Princess Anne Builders, Inc., et al. v Faucette

COURT OF APPEALS OF VIRGINIA
Present: 	Judges Bray, Frank and Humphreys
Argued at Chesapeake, Virginia
PRINCESS ANNE BUILDERS, INC. AND
NATIONWIDE MUTUAL INSURANCE COMPANY
OPINION BY
v. 	Record No. 0872-01-1 	JUDGE ROBERT J. HUMPHREYS
NOVEMBER 6, 2001
JAMES V. FAUCETTE
FROM THE VIRGINIA WORKERS' COMPENSATION COMMISSION
Robyn L. Neal (Robey, Spence & Drash, on
brief), for appellants.
W. Mark Broadwell (Forbes & Broadwell, on
brief), for appellee.
Princess Anne Builders, Inc. ("PAB") and its insurer
Nationwide Mutual Insurance Company, appeal the commission's
award of benefits to James V. Faucette. 	Appellants contend that
the commission erred in finding PAB was Faucette's statutory
employer, in finding that Faucette was disabled from May 23,
1995 through August 14, 1995, as well as April 5, 2000 and
continuing, and in finding appellants responsible for Faucette's
memory problems.
I. 	Background
It is well settled that "'[t]he Commission's findings of
fact are conclusive and binding on this court if supported by
credible evidence.'" 	The Greif Companies v. Hensley, 22 Va.
App. 546, 552, 471 S.E.2d 803, 806 (1996) (citation omitted).

So viewed, the commission determined that PAB was a construction
company that engaged routinely in the business of purchasing
lots from a developer, doing site work, and constructing homes
on these lots pursuant to a contract with a prospective buyer.
In performance of one of these contracts, PAB subcontracted with
Faucette's Tree Service to trim and remove tree limbs behind a
home they were constructing. 	A provision in the particular real
estate sales contract at issue specifically required PAB to trim
the tree branches behind the newly constructed home.
Don Dickerson, a supervisor for PAB, requested that
Faucette's Tree Service remove the tree limbs at the residence
on May 22, 1995, before an inspection by the prospective owner
that was scheduled for later that day. 	At that time, Faucette
was employed by his brother who owned Faucette's Tree Service.1
When they arrived at the site, Faucette's brother informed
Dickerson that the branches were too high and that they would
have to hire "tree climbers" to trim the limbs. 	Nevertheless,
after some discussion with Dickerson, Faucette climbed a ladder
to about 40 feet up one of the trees and began to cut the limbs.
After cutting one limb, Faucette lost his balance and fell.
1 The evidence demonstrated that prior to May 22, 1995,
Faucette had been deemed "disabled" by the Social Security
Administration due to his diabetes, liver problems and other
related conditions. 	Faucette was receiving benefits for his
disability at the time of the accident. 	Nonetheless, Faucette
had been employed by his brother on a consistent basis prior to
the date of the accident.
- 2 -

Faucette was transported immediately to a hospital where he
was treated for a complex scalp laceration, an occiputal
fracture, a cervical spine fracture, cervical radiculopathy, and
other traumas. 	The emergency technician noted that Faucette
"did not remember all the events of the fall." 	While in the
hospital, Faucette was placed in "cervical tong traction" with a
"halo ring."
On May 30, 1995, Faucette's neurologist recommended that he
undergo physical therapy due to his "mushy" triceps. 	On June 2,
1995 the neurologist noted Faucette's significant triceps and
deltoid weakness. 	He also noted a concern about Faucette's
concussion, stating that Faucette suffered from dizziness and
had difficulty with concentration and memory. 	Faucette was
ultimately discharged from the hospital on June 8, 1995.
Faucette saw Dr. Arthur Gillman on June 26, 1995.
Dr. Gillman noted that Faucette was doing "quite well and ha[d]
been ambulatory and engaging in some routine activities."
However, Faucette underwent cervical fixation surgery on July
11, 1995.
On August 14, 1995, Dr. Gillman removed Faucette's traction
halo device and fitted him with a cervical collar. 	Dr. Gillman
stated:
- 3 -

