Pikaart v. a & a Taxi Inc., No. 27003.

• Court: United States State Supreme Court of South Carolina
• Writing for the Court: Justice BEATTY.
• Citation: 393 S.C. 312,713 S.E.2d 267
• Decision Date: 11 July 2011
• Docket Number: No. 27003.
• Parties: Robert PIKAART, Respondent,v.A & A TAXI, INC. and South Carolina Uninsured Employers' Fund, Appellants.

393 S.C. 312
713 S.E.2d 267

Robert PIKAART, Respondent,
v.
A & A TAXI, INC. and South Carolina Uninsured Employers' Fund, Appellants.

No. 27003.

Supreme Court of South Carolina.

Heard April 6, 2011.Decided July 11, 2011.

[713 S.E.2d 268]

Brown W. Johnson, of Clarke, Johnson, Peterson & McLean, and Samuel Thompson Brunson, both of Florence, for Appellants.Charles Vance Leonard, of Harris & Leonard, P.A., of Myrtle Beach, for Respondent.Justice BEATTY.

A & A Taxi, Inc. and the South Carolina Workers' Compensation Uninsured Employers' Fund (collectively, Appellants) appeal from a circuit court order finding Robert A. Pikaart was an employee of A & A Taxi, Inc. at the time he was injured in two automobile accidents and that he was entitled to certain workers' compensation benefits. Appellants contend Pikaart was an independent contractor, not an employee; therefore, the South Carolina Workers' Compensation Commission has no jurisdiction in this matter. They further argue the circuit court improperly made findings of fact that did not bear on the limited issue of jurisdiction that was before it. We affirm.

I. FACTS

A & A Taxi, Inc. is a taxi company located in Myrtle Beach, South Carolina. It was formed by Romeo A. Liriani, the company's owner and president.

Pikaart had over twenty years of experience in the taxi business at the time this action arose. Pikaart was involved in two unrelated automobile accidents in Horry County on October 23, 2004 and January 2, 2005 while performing errands for A & A

[713 S.E.2d 269]

Taxi.¹ In April of 2005, Liriani and Pikaart parted ways. According to Pikaart, he was terminated after he advised Liriani that he would need surgery as a result of his injuries.

Pikaart sought workers' compensation coverage for alleged injuries he sustained to his neck, back, arms, hands, and fingers. A & A Taxi denied responsibility for Pikaart's claims on the basis Pikaart was an independent contractor, not an employee. A & A Taxi did not carry workers' compensation coverage, so the South Carolina Workers' Compensation Uninsured Employers' Fund was made a party to the action.

A hearing was held before a commissioner of the Workers' Compensation Commission. Pikaart testified that he had been employed by Liriani as A & A Taxi's office manager at the time of his accidents. He outlined his duties, which included the following: making a schedule for all of the taxis; implementing a $10 dispatch fee all drivers were required to pay A & A Taxi for dispatch services, which saved the company some overhead costs; processing the trip vouchers that were submitted for every taxi; implementing a rotation system for high-paying fares and a method for selling accounts receivable to provide immediate cash flow; hiring and firing drivers for Liriani; finding independent cabs to take calls whenever A & A Taxi was fully booked; overseeing vehicle maintenance for the taxis; filling in as a dispatcher and a driver whenever needed; and communicating with insurance companies, City Hall, and others on behalf of A & A Taxi.

In contrast, Liriani testified Pikaart was “never” the manager of A & A Taxi. Liriani stated Pikaart leased five cabs and three certificates (or medallions) from him, and that Pikaart leased two medallions from other individuals and operated all five of those cabs as his own business. He stated Pikaart never performed any duties for him; rather, he just controlled the five cabs he leased.

The commissioner found Pikaart was not an employee of A & A Taxi, but was instead operating his own taxi business. The commissioner concluded the Commission did not have jurisdiction over this case because no employer-employee relationship existed. An Appellate Panel of the Commission upheld the commissioner's order.

Upon review, the circuit court, noting it could take its own view of the preponderance of the evidence on jurisdictional matters, determined Pikaart was the manager of A & A Taxi and therefore an employee. The circuit court stated Pikaart “ran the entire [A & A Taxi] operation and was present every day” and that his “managerial duties [were] extensive.” The circuit court noted “it is clear [Pikaart's] overall task was to increase revenue for the company,” and “[h]is injuries occurred when furthering the business of [A & A Taxi].” Citing Nelson v. Yellow Cab Co., 349 S.C. 589, 564 S.E.2d 110 (2002), the circuit court found A & A Taxi exercised extensive control over Pikaart as well as the other workers. The circuit court additionally found Pikaart was entitled to certain workers' compensation benefits.

Appellants appealed. Pursuant to Rule 204(b), SCACR, we certified this case from the Court of Appeals.

