No. 05-83313. Kentucky Associated General Contractors Self Insurance Fund v. Tri State Crance Rental, Inc.

• Case Date: November 16, 2006
• Court: Kentucky

Kentucky Workers Compensation 2006. No. 05-83313. Kentucky Associated General Contractors Self Insurance Fund v. Tri State Crance Rental, Inc KENTUCKY ASSOCIATED GENERAL CONTRACTORS SELF INSURANCE FUND, LADEGAST AND HEFFNER CLAIM SERVICE, AND TRI STATE CRANE RENTAL, INC. (AS INSURED BY KENTUCKY ASSOCIATED GENERAL CONTRACTORS SELF INSURANCE FUND) PETITIONERS VS. TRI STATE CRANE RENTAL, INC., MARK R. FOSTER, AND HON. R. SCOTT BORDERS, ADMINISTRATIVE LAW JUDGE RESPONDENTSOPINION ENTERED: November 16, 2006CLAIM NO. 05-83313APPEAL FROM HON. R. SCOTT BORDERS, ADMINISTRATIVE LAW JUDGE OPINION AFFIRMING IN PART, REVERSING IN PART, AND REMANDING * * * * * * BEFORE: GARDNER, Chairman, STANLEY and COWDEN, Members.STANLEY, Member. The Petitioner, Kentucky Associated General Contractors Self-Insurance Fund ("KAGC"), seeks review of a decision rendered June 9, 2006, by Hon. R. Scott Borders, Administrative Law Judge ("ALJ"), finding in favor of the Respondent, Tri-State Crane Rental Company ("Tri-State"), on the question of extraterritorial coverage under the Kentucky Workers' Compensation Act, KRS 342.670(1)(b), and awarding costs pursuant to KRS 342.310. We affirm the ALJ's determination of coverage, but reverse his award of costs. The facts relevant to disposition of this appeal are undisputed and may be briefly summarized. Mark R. Foster ("Foster") was injured on May 20, 2005 in the course and scope of his employment as a crane operator for Tri-State. He was working in Ohio at the time. He is a resident of Ohio. The date of injury in question was Foster's first day back at work for Tri-State after a six-month period during which he had been laid off and, in the mean time, worked for another company. Foster had first gone to work for Tri-State on June 24, 2004. He worked through the Local 18, Operating Engineers, union hall, of which he has been a member for 30 years. Members' insurance and pension benefits are administered through the union, while their paychecks come directly from the hiring contractor, in this case Tri-State. Upon his original hiring in June, Foster presented himself to Tri-State's office in Bellevue, Kentucky, where he completed the necessary pre-employment paperwork and received his job assignment. He was not required to fill out an employment application, as he was hired by Tri-State on the basis of his experience and previous business relationship with the owners of the company, Paul and Kathy Pitzer. Foster did, however, interview with Mr. Pitzer before being hired. Tri-State contacted the union hall and requested Foster, specifically, for the job. Foster worked for Tri-State from June 24, 2004, to November 24, 2004 on various jobs located in Kentucky, Ohio and Indiana. His first job was at East Bend Power Plant in Kentucky, where he worked from June 24, 2004 through July 28, 2004. He then worked for Tri-State in Cincinnati, from July 29, 2004 through August 2, 2004. His next assignment lasted just three days, August 3, 2004, through August 6, 2004, in Ghent, Kentucky. He was then sent to Oxford, Ohio, from August 19, 2004 through August 27, 2004, before returning to Cincinnati to work from September 3, 2004 through October 8, 2004. This five-week period of employment in Cincinnati was on various jobs in the area. Foster next worked in Florence, Kentucky, from October 9, 2004 through November 8, 2004, and then again in Bellevue, Kentucky from November 8, 2004 through November 24, 2004. Foster apparently worked one day for Tri-State in Indiana, though the record does not disclose the exact date of that job. Foster was laid off by Tri-State as of November 25, 2004 when the company experienced the usual holiday slow-down in work. Tri-State advised Foster to sign back up at the union hall for other work, if necessary, and further advised that he would be contacted as soon as work picked up again. Immediately after his layoff from Tri-State, Foster took a job with Sofco Erectors ("Sofco"), for whom he worked from November 25, 2004 through April 15, 2005. He was contacted on or around November 25, 2004 by Tri-State and offered another assignment, but it was to last only a few days. Foster elected to take the job with Sofco, which was supposed to be a six-month assignment. Foster was without work from April 15, 2005 when the Sofco job wrapped up, until May 20, 2005 when he was contacted again by Tri-State. Although the job to which Foster was sent on May 20, 2005 was only a one-day assignment, it was understood that Foster was being "recalled" by Tri-State to work on a regular basis. Ms. Pitzer testified that it was usual for work to pick back up in the spring and it was anticipated there would be sufficient work to keep Foster employed for a while. Tri-State was not required to contact the union hall in order to bring Foster back to work. The evidence is somewhat conflicting as to the union's recall policy, however. According to Foster, if a union member works for a contractor for at least six months, then the contractor has the right to call the member back directly, without going through the union, for up to two years. The member is not required to go back to work for the contractor, however. It is a discretionary matter for both the contractor and union member. Ms. Pitzer testified that it is her understanding that the contractor may contact the member directly, without going through the union, if the member has worked for the contractor within the last year. In any case, it is undisputed that Tri-State recalled Foster directly on May 20, 2005. Foster reported to work that day at Tri-State's equipment holding yard on Spring Grove Avenue in Cincinnati, Ohio. He met Mr. Pitzer and the two of them traveled together to job sites in Wilmington and then South Lebanon, Ohio. It was upon returning to the yard in Cincinnati that Foster sustained the crush injury to his right thumb that is the subject of the claim sub judice. Foster's claim for workers' compensation benefits was submitted to KAGC through the fund's third-party administrator, Ladegast and Heffner ("LandH"). Mary Margaret Sutherland ("Sutherland"), the Vice-President of Claims Services for L and H, testified that Foster's claim was denied due to lack of coverage for the out-of-state injury. It is undisputed that Tri-State had a policy of coverage in effect through KAGC on the date of injury in question for claims arising in the state of Kentucky. Moreover, the policy also provided for coverage in "such other states, except Illinois, where the insured employs regularly employed Kentucky employees." Sutherland testified that "regularly employed Kentucky employees" is very liberally defined to include anyone who has worked in Kentucky at least eight hours before sustaining an injury. Sutherland further testified that, notwithstanding KAGC's out-of-state policy, it would not be interpreted to conflict with KRS 342.670. In other words, if the statute would provide extraterritorial coverage for a given injury, then the claim would be accepted...