Mayflower Corp. v. Davis

• Decision Date: 29 December 1994
• Docket Number: No. 93-3953,93-3953
• Parties: 20 Fla. L. Weekly D167 MAYFLOWER CORPORATION and Crawford & Company, Appellants, v. Wilma O. DAVIS, Appellee.
• Court: Florida District Court of Appeals

Page 1134

655 So.2d 1134

20 Fla. L. Weekly D167

MAYFLOWER CORPORATION and Crawford & Company, Appellants, v. Wilma O. DAVIS, Appellee.

No. 93-3953.

District Court of Appeal of Florida,

First District.

Dec. 29, 1994.

Robert W. Bleakley of Boehm, Brown, Rigdon, Seacrest & Fischer, P.A., Tampa, for appellants.

Richard R. Roach, Lakeland, and Bill McCabe, Longwood, for appellee.

SMITH, Senior Judge.

The employer/carrier (E/C) appeal an order of the judge of compensation claims (JCC) ordering the E/C to pay Claimant benefits based on an average weekly wage (AWW) calculated according to the premium basis upon which Claimant paid workers' compensation insurance premiums instead of section 440.14(1), Florida Statutes. We affirm.

Claimant was injured while on duty with Mayflower Corporation on January 26, 1987. The E/C accepted this injury as compensable and began paying Claimant benefits. On May 14, 1993, Claimant filed a claim seeking, among other things, a determination of the AWW. At the trial, the parties settled all issues except for the amount of AWW.

In the early 1980s, Claimant's husband began driving a truck for Mayflower as an independent contractor. A couple of years later, Claimant became qualified to drive and began driving with her husband as a team. The evidence established, and the JCC found, that Claimant and her husband operated as partners, and that she was paid from his earnings at Mayflower. Under this arrangement, Mayflower neither knew how much Claimant received nor had any control over it. Claimant and her husband never discussed how much Claimant would be paid. When Mr. Davis received a check from Mayflower, he simply deposited it into their joint account from which both of them withdrew funds as needed.

Mayflower's arrangement with Mr. Davis provided that he would receive 56% of the line haul, the amount Mayflower charges its customers for transporting their goods. Each month, Mr. Davis received a statement from Mayflower indicating the amount of line haul or other income he was to receive as well as any draw he had taken for monthly expenses and any deductions for insurance or other charges. The hauling income was then reported on Form 1099, which the Davis' used to calculate their income tax. Since the Davis' drove their own truck, which they were purchasing under a lease agreement, they were responsible for making payments on the truck and for paying all their other expenses, including fuel, maintenance and repairs, uniforms, workers' compensation charges, bank charges, meals and lodging out of their income. Thus, even though the Davis' hauling income for 1986 was $114,466.05, their adjusted gross income after expenses was only $11,939.20.

Mayflower required that Claimant be covered by workers' compensation insurance, and Mr. Davis' contract specifically required that he pay workers' compensation premiums through Mayflower. Mayflower set the premium basis on their policies and deducted the premiums from its drivers' income. Each Mayflower driver was charged the same amount of premium based upon a premium basis of $44,669, which was an estimate of a driver's earnings. Mr. Davis is listed as the insured on the Claimant's policy, which states that it covers "all employees and drivers including partners." There is no contention that Claimant is not covered under this policy. The Davis' paid premiums on this policy for five years and during that time neither the premium basis nor the premium amount was changed. The Davis' income was never audited to determine whether the basis was correct and the Davis' never received a rebate of premium.

A hearing was held in this cause on October 19, 1993 before Judge William D. Douglas to resolve the issue of the correct method for calculating the AWW. Claimant contended that her correct AWW was $429.51 because she and Mr. Davis had contracted with Mayflower for that amount in their workers' compensation insurance policy. The E/C, however, argued that Claimant's AWW should have been calculated according to section 440.14(1), Florida Statutes, which requires that it be based upon the average wage earned by the claimant during the thirteen weeks immediately preceding the accident. The JCC concluded that $429.51 was the correct AWW, based on his finding that the parties had contracted for that amount. In making this decision, the JCC relied upon Fleitas v. Today Trucking, Inc., 598 So.2d 252 (Fla. 1st DCA 1992), which held that an independent contractor's AWW may be based on a rate contracted for in the company's workers' compensation policy rather than a rate computed under section 440.14(1) as long as the contract rate bore a reasonable relationship to the claimant's actual wages and the claimant would not have otherwise been entitled to any benefits.

The E/C argue on appeal that the premium basis listed in the workers' compensation policy did not constitute a stipulated AWW and that Claimant's AWW should have been based upon section 440.14(1) rather than the estimated earnings contained in the policy. They also argue that this case is distinguishable from Fleitas because there the contract terms were specific--the policy stated the specific AWW to be used in the event of an injury--whereas here the contract does not delineate a specific AWW and no other evidence has been presented that the parties intended to contract for an AWW. According to the E/C, even if the parties had contracted for an AWW, the JCC erred in finding that Claimant was entitled to 50% of the premium basis amount because Claimant did not work daily with Mr. Davis during the thirteen weeks preceding her accident. Lastly, the E/C argue that Fleitas cannot be applied here because the current contract rate does not bear a rational relationship to Claimant's actual earnings. We disagree with the E/C's arguments and affirm.

Obviously, methods other than that set forth in section 440.14(1) may be used to calculate a claimant's AWW. Not only was this done in Fleitas, but this Court has previously approved other creative methods of determining the AWW that were tailored to fit the characteristics of a specific situation. Prestressed Decking Corp. v. Medrano, 556 So.2d 406 (Fla. 1st DCA 1989) (approving an AWW calculated according to the contract of employment instead of the statute); Waldorf v. Jefferson County School Bd., 622 So.2d 515 (Fla. 1st DCA 1993) (affirming the JCC's innovative approach to calculating the AWW of a substitute bus driver who only worked four weeks out of the year).

Here, the JCC was free to use a method other than that delineated in section 440.14(1) as long as that method had a foundation in Florida law. The JCC found the instant case similar to Fleitas, where this Court affirmed an AWW derived solely from the claimant's workers' compensation policy. 598 So.2d at 252. In Fleitas, the claimant, an independent truck driver who drove his own truck and paid his own expenses, was covered by the company's workers' compensation policy pursuant to an agreement under which he paid the premiums. Id. The policy in issue there stated that drivers of Today Trucking were "covered by Workmens' Compensation in the face amount of ... $240.00, per week with said premises to be paid by Today."

In a dispute over the correct AWW, claimant argued that he was entitled to benefits based on an AWW of $512 per week, which approximated his revenue less expenses. However, Today argued that Claimant's premiums should be based upon an AWW of $240 per week, the average weekly pay as specified in the policy. The JCC agreed that the correct AWW was the contract amount and stated that he did not see any problem with an independent contractor contracting for the amount of benefits he would pay premium on "so long as that agreement [was] reasonable and [bore] a reasonable relationship to the actual value of the service provided." Id. at 253. This Court affirmed the use of the contract rate in circumstances where it "bears a rational relationship to the claimant's actual wages and the claimant would not be entitled to any benefits but for the contract." Id. at 254.

We affirm the JCC's order awarding Claimant benefits based on an AWW of $429.51. Like the claimant in Fleitas, the claimant here is also an independent truck driver who would not be entitled to workers' compensation benefits but for the contract providing for coverage. Claimant's contract with Mayflower, which was evidenced by the workers' compensation policy and the Davis' course of dealing with Mayflower, and the payment of a specific premium that remained unchanged...