Opinion
Record No. 0525-92-3
January 5, 1993
FROM THE VIRGINIA WORKERS' COMPENSATION COMMISSION
E. Wayne Powell, for appellant.
Mark D. Kidd (Osterhoudt, Ferguson, Natt, Aheron Agee, on brief), for appellee.
Present: Chief Judge Koontz, Judges Moon and Willis
Argued at Salem, Virginia
Pursuant to Code § 17-116.010 this opinion is not designated for publication.
Groendyk Manufacturing Company seeks reversal of the Workers' Compensation Commission holding that James P. Mundy did not "return to employment" within the meaning of Code § 65.2-712. We reverse because we find that Mundy had returned to employment and we remand the case to the commission to determine the amount the employer would be entitled "by way of credit against future compensation" to account for any value Mundy had received for his "return to employment."
Code § 65.2-712 provides in relevant part:
So long as an employee receives payment of compensation under this title, such employee shall have a duty immediately to disclose to the employer, when the employer is self-insured, or insurer in all other cases, any incarceration, return to employment or increase in his earnings. Any payment to a claimant by an employer or insurer which is later determined by the Commission to have been procured by the employee by fraud, misrepresentation, or failure to report any incarceration, return to employment or increase in earnings may be recovered from the claimant by the employer or insurer either by way of credit against future compensation payments due the claimant, or by action at law against the claimant.
On June 18, 1987, the appellee, James Mundy, was injured in an industrial accident. The claim was accepted as compensable and compensation was paid through March 21, 1991. As of July 1991, no medical evidence established that Mundy could return to work. However, evidence did prove that he was doing some work in a store owned by his wife. In October 1990, Mrs. Mundy, the appellee's wife, gave up her hourly job at a truck stop and bought the Waskey Mill Store in Botetourt County. Appellee cosigned the deed of trust securing payment of the note. The note was in Mrs. Mundy's name.
The question is whether appellee "returned to employment" while spending time at his wife's store. The Code contains no definition of "return to employment." Thus, we look to other uses of the term within the Workers' Compensation Act to determine its meaning. The issue is whether Mundy was the employee of his wife within the meaning of the statute.
Whether decedent was an "employee" under Code § 65.1-4 turns on whether he performed work under an implied contract of hire with the defendant as the employer. See Board of Supervisors v. Lucas, 142 Va. 84, 92-93, 128 S.E. 574, 576 (1925).
. . .
A "contract of hire" is usually defined as an agreement in which an employee provides labor or personal services to an employer for wages or remuneration or other thing of value supplied by the employer. 1A Larson, The Law of Workmen's Compensation, § 47.10 at 8-145 — 8-149 (1973); 9 Words and Phrases, Contract of Hire or Hiring, at 546-550.
Since the word "hire" connotes payment of some kind, decisions under a Workmen's Compensation Act have uniformly excluded from the definition of "employees" workers who neither receive nor expect to receive remuneration of any kind for their services. 1A Larson, The law of Workmen's Compensation, supra, § 47.41 at 8-162 — 8-164.
An implied contract of hire exists where one party has rendered services or labor of value to another under circumstances which raise the presumption that the parties intended and understood that they were to be paid for, or which a reasonable man in the position of the person receiving the benefit of the services or labor would or ought to know that compensation or renumeration of some kind was to be exchanged for them. See Fitzgerald and Mallory Const. Co. v. Fitzgerald, 137 U.S. 98 (1890) (quoting Pew v. Bank, 130 Mass. 391, 395 (1881); 58 Am. Jur., Work and Labor, § 4 at 512.
Charlottesville Music Center v. McCray, 215 Va. 31, 34-35, 205 S.E.2d 674, 677-78 (1974).
