Public Decisions | The Appeal Commission

Decision #82/14 - Type: Workers Compensation

Preamble

The worker's widow is appealing the decision made by the Workers Compensation Board ("WCB") that her husband's death did not arise out of or in the course of his employment. A hearing was held on June 18, 2014 to consider the matter.

Issue

Whether or not the claim is acceptable.

Decision

That the claim is acceptable.

Decision: Unanimous

Background

On July 24, 2012, the Workplace Health & Safety Division of the Province of Manitoba ("WSH") notified the WCB that the worker was fatally injured when a concrete wall collapsed on top of him.

On July 25, 2012, a WCB adjudicator spoke with the worker's business partner who advised that they were helping out the worker's aunt and uncle at the time of the accident and it was not a paid job. The business partner indicated that he was going to have a meeting with Workplace Health and Safety and asked if he could call the adjudicator back the next day. He said he was present when the accident happened and the worker was his best friend.

On July 26, 2012, a WCB supervisor spoke with the worker's business partner and the following information was documented:

he and his partner were co-owners and only employees of the company.
his partner asked if the company could bid on the job but he told his partner no as he did not think they could put together a competitive bid. His partner decided to do the job anyways because it was family.
he was unsure whether his partner had any written agreements/contract with his aunt/uncle to complete the work or whether any payment for the work was involved.
his partner had rented equipment to get the work done so there definitely were costs involved besides the labor.

The WCB supervisor told the business partner that the WCB would further investigate to determine whether his partner died in the course of working on a job for the company he co-owned.

In a note to file dated July 27, 2012, the WCB adjudicator spoke with a workplace health and safety officer who attended the accident site. He said he spoke with the owners of the house (the worker's aunt and uncle) and it was confirmed that they were not paying for the job.

On August 1, 2012, the worker's widow was advised that the WCB was unable to provide compensation coverage for the July 24, 2012 accident as it was felt that the work being performed that day was of a personal nature rather than a contract of paid employment. It was concluded that the worker's death did not arise out of or in the course of employment.

On August 15, 2012, the widow's uncle spoke with a WCB case manager and the following was documented:

the worker's cousin told him that he had hired the worker to do the repair work on his parent's house and he was going to pay him $5000.00. His parents were not aware of this arrangement because it was going to be a surprise gift. When asked whether there was any signed contract or cheque deposits, the uncle said he did not know but would check. He stated that the agreement may only have been verbal.

Subsequent file documentation contained various witness statements and interview information. On November 21, 2012, a second letter was sent to the worker's widow which stated:

"...there are many contradictions in the evidence to the extent that the WCB is unable to determine, on a balance of probabilities, that there was a contract for service with the Partnership. In concluding that there was no contract for service with the Partnership, [the business partner's] evidence was particularly important, specifically [the business partner]:

repeated several times immediately after the incident that this was an unpaid job;
indicated that the Partnership did not put a bid on the job because he did not think that the Partnership could be competitive;
knew nothing of the arrangements between your husband and his family;
knew nothing of the job until a few days before the incident;
was not involved in producing the estimate that was provided to the WCB on August 15; and
indicated that cistern demolition was not the normal work for the Partnership.

The WCB accepts that [the business partner] was in shock when he spoke to various people immediately after the incident. However, it does not accept that what he said at that time was not true. To the contrary, it was precisely at this time, before [the business partner] had the opportunity to consider the implications of his answers, that his answers were more likely to be accurate.

The WCB does not accept [the business partner's] written statement, made on August 15, 2012 that that (sic) the "removal of a concrete cistern and re-finishing of the floor was agreed upon between ... and [worker's cousin] for approx. $5000" because it is inconsistent with all of his other evidence. As such, the claim is not acceptable."

On December 7, 2012, the widow appealed the above decision to Review Office stating: "WCB investigators are saying that statements made are fabrications, we know they are not. We are prepared to prove our statements validity under oath."

On January 30, 3013, Review Office determined the claim was not acceptable as it was unable to establish that the work performed by the worker on July 24, 2012 was pursuant to a contract for service between a person and the Partnership.

Review Office did not feel that statements taken under oath would alter the decision on the acceptance of the claim. Review Office acknowledged that the incident would have been a traumatic event for anyone who was at the job site and witnessed the accident but it could not dismiss the inconsistencies in the file information provided at the time of the accident and the information provided following the initial decision of August 1, 2012. Review Office indicated that the evidence on file did not support the written statement made by the worker's business partner of August 15, 2012 which indicated that the job of removing a cistern and refinishing the floor was agreed upon between the construction company and the worker's cousin for approximately $5000.00.

On March 13, 2013, the Worker Advisor Office appealed the above decision to the Appeal Commission and a hearing was arranged.

Reasons

Reasons:

Applicable Legislation

In considering appeals, the Appeal Commission and its panels are bound by The Workers Compensation Act, regulations and policies of the Board of Directors.

