Wilkinson v. Palmetto State Transp. Co., 4179.

• Decision Date: 20 November 2006
• Docket Number: No. 4179.,4179.
• Citation: 638 S.E.2d 109
• Court: South Carolina Court of Appeals
• Parties: Lea Ann WILKINSON (surviving spouse) For Scott R. WILKINSON (deceased employee), Respondent, v. PALMETTO STATE TRANSP. CO., Employer, and Canal Insurance Co., Carrier, Appellants.

638 S.E.2d 109

Lea Ann WILKINSON (surviving spouse) For Scott R. WILKINSON (deceased employee), Respondent, v. PALMETTO STATE TRANSP. CO., Employer, and Canal Insurance Co., Carrier, Appellants.

No. 4179.

Court of Appeals of South Carolina.

Submitted October 1, 2006.

Decided November 20, 2006.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Duke K. McCall, Jr., of Greenville, for Appellants.

Kathryn Williams, of Greenville, for Respondent.

WILLIAMS, J.:

Palmetto State Transportation Company and its carrier, Canal Insurance Company (jointly referred to as Palmetto), appeal a circuit court order affirming the Workers' Compensation Commission's (Commission) award of benefits to Scott Wilkinson's dependents. Palmetto argues the trial court erred in affirming the Commission's: (1) finding that an employer/employee relationship existed between Palmetto and Scott; (2) denial of a motion to include additional evidence; (3) finding that an occupational disability policy purchased by Scott is a collateral source; (4) denial of a motion to join Zurich American Insurance Company (Zurich), the provider of Scott's occupational disability policy, as a party defendant; and (5) denying the testimony of Gary Smith, Palmetto's expert. We affirm.

FACTS

On May 16, 2002, while driving a transfer truck, Scott Wilkinson was involved in a fatal accident in Virginia.

Scott's spouse, Lea Ann Wilkinson, contends that during the time of the accident, Scott was an employee of Palmetto. As such, she and the couple's son are entitled to death benefits from Palmetto's workers' compensation carrier under the Workers' Compensation Act. Palmetto argues that at the time of his death, Scott was an independent contractor and not an employee; therefore, Lea Ann is not entitled to receive benefits from Palmetto. To support this argument, Palmetto contends in 1998, Scott was hired as an employee, but in May 1999 and again in 2000, the parties signed a contract in which Scott was named as an independent contractor and Palmetto as the carrier.

Palmetto further avers that even if this Court were to find an employer/employee relationship existed, Palmetto's liability should be offset by any benefits paid to Lea Ann by the occupational disability policy Scott purchased from Zurich. Lea Ann argues this policy is wholly a collateral source; therefore, Palmetto is not entitled to receive any credit from payments made by Zurich.

On February 27, 2004, the Commissioner found an employer/employee relationship existed between Scott and Palmetto at the time of his death, and Lea Ann and the couple's child were entitled to receive death benefits under Palmetto's workers' compensation policy. In addition, the Commissioner held that Scott's occupational disability policy constituted a collateral source. Thus, Palmetto was not entitled to receive credit for benefits paid from that policy, nor could Palmetto receive benefits directly from that policy.

Prior to this ruling, Palmetto filed a motion to add Zurich as an additional party referencing the occupational disability policy purchased by Scott. In addition, Palmetto filed a motion to include additional evidence. The Commissioner denied both motions.

Consequently, Palmetto appealed to the Full Commission, asserting that the Commissioner erred in denying these motions. On September 28, 2004, the Commission's Appellate Panel affirmed and adopted the Commissioner's order. On September 25, 2005, Palmetto appealed to the circuit court, which affirmed the Commission. Palmetto now appeals to this Court.

STANDARD OF REVIEW

The Administrative Procedures Act applies to appeals from decisions of the Commission. Lark v. Bi-Lo, Inc., 276 S.C. 130, 134-35, 276 S.E.2d 304, 306 (1981). In an appeal from the Commission, neither this Court nor the circuit court may substitute its judgment for that of the Commission as to the weight of the evidence on questions of fact, but it may reverse when the decision is affected by an error of law. Corbin v. Kohler Co., 351 S.C. 613, 617, 571 S.E.2d 92, 95 (Ct.App.2002).

"Any review of the [C]ommission's factual findings is governed by the substantial evidence standard." Lockridge v. Santens of Am., Inc., 344 S.C. 511, 515, 544 S.E.2d 842, 844 (Ct.App.2001). Accordingly, we limit review to deciding whether the Commission's decision is unsupported by substantial evidence or is controlled by some error of law. Corbin, 351 S.C. at 617, 571 S.E.2d at 95.