Mrs. Mundy testified that she did not have any paid employees for her store but had friends who voluntarily assisted her when she could not be at the store. She testified that appellee was one of those volunteers who helped out around the store without pay. He opened the store on a daily basis at 6:00 a.m., rang up sales, and loaded the drink machines as needed until his wife arrived between 8:00 and 9:00 a.m. Appellee, who spent most of his time at the store, also wet-mopped the rear of the store and, on one occasion, carried a forty pound bag of dog food for a private investigator. His name, as well as those of his wife and wife's daughter, was listed on a sign required by law to be displayed in any establishment dispensing alcoholic beverages, naming the store's managers. Thus, he was the only "volunteer" able to sell the store's full line of products in the absence of his wife or his wife's daughter. In fact, the law prohibited the store from being open if one of the managers was not present, even if no alcoholic beverages were sold. A.B.C. Reg. VR 125-01-5(4)(A) (5:2 V.A.R. 173 October 24, 1988). In addition to performing these chores, appellee continued to hunt as a hobby, despite his back injury.
The commission's opinion states that it is "suggested" in the record that appellee performed these duties but that it was not shown with what regularity. We hold the evidence is uncontradicted that the regular course of operation of the business was for appellee to open the store at 6:00 a.m. and to perform the duties of an employee from 6:00 a.m. until 8:00 a.m. or 9:00 a.m. In fact, no evidence was introduced that any person other than appellee opened the store. We hold the only reasonable inference from the record to be drawn is that appellee regularly opened the store and worked for the first few hours every day.
Next, we must determine whether appellee reasonably expected anything of value from his services. We are bound by his statement that he received no direct compensation. However, when we determine whether appellee as a reasonable person expected to receive any benefit or something of value, we look beyond mere cash payments as salary. See Lowe v. National Maritime Union, 60 A.D.2d 743, 401 N.Y.S.2d 11 (1977);Buckner v. Kennedy's Riding Academy, 18 Or. App. 516, 526 P.2d 950 (1974); Dawson v. Eayrs, 297 Minn. 514, 210 N.W.2d 311 (1973); 1C A. Larson, Law of Workmen's Compensation, § 47.43 at 8-384 — 8-385 (1992).
The appellee, as well as his wife, testified that he received no pay for his services. The store generated a net profit of $6,504 from January 1 through May 31, 1991 or an average of approximately $1,300 per month. Mrs. Mundy took part of this money for payment of her personal expenses as well as for some family expenses. The remainder she put back into the business. The business records that were introduced reflect no payments to the appellee or payment of a salary to anyone.
Only after appellee's compensation check was discontinued by the carrier did Mrs. Mundy use the profits from the store for household expenses.
On appeal, when there is a conflict in the evidence we are bound by the commission's findings of fact, if supported by credible evidence. However, if there is no conflict in the evidence and the inferences that may be drawn therefrom, the question of the sufficiency thereof becomes one of law.Payne v. Master Roofing Siding, Inc., 1 Va. App. 413, 414, 339 S.E.2d 559, 560 (1986).
Appellee spent his days at the store. Even before his compensation was stopped, his wife was defraying some of her expenses, such as car payments, from store profits. When he was in the store in the morning, the wife was taking care of their child. His work enabled her to fulfill part of his responsibility to care for the child. Although he may not have been a partner with his wife in the store, he was a partner with his wife in a marriage. The store was potentially a substantial asset of that marriage. See Lambert v. Lambert, 6 Va. App. 94, 98, 367 S.E.2d 184, 187 (1988). If they divorced or his wife died, he would have a reasonable expectation of benefitting from the business to the extent it increased his marital estate.
Thus, if the business succeeded, the marriage partnership succeeded financially. Appellee's wife was able to pay marital expenses. If her estate increased, he stood to benefit. If her estate failed, he stood to lose. Appellee would lose his equity in the store and any loss in the store would drain the marital assets. We hold, as a matter of law, that on those facts, appellee returned to employment with the expectation to benefit from that employment.
Accordingly, the decision is reversed and amended to find that appellee returned to employment in October of 1990, when the Waskey Mill Store was purchased, and is remanded to the commission for further proceedings consistent with this opinion.
Reversed and Remanded.
Koontz, C.J., would affirm the decision of the commission, for the reason that the evidence supported the commission's finding that Mundy "had not returned to employment."