Middletown Heating and Air v. Michael Klimko

Opinion

IMPORTANT NOTICE NOT ·yo BE PUBLISHED OPINION ' (

THIS OPINION IS DESIGNATED "NOT TO BE PUBLISHED." PURSUANT TO THE RULES OF CIVIL PROCEDURE PROMULGATED BY THE SUPREME COURT, CR 76.28(4)(C), THIS OPINION IS NOT TO BE PUBLISHED AND SHALL NOT BE CITED OR USED AS BINDING PRECEDENT IN ANY OTHER CASE IN ANY COURT OF THIS STATE; HOWEVER, _ UNPUBLISHED KENTUCKY APPELLATE DECISIONS, RENDERED AFTER JANUARY 1, 2003, MAY BE CITED FOR CONSIDERATION BY THE COURT IF THERE IS NO PUBLISHED OPINION THAT WOULD ADEQUATELY ADDRESS THE ISSUE BEFORE THE COURT. OPINIONS CITED FOR CONSIDERATION BY THE COURT SHALL BE SET OUT AS AN UNPUBLISHED DECISION IN THE FILED DOCUMENT AND A COPY OF THE ENTIRE DECISION SHALL BE TENDERED ALONG WITH THE DOCUMENT TO THE COURT AND ALL PARTIES TO THE ACTION.

RENDERED: APRIL 26, 2018

NOT TO BE PUBLISHED

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MIDDLETOWN HEATING AND AIR APPELLANT

ON APPEAL FROM COURT OF APPEALS V. CASE NO. 2016-CA-001414-WC WORKERS' COMPENSATION BOARD NO. 2013-WC-86565

MICHAEL KLIMKO; HONORABLE APPELLEES STEPHANIE L. KINNEY, ADMINISTRATIVE LAW JUDGE AND WORKERS' COMPENSATION BOARD

MEMORANDUM OPINION OF THE COURT

AFFIRMING

. .

Middletown Heating arid Air ("Middletown") appeals from an opinion of

the Court 'of Appeals affirming an opinion of the Workers' Compensation Board

("Board") that affirmed in part, reversed in part, and remanded an award by the

Administrative Law Judge ("ALJ") to Michael Klimko. Middletown argues that

the ALJ clearly erred in determining that its former employee, Klimko, was

entitled to double income benefits for the period following his termination from

employment. We affirm the Court of Appeals' holding that the ALJ did not

clearly err. in finding that Klimko's conduct on the date he left employment with

Middletown, Jun~ 19, 2014 did not amount to an "intentional, deliberate action

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with reckless disregard of the consequences to himself or another," so as to bar

an award of double income benefits per KRSl 342.730(1)(cl(2).

I. BACKGROUND.

As summarized by the Court of Appeals, the relevant background of this

case is as follows:

On April 16, 2013, Klimko sustained an injury to his low back, accompanied by right-leg pain. At the time of his injury, Klimko was working as a Heating, Ventilation, and Cooling (HVAC) technician for Middletown. He returned to light-duty work in September of 2013, but earning the same wages and working the same number of hours.· On June 19, 2014, Klimko left his · employment with Middletown. Shortly thereafter, he began working for AirStream Technologies, with similarjob duties but with fewer hours and less physically demanding job duties.

Ultimately, the AW assessed Klimko with art 11 % impairment rating and awarded benefits accordingly. The AW also found that Klimko was entitled to a double income benefit from September 20, 2013, through March 20, 2014, and from June 20, 2014, forward. On appeal, the Board found that the AW erred by awarding double income benefits for the former period because Klimko returned to work at an equal or greater average weekly wage than he earned prior to his injury. However, the Board fol,lnd that the AW properly awarded double income benefits for the period after June 19, 2014, because Klimko's actions did not amount to an "intentional, deliberate action with a reckless disregard of the consequences either to himself or to another." Finally, the Board remanded the matter to the AW with directions to award permanent partial disability benefits on the date of injury, but suspended for any period that temporary total disability benefits wen~ paid. Middletown now petitions for review of this decision.2

1 Kentucky Revised Statutes. 2 Middletown Heating andAir v. Klimko, No. 2016-CA-001414-WC, 2017 WL 2211072, at *1 (Ky. App. May 19, 2017).

II. STANDARD OF REVIEW.

The sole issue on appeal is whether substantial evidence exists to

support the AL.J's award of double income benefits, or 2x multiplier, to Klimko

from June 20, 2014, forward. "The AW, as the finder of fact, a:nd not the

reviewing court, has the sole authority to determine the quality, character, and

substance. of the evidence." Square D Co. v. Tipton, 862 S.W.2d 308, 309 (Ky._

1993). Sirice Klimko, the party with the burden of proof before the AW, was

successful, the question on appeal to the Board was whether the AL.J's findings

were supported by substantial evidence. Wolf Creek Collieries v. Crum, 673

S.W.2d 735, 736 (Ky. App. 1984). The Board concluded that substantial

evidence existed to support the AW's finding that Klimko's conduct on the date

he left employment with Middletown did not meet the standard for "intentional,

· deliberate action" described by this Court in Livingwood v. Transfreight, LLC,

467 S.W.3d 249, 259 (Ky. 2015), so as to prohibit enhancement of his award to

double income benefits.