"Substantial evidence is evidence that, in viewing the record as a whole, would allow reasonable minds to reach the same conclusion that the full commission reached." Lockridge, 344 S.C. at 515, 544 S.E.2d at 844. "The `possibility of drawing two inconsistent conclusions from the evidence does not prevent an administrative agency's finding from being supported by substantial evidence.'" Lee v. Harborside Café, 350 S.C. 74, 78, 564 S.E.2d 354, 356 (Ct.App.2002) (quoting Palmetto Alliance, Inc. v. S.C. Pub. Serv. Comm'n, 282 S.C. 430, 432, 319 S.E.2d 695, 696 (1984)).

However, if any factual issue before the Commission involves a jurisdictional question, this Court is not bound by the Commission's findings of fact; but it can take its own view of the preponderance of the evidence on that issue. Wilson v. Georgetown County, 316 S.C. 92, 94, 447 S.E.2d 841, 842 (1994).

LAW/ANALYSIS

A. Employer/employee relationship

Palmetto initially argues the trial court and the Commission erred in concluding that an employer/employee relationship existed between Palmetto and Scott. We disagree.

Unless an employment relationship existed between the parties at the time of the alleged injury, an award cannot be granted. Alewine v. Tobin Quarries, 206 S.C. 103, 109, 33 S.E.2d 81, 83 (1945). Whether such a relationship exists is a jurisdictional question; therefore, this Court can take its own view of the preponderance of the evidence. S.C. Workers' Comp. Comm'n v. Ray Covington Realtors, Inc., 318 S.C. 546, 547, 459 S.E.2d 302, 303 (1995). However, doubts of jurisdiction are to be resolved in favor of inclusion rather than exclusion. Horton v. Baruch, 217 S.C. 48, 56, 59 S.E.2d 545, 548 (1950).

Palmetto places great weight on the agreement the parties signed in May 1999 and again in 2000, in which Scott was named as an independent contractor and Palmetto as the carrier. However, Palmetto forgets neither the descriptions of relationships as set forth in the parties' contract, nor the language in the contract declaring the parties to be that of independent contractor/carrier is binding on this Court. Kilgore Group Inc. v. S.C. Employment Sec. Comm'n, 313 S.C. 65, 69, 437 S.E.2d 48, 50 (1993). Rather, the determination of whether the worker is an employee or independent contractor is a fact-specific matter resolved by applying certain established principles. Nelson v. Yellow Cab Co., 349 S.C. 589, 594 564 S.E.2d 110, 112-13 (2002).

The test to determine whether a claimant is an employee or an independent contractor is if "the alleged employer has the right and authority to control and direct the particular work or undertaking, as to the manner or means of its accomplishment." S.C. Workers' Comp. Comm'n v. Ray Covington Realtors, Inc., 318 S.C. 546, 547, 459 S.E.2d 302, 303 (1995) (internal quotes omitted). Four factors determine the right of control.

They are: (1) direct evidence of right to or exercise of control, (2) method of payment, (3) furnishing of equipment, and (4) right to fire. Tharpe v. G.E. Moore Co., 254 S.C. 196, 200, 174 S.E.2d 397, 399 (1970). The presence of any one of the factors is sufficient proof of an employer/employee relationship; on the other hand, the absence of any one of the factors is at most mild influential evidence of contractorship. Dawkins v. Jordan, 341 S.C. 434, 439, 534 S.E.2d 700, 703 (2000).

In analyzing these factors, the Court recognizes that the Workers' Compensation Act favors the inclusion of employers and employees and not their exclusion. Horton, 217 S.C. at 56, 59 S.E.2d at 548. With this introduction in mind, we now turn our attention to these four factors.

The first factor is whether direct evidence exists of the right to, or the actual exercise of, control. If an alleged employer has the right to control and sets out the manner in which the work is to be accomplished, this is direct evidence of an employer/employee relationship. Young v. Warr, 252 S.C. 179, 189-90, 165 S.E.2d 797, 802 (1969). Palmetto contends it lacked control over Scott because Scott could refuse loads and consequently worked on his own schedule. We find this argument to be without merit.

Palmetto exercised its control over Scott by requiring Scott to exclusively carry its loads. When Scott carried a load for Palmetto, he was instructed on when and where to pick up the load as well as how and when to deliver the load. Moreover, Palmetto required Scott to apply the company logo to his truck. This is sufficient evidence to prove that Palmetto not only had the right to control Scott but exercised this control. See Nelson v. Yellow Cab Co., 349 S.C. 589, 597-98, 564 S.E.2d 110, 114 (2002) (Cab company had the right of control even when the cab driver could work as little as he wanted, drove the cab in any part of the city he chose, and could set his own schedule.).

The second factor for consideration is the method of payment; this factor indicates a lack of an employer/employee relationship. Like other employed drivers, Palmetto paid Scott by the mile. However, unlike other employed drivers, Scott's rate per mile was higher, and Palmetto made no deductions for either social security or income taxes. Moreover, unlike other employed drivers, Scott had to pay various expenses such as fuel costs, service fees, and toll fees. These facts indicate that Scott was not paid like other employed drivers.

The third factor is whether Palmetto furnished Scott's equipment; this factor indicates that Scott was an employee. Although...