Shapiro & Duncan, Inc. v. Payne

REPORTED

IN THE COURT OF SPECIAL APPEALS

OF MARYLAND

No. 0961

September Term, 2012

SHAPIRO AND DUNCAN, INC., et al.

v.

NICHOLAS L. PAYNE

Meredith,

Kehoe,

Thieme, Raymond, G., Jr.

(Retired, Specially Assigned),

JJ.

Opinion by Thieme, J.

Filed: January 29, 2014

On June 19, 2012, following a one-day bench trial in the Circuit Court for

Montgomery County, the circuit court affirmed the September 7, 2011 determination of the

Maryland Workers’ Compensation Commission, concluding that Appellee, Nicholas L.

Payne, was entitled to receive compensation from his employer, Shapiro and Duncan, Inc.,1

for a work-related injury that occurred in Washington, D.C., on October 20, 2010. In their

timely filed appeal, the Appellants raise a single question for our review:

Did the circuit court err when it affirmed the Commission’s finding that

appellee was a covered employee under the Maryland Workers’ Compensation

Act for the injuries he suffered outside the State of Maryland?

Discerning no error, we shall affirm the determinations of the circuit court.

I.

Appellee, Nicholas L. Payne, a resident of Madison, Virginia, was employed as a

plumber by Appellant, Shapiro and Duncan, Inc., a construction company incorporated in

Maryland.2 In the course of his employment with Shapiro and Duncan, Inc. in 2010,3 Payne

1

Shapiro and Duncan, Inc. maintained an insurance policy issued by Erie Insurance

Exchange to cover their workers’ compensation commitments in Maryland. Shapiro and

Duncan, Inc. and Erie Insurance Exchange were represented by the same attorney at trial, and

are acting in concert as the Appellants in the instant appeal.

2

Though it is not obvious from the facts in the instant case, Shapiro and Duncan, Inc.

attest that it is their policy to hire employees to work in the State where they reside.

3

Payne had worked for Shapiro and Duncan, Inc. twice previously. During his

previous periods of employment, Payne had worked at construction sites located in Maryland

and Virginia.

worked at one job site in Maryland and two job sites in Virginia.4 Payne also attended

meetings in Maryland in the course of his employment.

On October 20, 2010, Payne and his supervisor were passing through Washington,

D.C., on their way from their work site in Virginia to a meeting at Shapiro and Duncan, Inc.’s

fabrication plant in Landover, Maryland. Payne’s supervisor was driving the company-

owned vehicle when he accidentally collided with another vehicle. Payne suffered an injury

to his back in the collision.

Payne filed a claim against Shapiro and Duncan, Inc. with the Maryland Workers’

Compensation Commission. On September 7, 2011, the Commission authorized a

compensation award in Payne’s favor, concluding that Payne had sustained an accidental

injury in the course of his employment with Shapiro and Duncan, Inc.5

The Appellants jointly petitioned the Circuit Court for Montgomery County for

judicial review of the Commission’s determination. Following a de novo bench trial on June

19, 2012, the circuit court also found in favor of Payne, concluding that jurisdiction over

Payne’s claim was appropriate in Maryland. On July 13, 2012, the Appellants timely filed

a joint notice of the instant appeal.

4

Appellee worked approximately 604 hours for Employer in 2010, 214 hours in

Maryland; and 390 hours in Virginia.

5

The Commission’s determination was in the nature of a default judgment because,

neither Shapiro and Duncan, Inc., nor Erie Insurance Exchange filed any response to Payne’s

claim to the Workers’ Compensation Commission.

2

II.

Appellants contend that the circuit court erred as a matter of law in determining that

Maryland had jurisdiction over Payne’s compensation claim. Appellants assert that Payne

was not “regularly employed” in Maryland, and therefore, is not a “covered employee” as

that term is defined in the Workers’ Compensation Act. Appellants also contend that Payne’s

compensation claim would have been more appropriately filed in Virginia, but assert that the

provisions of the Virginia’s Workers’ Compensation Act were not relevant to the question

of whether appellant was a covered employee under the Maryland law, and therefore, the

court’s consideration of the Virginia Act at trial constituted an abuse of the court’s discretion.

