W.C. No. 4-278-412Industrial Claim Appeals Office.
December 12, 1996
FINAL ORDER
Amos Pamperien (respondent) and the claimant (collectively, petitioners) have separately petitioned for review of a final order of Administrative Law Judge Stuber (ALJ) which dismissed the claims against James W. Wood (Wood), and his insurer, State Farm Casualty Insurance Company, and held Pamperien liable for temporary disability and medical benefits awarded to the claimant. We affirm.
The ALJ found that the claimant was hired by the respondent to work on the construction of a house on property owned by Wood. On August 2, 1995, the claimant suffered disabling injuries arising out of and in the course of this employment. On conflicting evidence, the ALJ determined that Wood is exempt from the provisions of the Workers’ Compensation Act (Act) pursuant to § 8-41-402(1), C.R.S. (1996 Cum. Supp.). Therefore, the ALJ denied and dismissed the claims against Wood and ordered the respondent to pay the workers’ compensation benefits awarded in connection with the claimant’s injuries.
In awarding medical benefits, the ALJ found that the respondent failed to designate a physician to treat the claimant’s injuries, and the claimant then selected Dr. Makowski. Therefore, the ALJ found that Dr. Makowski is an authorized treating physician. However, the ALJ found that the claimant left authorized care when he sought treatment from Dr. Bergeron. Consequently, the ALJ determined that Dr. Bergeron and his referrals are not authorized treating physicians.
I. A.
On appeal, the claimant asserts that the homeowner’s exemption under § 8-41-402(1) does not apply to this claim because the “status of the homeowner was not disclosed.” We reject this argument.
Insofar as pertinent, § 8-41-402(1) states that:
“Articles 40 to 47 of this title shall not apply to the owner or occupant, or both, of residential real property which meets the definition of a `qualified residence,’ under section 163 (H)(4)(A) of the federal `Internal Revenue Code of 1986,’ as amended, who contracts out any work done to the property, unless the person performing the work is otherwise an employee of the owner or occupant, or both, of the property.”
In interpreting § 8-41-402(1) we adhere to the well established rule that statutes should be interpreted in a manner so as to effect their legislative intent. Organ v. Jorgensen, 888 P.2d 336 (Colo.App. 1994). To discern the legislative intent, we look first to the language of the statute, giving effect to the ordinary meaning of the words and phrases used. Ackerman v. Hilton’s Mechanical Men, Inc., 914 P.2d 524 (Colo.App. 1996); Husson v. Meeker, 812 P.2d 731
(Colo.App. 1991).
The plain language in § 8-41-402(1) does not require that the owner or occupant of residential real property which meets the definition of a qualified residence disclose that information to contractors or subcontractors prior to the date of the claimant’s industrial injury. Nor do we have any authority to read such a requirement into the statute. Kraus v. Artcraft Sign Co., 710 P.2d 480 (Colo. 1985); Best-Way Concrete Co. v. Baumgartner, 908 P.2d 1194 (Colo.App. 1995) Jacoby v. Metro Taxi, Inc., 851 P.2d 245 (Colo.App. 1993).
Furthermore, there is nothing in the cases interpreting § 8-41-402(1) which suggests that the homeowner’s exemption is conditioned on a pre-injury disclosure of the homeowner’s status, and the claimant cites no such authority. See Organ v. Jorgensen, supra; Brown v. Muto, ___ P.2d ___ (Colo.App. No. 95CA1985, November 29, 1996); Adaline v. Independent Home Builders of Colorado, W.C. No. 4-192-179, January 5, 1995, aff’d Independent Home Builders of Colorado v. Groves (Colo.App. No. 95 CA 0117, August 24, 1995 (not selected for publication). Therefore, we are not persuaded that the General Assembly intended to require such a disclosure.
B.
To the extent the claimant also argues that §8-41-402(1) is not applicable where, as here, the homeowner acts as a “general contractor” in the construction of a house on the residential real property, we disagree. We rejected a similar argument in Adaline v. Independent Home Builders of Colorado, supra. In fact, we noted that the statute implicitly contemplates that the homeowner may “contract out” work to be performed on the residential real property. Therefore, we held that the homeowner’s status as the “general contractor” for improvements to the residential real property is not dispositive of whether the homeowner is exempt from the provisions of the Act.
