Gerald McClain v. Birnamwood Condominium Association

Issued by THE LABOR AND INDUSTRIAL RELATIONS COMMISSION

(Affirming Award and Decision of Administrative Law Judge)

**Injury No.:** 15-064900

**Employee:** Gerald McClain

**Employer:**

- Birnamwood Condominium Association

- Markel Insurance Company

- Efthim Company Realtors, Inc. (dismissed)

- Travelers Casualty & Surety Company

- Meyers Trees & More, LLC

- Uninsured

**Additional Party:** Treasurer of Missouri as Custodian of Second Injury Fund

This workers' compensation case is submitted to the Labor and Industrial Relations Commission (Commission) for review as provided by § 287.480 RSMo. We have reviewed the evidence, read the briefs, and considered the whole record. We find that the temporary award of the administrative law judge is supported by competent and substantial evidence and was made in accordance with the Missouri Workers' Compensation Law. Pursuant to § 286.090 RSMo, we affirm the award and decision of the administrative law judge with this supplemental opinion.

The parties asked the administrative law judge to resolve the following two issues: (1) whether Meyers Trees & More, LLC, (Meyers Trees) was properly insured pursuant to the Missouri Workers' Compensation Law; and (2) whether Efthim Company Realtors, Inc. (Efthim), and/or Birnamwood Condominium Association (Birnamwood) are statutory employers.

The administrative law judge concluded as follows: (1) Meyers Trees was not properly insured; and (2) that Birnamwood was a statutory employer pursuant to § 287.040.1, RSMo, while Efthim was not liable as Birnamwood's agent.

On November 14, 2019, employer Birnamwood filed an application for review alleging that the administrative law judge erred in determining Birnamwood to be a statutory employer because tree trimming was not in Birnamwood's usual business. Alternatively, Birnamwood argued that Efthim should be an intermediary employer and therefore liable before Birnamwood. In its brief, Birnamwood abandoned this alternative argument. Accordingly, we do not address that alternative argument.

We adopt the findings of fact and conclusions of law from the temporary award of the administrative law judge, to the extent they are not inconsistent with the following supplemental facts and conclusions of law.

Birnamwood was a condominium association that ensured that common areas of a condominium complex were maintained, including the property's trees. Birnamwood contracted with Efthim to be a management agent in order to obtain bids for necessary

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Employee: Gerald McClain

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maintenance and present the bids to Birnamwood. In its contract with Efthim, Birnamwood gave Efthim the authorization to hire and pay employees on behalf of Birnamwood "to properly operate and maintain" Birnamwood. Tr., p. 1048. The contract also stated that such employees would be employees of Birnamwood and not "the Management Agent" Efthim. Id. The contract then stated, "Association to have no Employees." Id. (emphasis in original). Regardless of the last sentence just quoted, we find that the terms of the contract contemplated the hiring of employees on behalf of Birnamwood to perform the maintenance of the condominium complex property, including all tree trimming services.

Instead of hiring employees on Birnamwood's behalf, Efthim presented a bid from Meyers Trees to provide landscaping and tree trimming for the year at issue. Birnamwood awarded the contract to Meyers Trees, as it had done so for several previous years. It appears that Meyers Trees was the only company that Efthim contacted for a bid for several years.

All of the parties stipulated that employee, a direct employee of Meyers Trees, was injured when he slipped off of a roof during a tree-trimming job performed by Meyers Trees. Meyers Trees had previously presented a certificate of workers' compensation insurance to Birnamwood, but such certificate was actually not valid on the date of injury.

Conclusions of Law

Statutory Employer and Usual Business

Section 287.040, RSMo, provides the statutory definition of an employer for workers' compensation matters and provides:

1. Any person who has work done under contract on or about his premises which is an operation of the usual business which he there carries on shall be deemed an employer and shall be liable under this chapter to such contractor, his subcontractors, and their employees, when injured or killed on or about the premises of the employer while doing work which is in the usual course of his business.

1. The provisions of this section shall not apply to the owner of premises upon which improvements are being erected, demolished, altered or repaired by an independent contractor but such independent contractor shall be deemed to be the employer of the employees of his subcontractors and their subcontractors when employed on or about the premises where the principal contractor is doing work.

1. In all cases mentioned in the preceding subsections, the immediate contractor or subcontractor shall be liable as an employer of the employees of his subcontractors. All persons so liable may be made parties to the proceedings on the application of any party. The liability of the immediate employer shall be primary, and that of the others secondary in their order, and any compensation paid by those secondarily liable may

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be recovered from those primarily liable, with attorney's fees and expenses of the suit. Such recovery may be had on motion in the original proceedings. No such employer shall be liable as in this section provided, if the employee was insured by his immediate or any intermediate employer.

1. The provisions of this section shall not apply to the relationship between a for-hire motor carrier operating within a commercial zone as defined in section 390.020 or 390.041 or operating under a certificate issued by the Missouri department of transportation or by the United States Department of Transportation, or any of its subagencies, and an owner, as defined in section 301.010, and operator of a motor vehicle.