Subsections 1(1) and 4(1) of the Act set out the circumstances under which claims for injuries can be accepted by the WCB, and state that the worker must have suffered an injury by accident that arose out of and in the course of employment. Once such an injury has been established, the worker is entitled to the benefits provided under the Act.

This appeal deals with claim acceptance. The key issue to be determined by the panel is whether the worker's injury arose out of and in the course of his employment.

Position of the worker's estate

The estate was represented by the worker's widow and a worker advisor who made a submission on the widow's behalf. The widow answered questions posed by the panel.

The worker advisor submitted that the information on file supports there was a contract between the worker's cousin and the Partnership. She noted the following:

a written estimate of service dated June 4, 2012 between the worker's cousin and the partnership for the cost of $4761.90 plus $238.10 GST for the removal of a cistern and the pouring of a concrete floor.
the purchase and rental of materials to perform the work, verified with employment insurance receipts.
a calendar page dated July 23, 2012 completed by the worker for the purpose of tracking hours worked by the partners on the project. The worker's representative suggested that both partners would not be spending time during the work days if they were not being paid.
the statement of the worker's cousin confirming that he made a contract with the worker for the partnership to provide services at the cousin's parents' home.
the statement of the business partner that the work being performed was being done pursuant to a contract between the partnership and the worker's cousin.
the statement of the business partner dated October 24, 2012 to a WSH officer that the work was being performed pursuant to a contract.
the interview of the business partner with the RCMP on July 30, 2012 in which the business partner advised that "this was a work contract for his cousin, for the uncle's house." The worker's widow answered questions from the panel. She advised that:
she helped with the record keeping for the partnership and was training the partners on the use of Quickbooks, a computer based accounting program. She worked mostly with the business partner on the program.
she and the business partner searched the records and found an estimate dated June 4, 2012 for work at the worker's cousin's parents' home. She indicated that she helped create this estimate with the worker. She acknowledged that she initially thought she had prepared the document with the business partner but later remembered that it was with the worker.
regarding the delay in providing the estimate, the widow advised that she was not in the state of mind that she could do anything, and only did so later when her uncle spoke with her and encouraged her to search for documentation on the project such as bills.
she indicated that the worker would not undertake work for free. She said he had a career and financial goal which he was intent on achieving.
the date on the estimate was computer-generated by Quickbooks and could not be altered. Upon completion of the work, the estimate would be converted to an invoice.

The widow's uncle was called as a witness and was questioned by the panel. He provided information on his role as the widow's representative. He explained that he met with the business partner and obtained the statement dated August 15, 2012 and that the worker's cousin faxed him his statement dated August 15, 2012 to him.

The worker's cousin was called as a witness and was questioned by the panel. He advised that:

he had contracted with the worker to perform services on his parent's property.
this was a gift to his parents but had not discussed this with his parents.
the worker advised him the cost would be around $5000.
he did not receive a written estimate for the work.
he has lived out of province for 16 years and travels home to see his parents periodically depending on his work situation.
the worker did not provide a breakdown of costs when he provided the estimate and did not discuss payment times.
he did not have an expectation that the worker would perform the work for free, as this was a big project.
he attempted to remove the concrete walls himself two years prior but after a few days realized he would require professional assistance to complete the work.

Employer's Position

The worker's business partner was subpoenaed by the panel and provided information on the business's practices, role of the partners, the accident, and the statements that he provided to various authorities.

The business partner answered questions from the panel. He advised that:

