasonable . KRS
342.285; Special Fund v. Francis, 708 S .W.2d 641, 643 (Ky. 1986).
-1 0- The Board conducted an exhaustive review of the evidence and considered each
of the claimant's arguments carefully. It determined that the favorable evidence was
not so overwhelming as to compel a decision in the claimant's favor, and the Court of
Appeals affirmed . Having reviewed the evidence and the parties' arguments, we agree.
The claimant's second argument is that no statute or regulation permits a
stranger to a case to rule on a petition for reconsideration and that due process
prohibits the practice. He argues that it would be impossible for a subsequent AU to
step into the predecessor's mindset, particularly regarding a petition that asserts a
finding is the product of confusion and a misunderstanding of the facts. Moreover, to
permit a stranger to rule on a petition would effectively grant the individual appellate
powers or invite the individual to "rubber-stamp" the initial decision . He urges the court
to adopt a procedural rule that "he who decides the case must also hear the case" and,
on that basis, to set aside the decisions below, declare a "mistrial," apply CR 63, and
remand his claim for "a new trial."
This argument is based on the misconception that the "trial" in a workers'
compensation claim continues after the AU renders the decision . Although KRS
342.281 permits a party to petition for reconsideration, it states that the AU "shall be
limited in review to the correction of errors patently appearing on the face of the award,
order, or decision ." Granted this limited scope of review, an AU may not re-weigh the
evidence on a factual issue decided in the initial opinion . Wells v. Ford , 714 S .W.2d
481 (Ky. 1986); Eaton Axle Corporation v. Nally, 688 S .W .2d 334 (Ky. 1985); Beth-
Elkhorn Corp. v. Nash, 470 S .W.2d 329 (Ky. 1971). Contrary to the claimant's
argument, the same AU both heard this claim and decided it. A successor AU
determined only that the claimant's petition for reconsideration showed no patent error in the decision .
The claimant relies on Wells v. Ford, supra , in which the court determined that
expiration of the 10-day period for review found in KRS 342.281 does not divest the
fact-finder of authority to decide a petition for reconsideration . The court did not
consider whether the same fact-finder must decide both the initial claim and a petition
for reconsideration, and the claimant has pointed to nothing that would require as
much. Moreover, this court has determined that nothing in the statutes or regulations
requires a claim to be decided by the same AU throughout its life. See Tuttle v. O'Neal
Steel, Inc. , 884 S.W.2d 661, 663 (Ky. 1994).
CR 63 permits a successor judge to perform "the duties to be performed by the
court under these rules after a verdict is returned or finding of fact and conclusions of
law are filed ;" however, it gives the successor discretion to grant a new trial if satisfied
that the failure to preside over the trial would prevent performing those duties . In the
present case, the successor AU determined that the circumstances did not warrant a
new proceeding . Considering the scope of review afforded by KRS 342.281, we are
convinced that the successor did not err or violate the claimant's due process rights by
ruling on his petition.
The decision of the Court of Appeals is affirmed .
All concur. COUNSEL FOR APPELLANT :
David B . Allen P .O. Box 93 Versailles, KY 40383
COUNSEL FOR APPELLEE, BRIAN GRAY, PRO SE :
Brain Gray 109 Crest Court Nicholasville, KY 40356