Manone v. mj/cincinnati ( 2017 )

NOTICE: NOT FOR OFFICIAL PUBLICATION.
UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL
AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.
IN THE
ARIZONA COURT OF APPEALS
DIVISION ONE
MIKE MANONE, Petitioner,
v.
THE INDUSTRIAL COMMISSION OF ARIZONA, Respondent,
MJ MANONE LLC,1 Respondent Employer,
THE CINCINNATI INSURANCE COMPANY, Respondent Carrier.
No. 1 CA-IC 16-0051
FILED 6-29-2017
Special Action - Industrial Commission
ICA Claim No. 20141-610093
Carrier Claim No. 2223583
Rachel C. Morgan, Administrative Law Judge
AWARD SET ASIDE
COUNSEL
Snow, Carpio & Weekley, PLC, Phoenix
By Chad T. Snow, Dennis R. Kurth
Counsel for Petitioner
1 The court amends the caption to properly reflect the business name
of MJ Manone LLC. The above caption shall be used in all further filings
with the court in this matter.
Industrial Commission of Arizona, Phoenix
By Jason M. Porter
Counsel for Respondent Industrial Commission of Arizona
Lester, Norton & Brozina, P.C., Phoenix
By Rachel P. Brozina, Jo Fox Zingg
Counsel for Respondent Employer and Respondent Carrier
MEMORANDUM DECISION
Judge Maria Elena Cruz delivered the decision of the Court, in which
Acting Presiding Judge Peter B. Swann and Judge Margaret H. Downie
joined.
C R U Z, Judge:
¶1 This is a special action review of an Industrial Commission of
Arizona (“ICA”) award and decision upon review for a loss of earning
capacity (“LEC”). One issue is presented on appeal: whether the
administrative law judge (“ALJ”) legally erred by using the greater Phoenix
area as an appropriate geographical labor market to establish Petitioner
Mike Manone’s (“Petitioner”) LEC. Because the evidence of record does
not support the ALJ’s finding regarding the geographical labor market, we
set aside the award.
FACTUAL AND PROCEDURAL HISTORY
¶2 On April 1, 2014, Petitioner injured his left shoulder and arm
while working as a self-employed home builder doing business as MJ
Manone LLC. He filed a workers’ compensation claim, which was accepted
for benefits by the respondent carrier, The Cincinnati Insurance Company.
Petitioner underwent two surgeries, first for a torn rotator cuff and a
severed biceps tendon, and second for an infection at the surgery site.
¶3 After rehabilitation, Petitioner became medically stationary
with an unscheduled permanent partial impairment. The ICA then entered
an administrative award for no LEC,2 and Petitioner timely requested an
2 The ICA makes an initial determination of whether a permanent
impairment has resulted in a LEC. See Ariz. Rev. Stat. (“A.R.S.”) § 23-
1047(A).
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ICA hearing. The ALJ heard testimony from Petitioner and two labor
market experts: Richard A. Prestwood and Lisa A. Clapp.
¶4 The ALJ entered an LEC award based on Ms. Clapp’s
testimony. Petitioner requested administrative review, but the ALJ
summarily affirmed the award. Petitioner next brought this appeal.
¶5 This court has jurisdiction pursuant to Arizona Revised
Statutes (“A.R.S.”) sections 12-120.21(A)(2), 23-951(A), and Arizona Rules
of Procedure for Special Actions 10.3
DISCUSSION
¶6 In reviewing findings and awards of the ICA, we defer to the
ALJ’s factual findings, but review questions of law de novo. Young v. Indus.
Comm’n, 204 Ariz. 267, 270, ¶ 14, 63 P.3d 298, 301 (App. 2003). We consider
the evidence in a light most favorable to upholding the ALJ’s award. Lovitch
v. Indus. Comm’n, 202 Ariz. 102, 105, ¶ 16, 41 P.3d 640, 643 (App. 2002).
