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Active Care Chiropractic, Inc. v. Rudd

Supreme Court of Kentucky

September 27, 2018

ACTIVE CARE CHIROPRACTIC, INC. APPELLANT
v.
KATHERINE RUDD; HONORABLE JEANIE OWEN MILLER, ADMINISTRATIVE LAW JUDGE; WORKERS' COMPENSATION BOARD AND KENTUCKY COURT OF APPEALS APPELLEES

          ON APPEAL FROM COURT OF APPEALS CASE NO. 2017-CA-00469-WC WORKERS' COMPENSATION BOARD NO. 14-WC-81319

          COUNSEL FOR APPELLANT: Richard Christion Hutson Whitlow, Roberts, Houston & Straub, PLLC

          COUNSEL FOR APPELLEE: KATHERINE RUDD Mark Lane Ashburn

          OPINION

          VANMETER, JUSTICE

         KRS[1] 342.730(1)(c)2 states: "During any period of cessation of . . . employment, temporary or permanent, for any reason, with or without cause, payment of weekly benefits for permanent partial disability during the period of cessation shall be two (2) times the amount otherwise payable[.]"[2] The sole issue for this Court on appeal, an issue of first impression, is whether the two- multiplier under KRS 342.730(1)(c)2 applies to a claimant's benefits when that claimant returns to work and later retires for reasons not solely related to the work-related injury itself. We hold that in such circumstances the two-multiplier must be applied to comply with the unambiguous language of KRS 342.730(1)(c)2. Accordingly, we affirm.

         I. FACTUAL BACKGROUND.

         The facts in this case are not in dispute. Active Care Chiropractic employed Katherine Rudd part-time. One day, while taking out the trash at work, she slipped and fell, injuring her shoulder. After three shoulder surgeries, she returned to work. About a year after her return to work, she voluntarily retired, for reasons not solely related to the work-related injury. At her Formal Hearing Rudd stated:

It was not due to the accident, not directly. I was turning sixty, and I'd never had any medical problems before. This kind of made me re-evaluate things. I decided I wanted to spend what quality years I have left doing things that provide the greatest satisfaction, and decided that being a secretary just wasn't doing it for me anymore. So I retired.

         At Rudd's Benefit Review Conference, the parties agreed that the only issue before the ALJ was the correct multiplier to be applied to Rudd's benefits. The ALJ acknowledged that the parties originally agreed that no multiplier would apply. But Rudd argued that changes in the caselaw placed the modifier application at issue.

         Rudd referred to our recent decision in Livingood v. Transfreight, LLC, 467 S.W.3d 249 (Ky. 2015), which overruled the holding in Chrysalis House, Inc. v. Tackett, 283 S.W.3d 671 (Ky. 2009), that a work-related disability must be the reason for an employee's cessation of employment in order to afford application of the two-multiplier. Instead, Livingood held that "KRS 342.730(1)(c)2 permits a double income benefit during any period that employment at the same or a greater wage ceases 'for any reason, with or without cause,' except where the reason is the employee's conduct shown to have been an intentional, deliberate action with a reckless disregard of the consequences either to himself or to another." 467 S.W.3d at 259 (quoting KRS 342.730(1)(c)2).

         Rudd argued that, since her cessation from work was not due to intentional or reckless misconduct, that being the only restriction on a claimant's ability to recover under the statute, she should be entitled to the two-multiplier. In other words, because voluntary retirement constitutes a "cessation of employment. . . for any reason" and does not constitute intentional or reckless misconduct under Livingood, she qualified for the two-multiplier.

         The ALJ agreed, concluding she was "bound by the plain wording" of the statute and this Court's holding in Livingood, with the only purported restriction on application of the two-multiplier being the employee's intentional or reckless misconduct. The Workers' Compensation Board ("Board") and the Court of Appeals affirmed the ALJ's decision. Active Care Chiropractic's ("Active Care") appeal to this Court followed. See Ky. Const. § 115.

         II. STANDARD OF REVIEW.

         We review statutory interpretation de novo. Cumberland Valley Contractors, Inc. v. Bell Cty. Coal Corp., 238 S.W.3d 644, 647 (Ky. 2007). The well-established standard for reviewing a workers' compensation decision is to "correct the Board only where the Court perceives the Board has overlooked or misconstrued controlling statutes or precedent, or committed an error in assessing the evidence so flagrant as to cause gross injustice." W. Baptist Hosp. v. Kelly, 827 S.W.2d 685, 687-88 (Ky. 1992). Finally, review by this Court "is to address new or novel questions of statutory construction, or to reconsider precedent when such appears necessary, or to review a question of constitutional magnitude." Id. at 688.

