Walton v. Colonial Freight Sys., Inc.
| Decision Date | 06 May 2016 |
| Docket Number | No. E2015-00088-SC-R3-WC,E2015-00088-SC-R3-WC |
| Parties | DEMETRIUS D. WALTON v. COLONIAL FREIGHT SYSTEMS, INC. |
| Court | Tennessee Supreme Court — Special Workers' Compensation Appeals Panel |
Appeal from the Chancery Court for Knox County
Michael W. Moyers, Chancellor
The workers' compensation claimant was an independent contractor for the defendant, a common carrier engaged in interstate commerce. The claimant and the defendant agreed that the defendant would provide workers' compensation coverage to the claimant based on Tennessee Code Annotated section 50-6-106(1)(B) (2012). The claimant was injured while driving a tractor trailer for the defendant. The claimant's claim for benefits was denied, and he sued for workers' compensation benefits. The defendant moved for summary judgment, asserting that the claimant's employment agreement was void because of alleged material misrepresentations made by the claimant regarding his physical condition during his pre-employment medical examination. The trial court granted the defendant's motion, based on its finding that the claim was barred by claimant's pre-employment material misrepresentations and Tennessee Code Annotated section 56-7-103 (2012). This appeal has been referred to the Special Workers' Compensation Appeals Panel for a hearing and a report of findings of fact and conclusions of law under Tennessee Supreme Court Rule 51. We vacate the grant of summary judgment and remand to the trial court for further proceedings.
Tenn. Code Ann. § 50-6-225(a)(2) (2012) Appeal as of Right; Judgment of the Chancery Court Vacated and Remanded
Edward L. Summers, Knoxville, Tennessee, for the appellant, Demetrius D. Walton.
Richard L. Hollow, Knoxville, Tennessee, for the appellee, Colonial Freight Systems, Inc.
OPINIONOn June 10, 2011, Demetrius D. Walton and Colonial Freight Systems, Inc. ("Colonial") entered into a contract wherein Mr. Walton, as an independent contractor, agreed to transport goods for Colonial, and Colonial agreed to compensate Mr. Walton based on the mileage of the transports, less certain enumerated expenses, including workers' compensation insurance. On the same day, Colonial and Mr. Walton entered into a Workers' Compensation Contractual Agreement, wherein Colonial agreed to provide workers' compensation insurance coverage to Mr. Walton. As required by Tennessee Code Annotated section 50-6-106(1)(B), the parties signed and filed a Form I-14 with the Tennessee Department of Labor and Workforce Development, noting Mr. Walton's election to come under the Tennessee Workers' Compensation Act.
On June 14, 2011, while driving a tractor trailer for Colonial, Mr. Walton was injured in a wreck.1 Colonial denied his claim for workers' compensation benefits. After Mr. Walton exhausted the benefit review process, he sued Colonial for workers' compensation benefits in the Chancery Court for Knox County.2
Colonial moved for summary judgment, asserting that Mr. Walton made material misrepresentations regarding his physical condition during his pre-employment medical assessment, which induced Colonial to enter into its contractual relationship with Mr. Walton. Colonial argued that the contractual relationship on which Mr. Walton's workers' compensation complaint is based was rendered void ab initio, and therefore, Mr. Walton was not entitled to receive workers' compensation benefits. In his response, Mr. Walton denied making any material misrepresentations and asserted that factual issues existed as to whether he knowingly and willfully misrepresented his physical condition to Colonial, whether Colonial's reliance upon his alleged misrepresentations was a substantial factor in his hiring, and whether there was a causal connection between his injuries and the physical conditions he allegedly misrepresented.
Following a hearing, the trial court granted Colonial's motion, stating that Mr. Walton had "obtained employment by fraudulent means by not disclosing [his medical] conditions which he fully knew he had, . . . admitted that he had, and knew that he hadthroughout the discovery in this process, although he's tried [to] minimize . . . those matters." The trial court noted that the doctor who conducted Mr. Walton's pre-employment physical examination stated in an affidavit that he would not have certified Mr. Walton to drive had he known about his undisclosed medical conditions. The trial court observed that Mr. Walton had produced no evidence to contradict the doctor's statement. In addition, the trial court, sua sponte, relied on Tennessee Code Annotated section 56-7-103, which provides that misrepresentations made by an insured in applying for a policy of insurance "shall [not] be deemed material or defeat or void the policy or prevent its attaching, unless the misrepresentation or warranty is made with actual intent to deceive, or unless the matter represented increases the risk of loss." The trial court concluded that this statutory provision applied and that Mr. Walton knew of his medical conditions, failed to disclose them, and those medical conditions increased the risk to Colonial. On that basis, the trial court found that Mr. Walton was not entitled to any benefits.
