Kelly Catering, Inc. v. Holman

ALPERT, Judge. The Maryland Workers’ Compensation Commission determined that appellee, Sandra A. Holman, was an independent contractor (and not an employee of appellant Kelly Catering, Inc.) and therefore was not eligible to receive workers’ compensation benefits. Following her appeal, an Anne Arundel County jury reversed, and determined that Holman was, in fact, an employee of Kelly. Kelly, on appeal, now asks us to address the following variations on a single theme: I. Should the prevailing party from a previous workers’ compensation hearing be allowed to offer into evidence,' at a subsequent appeal of that decision [to the circuit court], the decision of the commission?

II

Is the prevailing party from a previous workers’ compensation commission hearing entitled to have the jury instructed that: a. the plaintiff is appealing a decision of the workers’ compensation commission; b. the workers’ compensation commission found that the plaintiff was an independent contractor and therefore was entitled to no benefits from defendant; and c. the plaintiff has the burden of proving by a preponderance of the evidence the decision of the Commissioner is wrong?

III

Given that the requirements of Md. Labor & Employment Code Anno., § 9-745(a) through (e), allow for one of ²⁶⁰ two possible dispositions of an appeal of a workers’ compensation case, i.e., (1) the court determines that the Commission acted within its powers and correctly construed the law and facts, or (2) the court determines that the Commission did not act within its powers or did not correctly construe the laws and facts, can a verdict or Order that does not make one of those two dispositions properly reverse, nullify or remand the findings or award of the Commission? We answer each of the first two questions (and the component parts thereof) in the affirmative (ie., in favor of appellant), and therefore reverse. Consequently, we need not consider the merits of appellant’s third argument. In an attempt to assist the circuit court on remand, however, we note that the form and substance of both the jury’s verdict and the Order corresponding thereto were sufficient to permit the court to reverse, nullify, or remand the findings or award of ■the Commission.

I. We begin by presenting the undisputed facts in this case. Sandra A. Holman (“Holman”), appellee, drove a catering truck owned by Kelly Catering, Inc., (“Kelly,”) appellant. The nature of Holman’s business may be simply described. She was given a specific territory to operate in, and within that territory Holman would, for the most part, drive from construction site to construction site selling food and beverages to the various construction crews.

On the date in question, August 29, 1989, the truck that Holman was driving was struck in the rear by a Prince William County (Virginia) police car. As a result of the accident, Holman apparently suffered various personal bodily injuries. In an attempt to seek recovery for these injuries, Holman filed a claim for benefits with the Maryland Workers’ Compensation Commission (hereinafter, the “WCC”). Kelly defended on the grounds that Holman was not a covered employ ²⁶¹ ee within the purview of the Workers’ Compensation statute 1 contending that Holman was an independent contractor and, therefore, not entitled to workers’ compensation benefits.

On May 15, 1990, an evidentiary hearing on the matter was held before Commissioner Charles J. Krysiak. Following the hearing, and based on the evidence before him, the Commissioner found in favor of Kelly, ie., he found that Holman was an independent contractor and, accordingly, not entitled to benefits. Holman filed a timely appeal to the Circuit Court for Anne Arundel County, and a jury trial was eventually set to commence on November 7, 1991. On the day of trial, prior to voir dire, Holman made an oral motion in the nature of a Motion in Limine.

By this motion, and over Kelly’s objection, Holman (1) acknowledged that the Commission’s decision had the effect of placing the burden of proof on Holman, bút (2) requested the court to bar Kelly from entering into evidence— or even mentioning — the fact that the placement of this burden resulted from the WCC’s decision. The court granted Holman’s motion, which lead to the following colloquy: MR. WALSH [attorney for Kelly]: My questioning and opening statement and possibly my closing I can’t say what I need to say. COURT: Okay.

You may have [a standing objection to the ruling on the motion] but ... remember[,] you can say what the presumption is and who [has] the burden of proof[.] MR. WALSH: ²⁶² And I can mention ... that there was a workers compensation hearing, too, I would presume, because I’m going to be talking about testimony— COURT: Well.... yes, you may, but you can’t get into the finding of the Commission. As a matter of law we will find in this case that the Commissioner’s findings [were] correct. But it’s on the issue, not his finding that’s before this jury.

MR. WALSH: I just can’t mention that the Commissioner is the one that the presumption resulted from. COURT: Right. MR.

WALSH: [So I can’t discuss the] specific decision, but I can bring up the hearing? COURT: Correct. (Emphasis added.) Five days later, i.e., on November 12, 1991, the parties reconvened for the jury instructions, closing arguments, deliberations and verdict. As part of the process, Kelly requested that the court give the jury Maryland Civil Pattern Jury Instruction [“MPJI”] 30:3 (“Burden of Proof [in Workers’ Compensation cases]”),'which reads in relevant part as follows: This case has been heard and decided by the [Workers’] Compensation Commission.

The [employee is] appealing the decision of the Commission. The Commission determined that [Holman is an independent contractor]. This decision is presumed to be correct. The [employee has] the burden of proving by a preponderance of the evidence that the decision is wrong.

