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CASE NO. 4471 CRB-7-01-12
COMPENSATION REVIEW BOARD
WORKERS’ COMPENSATION COMMISSION
JANUARY 15, 2003
T.J. GERMAIN TREE SERVICE
NO RECORD OF INSURANCE
SUNSHINE SUPPLY CO.
PRINCIPAL EMPLOYER (ALLEGED)
AIG CLAIM SERVICES, INC.
SECOND INJURY FUND
The claimant was not represented at oral argument. Notice sent to Randy Cohen, Esq., Corsello & Cohen, LLC, 10 Byington Place, Norwalk, CT 06850.
The respondent T.J. Germain Tree Service was represented by Barry S. Moller, Esq., Cramer & Anderson, P.O. Box 278, 46 West St., Litchfield, CT 06759-0278.
The respondents Sunshine Supply Co. and AIG Claim Services were represented by Michael McAuliffe, Esq., Pomeranz, Drayton & Stabnick, 95 Glastonbury Blvd., Glastonbury, CT 06033.
The Second Injury Fund was not represented at oral argument. Notice sent to Amy F. Goodusky, Esq., O’Brien, Tanski & Young, CityPlace II, Hartford, CT 06103-3402.
This Petition for Review from the December 6, 2001 Ruling of the Commissioner acting for the Seventh District was heard June 21, 2002 before a Compensation Review Board panel consisting of the Commission Chairman John A. Mastropietro and Commissioners Donald H. Doyle, Jr. and Amado J. Vargas.
JOHN A. MASTROPIETRO, CHAIRMAN. The respondent T.J. Germain Tree Service [hereinafter Tree Service] has petitioned for review from the December 6, 2001 Ruling of the Commissioner acting for the Seventh District. On appeal, it contends that the trier erred by failing to reopen this case for further proceedings concerning the existence of a principal employer. We find no error in the denial of Tree Service’s motion, and affirm the trial commissioner’s decision.
In a Finding and Award dated March 29, 2001, the trial commissioner found that the claimant was working for the respondent Tree Service on September 24, 1997, when he sustained a fractured femur. His employer was not covered by workers’ compensation insurance on that date, and evidence was presented to suggest that the respondent Sunshine Supply Co. may be responsible for payment of benefits as a principal employer under § 31-291 C.G.S.1 The trier found, however, that Sunshine Supply did not have control of the premises on which the claimant was injured at the time of said injury, thereby removing Sunshine Supply from the possible reach of § 31-291. He thus ordered the respondent Tree Service to take responsibility for temporary total disability, temporary partial disability, and permanent partial disability benefits, along with medical expenses related to the claimant’s injury and consequent treatment. See also, April 30, 2001 Amended Finding and Award.
The employer then moved for a modification of this award on July 24, 2001, claiming that the trier’s decision was made in the absence of a necessary party to the claim, and without the facts requisite to make an adequate determination under § 31-291. The employer also contended that the Second Injury Fund had failed to contest liability as required by § 31-355, thereby precluding it from bringing a claim for reimbursement against Tree Service. Meanwhile, the Fund also filed a Motion to Open dated August 6, 2001. At a subsequent hearing on these two motions, the movants contended that a change of circumstances had occurred within the meaning of § 31-315, insofar as all of the evidence pertinent to the § 31-291 issue was not presented to the commissioner at the time of trial. Neither movant was able to prove to the commissioner that this evidence was not then available, however. The trier thus denied both motions to open, whereupon the respondent Tree Service appealed to this board.
The appellant explains in its brief that the formal hearing of November 20, 2001 regarding the motions to open was conducted without the creation of a record2 and without the trier allowing the parties to present evidence or testimony. It contends that due process requirements have not been satisfied with regard to its Motion to Open, and it requests a remand for further proceedings. The respondents Sunshine Supply and AIG Claim Services, meanwhile, contend that all parties were represented by counsel at the November 20, 2001 formal hearing, and that extensive legal arguments were presented based upon the motions that had already been filed. Their position is that no additional proceedings were necessary in order for the trier to issue his December 6, 2001 ruling dismissing the employer’s Motion to Open.