Since discharge, Mr. Faucette has continued
to [do] quite well. 	His incision is
entirely healed and he notes no neck
discomfort and, if anything, some
improvement in the triceps weakness which
was noted after the injury. 	He has
continued to have some arm discomfort and
dysesthesia but I feel this may be related
to his history of diabetic neuropathic pain
which was noted to be present premorbidly.
He advised "that [Faucette] continue with conservative
activities at home and avoid driving or any heavy lifting or
bending."
Faucette treated with Dr. Gillman again on March 18, 1996.
Dr. Gillman noted at that time that Faucette appeared to have
"done quite well over the past several months," with "marked
improvement in the strength of his upper extremities and no
parasthesia or other neurological symptoms." 	Dr. Gillman did
not refer to any work restrictions, but advised Faucette to
return for a follow-up examination in six months.
On May 21, 1996, Dr. James Phillips, an orthopedist,
examined Faucette and diagnosed him with "C8 radiculopathy with
chronic triceps weakness secondary to fracture sublaxation."
Dr. Phillips referred Faucette to a neurosurgeon, Dr. James
Allen, who examined Faucette on July 30, 1996. 	Dr. Allen
diagnosed Faucette with dysfunction of the left shoulder joint.
On August 15, 1996, Dr. William Mullins, another
orthopedist, examined Faucette and diagnosed him with a partial
frozen shoulder. 	Faucette received physical therapy through
- 4 -

September 4, 1996. 	A letter dated September 5, 1996 from the
physical therapist to Dr. Mullins stated that Faucette had seen
no increase in the strength of his left shoulder. 	The therapist
recommended continued physical therapy for the condition, but
the records before the commission showed no evidence that
Faucette continued treatment after that date.
Dr. Tamara Fox, Faucette's family physician, treated
Faucette on several occasions for shoulder pain between 1996 and
1998. 	On March 17, 1998, Dr. Fox diagnosed Faucette with
cervical muscle strain but mentioned no work restrictions. 	On
April 29, 1998, Dr. Fox performed a complete physical exam and
noted Faucette's neck appeared to be "normal."
Faucette was later examined by Dr. James Reid on April 5,
2000. 	Dr. Reid diagnosed Faucette with memory loss, chronic
pain syndrome, and C8 radiculopathy secondary to the 1995
accident. 	He opined that Faucette was "permanently and totally
disabled from gainful employment," due to the chronic pain
syndrome and Faucette's inability to walk or change positions
without aggravating the "chronic pain syndrome, the memory loss,
and the severe de-conditioning and specifically triceps
atrophy." 	Dr. Reid confirmed that the 1995 accident caused
Faucette's disability, notwithstanding his extensive medical
history, reasoning that persons with "his diabetes and level of
peripheral neuropathy who are without other injury or illness
- 5 -

are known to be able to function satisfactorily in the
workplace."
Faucette sought an award of medical benefits and temporary
total disability benefits from May 22, 1995 and continuing.
Appellants defended the application arguing that Faucette was
not an employee, that PAB was not Faucette's statutory employer,
that Faucette's disability was not related to the accident, and
that Faucette failed to make reasonable efforts to market his
residual work capacity. 	Appellants also sought indemnity from
Faucette's Tree Service in the event they were found responsible
for Faucette's injuries and resulting disability.
During the hearing, Sidney Wood, PAB's president,
characterized the company as a home construction business and
averred that landscaping was not part of the company's general
business. 	Wood testified that the company regularly employed
subcontractors for plumbing, framing and electrical work, in
addition to landscaping work.
Dickerson, the site supervisor, acknowledged that he had
contracted with Faucette's Tree Service to trim the trees before
the scheduled inspection for May 22, 1995, but denied that the
actual tree Faucette fell from was one of the trees that he had
asked the service to remove. 	In fact, Dickerson testified that
he had directed Faucette not to work on the tree that he fell
from.
- 6 -

The deputy commissioner denied Faucette's application
finding that Faucette's Tree Service was not subject to the Act
and that PAB was neither the employer nor statutory employer of
Faucette. 	In so holding, the commissioner noted that Dickerson
did not direct Faucette's work and that Faucette had failed to
prove that landscaping or tree service was part of PAB's trade,
business or occupation.
On review, the full commission reversed, holding that PAB
was the statutory employer of Faucette at the time of the
accident. 	Specifically, the commission agreed that the evidence
did not establish that tree removal and landscaping were part of
PAB's trade, business or occupation. 	However, they found that
the main contract negotiated between PAB and the buyers of the
property required PAB to trim the branches directly behind the
house. 	Thus, pursuant to Code § 65.2-302(B), the commission
held that PAB met the definition of Faucette's statutory
employer as PAB was essentially a general contractor, obligated
by a main contract to complete the entire project, and that the
work out of which the accident arose was a
subcontracted-fraction of that contract. 	The commission
remanded the matter to the deputy commissioner to make findings
regarding the extent of Faucette's disability, as well as his
periods of disability and/or marketing efforts.
During the final hearing in the matter, Faucette submitted
additional medical evidence concerning his injuries, and lay
- 7 -

