Opinion
BOARD No. 03833192
Filed: April 9, 1997
REVIEWING BOARD DECISION (Judges Smith, Maze-Rothstein and McCarthy)
APPEARANCES
Lawrence Machione, Esq., for the employee at hearing
Morgan J. Gray, Esq., for the employee on brief
Ralph J. Cafarelli, Esq., for the insurer
The insurer appeals from the decision of the administrative judge awarding a closed period of § 34 temporary total incapacity benefits. Because the claimant was a sole proprietor, the Department of Industrial Accidents had no authority under the workers' compensation act to order payments to him. We reverse the benefit award as it is contrary to law.
The facts are not in dispute. Charles Chute, forty-nine years old at the time of hearing, was born and educated through high school in Ireland. He became domiciled in the United States in 1977 and in 1982 he formed the Charles Chute Painting Company, an unincorporated business. He was personally involved in all aspects of the painting contracting business from solicitation of bids to performance of actual painting jobs. (Dec. 5.) The only regular persons working at Chute Painting were Mr. Chute and his wife who acted as bookkeeper and occasionally drew a salary from the business. (Dec. 7.) If a job was too big for him to handle alone, then Chute would hire an additional laborer temporarily for that particular job. (Id.)
Chute purchased and consistently maintained a workers' compensation insurance policy for his business. The named insured on the policy was Charles Chute, doing business as Charles Chute Painting Co. (Employee Ex. 2.) The premium charged to Chute Painting was based on the actual payroll of the company, which included his own salary. Chute specifically inquired of his original insurance agent as to his own coverage and was assured that he would be covered. He first became aware of the possibility that he was not covered after his injury. (Dec. 6-7.)
On August 11, 1992 Chute was painting a wall using a paint roller. When bending down to roll paint, he felt excruciating lower back pain and right leg numbness which lasted for several minutes before subsiding. He worked the remainder of the week and sought medical treatment the following Monday. A MRI revealed a herniated disc. Surgery was performed after which he underwent physical therapy. He returned to work on March 8, 1993. (Dec. 5-6.)
Chute filed a claim for benefits which the insurer resisted. The claim was denied at conference and the claimant appealed. A hearing de novo was held in front of the same administrative judge. At the close of testimony the parties stipulated that the employee was disabled from August 17, 1992 to March 8, 1993. The sole issue before the judge was insurance coverage. The insurer raised as its defense that Mr. Chute was an owner of Charles Chute Painting Company and therefore not entitled to coverage.
In awarding benefits the administrative judge made the following general findings:
1. I find that Charles Chute is both owner and Employee of the Charles Chute Painting Company. (Dec. 9.)
4. I dismiss [the argument that Chute is not entitled to coverage without having a rider attached to his policy] since Liberty Mutual collected substantial premium amounts for the past five (5) years based upon the total payroll of Charles Chute Painting Company in which Charles Chute's salary was included.
Representations were made to Mr. chute [sic] that hiss [sic] Workers [sic] Compensation Policy in fact covered him. As such, I further find that an implied contract of law has beer. established between the parties in which case, Mr. Chute is entitled to compensation benefits under this policy. (Dec. 10.)
In its appeal, the insurer argues that the claimant is not an employee for the purposes of the workers' compensation act and, therefore, is not entitled to benefits, citing Ryder's Case, 341 Mass. 661, 171 N.E.2d 475 (1961) and Hayes' Case, 348 Mass. 447, 204 N.E.2d 277 (1965). We agree.
The workers' compensation act is a scheme of insurance for employees who give up their rights to sue their employers in tort. See Neff v. Commissioner of Dept. of Indus. Accidents, 421 Mass. 70, 653 N.E.2d 556 (1995); G.L.c. 152, § 24. The workers' compensation act does not cover the personal injuries of all individuals arising from their work but only those which occur to "employees."
G.L.c. 152, § 24, entitled "Waiver of right of action for injuries" provides in pertinent part:
An employee shall be held to have waived his right of action at common law or under the law of any other jurisdiction in respect to an injury that is compensable under this chapter, to recover damages for personal injuries, if he shall not have given his employer, at the time of his contract of hire, written notice that he claimed such right . . . If an employee has not given notice . . ., the employee's spouse, children, parents and any other member of the employee's family or next of kin who is wholly or partly dependent upon the earnings of such employee at the time of injury or death, shall also be held to have waived any right created by statute, at common law, or under the law of any other jurisdiction against such employer, including, but not limited to claims for damages due to emotional distress, loss of consortium, parental guidance, companionship or the like, when such loss is a result of any injury to the employee that is compensable under this chapter.
An employee is defined in the Act as "every person in the service of another under any contract of hire." G.L.c. 152, § 1 (4). We recognize that "[t]he workmen's compensation act is to be construed broadly to include as many employees as its terms will permit." Warren's Case, 326 Mass. 718, 719, 97 N.E.2d 184, 186 (1951). But a sole proprietorship is not an entity separate from its owner. The owner, if an employee, would also be an employer. "The compensation act cannot be supposed to have contemplated any such combination of employer and employee status in one person." The same individual may not be both employee and employer for purposes of the workers' compensation act. Ryder's Case, supra, 341 Mass. at 665, 171 N.E.2d at 478.
Chute was not "in the service of another." His painting company was not an entity independent of him. The fact that he performed manual tasks is of no moment. "[T]he work, to qualify as employment, should be done under the control of someone. If the [claimant] is himself the ultimate wielder of control, it is difficult to see how even his performance of menial work could be termed employment." Hayes's Case, supra, 348 Mass. at 452, 204 N.E.2d 280. For these reasons, we hold that the claimant cannot qualify as an "employee" under G.L.c. 152, § 1 (4).
The claimant argues that the insurer is estopped to deny recovery under the workers' compensation act. However, since the claimant is not an "employee" under the act, the administrative judge lacked authority to direct the insurer to pay workers' compensation benefits. The Division of Dispute Resolution in Department of Industrial Accidents is not a court of general or limited common law jurisdiction. It is purely and solely an administrative tribunal, specifically created to administer the workers' compensation act in aid and with the assistance of the superior court. As such, it possesses only such authority and powers as have been conferred upon it by express grant or arise therefrom by implication as necessary and incidental to the full exercise of the granted powers. Full performance of the conditions of the workers' compensation act are essential prerequisites to its jurisdiction. Its authority, and the statutory limitation upon the exercise of such authority, cannot be enlarged, diminished or destroyed, by express consent, or waived by acts of estoppel. Hayes' Case, supra, 348 Mass. at 452-453, 204 N.E.2d at 281. The claimant's remedy, if any, lies in a different forum.
Because the decision of the administrative judge was beyond the scope of his authority and contrary to law, we reverse it. See G.L.c. 152, § 11C.
So ordered.
_________________________________ Suzanne E.K. Smith Administrative Law Judge
_________________________________ William A. McCarthy Administrative Law Judge
_________________________________ Susan Maze-Rothstein Administrative Law Judge