In order to resolve the issues before us here on appeal, we begin by looking at the proceedings that led up to the March 29, 2001 Finding and Award. There were two formal hearings held prior to that award, along with a pro forma hearing for the submission of briefs. All three hearing notices list “compensability/causal connection” as the only pending issue, though the testimony went far beyond that subject. With respect to § 31-291, there are three key elements that govern the determination that a particular entity is a principal employer within the meaning of the statute. First, the relation of the principal employer and contractor must exist in work wholly or in part for the former. Second, the work must be performed on or about premises controlled by the principal employer. Finally, the work must be a part or process in the business or trade of the principal employer. Hebert v. RWA, Inc., 48 Conn. App. 449, 453 (1998), cert. denied, 246 Conn. 901 (1998). Whether or not a principal employer relationship exists in a given case is ordinarily a question of fact for the trial commissioner to decide. Jones v. Lillibridge, 16 Conn. Workers’ Comp. Rev. Op. 143, 3149 CRB-2-95-6 (Nov. 27, 1996).
At the first formal hearing, the claimant testified as to the circumstances of his injury and the nature of his employment with Terence Germain, the owner and operator of the tree service. April 25, 2000 Transcript. He also testified that he had been present at the job site with Germain and Edward McCarty, the owner of the respondent Sunshine Supply, a week prior to his injury. Germain then took the stand, and testified that he was hired by McCarty to cut down some trees in a wooded lot in Weston where a house was being built. He stated that he had met McCarty there on the morning of the claimant’s injury to clarify which trees needed to be cut, and McCarty asked him to begin work that day if possible. Transcript, p. 37. Based on a conversation that the two had shared, Germain was under the impression that McCarty was the general contractor on the project. He also testified that McCarty later refused to pay him for the work that was completed because he knew that someone had been injured on the job site. Id., pp. 40-41. Germain admitted that he had not been carrying workers’ compensation insurance at the time of the claimant’s injury, explaining that he had not known it was necessary. Id., p. 51. Because McCarty had been called away from the formal hearing on an emergency, and was unavailable to testify, the commissioner agreed to continue the case in order to properly address the principal employer issue. Transcript, p. 56.
At the October 11, 2000 formal hearing, for which there is no transcript available, the April 20, 1998 deposition of McCarty was introduced into evidence. Respondent’s Exhibit 2. In that deposition, McCarty stated that the principal business of Sunshine Supply is general contracting. Id., p. 12. He described the driveway-construction job that the owner of the property had hired his company to perform, and clarified that he was not responsible for building the accompanying residence. Id., pp. 36-37. On the morning that the claimant was injured, McCarty stated that he had met Germain at the property to show him a map that detailed changes in the line of the driveway. Id., p. 43. His own employees had not yet begun any of their work on the driveway, as the first step in the process was to clear the obstructing trees. Id., p. 49. He then testified that he had specifically told Germain not to start the tree-felling job, as he did not yet have a written contract to complete the work with the property-owners. Id., p. 56. Said contract was not executed until October 23, 1997. McCarty stated that Germain and his associates nonetheless cleared the trees, which he first learned of about ten days later when Germain dropped off a bill at his office, leaving him “flabbergasted.” Id., pp. 56-57. He also maintained that the wrong trees had been cleared, describing the work as “butchery;” Id., 62; and he went on to elucidate the angry reactions of the buyer and the owners.
In its proposed findings, Sunshine Supply noted that the principal employment issue had been raised at trial, though no evidence had been presented by either Tree Service or the Second Injury Fund in relation to said issue. Proposed Findings, ¶¶ 9-11. Sunshine Supply then pointed out that the driveway construction contract between itself and the property owners was not formed until after the claimant had already been injured. Id., ¶ 16. Sunshine Supply also observed that Germain’s testimony was inconsistent with itself and with that of the claimant, and stressed that he and his employee had used their own tools at the job site and had not been instructed as to how to cut down the trees located there. Id., ¶¶ 19-21. A memorandum of law accompanied its proposed findings, explaining why there was no evidence that Sunshine Supply had control over the job site. The record contains no proposed findings from either Tree Service or the Second Injury Fund, and the claimant did not mention the principal employer issue in his recommended findings.
The trial commissioner’s relevant findings were as follows:
4. Evidence is presented to suggest that Sunshine Supply Company may be responsible for payment of Chapter 568 benefits, based on C.G.S. § 31-291, the so-called principal employer statute.
5. However, no issue has been presented or pursued regarding a § 31-291 exposure on the part of Sunshine Supply Company.
6. C.G.S. § 31-291 requires that a principal employer must be in control of the premises where the injury occurs in order for him to be held liable to pay compensation.
7. The evidence presented demonstrates that Sunshine Supply Company did not have control of the premises at the time or on the date Claimant was injured.
On the strength of these subordinate findings, the trier concluded that § 31-291 liability should not be ascribed to any party. The Tree Service later retained new counsel, who several months later moved to open the trier’s award on the ground that the trier had been presented with insufficient facts to make a determination under § 31-291. Shortly thereafter, the Fund followed suit with its own motion.