Here, Birnamwood does not challenge the progression of liability from Meyers Trees to itself pursuant to § 287.040.3, RSMo. However, it argues that it could not be a statutory employer pursuant to § 287.040.1, RSMo, because tree trimming is not part of its usual business.

The Supreme Court of Missouri has "defined 'usual business' as 'those activities (1) that are routinely done (2) on a regular and frequent schedule (3) contemplated in the agreement between the independent contractor and the statutory employer to be repeated over a relatively short span of time (4) the performance of which would require the statutory employer to hire permanent employees absent the agreement.'" *McCracken v. Wal-Mart Stores E., LP*, 298 S.W.3d 473, 480 (Mo. 2009) (quoting *Bass v. Nat'l Super Mkts., Inc.*, 911 S.W.2d 617, 619 (Mo. banc 1995)).

The court in *McCracken* continued,

> This definition is designed to exclude "specialized or episodic work that is essential to the employer but not within the employer's usual business as performed by its employees."

*McCracken*, 298 S.W.3d at 480 (quoting *Bass*, 911 S.W.2d at 621).

Birnamwood argues that the administrative law judge failed to focus on the specific work of rooftop tree trimming, instead of the general tree trimming of the entire complex. Birnamwood argues that it only performed rooftop tree trimming work once a year, which was not frequent enough to constitute routinely done on a regular and frequent schedule. Birnamwood also pointed out that such rooftop tree trimming was only performed when requested by a resident, and was therefore, not a regularly scheduled event.

Efthim disagreed with Birnamwood's limitation to rooftop tree trimming and argued that tree trimming, more generally speaking, was performed on a weekly basis by Meyers Trees. Efthim also pointed out that Birnamwood allotted an amount in its budget for tree trimming. In the temporary award, the administrative law judge found employee's testimony credible that he trimmed trees at least once a week, including climbing a roof related to tree trimming tree services six times a year. We do not see a reason to

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disturb the credibility finding of the administrative law judge and also find employee's testimony credible on this point. We also conclude that it appears that when awarding the contract to Efthim, the parties contemplated tree trimming to include all aspects of such work, including rooftop tree trimming.

The last prong in analyzing whether a task is in the employer's usual business is the ultimate question: would the employer need to hire an employee if it could not contract out the work? Birnamwood argues that it would not have hired an employee, but merely would have found another contractor to perform the work. This argument presents a pragmatic approach, but does not apply the question. If there were no contractors, then would the statutory employer need to hire an employee to perform the work?

We agree with the administrative law judge that the answer would be yes. As we found above, the terms of the contract between Birnamwood and Efthim already contemplated hiring employees to perform the essential maintenance of the property's grounds. Accordingly, we conclude that Birnamwood would have hired an employee to trim trees if it could not have contracted out the work and it would have used Efthim to hire and pay employees on behalf of Birnamwood. We further agree that the tree trimming services performed by Meyers Trees over the years of service to Birnamwood was not merely specialized or episodic work, but was within Birnamwood's usual business.

**Conclusion**

We affirm and adopt the award of the administrative law judge as supplemented herein.

This award is only temporary or partial. It is subject to further order, and the proceedings are hereby continued and kept open until a final award can be made. All parties should be aware of the provisions of § 287.510 RSMo.

The temporary award and decision of Administrative Law Judge Karla Ogrodnik Boresi is attached and incorporated herein to the extent not inconsistent with this supplemental decision.

Given at Jefferson City, State of Missouri, this 15th day of December 2020.

LABOR AND INDUSTRIAL RELATIONS COMMISSION

Robert W. Cornejo, Chairman

Reid K. Forrester, Member

S. Vite Curls

Shalonn K. Curls, Member

Attest:

Secretary

Issued by DIVISION OF WORKERS' COMPENSATION

Employee: Gerald L. McClain

Dependents: N/A

Employer: Meyers Trees & More, LLC; Birnamwood Condominium Association; and Efthim Company Realtors/ Efthim Company Realtors, Inc.

Additional Party: Second Injury Fund

Insurer: Uninsured; Markel Insurance Co.; and Travelers Casualty & Surety Co.

Hearing Date: July 29, 2019

Injury No.: 15-064900

Before the DIVISION OF WORKERS' COMPENSATION Department of Labor and Industrial Relations of Missouri Jefferson City, Missouri

1. Are any benefits awarded herein? Yes.
2. Was the injury or occupational disease compensable under Chapter 287? Yes.
3. Was there an accident or incident of occupational disease under the Law? Yes.
4. Date of accident or onset of occupational disease: April 8, 2015.
5. State location where accident occurred or occupational disease contracted: on or about unit 1577 of the condominium complex located at 4177 Crescent Drive, St. Louis, Missouri 63129.
6. Was above employee in employ of above employer at time of the alleged accident? See Award.
7. Did employer receive proper notice? Yes.
8. Did accident or occupational disease arise out of and in the course of the employment? Yes.
9. Was claim for compensation filed within time required by Law? Yes.
10. Was employer insured by above insurer? See Award.
11. Describe work employee was doing and how accident happened or occupati