OPINION ENTERED: FEBRUARY 22, 2010
CLAIM NO. 2008-01540
JEFFREY GRAHAM PETITIONER
VS. APPEAL FROM HON. R. SCOTT BORDERS,
ACTING CHIEF ADMINISTRATIVE LAW JUDGE
TSL, LTD.
and R. SCOTT BORDERS
ACTING CHIEF ADMINISTRATIVE LAW JUDGE RESPONDENTS
OPINION
AFFIRMING
* * * * * *
BEFORE: ALVEY, Chairman; COWDEN and STIVERS, Members.
ALVEY, Chairman. Jeffrey Graham (“Graham”) seeks review of a decision rendered October 19, 2009, by Hon. R. Scott Borders, Chief Administrative Law Judge (“ALJ”), dismissing Graham’s claim for Kentucky workers’ compensation benefits against TSL, LTD (“TSL”) for lack of extraterritorial jurisdiction pursuant to KRS 342.670. Graham did not file a petition for reconsideration before the ALJ prior to initiating this appeal.
On appeal, Graham argues that because he accepted TSL’s offer of employment by telephone while he was in Kentucky, and his employment with the company was not principally localized in any state, pursuant to KRS 342.670(1)(b) Kentucky has jurisdiction with regard to his injury and it was error for the ALJ to rule otherwise. We affirm.
At all times relevant to this case, Graham has been a resident of Nicholasville, Kentucky. Graham worked as a tractor trailer/truck driver hauling automobiles for City Auto Transport (“City Auto”), located in Mt. Sterling, Kentucky, from 1993 through 2007, at which time the company ceased car hauling operations.
Graham stated that in November 2007, he and several other City Auto employees learned that TSL, another car hauling company with offices in St. Peters, Missouri, was hiring truck drivers. Graham testified he called TSL in Missouri seeking employment and was hired “over the phone.” Graham stated that at TSL’s request, he obtained from his personnel file at City Auto copies of his commercial driver’s license, documentation concerning his years of experience working as a truck driver, and a recent physical examination and drug test performed at Urgent Treatment in Lexington Kentucky, and faxed those documents to Jim Gage, a TSL employee, in Missouri. According to Graham:
Q When Jim Gage had an opportunity to receive those facts, review those facts, did you and he have a further conversation about going to work with them?
A It was just a matter of minutes. I mean, every thing was faxed to him, we were still on the phone talking and he was sitting there looking at it and he said, “When can you come to work for me?” or something to that effect. He said, you know, “you can start tomorrow.” I said, “No, I want to give City Trucking a two-week notice.” I said, “It’s more than fair.” I said, “I can’t just up and jump the boat.”
Q The real key is he told you that you were hired and you could come to work for him, correct?
A Yes sir.
Graham testified that shortly thereafter, he received a prepaid one-way Greyhound bus ticket in the mail from TSL for transportation from Lexington, Kentucky to St. Louis, Missouri. He then traveled to TSL in Missouri where he was required to take a driving test and participate in a policy and procedure training session. He was also required to undergo another drug test. Thereafter, he was supplied with a truck by TSL and began driving for the company.
Graham testified that while he was employed by TSL, he received his dispatches from St. Peters, Missouri and hauled cars “coast to coast and border to border.” He received his payroll checks through direct deposit from TSL’s offices in Toledo, Ohio.
Graham suffered a work-related injury while working for TSL in Cape May Court, New Jersey on January 25, 2008. It is undisputed on that occasion while unloading a jeep from the top of his trailer, Graham slipped and fell ten to twelve feet to the ground injuring his right foot and ankle. Following the injury, Graham returned to Kentucky and was treated by Dr. Gregory D’Angelo.
After conducting an MRI, Dr. D’Angelo diagnosed Graham with a comminuted fracture of the right calcaneus. On March 17, 2008, Graham underwent surgery performed by Dr. D’Angelo consisting of an open reduction of the right calcaneus with internal fixation. Dr. D’Angelo subsequently recommended that Graham be permanently restricted to sedentary work involving only occasional standing and walking.
On January 26, 2009, Graham underwent an independent medical evaluation performed by Dr. Michael Heilig. Following a physical examination, Dr. Heilig diagnosed Graham as having persistent right calcaneal pain, “status post fracture.” Dr. Heilig felt that Graham would require future treatment for his work-related injury including surgery for hardware removal and a subtalar fusion. Dr. Heilig recommended permanent restrictions of no lifting greater than ten pounds and no climbing. Dr. Heilig further concluded Graham no longer retained the physical capacity to return to his previous work as a truck driver. Pursuant to the AMA Guides to the Evaluation of Permanent Impairment, 5th Edition, Dr. Heilig assessed Graham as having a 14% whole person impairment due to the injury.