         III. ANALYSIS.

         KRS 446.080(1) directs that "[a]ll statutes of this state shall be liberally construed with a view to promote their objects and carry out the intent of the legislature[.]" This Court's goal, in construing statutes, "is to give effect to the intent of the [legislature]. We derive that intent . . . from the language the [legislature] chose, either as defined by the [legislature] or as generally understood in the context of the matter under consideration." Livingood, 467 S.W.3d at 256 (internal quotations and citations omitted). "General principles of statutory construction hold that a court must not be guided by a single sentence of a statute but must look to the provisions of the whole statute and its object and policy." Cty. of Harlan v. Appalachian Reg'l Healthcare, Inc., 85 S.W.3d 607, 611 (Ky. 2002). However, when construing provisions to match objectives of whole statutes, "[w]e have a duty to accord to words of a statute their literal meaning unless to do so would lead to an absurd or wholly unreasonable conclusion." Livingood, 467 S.W.3d at 257-58 (internal citations and quotations omitted). Moreover, "it is neither the duty nor the prerogative of the judiciary to breathe into the statute that which the Legislature has not put there.'” Wilson v. SKW Alloys, Inc., 893 S.W.2d 800, 802 (Ky. App. 1995) (quoting Gateway Constr. Co. v. Wallbaum, 356 S.W.2d 247, 248-49 (Ky. 1962)).

         The plain language of KRS 342.730(1)(c)2 unquestionably supports Rudd's position: "During any period of cessation of. . . employment, temporary or permanent, for any reason, with or without cause," a claimant shall be awarded permanent-partial disability benefits as modified by the two-multiplier, (emphasis added). Taken at face value, Rudd's argument, that voluntary retirement and removal from the workforce for reasons not solely related to the workplace injury qualifies as "cessation of . . . employment . . . for any reason" and affords the application of the two-multiplier to benefits received, is supported by the language of the statute.

         Active Care argues that this Court should disregard this unambiguous language and carve out an exception akin to the intentional misconduct exception from Livingood. In Livingood, we noted the "legislative intent in KRS Chapter 342 that an employee should not benefit from his own wrongdoing." 467 S.W.3d at 258. The many examples throughout Chapter 342 barring compensation due to wrongdoing by the employee exemplify this legislative intent and support the exception fashioned in Livingood. See KRS 342.035(3) (denying compensation for unreasonable failure to follow medical advice); 342.165(2) (denying compensation when employee knowingly and willingly makes a false representation regarding physical condition at time of employment); 342.610(3) (denying compensation when injury occurs due to voluntary intoxication or willful intent to injure oneself or another).

         In the present case, absent any evidence of Rudd's intentional or reckless wrongdoing, no exception to the unambiguous language of KRS 342.730(1)(c)2 precludes the recovery of the two-multiplier. Indeed, voluntary retirement cannot possibly be construed as "an intentional, deliberate action with a reckless disregard of the consequences." Livingood, 467 S.W.3d at 259. Instead, voluntary retirement falls squarely within the statute as a "cessation of . . . employment . . . for any reason, with or without cause[.]" KRS 342.730(1)(c)2.

         As stated previously, we have a "duty to accord to words of a statute their literal meaning unless to do so would lead to an absurd or wholly unreasonable conclusion." Livingood, 467 S.W.3d at 257-58. In Livingood, we determined that allowing an employee to "benefit from his own wrongdoing" would lead to such a wholly unreasonable result based upon the whole of Chapter 342. Id. at 257. Here, however, a literal construction of KRS 342.730(1)(c)2 prescribes that Rudd receive the two-multiplier because voluntary retirement is a "cessation of . . . employment . . . for any reason," and does not lead to an absurd or unreasonable result in conjunction with the rest of Chapter 342, unlike intentional misconduct, even if the purpose of the statute is to "encourage continued employment," as Livingood noted in dicta. Id.

         Thus, when an individual voluntarily chooses to retire, a decision made for reasons not solely related to that individual's work-related injury, that individual is entitled to the two-multiplier listed in KRS 342.730(1)(c)2. Such a conclusion complements our decision in Livingood, a case in which we recognized an appropriate limitation on the ...


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