Payne responds, asserting that the circuit court’s conclusion that appellant was a

“covered employee” who was entitled to compensation for his work related injury from his

Maryland employer was legally correct and fully supported by the admissible evidence

presented at trial. Payne further asserts that because there was sufficient evidence to support

the trial court’s determinations, even without reference to Virginia law, any error in the trial

court’s consideration of Virginia’s compensation statutes was harmless.

III.

We find the Court of Appeals’ opinion in Pro-Football, Inc. v. McCants, 428 Md. 270

(2012), to be helpful in succinctly stating the applicable law and standard of review to which

we must adhere in the instant appeal:

“When an individual seeks to secure workers’ compensation coverage

for an injury sustained on the job, the first question to be resolved is whether

3

he or she is a ‘covered employee.’” W.M. Schlosser Co. v. Uninsured

Employers’ Fund, 414 Md. 195, 206 (2010). This is because the Commission

has jurisdiction to hear only those claims brought by a “covered employee” as

that term is employed in the Workers’ Compensation Act. See generally §§

9–709 through 9–711. Whether an individual is a “covered employee”

depends on whether the individual is an employee of the employer, § 9–202(a);

and on the site of the employment. See § 9–203;[6] see also McElroy Truck

Lines, Inc. v. Pohopek, 375 Md. 574, 581 (2003). As to the site of

employment, “an individual who is employed wholly outside of this State is

not a covered employee,” § 9–203(c), and an individual whose work takes

place entirely “in this State” is a covered employee. § 9–203(a)(1).

The question is a closer one when an individual’s employment

necessitates work both inside and outside of Maryland. Under § 9–203(a)(2),

an individual working across state lines may qualify as a covered employee if

the individual works “regularly” in Maryland and on a “casual, incidental, or

occasional basis” outside of the state. An individual who only works

“intermittently or temporarily” in Maryland is not a covered employee if five

other conditions, not pertinent here, are met. See § 9–203(b)(i)–(v).

* * *

The parties’ dispute requires us to determine whether [the employee]

was “regularly employ[ed]” in Maryland such that, in this case, his activity in

Virginia is “ca[su]al, incidental, or occasional” within the meaning of §

9–203(a)(2). When interpreting a statute, our primary goal is to ascertain

6

Maryland Code (1999, 2008 Repl. Vol.), § 9–203(a) of the Labor and Employment

Article (“L.E.”), provides in pertinent part:

[A]n individual is a covered employee while working for the employer of the

individual:

(1) in this State;

(2) outside of this State on a casual, incidental, or occasional basis if the

employer regularly employs the individual within this State; or

(3) wholly outside the United States under a contract of employment made in

this State for the work to be done wholly outside of the United States.

4

legislative intent. W.M. Schlosser Co., 414 Md. at 203. Construction of a

statute begins and ends with the plain meaning, when that meaning is clear and

unambiguous. Id. at 203–04. Moreover, when we set out to interpret a

provision of the Workers’ Compensation Act, we construe its provisions

“liberally, where possible, in order to effectuate the broad remedial purpose of

the statutory scheme.” Uninsured Employers’ Fund v. Danner, 388 Md. 649,

659 (2005).

We bear in mind, too, that the posture of the instant appeal requires our

review of a Commission decision first reviewed by the Circuit Court during a

de novo trial proceeding. See § 9–745(d); see also General Motors Corp. v.