At the November 20, 2001 hearing below, Tree Service’s counsel contended that the trier never got the opportunity to consider the credibility of McCarty because that witness was never produced at the time of trial, and urged that the case be opened so his live testimony could be heard. Transcript, p. 7. Further, counsel argued that there was likely a general contractor who was responsible for the entire construction project, and who was not made a party to the claim. Tree Service contended that a full determination could only be made in the presence of the proper parties, which supported the reopening of the principal employment issue. In response, Sunshine Supply argued that the § 31-291 issue had been an issue in the case from its inception, as evidenced by depositions of McCarty and Germain that were taken in 1998. Counsel represented that McCarty had been late for the October 11, 2000 formal hearing, which resulted in his deposition being admitted in lieu of personal testimony. Transcript, p. 13. No objection was made by the Fund, by Tree Service’s attorney, or the claimant’s counsel. As for the new evidence that Tree Service’s counsel had obtained, Sunshine Supply contended that it had all been available at the time of the formal hearing, and could have been presented earlier.
Under § 31-315, an award can only be opened where there has been a shift in the claimant’s condition (not an issue here), or where “changed conditions of fact have arisen which necessitate a change of such agreement, award or transfer . . . .” The Second Injury Fund attempted to characterize the discovery of another potentially responsible party as a changed condition of fact, and analogized the circumstances to those in a criminal case where a party is wrongly convicted based on incorrect facts, though counsel could not go so far as to say that these “new” facts were not discoverable with due diligence at the date of the hearing. Transcript, p. 20, 26. Tree Service, meanwhile, insisted that this was a rare circumstance where equity demanded that the case be reopened. Id., 22.
The commissioner ultimately ruled in his December 6, 2001 decision that the parties’ failure to present all of the relevant evidence regarding § 31-291 at the time of trial did not amount to a change of circumstances now that these omissions had been discovered. Insofar as ¶ 5 of the March 29, 2001 award read that “no issue has been presented or pursued regarding a § 31-291 exposure on the part of Sunshine Supply Company,” the trier reasoned that the paragraph should actually have read, “no evidence has been presented . . . ,” as the issue had been raised, but the evidence had been unconvincing. Tree Service maintains on appeal that this ruling was improper, because it was made without the benefit of formal testimony or evidence. “When a Motion to Open is grounded by a claim of mistake, change in circumstances, fraud, or misrepresentation, the Commissioner is required to make [a] factual determination . . . [and] due process requires a hearing to provide the parties with an opportunity to present evidence.” Brief, p. 3, citing Gonzalez v. Electric Transport, 13 Conn. Workers’ Comp. Rev. Op. 6, 8, 1729 CRB-1-93-5 (Oct. 13, 1994).
It is clear from the history of this case that a good deal of evidence was introduced at the formal hearings relevant to the role of Sunshine Supply as a possible principal employer under § 31-291. Little attention was paid to the interaction between the claimant and T.J. Germain Tree Service, as no one disputed that they had an employer-employee relationship out of which the claimant’s injury arose. Rather, much of the testimony involved Germain’s dealings with Edward McCarty, and the degree of involvement the latter had with the tree-cutting endeavor and the driveway construction job in general. Though, due to extenuating circumstances, McCarty never quite reached the witness stand, his deposition was admitted without objection at the second formal hearing. As noted, Sunshine Supply later addressed the principal employer issue in its proposed findings, while the other respondents remained silent.
Gonzalez, supra, is a case in which a claimant sought to open a stipulation between himself and an employer/insurer on the ground of mutual mistake, as one of his medical providers had never billed either him or the insurer, leaving both parties unaware of the outstanding bill. The respondents argued that the claim had been properly settled, and any mistake was the fault of the medical provider. The provider, meanwhile, was prepared to go forth with the presentation of evidence to support the motion. The trial commissioner refused that request, stating that he lacked jurisdiction to take testimony from the provider unless and until the motion was heard and the matter reopened. He then issued an oral ruling denying that motion on equitable grounds, explaining that the claimant had now been paid and had left the country, thereby making it unlikely that the respondents would be able to recoup the money paid on the stipulation.
