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Hayes v. Ginger C, LLC

Court of Appeals of Missouri, Western District, First Division

September 3, 2019

ROMMAE HAYES, Appellant,
v.
GINGER C, LLC AND TREASURER OF THE STATE OF MISSOURI, CUSTODIAN OF THE SECOND INJURY FUND, Respondents.

          Appeal from the Labor and Industrial Relations Commission

          Before Cynthia L. Martin, Presiding Judge, Victor C. Howard, Judge and Alok Ahuja, Judge

          CYNTHIA L. MARTIN, JUDGE.

         Rommae Hayes ("Hayes") appeals from the Labor and Industrial Relations Commission's ("Commission") final award denying his claim for workers' compensation benefits. Hayes asserts that the Commission's denial of benefits was erroneous because: (1) the overwhelming weight of the evidence established that, at the time of his accident, Ginger C, LLC ("Ginger C") was a construction industry employer having at least one employee or alternatively an employer with five or more employees, and that Hayes was an employee of Ginger C; and (2) the overwhelming weight of the evidence established that a statutory employment relationship existed between Hayes and Ginger C. Finding no error, we affirm.

         Factual and Procedural History

         Nakhle Asmar ("Asmar") is the owner of Ginger C. Ginger C owns houses and apartments that it rents to students, low-income residents, and veterans in the Columbia, Missouri area. Ginger C's sole source of income is rent paid by tenants.

         In February 2013, Hayes was released from prison on an early release program, and lived at Reality House in Columbia, Missouri. Hayes was required to be employed at least forty hours a week. Another Reality House resident, Weston Magee ("Magee"), performed renovation, repair, and maintenance work on Ginger C's rental properties. Hayes's parole officer asked Magee to assist Hayes in obtaining a job with Ginger C. Hayes had forty years of experience in construction, including experience paving and performing concrete and highway work.

         Hayes began performing renovation, repair, and maintenance on Ginger C's rental properties in April 2013. Asmar testified that Ginger C does not undertake to perform any construction work beyond renovating, repairing, or conducting maintenance on its own rental properties. Asmar testified that in 2013, Ginger C used independent contractors to perform this work. Asmar testified that he advised persons hired to work on Ginger C's rental properties that they were independent contractors working by the job. Ginger C issued 1099 forms to persons hired to perform renovation, repair, or maintenance work on its rental properties, and did not withhold taxes from checks paid for work performed. Ginger C did not provide health insurance, vacation days, or sick leave to any of the persons hired to perform renovation, repair, or maintenance work on its rental properties.

         Asmar testified that Hayes was not always available to perform renovation, repair, or maintenance work on Ginger C's rental properties because Hayes worked independently on other properties, including projects in Moberly. Asmar testified that when Hayes was available, Hayes would either submit a bid for work that needed to be performed, or he would bill Ginger C at an hourly rate. Asmar testified that if Hayes did not first bid for a job, Hayes received $12 per hour, plus the cost of any materials provided. Ginger C also reimbursed Hayes for the use of his personal truck. Asmar testified that he received all calls for maintenance from Ginger C's tenants, and that he would direct maintenance calls to various independent contractors, including Hayes. Asmar testified that Hayes was not obligated to accept a request to perform maintenance work. Asmar testified that Hayes always provided his own tools, and that if Hayes needed a tool to perform work for Ginger C, it would be purchased for him with the cost deducted from Hayes's check.

         Hayes testified that Asmar did not tell him he was an independent contractor, or that he worked job to job. Hayes testified that at the beginning of his employment relationship with Ginger C, he was paid $10 per hour and worked at least forty hours per week. Hayes testified that after two weeks on the job, Ginger C increased his pay to $12 per hour and compensated him for the use of his truck. Hayes testified that Asmar would pay him every Friday by check for work completed during the week, and that Asmar would write another check on Monday morning for work completed by Hayes on Saturday and Sunday. Hayes testified that he "never missed a week" of work with Ginger C. Hayes produced no pay stubs in support of his claims about the amount he was paid per hour or about the number of hours worked, though he claimed they were available.

         Hayes testified that the work he did for Ginger C ranged from changing light bulbs to fully renovating rental properties. Hayes explained that Asmar would call him every morning to tell him what work needed to be done on Ginger C's rental properties before meeting Hayes and other workers at a local hardware store to buy the materials needed. Hayes testified that, while he had "simple tools" from his forty years in the construction industry, he did not have all of the tools necessary for the work he did for Ginger C. Hayes confirmed that Asmar would purchase any tools he needed from a local hardware store and that the cost of these tools were deducted from his weekly checks.

         Hayes testified that Asmar never told Hayes how to do work he was asked to perform, and that Asmar relied on Hayes to assess each job to determine whether he was qualified to perform requested work. Hayes claimed that over time, he began receiving maintenance calls directly from Ginger C's tenants and that he began carrying the keys to all of Ginger C's properties.