The [Board] is entitled to _the same deference for its appellate decisions as we intend when we exercise discretionary review of Kentucky Court of Appeals decisions in cases that originate in circuit court. The function of further review of the [Board] in the Court of Appeals is to correct th~ 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. The function of further review in our Court is to address new or novel questions of statuto:iy construction, or to reconsider precedent when such appears necessary, or to review a question of constitutional magnitude.

W .Baptist Hosp. v. Kelly, 827 S.W.2d 685, 687-88 (Ky. 1992).

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III. ANALYSIS.

KRS 342.730(1)(c)(2) permits a double income benefit for any period that

employment at th~ same or a greater wage ceases "for any reason, with or

without cause." In Livingwood, we revisited our prior holding in Chrysalis

House, Inc; v. Tackett, 283 S.W.3d 671 (Ky. 2009), and clarified that "KRS

342.730(1)(c)(2) permits a double income benefit dunng any period that

employment at the same or agreater 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. We

overruled the requirement set forth in Chrysalis House that KRS

342.730(1)(c)(2) mandates that the cessation of employment at the same or

greater wage relate to the disabling injury. Id. at 257.

In Livingwood, the employee returned to work at the same wages after

sustaining a disabling injury, but was subsequently terminated when he

accidentally bumped a forklift he was operating into a pole while in an

unfamiliar area. Id. at 252. We held that the employee's operation of the

forklift did not rise to the level of intentional, deliberate action with a reckless

disregard of the consequences either to ~imself or another, so as to preclude an

award of double income benefits. _Id. ~t 259. See also Fuertes v. .Ford Motor

Co., 481 S.W.3d 808, 810 (Ky. 2016) ("this is a high standard and basic bad - .

behavior will not bar application of the two multiplier."); but see Chrysalis

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Hous_e, 283 S.W.3d at 673-74 (employee's conduct, which involved theft, would

meet this standard).

In Livingwood, we noted that requiring proof of this high standard of

conduct by an employee was consistent with other provisions of KRS Chapter

342 which evince "a legislative intent that an employee should not benefit from '

his own wrongdoing." 467 S.W.3d at 258. As we observed in Chrysalis House,

the purpose of KRS 342.730(l)(c)(2) is.to create an incentive for partially

disabled workers "to return to work at which they will earn the same or a

greater average weekly wage by permitting them to receive a bas!c benefit in

addition to their wage.but_ assuring them of a double benefit if this attempt

proves to be unsuccessful." Livingwood, 467 S.W.3d at 256.

In the current case, as described by the Court of the Appeals,

Klimko left his employment with Middletown following an incident that occurred on June 19, 2014. While servicing an air conditioner at a customer's house, Klimko found that the coil was leaking refrigerant. He called his· manager .to get a price on a replacement coil. During that call, he had a disagreement with his manager about Middletown's down-payment policies. The argument became heated, and Klimko told his manager that he was quitting. The manager asked Klimko to return to the office to discuss the matter, but Klimko again stated that he was going home. The customer called Middletown later to say that she had asked Klimko to leave because of his behavior. Middletown had to send another HVAC technician to the house because the customer's air conditioner was not functioning. Middletown retrieved Klimko's work truck later that day, and he returned his tools the foUowing day.

Middletown argues that Klimko's misconduct precludes.application of the 2x

multiplier. The AW disagreed, stating:

The AW does not view Plaintiffs resignation as an intentional, deliberate action with reckless disregard of the consequences to himself or another. In this case,

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substantial evidence does not establish Plaintiffs conduct was of that nature. Plaintiff resigned his position with the Defendant on June 19, 2014. Plaintiff resigned out of frustration on June 19, 2014. He voluntarily quit and returned the Defendant's equipment[.] Because Plaintiff stopped earning a same or greater wage, he is entitled to the 2x multiplier during this period.3 ·

Middletown asserts that the AW clearly erred in finding that Klimko's

conduct did not amount to an intentional, deliberate action with reckless

disregard of the consequences to himself or another. Middletown emphasizes

that Klimko deliberately quit in the middle of a job, and argiles his actions

damaged its relationship with a customer, forced it to send another HVAC

technician to complete the work, and caused it to have to retrieve Klimko's

work truck and equipment. \

The Board, while finding Klimko's conduct to be "reprehensible," found

sufficient evidence in the record to support th~ AW's finding that Klimko

remained eligible for double·income benefits. The AW found that Klimko

merely resigned out of frustratio~, and not with a subjective intention to

deliberately disregard the consequences of his actions. The Court of Appeals,

while noting that Klimko's conduct was clearly unacceptable and would have

been grounds for his termination if he had not resigned first, agreed with the

·Board that the AW's findings were within her discretion to conclude that

Klimko's conduct did not amount to intentional, deliberate action with reckless

disregard of the consequences to himself or another. Upon review, we conclude

3 2017 WL 2211072, at *2-3.

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·that substantial evidence exists to support the AW's findings and thus we

decline to disturb them.

III. CONCLUSION.

For the foregoing reasons, we affirm the Court of Appeals' opinion.

All sitting. All concur.

COUNSEL FOR APPELLANT:

Rodney Joseph Mayer U'SELLIS & KITCHEN PSC

COUNSEL FOR APPELLEE, MICHAEL KLIMKO:

Wayne C. Daub

COUNSEL FOR APPELEE, WORKERS' COMPENSATION BOARD:

Dwight Taylor Lovan

COUNSEL FOR APPELLEE, ADMINISTRATIVE LAW JUDGE, HONORABLE STEPHANIE L. KINNEY:

Stephanie L. Kinney