Mr. Walton has appealed, contending that the trial court erred by granting Colonial's motion for summary judgment based on Mr. Walton's alleged material misrepresentations and applying Tennessee Code Annotated section 56-7-103.
A motion for summary judgment should be granted only when "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Rye v. Women's Care Ctr. of Memphis, ___ S.W.3d ___, 2015 WL 6457768, at *12 (Tenn. Oct. 26, 2015) (quoting Tenn. R. Civ. P. 56.04). The appellate court must review the evidence in a light most favorable to the non-moving party and draw all reasonable inferences in favor of the non-moving party. Staples v. CBL & Assocs., Inc., 15 S.W.3d 83, 89 (Tenn. 2000) (citing Robinson v. Omer, 952 S.W.2d 423, 426 (Tenn. 1997); Byrd v. Hall, 847 S.W.2d 208, 210-11 (Tenn. 1993)). The standard of review is de novo with no presumption of correctness attached to the trial court's conclusions. Teter v. Republic Parking Sys., Inc., 181 S.W.3d 330, 337 (Tenn. 2005) (citing Mooney v. Sneed, 30 S.W.3d 304, 306 (Tenn. 2000); Carvell v. Bottoms, 900 S.W.2d 23, 26 (Tenn. 1995)). Because of the remedial nature of the Tennessee Workers' Compensation Act and the importance of medical opinion testimony, "summary judgment motions should be entered with caution in workers' compensation cases." Downen v. Allstate Ins. Co., 811 S.W.2d 523, 524 (Tenn. 1991); see also Berry v. Consol. Sys., Inc., 804 S.W.2d 445, 446 (Tenn. 1991) ().
Tennessee employers are statutorily obligated to provide their employees with workers' compensation coverage unless specifically exempted from the Tennessee Workers' Compensation Act. Perkins v. Enter. Truck Lines, Inc., 896 S.W.2d 123, 125(Tenn. 1995) (citing Tenn. Code Ann. § 50-6-106 (1991 & Supp. 1994)). Tennessee Code Annotated section 50-6-106(1)(A) exempts from the Act "[a]ny common carrier doing an interstate business while engaged in interstate commerce." Tenn. Code Ann. § 50-6-106(1)(A); see also Long v. Stateline Sys., Inc., 738 S.W.2d 622, 623 (Tenn. 1985). Although a common carrier under this section is not deemed to be the employer of a leased-operator or owner-operator of a motor vehicle, see Tenn. Code Ann. § 50-6-106(1)(A), Tennessee Code Annotated section 50-6-106(1)(B) provides that leased operators or leased owner/operators of motor vehicles under contract to common carriers may elect to receive workers' compensation coverage. Tennessee Code Annotated section 50-6-106(1)(B) states:
[A] leased operator or a leased owner/operator of a motor vehicle under contract to a common carrier may elect to be covered under any policy of workers' compensation insurance insuring the common carrier upon written agreement of the common carrier, by filing written notice of the contract, on a form prescribed by the commissioner, with the division[.]
Tenn. Code Ann. § 50-6-106(1)(B); see also 20 Tenn. Workers' Comp. Prac. & Proc. Appendix C Form I-14 ("Form I-14").
Mr. Walton elected to receive workers' compensation insurance coverage from Colonial. The parties executed an agreement to that effect and filed a Form I-14. Mr. Walton was required to obtain a medical certificate from a medical examiner under federal motor carrier safety regulations before he could drive a truck for Colonial. See 49 C.F.R. § 391.41 (2010). On May 31, 2011, Dr. John McElligott conducted a Department of Transportation ("DOT") physical examination of Mr. Walton. Dr. McElligott did not certify Mr. Walton to drive because Mr. Walton had a blood pressure reading of 180/120, which was over the allowable limits. On June 6, 2011, Mr. Walton returned to Dr. McElligott for a follow-up examination. His blood pressure was improved, and Dr. McElligott gave him a three-month certification. On June 10, 2011, Mr. Walton and Colonial entered into an employment agreement and an agreement for workers' compensation coverage.
In its motion for summary judgment, Colonial asserted that Mr. Walton made three knowing and willful false representations of his physical condition in his responses to questionnaires completed during his May 31 and June 6, 2011 medical examinations with Dr. McElligott. The first alleged misrepresentation concerned Mr. Walton's history of hypertension. At the May 31 examination, in a section of the...
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