21st Century etc v. Vincent Giacchina ( 1995 )

COURT OF APPEALS OF VIRGINIA
Present: Judges Barrow * , Koontz and Fitzpatrick
Argued at Alexandria, Virginia
TWENTY-FIRST CENTURY CONCRETE,
INC. AND AMERICAN RELIANCE
INSURANCE COMPANY
v. Record No. 1621-94-4
VINCENT GIACCHINA, HOMES BY
VINCENT, INC. AND ASSURANCE
COMPANY OF AMERICA OPINION BY
JUDGE JOHANNA L. FITZPATRICK
VINCENT GIACCHINA MAY 16, 1995
v. Record No. 1645-94-4
TWENTY-FIRST CENTURY CONCRETE,
INC., AMERICAN RELIANCE
INSURANCE COMPANY, HOMES BY
VINCENT, INC. AND ASSURANCE
COMPANY OF AMERICA
FROM THE VIRGINIA WORKERS' COMPENSATION COMMISSION
Cathie Howard (Richard A. Hobson; Williams & Pierce, on
brief), for appellants/cross-appellees Twenty-First Century
Concrete, Inc. and American Reliance Insurance Company.
T. Chappell Aldridge for appellee/cross-appellant Vincent
Giacchina.
P. Dawn Bishop (Sands, Anderson, Marks & Miller, on brief),
for appellees/cross-appellees Homes By Vincent, Inc. and
Assurance Company of America.
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On appeal, Twenty-First Century Concrete, Inc. (Twenty-
First) contends that the commission erred in finding Vincent
Giacchina (claimant) to be in the joint service of both Twenty-
First and Homes by Vincent, Inc. (Homes) at the time of the
injury. As cross-error, claimant argues that the commission
*
Judge Barrow participated in the hearing and decision of
this case and joined in the opinion prior to his death.
erred in denying his application for temporary total disability
benefits under Code § 65.2-500 because he failed to prove actual
wage loss and a loss to Twenty-First and Homes, corporations in
which he had a substantial ownership interest. We hold that:
(1) credible evidence supports the commission's finding that
claimant was in the joint service of both employers, and (2) the
commission erred in requiring a financial loss to the
corporations as a prerequisite to compensation.
BACKGROUND
Claimant was both chief executive officer and a working
employee of Twenty-First and Homes. In February 1993, Homes was
the general contractor and Twenty-First was the concrete
subcontractor in the construction of a new home. Claimant,
acting as an employee of Twenty-First, poured concrete for a
fireplace hearth on February 24, 1993. The next day, he returned
to the work site for a progress inspection and to check the
hearth. After claimant inspected the hearth, one of the on-site
carpenters asked him to check a second-story stud wall that had
been recently changed. Claimant climbed a ladder to look at the
stud wall and to check the chimney flue's alignment with the
roof. Claimant fell from the ladder and fractured several ribs.
Before the accident, claimant received a salary from both
corporations "by regular check or as needed," and he had
authority to decide how much money to withdraw. Claimant did not
draw income from either corporation during his period of
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disability. The construction of the house continued, and
claimant was required to reassign other employees to cover for
his absence. The parties agree that claimant sustained an injury
by accident arising out of and in the course of his employment,
which rendered him totally disabled from February 25, 1993 until
May 20, 1993. Additionally, the parties stipulated that his
combined average weekly wage using his 1992 W-2 statements is
$1,025.13. Each employer argues that: (1) claimant was working
for the other corporation at the time of the accident, and (2)
because the corporations suffered no actual loss, and claimant
was paid by draws over which he had control, he sustained no wage
loss.
JOINT EMPLOYER LIABILITY
Twenty-First argues that the commission erred in finding
that claimant was in the joint service of both employers when he
was injured.