         In June 2013, Ginger C purchased a triplex at 1500 Hinkson in Columbia ("Hinkson property"). The Hinkson property required repairs, including replacement of the concrete basement floor, before it could be rented to tenants. Ginger C solicited a bid from Columbia Maintenance Company for the concrete work. Hayes and Roland Nabhan ("Nabhan")[1] (Asmar's brother-in-law who also did renovation, maintenance, and repair work for Ginger C) learned of the quote, and offered to perform the work for less than Columbia Maintenance Company's bid. Asmar testified that "Hayes claimed to be an expert in concrete laying and he said, 'We can do a much better job much cheaper for you, '" without giving a more precise bid. Nabhan's testimony supported Asmar's recollection. Nabhan testified that Asmar solicited a bid from "somebody else," but that he and Hayes said they could do the job for cheaper. Hayes testified to a different version of events, and claimed that Nabhan told Asmar, "No, no. Don't you do that. We're going to do it now." Hayes testified that he and Magee "griped about it" because neither had the skills necessary to perform concrete work.

         On June 26, 2013, Nabhan arranged for the delivery of concrete and necessary tools to the Hinkson property so that he, Magee, and Hayes could replace the concrete floor in the basement. Nabhan worked outside with the concrete mixer truck, pouring concrete into a wheelbarrow. Magee moved the wheelbarrow where needed and dumped concrete on the floor. Hayes smoothed the concrete before it set up. At some point, concrete got into Hayes's boots, but he continued working.

         After the job was complete, Hayes took off his boots to find that he had concrete burns on his legs. Hayes initially went to a local pharmacy and purchased a burn ointment, but later went to the hospital. Hayes was admitted to the burn unit, where he was diagnosed with third-degree burns. Skin grafts were required on both of Hayes's legs. Hayes spent four days in the hospital. Hayes testified that he missed two to three weeks of work as a result of his injuries. Hayes did not receive any further medical treatment for his injuries after mid-2013.

         Hayes filed a claim for workers' compensation benefits on May 21, 2015, seeking compensation for injuries to his lower extremities and body as a whole, and seeking benefits from the Second Injury Fund because Ginger C failed to insure itself against claims for workers' compensation.[2] Hayes's claim was heard by an Administrative Law Judge ("ALJ") on August 29, 2017, and September 6, 2017. At the beginning of the hearing, the parties advised the ALJ they had stipulated that: (1) "[O]n June 26, 2013, while in the employment of Ginger C . . ., [Hayes] sustained an injury by accident in Columbia, Missouri;" (2) "[Ginger C] had notice of the injury and a claim for compensation that was timely filed;" and (3) "[Ginger C] has paid no benefits to date." In addition, the parties confirmed with the ALJ that the agreed upon issues to be determined included whether Hayes's injury by accident "ar[ose] out of and in the course of employment," and whether the Second Injury Fund had liability given Ginger C's uninsured status.[3]

         During the hearing, Hayes, Asmar, and Nabhan testified and the ALJ received exhibits. Following the hearing, the ALJ issued a written decision on December 6, 2017, denying Hayes's claim ("ALJ Award"). The ALJ Award described the parties' stipulations, framing the first as whether "[Hayes] sustained an injury by accident while doing work for Ginger C . . . on June 26, 2013, in Columbia, MO."[4] The ALJ Award made numerous findings of fact, including a finding that Hayes was not credible and his testimony could not be relied on, because "[h]is testimony was full of false statements and exaggerations." The ALJ Award found that Asmar and Nabhan were credible witnesses.

         The ALJ Award concluded that Hayes's injury did not occur in the course and scope of his employment because Hayes was not an "employee" as defined by the Workers' Compensation Law, [5] and that even if Hayes was an employee as defined by the Workers' Compensation Law, Ginger C was not an "employer" subject to the Workers' Compensation Law. The ALJ thus concluded that Ginger C was not required to have workers' compensation insurance and that the Second Injury Fund had no liability to Hayes.

         Hayes appealed the ALJ Award to the Commission. By a 2-1 vote, the Commission affirmed the ALJ Award and incorporated it by reference into the Commission's final award ("Final Award"). The dissenting commissioner concluded that Hayes's injury was compensable because, pursuant to section 287.040.1, a statutory employment relationship existed between Ginger C and Hayes.

         Hayes filed this timely appeal. Additional facts are discussed as necessary to address Hayes's claims on appeal.

         Standard of Review

         Section 287.495.1 controls our standard of review of the Final Award:

The court, on appeal, shall review only questions of law and may modify, reverse, remand for rehearing, or set aside the award upon any of ...

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