the partnership had a joint bank account.
his role in the partnership was to look after the paper work; he was learning a computer program for preparing estimates and invoices, but had not mastered the program.
the partnership performed a variety of construction services including roofing, renovations and cement work.
regarding the estimate dated June 4, 2012, the worker advised that he had not prepared this estimate. He said the worker had more knowledge of the type of work (concrete) involved so the worker prepared the estimate.
he would give estimates on jobs involving materials and that the worker would give estimates on jobs involving concrete work.
most work was performed under verbal estimates, but at the start of 2012, they were starting the process of preparing estimates on Quickbooks, to upgrade their business practices. This was done with the support and training by the worker's wife.
the day prior to the accident the business partner was working on a different job.
with respect to the reference to a "favour" in one of his statements, he indicated that it was a favour because it was work that he did not enjoy and only did it because it was for the worker's relatives. He had not intended it to mean that the work was free.
his mental state when he was initially interviewed was very poor and he does not remember what he said or who interviewed him.
Analysis
The issue before the panel is whether the deceased worker's injury arose out of and in the course of his employment with the partnership.
The main issue arising in the adjudication of the claim is whether the worker was providing services pursuant to a contract for services or was performing the services as a favour for the worker's relatives without monetary compensation. The WCB determined that the worker was not performing services pursuant to a contract for service between a person and the partnership and therefore that the claim was not acceptable.
To ensure the claim was fully adjudicated, the panel obtained copies of the WSH investigation notes and the RCMP investigation notes. These materials included statements from various
persons including the business partner. The panel also subpoenaed the worker's widow, business partner, widow's uncle, who served as her representative, and the worker's cousin. The panel had significantly more information before it than the WCB had to assist in adjudication of the claim. The panel also had an opportunity to question the witnesses on perceived contradictions in their statements.
Upon review of all the evidence including the evidence provided at the hearing and the evidence obtained from WSH and the RCMP through their investigations, the panel finds that the worker and his business partner were performing services pursuant to a verbal contract for services at the time that the worker was injured. While there was some conflicting evidence on the file, the panel finds that the evidence, on a balance of probabilities, supports a finding that the worker was injured by an accident arising out of and in the course of his employment. It follows that the panel finds that the claim is acceptable.
In considering this appeal, the panel notes:
- the worker and business partner operated a partnership and obtained personal coverage from the WCB.
- the partnership performed construction related services including roofing, renovation and concrete work.
- on July 24, 2012 the worker and his business partner were working on premises owned by the worker's aunt and uncle.
- while performing services a concrete wall collapsed resulting in a fatal injury to the worker.
- WSH officials and RCMP officials investigated the incident and took statements from the property owners, the business partner and others.
- a claim was filed on behalf of the worker's dependants.
In reaching its decision, the panel placed significant weight on the evidence of the business partner. The panel found the business partner to be a credible and honest witness. He answered questions forthrightly and his evidence was consistent.
The panel notes there was information on the file attributed to the business partner near the date of the incident which the WCB relied upon to make its decision. The panel questioned the business partner on this information and has determined that it is satisfied with the business partner's explanations.
The WCB placed weight on the memo dated July 25, 2012 on the WCB file. The memo indicates that WCB staff spoke with the business partner by phone on July 25, 2012. He advised that it was not a paid job but wanted to call the adjudicator back the next day, as he was on the way to a WSH meeting.
The panel also reviewed the WSH officer's notes prepared at the scene of the accident which indicate that the officer spoke with the business partner at the scene of the accident and that the business partner advised "This wasn't work for their company it was just a favour for (name removed)."
Regarding these discussions, the panel accepts the business partner's explanation that he was in shock and confused and does not recall what he said or who interviewed him. The panel notes that the RCMP Supplementary Occurrence Report of the incident confirms the business partner's mental status at this time. It noted that the business partner was shocked, shaking and crying and was not able to provide more information. The panel accepts the business partner's explanation and accordingly places no weight on the July 25, 2012 WCB memo or the WSH interview notes.
The panel also reviewed the memo on the WCB file dated July 26, 2012 prepared by a WCB supervisor. The memo notes that the business partner attended a meeting in Brandon on July 26, 2012 and advised that "his partner asked him if the company would bid on the job but [business partner] said no because he didn't think they could put together a competitive bid. His partner decided to do the job anyway because it was family. [Business partner] was unsure whether his partner had any written agreement/contract with the aunt/uncle to complete the work or whether any payment for the work was involved." The panel finds that this information is equivocal, and does not support a finding either way that the worker was or was not in the course of his employment at the time of the accident.
The panel also reviewed the RCMP General Report of the accident which was based on notes made on July 24, 2012. Contrary to information gathered by WSH, the report summary indicates that the worker and business partner were contracted to remove a cistern from the basement.
The panel further notes that the worker was interviewed by the RCMP on July 30, 2012 and attaches significant weight to this business partner's interview. During the interview the business partner was asked "Was it a work contract or was he just helping out a friend?" The business partner replied "This was a work contract for his cousin, for the uncle's house." The panel notes that this interview took place before the WCB denied the claim, and before he was aware of any consequence of his evidence.
The business partner has provided other statements and evidence at the hearing which are consistent with his July 30th statement and which confirm the work was being performed by the partnership pursuant to a verbal contract. In particular:
- the partnership incurred costs and would not be able to perform the work for free
- the worker was more experienced in concrete work and was responsible for calculating the contract price.
- this was a labour intensive project, with about $750 in rental equipment and materials, leaving $4000 for labour. The evidence suggests that the project would take one to one and a half weeks, and the business partner indicated that their charged labour rate for projects would never go below $35.00 per hour. In the panel's view, the $5,000 contract quote is consistent with the size of the project.
The panel also attaches significant weight to the evidence of the worker's cousin. He confirmed that he asked the worker to perform the work and that the worker estimated the cost to a be around $5,000. He advised that his parents were not aware of the financial arrangements for the work because he was paying for it as a gift for his parents. Given the worker's cousin's evidence, the panel attaches no weight to the evidence from the home owners, the worker's aunt and uncle.
In conclusion, after considering all the evidence, the panel finds, on a balance of probabilities, that the worker was injured while performing services pursuant to a contract and that the resulting claim is acceptable.
The appeal is allowed.

Panel Members

A. Scramstad, Presiding Officer
A. Finkel, Commissioner
P. Walker, Commissioner

Recording Secretary, B. Kosc

A. Scramstad - Presiding Officer

Signed at Winnipeg this 26th day of June, 2014

Back