Code § 65.2-529 of the Workers' Compensation Act provides
that:
[w]henever any employee for whose injury or
death compensation is payable under this
[Act] shall at the time of the injury be in
the joint service of two or more employers
subject to this title, such employers shall
contribute to the payment of such
compensation in proportion to their wage
liability to such employee.
On appeal, "we review the evidence in the light most favorable to
the prevailing party." R.G. Moore Bldg. Corp. v. Mullins, 10 Va.
App. 211, 212, 390 S.E.2d 788, 788 (1990). "Factual findings of
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the . . . [c]ommission will be upheld on appeal if supported by
credible evidence." James v. Capitol Steel Constr. Co., 8 Va.
App. 512, 515, 382 S.E.2d 487, 488-89 (1989).
Credible evidence supports the commission's finding that
claimant was working for both employers at the time of the
accident. Although the deputy commissioner found only Homes
liable for benefits, he found claimant "very candid in his
admission that he . . . was engaged in the work of both employers
when he was ascending the ladder to inspect the chimney and stud
wall." The full commission adopted this credibility finding and
accepted claimant's testimony that he was performing work for
both employers when he fell.
WAGE LOSS
Both employers argue that claimant did not sustain a wage
loss as a result of his accident because: (1) he had the
authority to draw his regular income from the corporations, and
(2) the corporations did not suffer any monetary loss.
At the hearing before the deputy commissioner, the parties
stipulated that: (1) claimant's injury arose out of and in the
course of his employment, and (2) claimant's average weekly wage
could be determined from his 1992 W-2 statements. The W-2
statements showed claimant's combined income from both employers
to be $53,307, with an average weekly wage of $1,025.13. Neither
employer disputed that claimant was totally disabled as a result
of the accident from February 25, 1993 to May 20, 1993.
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Code § 65.2-500(A) provides the compensation formula in
total disability cases:
When the incapacity for work resulting from
the injury is total, the employer shall pay,
or cause to be paid, as hereinafter provided,
to the injured employee during such total
incapacity, a weekly compensation equal to 66
2/3 percent of his average weekly wages, with
a minimum not less than 25 percent and a
maximum of not more than 100 percent of the
average weekly wage of the Commonwealth as
defined herein.
"Benefits under [Code §§ 65.2-500 and 65.2-502] for total and
partial incapacity compensate the employee for loss of earnings
resulting from the injury." Crystal Oil Co., Inc. v. Dotson, 12
Va. App. 1014, 1020-21, 408 S.E.2d 252, 255 (1991). "The extent
of earning capacity must be ascertained from the evidence, and
such is not limited to any special class of proof. All legal
facts and circumstances surrounding the claim should properly be
considered . . . ." Pilot Freight Carriers, Inc. v. Reeves, 1
Va. App. 435, 441, 339 S.E.2d 570, 573 (1986). Compensation in
both total and partial disability cases "is ultimately dependent
upon and determined on the loss of wages." Nicely v. Virginia
Elec. & Power Co., 195 Va. 819, 823, 80 S.E.2d 529, 531 (1954).
The parties agree that the characterization of draw as pure
profits or profits and earnings is not an issue on appeal. We
hold that the commission erred in finding no loss of earning
capacity or actual wage loss. We hold that the commission erred
in finding that claimant did not experience any actual wage loss.
Claimant was totally incapacitated and earned no wages for the
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period February 25, 1993 to May 20, 1993. Thus, even though
claimant had authority to draw wages from the corporations, he
was not paid because he had to reassign other employees to
perform his duties. Additionally, we find no authority that
requires a worker to show a loss to his employer, even when the
worker is part owner of the employer corporation. Workers'
compensation benefits compensate the worker for his own loss of
earnings or earning capacity, not losses suffered by his or her
employer. In this case, claimant should be compensated as a
worker for his loss of earning capacity caused by his work-
related injury.
Accordingly, we affirm the commission's finding that
claimant was in the joint service of both employers and reverse
the commission's denial of benefits.
Affirmed in part,
reversed in part,
and remanded.
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