Bark, 79 Md. App. 68, 73 (1989) (noting that “an appeal to the circuit court

from a decision of the Workers’ Compensation Commission is totally

different” from an appeal taken generally from an administrative decision

under the Maryland Administrative Procedure Act). We are not tasked,

however, with review of the Commission’s or Circuit Court’s factual findings,

to which we would owe deference. W.M. Schlosser Co., 414 Md. at 205

(quoting Md. Aviation Admin. v. Noland, 386 Md. 556, 571 (2005)). Instead,

we are called upon to determine whether each respective tribunal was legally

correct in its construction and application of § 9–203. Cosby v. Dep’t of

Human Res., 425 Md. 629, 638 (2012) (quotation marks omitted).

In that mode, we do not interpret the Workers’ Compensation Act in a

vacuum; rather, we review the Commission’s interpretation of a statute it

enforces. We “determine if the administrative decision is premised upon an

erroneous conclusion of law.” W.M. Schlosser Co., 414 Md. at 204 (quoting

Md. Aviation Admin., 386 Md. at 571). That determination is not made de

novo, substituting our judgment for that of the Commission. Motor Vehicle

Admin. v. Carpenter, 424 Md. 401, 413 (2012). We recognize the

Commission’s expertise in the field of workers’ compensation and

consequently grant a degree of deference to the Commission’s interpretation.

Id. “We are under no constraint, however, to affirm an agency decision

premised solely upon an erroneous conclusion of law.” Thomas v. State Ret.

& Pension Sys., 420 Md. 45, 54–55 (2011) (quotation marks omitted).

Id. at 280, 282-83 (parallel citations omitted).

The parties agree that at the time of the accident, Payne was an employee of Shapiro

and Duncan, Inc. The parties further agree that Payne worked neither wholly inside nor

5

wholly outside of Maryland. The parties’ dispute centers on whether Payne’s interstate

employment qualifies him as a “covered employee” under L.E. § 9–203(a)(2). The parties

specifically dispute whether Payne’s work on a single job in Maryland and attendance at

meetings in Maryland constitutes regular employment in the State; and whether the

substantial time Payne spent in Virginia may be characterized as “casual, incidental, or

occasional” under L.E. § 9–203(a)(2).

Accordingly, our analysis in this case turns upon whether Payne was correctly

classified by the Commission, and subsequently by the circuit court, as a “covered

employee,” i.e., an employee who was “regularly” employed in Maryland and who works

outside of this State on only “a casual, incidental, or occasional basis.” L.E. § 9-203(a)(2).

In deciding whether an employee works regularly in Maryland, we consider the facts and

circumstances presented in each case, including: 1) the nature of the employer’s work; 2)

the scope and purpose of the claimant’s hiring; 3) the actual and intended duration of the

claimant’s employment; and, 4) whether the claimant’s work was occasional, incidental,

accidental, or a usual part of the employer’s business. Pohopek, 375 Md. at 586–87; see also

McCants, 428 Md. at 283-84 (quoting Pohopek, also suggesting that courts consider the

understandings and expectations of the parties regarding the location and duration of the

work based on any previous interactions or statements and representations made by the

parties (quoting Hodgson v. Flippo Construction Company, Inc., 164 Md. App. 263, 269,

cert. denied, 390 Md. 285 (2005))).

6

Throughout this case, the circuit court was mindful of the well-established principle

that Maryland’s compensation laws are to be broadly construed in favor of allowing coverage

for work-related injuries in cases where coverage is unclear. Hodgson, 164 Md. App. at 267

(“‘[T]he Workers’ Compensation Act is remedial in nature and we are therefore required to

“liberally construe[ ]” its provisions “in favor of injured employees” so as “ to effectuate its

benevolent purposes.’” (quoting Subsequent Injury Fund v. Slater, 27 Md. App. 295, 300

(1975)). After taking judicial notice of Virginia’s compensation laws, which do not allow

a claimant to recover compensation for an injury that occurred outside of Virginia unless the

employer is based in Virginia, the trial court expressed its reluctance to leave Payne without

any avenue to recover any compensation to which he was entitled for his work-related injury,

because of conflicts between the laws of Maryland and Virginia.