Brian Benner (“Benner”), vice president of TSL, testified by deposition taken July 15, 2009. Benner confirmed that TSL drivers generally operate nationwide in forty-eight states. Benner stated that Graham’s application for employment with TSL was completed on November 8, 2007, and the remainder of his paper work was completed on November 19, 2007. Benner testified the employment application originally completed by Graham in Kentucky expressly contained language indicating that it was not an employment contract. Benner stated that St. Peters, Missouri is the location of the corporate offices of TSL’s subsidiary through which Graham was employed. Benner testified that St. Peters is also the location of the shop facility for the company and the place where all trailer units are kept, the personnel and dispatch departments are located, and the orientation process is conducted.
Benner testified that after TSL receives a job application from drivers seeking employment, a “vast number” of other things must first take place before the applicant is actually hired. The applicant must complete “orientation in regards to Department of Transportation regulations and company policies,” a road test, a drug test, and a physical examination, and sign paperwork including a “payroll deposit request.” According to Benner, these activities are routinely conducted at the corporate facilities in St. Peters, Missouri. Potential new hires must also become registered in the state of Ohio for authority to drive on behalf of TSL in 48 states. According to Benner, upon completion of these prerequisites and if “everything checks out,” the applicant is issued a letter informing him that he has been hired. Benner testified that Graham’s letter of hire was issued by TSL on November 20, 2007. Benner stated that all of the pre-employment activities and paperwork pertaining to Graham’s hiring, with the exception of the actual job application, were completed in St. Peters, Missouri.
Benner stated that after being hired, Graham was provided with a truck and received all dispatches from its operation in Missouri. Benner confirmed that Graham’s pay was issued by the company via direct deposit from a bank in Toledo, Ohio. Benner testified that TSL has no fixed place of business in Kentucky.
Concerning when and where Graham was hired by TSL, Benner testified as follows:
Q. And the process that he went through to get hired, where was the last step in that process completed?
A. Would be in St. Peters, Missouri.
Q. And it was in Missouri that he became an employee of TSL, Ltd.?
A. That is correct.
Q. And the confirmation of his hire was that letter that you wrote dated November 20, 2007?
A. That would be correct.
After weighing the above evidence, the ALJ determined that while Graham “may have been assured employment over the telephone line while he was in Kentucky,” the actual contract for hire was entered into between Graham and TSL in Missouri. The ALJ further determined Graham’s employment with TSL was not principally localized in any state. Based on these findings in reliance on KRS 342.670, the ALJ dismissed Graham’s “claim for lack of jurisdiction.”
In the absence of a petition for reconsideration filed by Graham, on questions of fact the Board is limited to a determination of whether there is any substantial evidence contained in the record to support the outcome selected by the ALJ. Stated otherwise, where no petition for reconsideration is filed prior to the Board’s review, inadequate, incomplete, or even inaccurate findings of fact on the part of an ALJ will not justify reversal or remand if there is substantial evidence in the record that supports the ALJ’s ultimate conclusion. Eaton Axle Corp. v. Nally, 688 S.W.2d 334 (Ky. 1985); Halls Hardwood Floor Co. v. Stapleton, 16 S.W.3d 327 (Ky.App. 2000).
Graham, as the claimant in a workers’ compensation proceeding, had the burden of proving each of the essential elements of his cause of action. Snawder v. Stice, 576 S.W.2d 276 (Ky. App. 1979). Since Graham was unsuccessful before the ALJ, the question on appeal is whether the evidence compels a different result. Wolf Creek Collieries v. Crum, 673 S.W.2d 735 (Ky. App. 1984). Compelling evidence is defined as evidence that is so overwhelming no reasonable person could reach the same conclusion as the ALJ. REO Mechanical v. Barnes, 691 S.W.2d 224 (Ky. App. 1985). The function of the Board in reviewing the ALJ’s decision is limited to a determination of whether the findings made by the ALJ are so unreasonable under the evidence that they must be reversed as a matter of law. Ira A. Watson Department Store v. Hamilton, 34 S.W.3d 48 (Ky. 2000).