In meeting this burden the [employee] may rely on the same, less or more evidence than was presented to the Commission. ²⁶³ (Continue with the second and following paragraphs of MPJI 1:8a, General Instructions [as to the Burden of Proof].) The court denied Kelly’s request, and instead simply used MPJI 1:8a (the general civil instruction as to the preponderance of the evidence) with the following short, additional, introductory preface: The posture of this case ... is [that] ... under the law the claimant in this case is presumed to be an independent contractor. She is not presumed to be an employee. The claimant in the case has the burden of proving her case to the extent that she is an employee. The claimant asserts that claim, that she is an employee, and has the burden of proving it by what we call the preponderance of the evidence. [Whereupon, the Court essentially gave MPJI 1:8a.] The jury’s verdict came back in favor of Holman, and against Kelly.

Specifically, this verdict came back in the form of answers to two questions, to wit: In August, 1989, Sandra Holman was an employee of Kelly Catering, Inc.? Yes. or Was Sandra Holman an independent contractor doing business with Kelly Catering, Inc. in August, 1989? No. On November 25, 1991, the trial court signed an order with respect to the jury’s finding. This order read, in relevant part, as follows: This appeal ... having been tried before a jury on November 5-7 [sic], 1991, an[d] the jury by special verdict finding that the Claimant was an employee of Kelly Catering, Inc., it is this 25th day of Nov., 1991, by the Circuit Court for Anne Arundel County, ORDERED, that the May 15, 1990 Award of the Workers’ Compensation Commission be and hereby is vacated with respect to the provision finding that Claimant was not an employee of Kelly Catering, Inc., but was an independent contractor^] ²⁶⁴ Kelly subsequently filed this appeal, in which it contends that the trial court made the three above-mentioned errors: (1) Kelly should have been allowed to offer into evidence the decision of the commission, (2) Kelly was entitled to a jury instruction similar to that of MPJI 30:3, and (3) the jury’s decision, along with the Court’s November 25, 1991 Order, were insufficient to reverse properly, nullify or remand the findings or award of the Commission.

We discuss each of these contentions respectively below.

II

EVIDENCE AND STATUTORY INTERPRETATION Even though' ostensibly couched in evidentiary terms 2 , the crux of Kelly’s first issue on appeal is grounded in both statutory interpretation and the rules of evidence. We shall first discuss the statutory component, and then the evidentiary one. A. The Statute Relevant Statutory Provisions As Kelly correctly notes, the governing statutory language reads, in relevant part, as follows: [LE] § 9-745. Conduct of appeal proceedings. # ijs í}: (b) Presumption and burden of proof. — In each court proceeding under this title: (1) the decision of the Commission is presumed to be prima facie correct; and (2) the party challenging the decision has the burden of proof.

(c) Determination by court. — The court shall determine whether the Commission: (1) justly considered all of the facts about the accidental personal injury[;] (2) exceeded the powers granted to it under this title; or ²⁶⁵ (3) misconstrued the law and facts applicable in the case decided. Kelly directs our attention to the legislature’s apparently deliberate focus on the Commission’s decision: [T]he decision of the Commission is presumed to be prima facie correct]. LE § 9 — 745(b)(1).] * * * [T]he party challenging the decision has the burden of proof. [LE § 9-745(b)(2).] * * * * The court shall determine whether the Commission [complied with LE §§ 9-745(c)(l) through (3) ]. Appellant’s Brief at 8 (emphasis added by Kelly).

Ergo, Kelly contends that “[t]he plain language of this statute shows that determinations to be made on appeal [to the circuit court] must and are having to do with what the Commission decided.” See Abell v. Goetze, Inc., 245 Md. 433, 437 , 226 A.2d 253 (1967) (“The burden is upon the appellant to overcome the presumption that the decision of the Commission is prima facie correct, and he must do this to the satisfaction of the trier of the facts”; emphasis suggested by Kelly). Consequently, Kelly argues, “If the fact finder is not even aware the Commission made a decision[,] how can [the fact finder on appeal] possibly decide whether the decision was supported by the facts[?]” Id. We agree, but for reasons different than those advocated by Kelly. We begin our discussion by examining Judge Moylan’s incisive analysis in General Motors Corp. v. Bark, 79 Md.App. 68 , 555 A.2d 542 (1989), a case cited extensively by both parties to this action.

The facts in Bark may be summarized briefly. A salvage mechanic, Harry T. Bark, suffered a knee injury in the course and scope of his employment. The WCC awarded temporary total disability benefits to him, and his employer appealed. On appeal, in a non-jury trial before the Circuit Court for Baltimore City (Hammerman, J), the court reversed the WCC’s decision (and thereby denied benefits to Bark).

On Bark’s subsequent appeal to an en bane panel of the circuit court, the panel reversed the circuit court’s decision (essentially reinstating the WCC’s decision in favor of coverage). The ²⁶⁶ case was then appealed to us, and we reversed the panel’s decision (essentially reinstating Judge Hammerman’s decision denying coverage 3 . The procedural posture of the case provided Judge Moylan with an opportunity to discuss the various standards of review at work in that case: en banc review, review of administrative agency decisions generally, and, of most importance to us presently, de novo review in workers’ compensation cases. With respect to de novo review, Judge Moylan’s discussion focused on an apparent inconsistency between two provisions in the law as then codified.