testimony suggesting that his memory had deteriorated since the
accident. 	The deputy commissioner found that Faucette had
proved he was totally disabled from May 22, 1995 through August
14, 1995. 	However, noting that Dr. Gillman released Faucette to
limited activity at that time, and discounting the opinion of
Dr. Reid, the commissioner found no credible medical evidence
suggesting that Faucette could not work from August 15, 1995 and
continuing. 	The commissioner finally determined that, based on
the medical evidence, appellants were not responsible for
Faucette's liver or memory problems, but were responsible for
his neck and shoulder injuries.
On review, the full commission affirmed the deputy
commissioner's award with modifications. 	Specifically, the
commission found that Dr. Reid's examination and opinion with
regard to Faucette's work capacity were credible and persuasive,
based upon the medical evidence. 	Accordingly, the commission
awarded Faucette benefits from the period of May 22, 1995
through August 14, 1995, as well as from April 5, 2000 and
continuing. 	The commission further found that appellants were
responsible for Faucette's memory problems.
On appeal, appellants argue that the commission erred in
finding that PAB was the statutory employer of Faucette, in
finding that Faucette was entitled to benefits from May 22, 1995
through August 14, 1995, as well as April 5, 2000 and
continuing, and in finding appellants responsible for Faucette's
- 8 -

memory problems. 	Faucette asserts cross-error, contending that
the commission erred in finding he was not entitled to benefits
between August 14, 1995 and April 5, 2000.
II. 	Analysis
We first note that "[t]he issue whether a person is a
statutory employee presents a mixed question of law and fact
which must be resolved in light of the facts and circumstances
of each case." 	Cooke v. Skyline Swannanoa, 226 Va. 154, 156,
307 S.E.2d 246, 247 (1983).
Code § 65.2-302 provides the following in relevant part:
A. 	When any person (referred to in this
section as "owner") undertakes to perform or
execute any work which is a part of his
trade, business or occupation and contracts
with any other person (referred to in this
section as "subcontractor") for the
execution or performance by or under such
subcontractor of the whole or any part of
the work undertaken by such owner, the owner
shall be liable to pay to any worker
employed in the work any compensation under
this title which he would have been liable
to pay if the worker had been immediately
employed by him.
B. 	When any person (referred to in this
section as "contractor") contracts to
perform or execute any work for another
person which work or undertaking is not a
part of the trade, business or occupation of
such other person and contracts with any
other person (referred to in this section as
"subcontractor") for the execution or
performance by or under the subcontractor of
the whole or any part of the work undertaken
by such contractor, then the contractor
shall be liable to pay to any worker
employed in the work any compensation under
this title which he would have been liable
- 9 -

to pay if that worker had been immediately
employed by him.
The Virginia Supreme Court has stated:
"[T]he test is not one of whether the
subcontractor's activity is useful,
necessary, or even absolutely indispensable
to the statutory employer's business, since,
after all, this could be said of practically
any repair, construction or transportation
service. 	The test (except in cases where
the work is obviously a subcontracted
fraction of a main contract) is whether this
indispensable activity is, in that business,
normally carried on through employees rather
than independent contractors."
Cinnamon v. International Business Machines Corp., 238 Va. 471,
475-76, 384 S.E.2d 618, 620 (1989) (quoting Shell Oil Co. v.
Leftwich, 212 Va. 715, 722, 187 S.E.2d 162, 167 (1972)).
In Cinnamon, the Court further extended this holding,
finding that the Shell Oil test
consists of two prongs. 	One, the so-called
"normal-work test", relates to the
determination of statutory-employer status
as defined in Code [§ 65.2-302(A) and (C)].
As the language of [that section] makes
clear, that prong relates to an owner who
engages an independent contractor to perform
certain work. 	If the work out of which the
industrial accident arose is, in the
language of Shell Oil, work "normally
carried on through [the owner's] employees
rather than independent contractors", it is,
in the language of the statute, a "part of
[the owner's] trade, business or
occupation". 	In such case, the owner is the
statutory employer of the injured worker,
whether directly employed by the independent
contractor or by a subcontractor.
The other prong, an exception to the first
and sometimes labeled the
- 10 -