Based on the evidence presented by the parties, the circuit court determined that

Shapiro and Duncan, Inc. is a construction company based in Maryland that does not have

a Virginia office. Based on the evidence of Payne’s work history and the fact that Shapiro

and Duncan, Inc. was based in Maryland, the court found that Payne was hired in Maryland,

and that it was the parties’ intention that Payne would work, at least initially, on a job site

located in Maryland. The court concluded, therefore, that the “home base” of Payne’s

employment was Maryland.

The trial court next noted the guidance of this Court and the Court of Appeals in

Hodgson and Pohopek, stating that the nature of construction work is transient, making any

7

effort to predict the location of future jobs speculative. See Hodgson, 164 Md. App at 271-

72; Pohopek, 375 Md. at 593. The evidence presented to the court indicated that, prior to his

injury, Payne worked on one project in Maryland, followed by two projects in Virginia.

Based solely on evidence that Payne resided in Virginia and had worked more hours on job

sites in Virginia than he had in Maryland during the few months he was employed by Shapiro

and Duncan, Inc., the trial court was not able to find that Payne’s work had become so

“centralized and fixed” in Virginia that Virginia usurped Maryland as Payne’s “home-base.”

On review, we are persuaded that the trial court’s findings of fact, to which we must

defer, are not clearly erroneous. See W.M. Schlosser Co., 414 Md. at 205 (cautioning that

appellate review does not include reviewing factual findings). Applying Maryland’s

compensation laws to the facts, we conclude, as the trial court did, that Payne worked

regularly in both Maryland and Virginia. This court has previously stated that if an employee

works outside the state, but does not work wholly outside the state, then the employee’s work

outside the state is considered casual.7 Pohopek, 375 Md. at 592; Hodgson, 164 Md. App.

7

We note that the facts in the instant case are distinguishable from those before the

Court in Hodgsen, upon which Appellants rely. Unlike in Hodgsen where there was an

extensive work history with numerous projects upon which the court could rely in

determining that the “home base” of the claimant’s employment had moved outside of

Maryland, in this case, Payne had only been working for Shapiro and Duncan, Inc. for a short

time, and had only worked on three projects, one in Maryland and two in Virginia, before he

was injured. Therefore, in the instant case, there is not the same well-developed employment

record upon which the court could base a determination that Payne’s “home base” had

actually and conclusively moved to Virginia for the long term. Moreover, weighing the

percentage of the employee’s time that is spent in each state, as the Court did in Hodgsen and

as the Appellants repeatedly do in the instant case, is not appropriate in all cases. See

(continued...)

8

at 271. Because Payne worked regularly in Maryland, and his work in Virginia may be

characterized as casual, Payne falls within the definition of a covered employee for the

purposes of Maryland’s compensation laws. L.E. § 9-201(a)(2). Therefore, Maryland has

jurisdiction over Payne’s compensation claim. Discerning neither error nor abuse of

discretion in the determinations of the circuit court, we affirm that court’s judgment in this

case.

Insofar as Appellants assert that the trial court’s consideration of Virginia’s Workers’

Compensation Statute was improper, we note that the Courts of Maryland are obliged to take

judicial notice of the common law and statutes of our sister States. Md. Code (1974, 2012

Repl. Vol.) § 10-501 of the Courts and Judicial Proceedings Article. In this case, the

Virginia statute was relevant to the trial court’s consideration of the Appellants’ assertion

that Payne’s claim was more appropriately brought in Virginia. Therefore, the trial court’s

consideration of the statute when it was offered by Payne’s attorney does not constitute error.

JUDGMENTS OF THE CIRCUIT

COURT FOR MONTGOMERY

COUNTY AFFIRMED; COSTS TO

BE PAID BY APPELLANTS.

7

(...continued)

Pro-Football, Inc. v. Tupa, 197 Md. App. 463, 473 (2011) (opining that determining whether

jurisdiction over an employee’s claim arises in Maryland, “requires more than simply tallying

up the quantity of time the employee spends in each jurisdiction”).

9