This conclusion is consistent with the court’s opinion i Brown v. Muto, supra. Specifically, the court concluded that § 8-41-402(1) creates a distinction between the owner or occupant of qualified residential real property who contracts for labor, and a person who is a contractor or subcontractor in the construction or remodeling business. Th Muto court held that § 8-41-402(1) creates a legal fiction such that “contractors and subcontractors, who might otherwise be independent contractors, and their employees are `employees’ of the property owner for workers’ compensation purposes while working on a real property improvement.” However, the court held that the statute creates an exception for owners of qualified residential property which is “broader than the legal fiction.” Thus, the Muto court concluded that the homeowner’s exemption applies to both actual employers and statutory employers who own qualified residential real property.
C.
Next, the petitioners contend that the evidence does not support the ALJ’s finding that the property here meets the definition of a “qualified residence” for purposes of the homeowner exemption. In support, the petitioners cite evidence that Wood was in the business of building homes, and that in obtaining a construction loan for this particular property, Wood signed documents indicating that the loan was for “business purposes.” The petitioners also rely upon evidence that Wood had the property listed for sale both prior to and after the claimant’s injury. Further, the petitioners rely upon evidence that Wood had a residence in California, owned a condominium in Aurora, and rented a house in Lakewood during the house construction on this property.
As conceded by the petitioners, the issue before the ALJ was whether Wood was the owner of a “qualified residence”at the time of the claimant’s injury. See Brown v. Muto supra. Section 163(h)(4)(A) of the Internal Revenue Code (IRS) defines “qualified residence” as the taxpayer’s principal residence and one other residence.
Furthermore, the petitioners’ recognize that the ALJ’s factual determinations must be upheld if supported by substantial evidence in the record. Section 8-43-301(8), C.R.S. (1996 Cum. Supp.); Brown v. Muto, supra. Substantial evidence is that quantum of probative evidence which a rational fact-finder would accept as adequate to support a conclusion, without regard to the existence of conflicting evidence. Durocher v. Industrial Claim Appeals Office, 905 P.2d 4 (Colo.App. 1995). In applying the substantial evidence test we must defer to the ALJ’s credibility determinations, and the ALJ’s resolution of inconsistent or conflicting testimony. Colorado Springs Motors, Ltd. v. Industrial Commission, 165 Colo. 504, 441 P.2d 21 (1968); see also El Paso County Department of Social Services v. Donn, 865 P.2d 877 (Colo.App. 1993) (ALJ may credit all, part, or none of witness’ testimony).
Here, the ALJ credited Wood’s testimony that the house he was constructing was for his personal use and not business. (Transcript March 20, 1996, pp. 125, 138). The ALJ expressly acknowledged the evidence that Wood had may have had a “dual purpose” to sell the property for a profit and use the property as a personal residence, but he resolved the conflict by finding that Wood’s “primary and predominant” intent was to use the house as his residence “if he was financially able to do so,” dependent on whether his condominium in Aurora was sold by the time the new house was ready for occupancy. (Conclusions of Law 5). In support, the ALJ relied upon evidence that Wood built the house for his personal needs rather than those of the retail housing market, and that Wood subsequently began to reside in the house. (Transcript March 20, 1996, pp. 83, 91, 108).
Moreover, the IRS enforcement regulations allow a taxpayer to treat a home under construction as a qualified residence for a period of up to 24 months if the residence becomes a qualified residence at the time the residence is ready for occupancy See Treas. Reg. § 1.163-10 T(p)(5). Therefore, property owners who do not take occupancy of the property until after the industrial injury are not excluded from the homeowner’s exemption. Organ v. Jorgensen, 888 P.2d at 337. Accordingly, the evidence that Wood resided in California or Aurora during the construction of the house in question is not determinative of whether the property constitutes a qualified residence.
Wood testified that he established the property as his permanent residence in February 1996 when a certificate of occupancy was issued. (Transcript March 20, 1996, pp. 93, 117, 131). Thus, Wood’s testimony supports the ALJ’s determination that the uninhabitable residence at the time of the claimant’s industrial injury met the definition of a “qualified residence.”
Although the evidence could have been interpreted differently, the ALJ’s findings are supported by Wood’s testimony and we may not substitute our judgment for that of the ALJ concerning the sufficiency and probative weight of this evidence See Martinez v. Regional Transportation District, 832 P.2d 1060 (Colo.App. 1992). Consequently, the existence of evidence in the record, which if credited, might support a contrary result does not establish grounds for appellate relief See F.R. Orr Construction v. Rinta, 717 P.2d 965
(Colo.App. 1985).
The petitioners’ remaining arguments on this issue have been considered and are not persuasive. Therefore, the ALJ did not err in dismissing the claims against Wood and his insurer.
II.