On appeal, this board reversed, stating that the medical provider indeed had standing to present evidence designed to show mutual mistake. Further, we noted that there was also an allegation that the insurer had indeed received a bill from the provider, which it had neither paid nor officially denied. A decision to grant or deny a motion to open falls within the discretion of the trial commissioner. Tomaszek v. Girard Motors, Inc., 4166 CRB-2-99-12 (Feb. 23, 2001), aff’d, 70 Conn. App. 122 (2002)(per curiam). However, because such a motion requires that the trier make a factual determination before he can decide whether or not to exercise his discretion to reopen a case, this board remanded for an evidentiary hearing as required by due process. Gonzalez, supra, 8. “The commissioner should have permitted such evidence [as was offered by the medical provider], not to decide on the payment of bills but for the purposes of claimant’s motion to open the stipulation.” Id.
An important distinction between the instant case and Gonzalez is that, in Gonzalez, there had been no evidence introduced at the initial proceedings concerning the medical provider’s bills. The motion to open the award was based upon a completely new issue that had not been dealt with previously. Absent an evidentiary hearing, the motion would have been denied without any evidence having been taken as to the factual foundation underpinning that motion. Thus, the medical provider was given the opportunity to present its evidence on remand.
Here , in contrast, the motion to open centers around the absence of McCarty’s testimony, a witness whose deposition was admitted in lieu of his live testimony at the second formal hearing without objection by any party. This deposition directly addresses issues relevant to possible principal employer liability under § 31-291. The other alleged ground for reopening is the possible involvement of another principal employer, Mark Nevas, the landowner who was residing in Montana at the time of the November 20, 2001 hearing, and who said he could make himself available to testify at a later date if needed. Transcript, pp. 16-17. As Sunshine Supply noted, McCarty’s deposition is replete with references to Nevas as the owner of the property. There is little question that the parties might have sought his presence at the previous formal hearing given the information then available, and the subject of the discussions that were being held.
We do not believe that further evidence regarding the nature of McCarty and Nevas’ involvement with the driveway construction project was necessary for the trier to judge whether there were “changed circumstances” in this particular situation. Both individuals were known to the parties at the time of trial, and their testimony could have been secured then. We see this case as less similar to Gonzalez than to Prioli v. Connecticut State Library/Arts Commission, 3955 CRB-6-98-12 (Jan. 13, 2000), aff’d, 64 Conn. App. 301 (2001), cert. denied, 258 Conn. 917 (2001), in which we held that the trial commissioner was not required to reopen an award in order to accept evidence regarding a claimant’s ratification of a contingency fee, as such evidence could have been introduced earlier, but was ignored because its importance was not apprehended at the time. The evidence that Tree Service and the Fund seek to introduce here is comparable in nature. The record shows that the proponents of such evidence were known at the time of trial, and the facts relevant to the § 31-291 principal employer issue were already being discussed. Sufficient evidence had been presented from which the commissioner could decide whether Sunshine Supply had procured work to be done by Tree Service as a contractor, whether that work was a part or process of Sunshine Supply’s business, and whether it was to be done on premises that were functionally under its control. See Jones, supra.
Consequently, we hold that the trier did not abuse his discretion by declining to reopen this case to receive further testimony from Sunshine Supply’s owner, and to investigate the possible principal employer status of Nevas, whose ownership of the property had been discussed in McCarty’s deposition. Such matters could indeed have been addressed earlier, and the trier did not need to take further evidence to determine that no change in circumstances had occurred within the meaning of § 31-315.
Accordingly, we affirm the trial commissioner’s denial of the Motion to Open.
Commissioners Donald H. Doyle, Jr. and Amado J. Vargas concur.
1 Section 31-291 provides, “When any principal employer procures any work to be done wholly or in part for him by a contractor, or through him by a subcontractor, and the work so procured to be done is a part or process in the trade or business of such principal employer, and is performed in, on or about premises under his control, such principal employer shall be liable to pay all compensation under this chapter to the same extent as if the work were done without the intervention of such contractor or subcontractor. The provisions of this section shall not extend immunity to any principal employer from a civil action brought by an injured employee or his dependent under the provisions of section 31-293 to recover damages resulting from personal injury or wrongful death occurring on or after May 28, 1988, unless such principal employer has paid compensation benefits under this chapter to such injured employee or his dependent for the injury or death which is the subject of the action.” BACK TO TEXT
2 Through the diligent efforts of this Commission’s staff, we have been able to obtain a transcript of the November 20, 2001 formal hearing. An error of unknown origin resulted in the absence of a transcript on appeal, although one had been requested on the petition for review. However, the proceedings had been conducted on the record in the presence of a court reporter, and tapes remained available from which a transcript could be created. Thus, we are now able to review the discussion between the attorneys and the trial commissioner that was held on November 20, 2001. BACK TO TEXT
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