¶7 Petitioner argues that the ALJ legally erred by concluding that
the greater Phoenix area was part of the appropriate geographical labor
market for establishing his LEC. A claimant’s earning capacity must be
assessed with reference to his “area of residence,” which includes the area
where the employee lived and worked at the time of the industrial injury
and any geographical labor market to which the employee relocated
thereafter. See Arizona Workers’ Compensation Handbook, § 7.4.2.4, at 7-24
(Ray J. Davis et al. eds., 1992 & Supp. 2015); Zimmerman v. Indus. Comm’n,
137 Ariz. 578, 581, 672 P.2d 922, 925 (1983).
¶8 We addressed the concept of the geographical labor market in
Kelly Services v. Industrial Commission, 210 Ariz. 16, 106 P.3d 1031 (App.
2005).
[T]he more appropriate inquiry for determining whether a
particular labor market (not requiring a change in residence)
is within a claimant’s “area of residence” is whether a
reasonable person in the claimant’s situation would probably
seek employment there. In making such a determination, a
totality of the circumstances approach, in which all relevant
factors are considered, should be used. By way of example
3 We cite the current version of statutes and rules unless revisions
material to this decision have since occurred.
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only, relevant considerations in determining whether a
potential job lies within a person’s geographical labor market
area would typically include availability of transportation,
duration of commute, and the length of workday. . . . It would also
include the ability of the person to make the commute based
on his physical condition.
Id. at 20, ¶ 15, 106 P.3d at 1035 (citations omitted) (emphasis added).
Professors Larson have recognized that a reasonable effort to obtain
employment “does not require the claimant to look for work beyond the
general area where he or she lives.” 7 Arthur Larson and Lex K. Larson,
Larson’s Workers’ Compensation Law, § 84.01[4], at 84-10 (2016).
¶9 Petitioner testified that from 2005 – 2013, most of his work
was in Phoenix. In 2013, he moved to Yarnell, “after the fire, to help the
victims rebuild their homes.” He has lived there continuously since 2013,
in a home he rents in Peeples Valley. After Petitioner’s treating doctor
released him to return to work, all his work has been in Yarnell except for
one job in Glendale.
¶10 Petitioner testified that based on his industrially-related
physical restrictions, he has been limited to much smaller construction
projects, such as decks and garages. He has also helped another builder,
RGB Restoration and Builders, by overseeing two of its projects: one in
Glendale and the other in Yarnell.4 Petitioner testified that he is separated
from his wife, but when he came to Glendale for the RGB job, she let him
stay at her Glendale apartment.
¶11 Both labor market experts addressed the geographical labor
market. Mr. Prestwood testified:
Well, I left out the Phoenix area because he is in excess of two
hours from Phoenix. Surprise might fit in. Yarnell would fit
in. Prescott would fit in. We’re still looking at . . . 25 miles to
get to Wickenburg and 55 miles from Prescott . . . . So I left
out the Phoenix metropolitan area. . . . Phoenix metropolitan
area if you go far, far west. . . . Central Phoenix, no; west
4 Petitioner testified that he is a member of RGB, a roofing business,
and he brought the Yarnell job to RGB. RGB offered him $250 per week to
oversee the jobs.
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Phoenix, no, unless you want to take off 55 cents a mile for the
additional driving he would do.
Ms. Clapp testified that she used both the Phoenix metropolitan area as well
as the Prescott area. She identified five different positions: one in Phoenix,
one in Chandler, two in Tempe, and one in Prescott. She explained that it
was not “unusual for builders to go where the projects are,” and Petitioner
“had access to” an apartment in Glendale.
¶12 The ALJ resolved the conflict in the labor market evidence in
favor of Ms. Clapp. She summarized Ms. Clapp’s testimony, “over the two
years prior to the industrial injury, applicant’s company serviced both
Yarnell and metropolitan Phoenix and he is presently working in Glendale
. . . .”5 While technically correct, this statement does not support the legal
conclusion that Phoenix is the proper geographical labor market. Petitioner
was still living and working in Phoenix in 2012, two years before the April
1, 2014 industrial injury. But he relocated to Yarnell in 2013, and he both
lived and worked there at the time of his injury.