The claimant also argues that the ALJ erred in finding that Dr. Bergeron and his referrals are not “authorized treating physicians.” We perceive no error.
It is well established that where the employer waives the right to select a physician to treat the claimant’s injury, the right of selection passes to the claimant. Section 8-43-404(5)(a), C.R.S. (1996 Cum. Supp.). Furthermore, where the claimant selects the treating physician, all providers in the normal progression of referrals from the selected physician are authorized treating physicians. Greager v. Industrial Commission, 701 P.2d 168 (Colo.App. 1985).
However, § 8-43-404(5)(a) prohibits the claimant from retaining additional physicians outside the chain of referral, without following the statutory procedure. See Jacoby v. Metro Taxi, Inc., supra; Pickett v. Colorado State Hospital, 32 Colo. App. 282, 513 P.2d 228 (1973). Specifically, §8-43-404(5) provides that the claimant may change providers upon written permission from the insurer or may obtain an order from the ALJ for a change of physician upon a “proper showing.”State Insurance Fund v. Luna, 156 Colo. 106, 397 P.2d 231
(1964); Consolidated Landscape v. Industrial Claim Appeals Office, 883 P.2d 571 (Colo.App. 1994).
Here, there is no finding or assertion that Dr. Makowski referred the claimant to Dr. Bergeron. Nor did the claimant request permission to treat with Dr. Bergeron. Under these circumstances, the ALJ did not err in finding that Dr. Bergeron and his referrals are not authorized to treat the claimant’s injury.
Moreover, we are unable to locate any authority in support of the claimant’s argument that where the employer is uninsured and the claimant is unable to afford the services of the initial treating physician, the claimant is not required to comply with § 8-43-404(5) before changing providers. Cf. Dominguez v. Monfort of Colorado, W.C. No. 3-857-241, February 27, 1991 (denial of liability does not abrogate employer’s right of first selection); see also Vanadium Corp. of America v. Sargent, 134 Colo. 555, 307 P.2d 454 (1957). In particular, we disagree with the claimant’s assertion that the “Utilization Standards” in the Rules of Procedure, Part XVI(B)(1)(a), 7 Code Colo Reg. 1101-3 at 70, create a distinction between the definition of “authorized treating physician” under circumstances where the employer provides medical benefits, and circumstances where the employer refuses to pay medical benefits. To the contrary Rule XVI(B)(1)(a) provides that with regard to physicians selected by the claimant, the term “authorized treating physician” refers to “the health care provider chosen by the injured worker” and “a provider selected by the injured worker with permission from the payer, the Division” or the ALJ.
Furthermore, the claimant’s reliance upon Story v. Industrial Claim Appeals Office, 910 P.2d 80 (Colo.App. 1995), is misplaced. In that case, the court’s discussion of the claimant’s right to change treating physicians “at any time” was in reference to the claimant’s right under § 8-43-404(5) to obtain an order for a change of physicians upon a “proper showing.”
IT IS THEREFORE ORDERED that the ALJ’s order dated June 3, 1996, is affirmed.
INDUSTRIAL CLAIM APPEALS PANEL
____________________________________ Kathy E. Dean
____________________________________ Bill Whitacre
NOTICE
This Order is final unless an action to modify or vacate this Order is commenced in the Colorado Court of Appeals, 2 East 14th Avenue, Denver, CO 80203, by filing a petition for review with the court, with service of a copy of the petition upon the Industrial Claim Appeals Office and all other parties, within twenty (20) days after the date this Order is mailed, pursuant to section 8-43-301(10) and 307, C.R.S. (1996 Cum. Supp.).
Copies of this decision were mailed December 12, 1996
to the following parties:
James Harold Durfee 3662 W. Greenwood Place, Denver, CO 80236
Amos Pamperien, 2500 W. Hampden, #156, Englewood, CO 80110
James Wood, 2360 Granby Way, Aurora, CO 80011
State Farm Fire Casualty Ins. Co., Attn: Doug Tabor, 4380 S. Syracuse, Ste. 200, Denver, CO 80221
Elliot Weiner, Esq., 999 18th St., Ste. 3100, Denver, CO 80202 (For State Farm Respondents)
Michael Sutherland, Esq. Stephanie L. Boyett-Colgan, Esq., 1700 Broadway, Ste. 1910, Denver, CO 80290 (For Respondent James Wood)
T. J. Carney, Esq., 1717 Washington Ave., Golden, CO 80401-1994 (For the Claimant)
Kent L. Singer, Esq., 1410 Grant St., Ste. #g-208, Denver, CO 80203 (For Amos Pamperien)
BY: _______________________