In rendering a decision, Kentucky’s workers’ compensation Act grants the ALJ as fact finder the sole discretion to determine the quality, character, and substance of evidence. See KRS 342.275; KRS 342.285; AK Steel Corp. v. Adkins, 253 S.W.3d 59 (Ky. 2008). The ALJ may draw reasonable inferences from the evidence, reject any testimony, and believe or disbelieve various parts of the evidence, regardless of whether it comes from the same witness or the same adversary party’s total proof. Caudill v. Maloney’s Discount Stores, 560 S.W.2d 15, 16 (Ky. 1977). Although a party may note evidence that would have supported a different outcome than that reached by the ALJ, such evidence is not an adequate basis to reverse on appeal. McCloud v. Beth-Elkhorn Corp., 514 S.W.2d 46 (Ky. 1974). The Board, as an appellate tribunal, may not usurp the ALJ’s role as fact finder by superimposing its own appraisals as to weight and credibility or by noting reasonable inferences that otherwise could have been drawn from the evidence. Whittaker v. Rowland, 998 S.W.2d 479, 481 (Ky. 1999). In order to reverse the decision of the ALJ, it must be shown there was no evidence of substantial probative value to support the decision. Special Fund v. Francis, 708 S.W.2d 641 (Ky. 1986).
For purposes of Graham’s case, it is undisputed the issue of extraterritorial jurisdiction rests on an analysis of KRS 342.670(1)(b), which reads in pertinent part:
(1) If an employee, while working outside the territorial limits of this state, suffers an injury on account of which he ... would have been entitled to the benefits provided by this chapter had that injury occurred within this state, that employee ... shall be entitled to the benefits provided by this chapter, if at the time of the injury ...
(b) He is working under a contract of hire made in this state in employment not principally localized in any state....
By express
language, the above provision requires proof of two elements: 1) a
contract of hire made in Kentucky; and 2) employment not principally
localized in any state. If Graham’s contract of hire was not made in Kentucky, extraterritorial coverage was not available to
confer jurisdiction on Kentucky under KRS Chapter 342, and the ALJ
correctly dismissed the claim.
That having been said, in this instance the issue of where Graham’s contract of hire with TSL was made is a mixed question of fact and law. Graham is correct in his recitation of the general rule that “in contracts made by telephone, the place where the acceptor speaks his acceptance is the place where the contract is made.” Universal Ins. Co. v. Mills, 293 Ky. 463, 169 S.W.2d 311, 314 (1943). Nevertheless, the record contains conflicting evidence concerning whether Graham, while in Mt. Sterling, Kentucky, after finally hanging up the telephone with Gage in November 2007, had actually finalized his contract of hire with TSL or merely initiated a protracted application process for employment which remained incomplete until after he arrived in St. Peters, Missouri.
It is undisputed that Graham’s employment with TSL was not principally localized in any state and that his injury did not occur in Kentucky. Moreover, Graham was the one seeking a job when he called TSL’s corporate offices in Missouri. Graham admitted that after speaking by telephone with a TSL representative, he traveled to Missouri where he was required to take part in a driving test, participate in training sessions, and undergo drug testing before being provided with a truck and allowed to drive for the company.
Additionally, Benner, as TSL’s vice president, testified that while in Missouri, Graham was required to pass a road test, participate in training and orientation mandated by the Department of Transportation regulations, undergo a pre-employment physical and drug testing, complete registration for authority to drive on behalf of TSL in 48 states and sign all necessary paperwork. Benner characterized these activities as part of the overall application process and mandatory prerequisites to any contract for hire entered into and approved by TSL. According to Benner, Graham did not become TSL’s employee until the entire application process was accomplished and Graham’s offer/application to work was accepted in writing by the company. Benner testified that the contract for hire between Graham and TSL was entered into in Missouri and not in Kentucky.
In our opinion, Benner’s testimony standing alone qualifies as evidence of substantial probative value sufficient to support the outcome selected by the ALJ. Eck Miller Transportation Corp. v. Wagers, 833 S.W.2d 854, 858 (Ky. App. 1992). Because the ALJ’s determination that Graham was hired by TSL in Missouri and, therefore, extraterritorial coverage was not available to confer jurisdiction on Kentucky is supported by substantial evidence, we may not disturb his decision on appeal. Special Fund v. Francis, supra.
Accordingly, the decision rendered October 19, 2009, by Hon. R. Scott Borders, Chief Administrative Law Judge, is hereby AFFIRMED.
ALL CONCUR.
COUNSEL FOR PETITIONER:
HON. McKINNLEY MORGAN
921 S MAIN ST
LONDON, KY 40741
COUNSEL FOR RESPONDENT:
HON. W. BARRY LEWIS
PO BOX 800
HAZARD, KY 41702
ADMINISTRATIVE LAW JUDGE:
HON. R. SCOTT BORDERS
8120 DREAM STREET
FLORENCE, KY 41042