On the one hand, the Workmen’s [now Workers’] Compensation Act, then codified as Md.Ann. Code art. 101, § 56 (governing “Appeals”) [now subsumed, in relevant part, into LE §§ 9-737, 9-745(c) ] 4 , provided initially that Any employer, employee, beneficiary or person feeling aggrieved by any decision of the [WCC] affecting his interests under this article, may have the same reviewed by a proceeding in the nature of an appeal and initiated in the circuit court * * * and the court shall determine whether the [WCC] has justly considered all the facts concerning the injury, whether it has exceeded the powers granted it by the article, and whether it has misconstrued the law and facts applicable in the case decided. Bark, 79 Md.App. at 73 , 555 A.2d 542 (quoting art. 101, § 56(a) [now LE §§ 9-737, 9-745(c)]; emphasis added in Bark). The effect of this provision, without more, suggests that the circuit court, “in routinely appellate fashion, would scrutinize the action of the Commission for legal error, includ ²⁶⁷ ing the question of evidentiary sufficiency.” Bark, 79 Md.App. at 74 , 555 A.2d 542 . But the statute, noted Judge Moylan, did provide “more.” Indeed, the statute significant[ly] departed] from the administrative agency norm, ... [and went] on to provide a vastly broader recourse for the appellant in a Workers’ Compensation case: “Upon the hearing of such an appeal the court shall, upon motion of either party filed with the clerk of the court according to the practice in civil cases, submit to a jury any question of fact involved in such case.” There is thus provided, in major measure, the prerogative of a trial de novo at the circuit court level of any or all of the factual issues initially determined by the Commission.

Bark, 79 Md.App. at 74 , 555 A.2d 542 (quoting art. 101, § 56(a) [now LE § 9-745(d) ]; emphasis added here). 5 The two provisions, Judge Moylan noted, present an apparent inconsistency. On the one hand, the statute seems to suggest that an aggrieved party is afforded a trial de novo; on the other hand, the disposition provided for in the statute is decidedly not consistent with a de novo proceeding. Bark, 79 Md.App. at 74-75 , 555 A.2d 542 . That disposition (then codified as part of art. 101, § 56(a), and now recodified substantially unchanged at LE § 9-745(e)) currently reads as follows: If the court determines that the Commission acted within its powers and correctly construed the law and facts, the court shall confirm the decision of the Commission.

LE § 9 — 745(e)(1). The conflict between the concept of a trial de novo, on the one hand, and the disposition set forth in LE § 9-745(e), on the other, is obvious: ²⁶⁸ What would happen if the circuit court concluded that the decision of the Commission was in every respect free from error (arguably requiring its affirmance) but the circuit court, in the course of its de novo fact finding, nonetheless reached a different conclusion? Does a different de novo result necessarily imply error on the part of the Commission? Hardly.

If the de novo court found a particular witness highly credible, that would not establish that the Commission had been in error or had “misconstrued the facts” in finding that same witness less credible. If the de novo court gave a particular bit of testimony or other evidence great weight, that would not establish that the Commission had been in error or had “misconstrued the facts” in giving it less weight. Regrettably, the case law has not yet even addressed, let alone attempted to reconcile, these apparently contradictory directions[.] Bark, 79 Md.App. at 75 , 555 A.2d 542 . We now attempt to address and to reconcile the apparently contradictory directions set forth in the Workers’ Compensation statutes as the same were discussed by Judge Moylan.

The Preservation of the De Novo Hearing We begin, as we must, with Judge Moylan’s correct assess- ' ment of the situation in Bark : Under the appropriate standard of review, [ie., the clearly erroneous standard] Judge Hammerman’s de novo fact finding was ... free from error. This does not remotely suggest that the Commission’s finding was not also free from error. The Commission “justly considered all of the facts concerning the injury.” The Commission did not exceed “the powers granted it by the Article.” The Commission did not misconstrue “the law and the facts applicable in the case decided.” If, therefore, Judge Hammerman or the in banc panel or this Court were being called upon to assess the propriety of what the Commission did, the Commission’s decision would unquestionably be affirmed. The Commission’s decision is not being affirmed, however, not because that is the wrong ²⁶⁹ answer but because that [i.e., “Did the Commission act properly?”] is the wrong question.

Because of the very nature of de novo fact finding, we are not assessing, and the in banc panel should not have assessed, the propriety of the Commission’s decision. What matters rather is the propriety of Judge Hammerman’s fie., the fact finder’s] decision. Bark, 79 Md.App. at 85 , 555 A.2d 542 . The essence of the relevant portion of our holding in Bark deserves restatement: Despite the language of LE §§ 9-745(c) and (e) — which admittedly appear to focus on the propriety of the Commission’s decision — the circuit court (in Workers’ Compensation appeals) essentially sits as a de novo court.