¶13 We have recognized that a claimant may voluntarily expand
his geographical labor market. Ihle v. Indus. Comm’n, 14 Ariz. App. 463, 465-
66, 484 P.2d 232, 234-35 (1971). When a claimant voluntarily moves from
the locality where the injury was sustained, the labor market includes both
where the claimant previously lived and worked, as well as his new
residence. See Roach v. Indus. Comm’n, 137 Ariz. 510, 511-12, 672 P.2d 175,
176-77 (1983). In this case, Petitioner testified that since 2013, all his work
has been in Yarnell except for the one RGB job in Glendale. We find this
evidence insufficient to establish a voluntary expansion of the relevant
labor market as a matter of law.6
5 Video surveillance of Petitioner was conducted on five days between
October 3 and October 14. It reflected Petitioner’s presence in Glendale for
the RGB job, in Yarnell, observing, supervising, and occasionally assisting
at a building site, and visiting a chiropractor and a physical therapist.
6 The ALJ did not make a credibility finding, and this court will not
imply a rejection of credibility. See Joplin v. Indus. Comm’n, 175 Ariz. 524,
528, 858 P.2d 669, 673 (App. 1993). Our review in this case is not based on
credibility, but on the application of the facts in the record to law.
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¶14 In determining what is within the relevant labor market, we
have found that the geographical labor market for a claimant residing in a
small rural Arizona town included nearby communities that were 24 and
34 miles away. See Kelly Servs., 210 Ariz. at 17, ¶ 3, 106 P.3d at 1032. But,
conversely, the Arizona Supreme Court has found that a claimant living
and working in rural Arizona at the time of his industrial injury was not
required to look for work in Phoenix, approximately 200 miles from his
home. Phelps Dodge Corp. v. Indus. Comm’n, 90 Ariz. 248, 250, 367 P.2d 270,
272 (1961).7
¶15 In this case, both labor market experts agreed that Prescott
was within the relevant labor market—approximately 34 miles and a fifty-
minute drive from Yarnell. But only Ms. Clapp included the Phoenix
metropolitan area. From Yarnell to central Phoenix is approximately 90
miles and a one hour and forty-minute drive. Three of the positions relied
on by Ms. Clapp are in the east valley, further from Petitioner’s Yarnell
home.
¶16 The carrier argues that Paramo v. Industrial Commission, 186
Ariz. 75, 918 P.2d 1093 (App. 1996), supports Ms. Clapp’s inclusion of
Phoenix in the relevant labor market. We disagree and find Paramo
factually distinguishable. In Paramo, the claimant was a migrant farm
worker. Id. at 77, 918 P.2d at 1095. He traveled between Yuma, Arizona,
and Salinas, California, harvesting crops. Id. The Paramo claimant spent
the year working in each location. Id. This court held that his relevant labor
market included both cities. Id. at 79-80, 918 P.2d at 1097-98. In this case,
Petitioner did not work in Phoenix after he relocated to Yarnell in 2013. We
find that Paramo is not applicable and Phoenix is outside Petitioner’s
geographical labor market.
¶17 Based on our resolution of the geographical labor market
issue, it is not necessary to address the issue of travel expenses. See Ihle, 14
Ariz. App. at 465-66, 484 P.2d at 234-35 (Arizona courts have recognized
that when a claimant voluntarily expands his relevant labor market by
seeking employment outside of the area where he lived and worked at the
7 For purposes of the good faith work search required to receive
unemployment benefits, the Arizona Department of Economic Security
defines a “reasonable commuting distance” as not more than: “20 miles
from the claimant’s residence to place of employment,” “one hour elapsed
commuting time one way,” or “[c]ommuting expense equal to 15% or more
of a claimant’s gross wage.” See Ariz. Admin. Code R6-3-52150.D.6.
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time of the injury, travel expenses become a relevant consideration for the
LEC).
CONCLUSION
¶18 For all of the foregoing reasons, we set aside the award.
AMY M. WOOD • Clerk of the Court
FILED: AA
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