II. STANDARD OF REVIEW

The Administrative Procedures Act (APA) establishes the standard for judicial review of workers' compensation decisions. Pierre v. Seaside Farms, Inc., 386 S.C. 534, 689 S.E.2d 615 (2010); Lark v. Bi–Lo, Inc., 276 S.C. 130, 276 S.E.2d 304 (1981). Under the APA, this Court can reverse or modify the decision of the Commission where the substantial rights of the appellant have been prejudiced because the decision is affected by an error of law or is clearly erroneous in view of the reliable, probative, and substantial evidence considering the record as a

[713 S.E.2d 270]

whole. Pierre, 386 S.C. at 540, 689 S.E.2d at 618; Transp. Ins. Co. v. South Carolina Second Injury Fund, 389 S.C. 422, 427, 699 S.E.2d 687, 689–90 (2010) (citing S.C.Code Ann. § 1–23–380(5)(d), (e) (Supp.2009)).

An award under workers' compensation law is not authorized unless an employer-employee relationship existed at the time of the injury for which a claim is made. Crim v. Decorator's Supply, 291 S.C. 193, 352 S.E.2d 520 (Ct.App.1987); McLeod v. Piggly Wiggly Carolina Co., 280 S.C. 466, 313 S.E.2d 38 (Ct.App.1984); see also S.C.Code Ann. § 42–1–130 (Supp.2010) (defining “employee” under workers' compensation law to include “every person engaged in an employment under any appointment, contract of hire, or apprenticeship, expressed or implied, oral or written....”).

The question whether a claimant is an employee or an independent contractor is a jurisdictional issue. Wilkinson ex rel. Wilkinson v. Palmetto State Transp. Co., 382 S.C. 295, 676 S.E.2d 700 (2009); Vines v. Champion Bldg. Prods., 315 S.C. 13, 431 S.E.2d 585 (1993). Where the disputed issue concerns jurisdiction, this Court may take its own view of the preponderance of the facts upon which jurisdiction is dependent. Wilson v. Georgetown County, 316 S.C. 92, 447 S.E.2d 841 (1994); Spivey v. D.G. Constr. Co., 321 S.C. 19, 467 S.E.2d 117 (Ct.App.1996).

It is South Carolina's policy to resolve jurisdictional questions in favor of inclusion of employees within workers' compensation coverage rather than exclusion. Shuler v. Tri–County Elec. Co–op, 385 S.C. 470, 684 S.E.2d 765 (2009); Hill v. Eagle Motor Lines, 373 S.C. 422, 645 S.E.2d 424 (2007); Pilgrim v. Eaton, 391 S.C. 38, 703 S.E.2d 241 (Ct.App.2010).

Although we may take our own view of the preponderance of the evidence on matters affecting jurisdiction, this broader scope of review does not require this Court to ignore the findings of the Commission, which was in a better position to evaluate the credibility of the witnesses. Paschal v. Price, 392 S.C. 128, 133, 708 S.E.2d 771, 773 (2011); Shealy v. Aiken County, 341 S.C. 448, 535 S.E.2d 438 (2000).

III. LAW/ANALYSIS

On appeal, Appellants contend the circuit court erred in (1) finding Pikaart was an employee of A & A Taxi, rather than an independent contractor, and (2) making findings of fact numbered one through nine because they do not relate to the limited issue of jurisdiction that was before the court.

A. Employee Versus Independent Contractor

Under South Carolina law, the primary consideration in determining whether an employer-employee relationship exists is whether the purported employer has the right to control the employee in the performance of the work and the manner in which it is done. Kilgore Group, Inc. v. South Carolina Employment Sec. Comm'n, 313 S.C. 65, 437 S.E.2d 48 (1993). “The test is not the actual control exercised, but whether there exists the right and authority to control and direct the particular work or undertaking.” Id. at 68, 437 S.E.2d at 49.²

The four principal factors indicating the right of control are (1) direct evidence of the right to, or exercise of, control; (2) the method of payment; (3) the furnishing of equipment; and (4) the right to fire. South Carolina Workers' Comp. Comm'n v. Ray Covington Realtors, Inc., 318 S.C. 546, 459 S.E.2d 302 (1995); Chavis v. Watkins, 256 S.C. 30, 180 S.E.2d 648 (1971).

In Wilkinson, this Court announced a return to our jurisprudence that evaluates the four factors with equal force in both directions to provide an even-handed and balanced approach.

[713 S.E.2d 271]

Wilkinson, 382 S.C. at 300, 676 S.E.2d at 702. This overruled the analytical framework previously set forth in Dawkins v. Jordan, 341 S.C. 434, 534 S.E.2d 700 (2000) on the basis it unduly weighted the factors in a manner that favored a finding of employment by providing the existence of any single factor was virtually proof of an employment relationship, while contrary evidence as to any one factor was only mildly persuasive evidence of contractorship. Id.

In the current...