"subcontracted-fraction test", relates to
the determination of statutory-employer
status as defined in [Code § 65.2-302(B) and
(C)]. 	In the context of the construction
business, it relates to a general
contractor, the party obligated by the main
contract with the owner to complete the
whole project. 	If the work out of which the
accident arose was, in the language of Shell
Oil, "obviously a subcontracted fraction of
[that] contract" and, in the language of the
statute, "not a part of the trade, business
or occupation of" the owner, the general
contractor who engaged the subcontractor to
perform that fraction is the statutory
employer of the injured worker, whether
directly employed by the primary
subcontractor or by a secondary
subcontractor.
Id. at 476, 384 S.E.2d at 620.
Here, in applying Code § 65.2-302(B), the commission found
Faucette failed to prove that tree removal and landscaping were
part of PAB's trade or business. 	However, because PAB
subcontracted with Faucette's Tree Service in performance of a
real estate sales contract contemplating the ultimate sale of
the property to the buyers, the commission held PAB liable as
Faucette's statutory employer.
We do not find error in the commission's resulting
determination. 	Here, PAB, although the "owner" of the home and
property, contracted with the buyer to complete construction of
the home and development of the lot, and then to deliver the
property to the buyer. 	In performance of that contract, PAB
subcontracted a fraction of the required work - trimming the
trees - to Faucette's Tree Service.
- 11 -

Under the clear language of Code § 65.2-302(B), in a
situation where a general contractor contracts to execute work
for "another person," which is not a part of that "other
person['s]" trade, business or occupation, and then contracts
with a subcontractor to perform the whole or any part of the
work required under the contract, the contractor is liable as
the statutory employer of the subcontractor's employees for
purposes of the code section.
Thus, under these facts and circumstances, PAB was the
statutory employer of Faucette. 	The tree removal was clearly a
subcontracted-fraction of the main sales contract. 	Further, no
evidence was presented to indicate that home construction and/or
lot development was part of the trade, business or occupation of
the "other person" here - the home buyer. 	Thus, PAB falls
squarely within the definition of the statutory employer of
Faucette, pursuant to Code § 65.2-302(B). 	Accordingly, we
affirm the decision of the commission on this issue.
Finally, appellants ask us to address Faucette's
eligibility for benefits and their liability for his memory
problems, and Faucette seeks review regarding his eligibility
for benefits between the periods of August 14, 1995 and April 5,
2000. 	As to each of these arguments we again state that "[w]e
will not disturb the factual determination of causation if
credible evidence supports the finding, even if the record
contains evidence to the contrary. 	Additionally, '[q]uestions
- 12 -

raised by conflicting medical opinions will be decided by the
commission.'" 	Food Distributors v. Estate of Ball, 24 Va. App.
692, 704, 485 S.E.2d 155, 161 (1997) (quoting Penley v. Island
Creek Coal Co., 8 Va. App. 310, 318, 381 S.E.2d 231, 236
(1989)).
"In determining whether credible evidence
exists, the appellate court does not retry
the facts, reweigh the preponderance of the
evidence, or make its own determination of
the credibility of the witnesses." 	Wagner
Enterprises v. Brooks, 12 Va. App. 890, 894,
407 S.E.2d 32, 35 (1991). 	"Matters of
weight and preponderance of the evidence,
and the resolution of conflicting inferences
fairly deducible from the evidence, are
within the prerogative of the commission,
and are conclusive and binding on the Court
of Appeals." 	Kim v. Sportswear, 10 Va. App.
460, 465, 393 S.E.2d 418, 421 (1990)
(citation omitted); see also Code
§ 65.2-706(A).
City of Richmond Fire Dep't v. Dean, 30 Va. App. 306, 311-12,
516 S.E.2d 709, 711-12 (1999).
We find the evidence here supports the commission's
determination on these issues. 	The commission carefully
considered the voluminous amount of medical evidence involved in
these proceedings, including that of Faucette's prior medical
history. 	In addition, although the commission was entitled to
give lesser weight to Dr. Reid's opinion because he was not
Faucette's treating physician, it was not obligated to do so.
See Georgia-Pacific Corp. v. Robinson, 32 Va. App. 1, 5, 526
S.E.2d 267, 269 (2000) ("The probative weight to be accorded
- 13 -

[medical] evidence is for the Commission to decide; and if it is
in conflict with other medical evidence, the Commission is free
to adopt that view 'which is most consistent with reason and
justice.'" (quoting C.D.S. Const. Services v. Petrock, 218 Va.
1064, 1070, 243 S.E.2d 236, 240 (1978))).
Thus, we affirm the decision of the commission.
Affirmed.
- 14 -