2018 WL 4832357

United States District Court, E.D. Oklahoma.
Taylor G. NAIL, Plaintiff,
v.
BLUE DONKEY TRANSPORT, LLC and Warren J. Lewis, Defendants.
Case No. 6:18-CV-00159-JHP
|
Signed 10/04/2018
Attorneys and Law Firms
George R. Mullican, Matthew B. Covert, Mullican & Hart, PC, Tulsa, OK, for Plaintiff.
Bob L. Latham, Brian L. Carter, Troy J. McPherson, Latham Wagner Steele & Lehman, PC, Tulsa, OK, for Defendants.

OPINION AND ORDER
James H. Payne, United States District Judge
*1 Before the Court is Defendants Blue Donkey Transport, LLC and Warren J. Lewis’s Motion to Dismiss and Quash Service of Process (“Motion to Dismiss”) (Dkt. 12), Plaintiff’s Response in Opposition (Dkt. 15), and Defendants’ Reply (Dkt. 18). After consideration of the briefs and for the reasons stated below, the Defendants’ Motion to Dismiss is GRANTED in part and DENIED in part.

BACKGROUND
Plaintiff, Taylor Nail’s claims against the Defendants, Blue Donkey Transport, LLC (“Blue Donkey”) and Warren J. Lewis (“Lewis”), arise from a motor vehicle collision that occurred on March 10, 2017, in Wagoner County, Oklahoma on the Muskogee Turnpike. (See Dkt. 2-2 at ¶ 6.) On October 2, 2017, Lewis filed a Voluntary Chapter 7 Bankruptcy Petition in the United States Bankruptcy Court for the District of Colorado, Case No. 17-19142-KHT. (Dkt. 12-1) In the Bankruptcy Petition, Lewis identified himself as having 100% ownership interest in Blue Donkey and scheduled it as an asset of the bankruptcy estate. (Id.) Additionally, the Bankruptcy Petition stated Blue Donkey existed and was an active business from January 1, 2013, to July 1, 2017. However, Lewis’s Bankruptcy Petition does not identify any claims against the Plaintiff, nor did it list her as a creditor or list her claim against him and/or Blue Donkey as a debt. (Id.)

On October 27, 2017, Plaintiff filed a Petition based upon the collision in the State District Court of Muskogee County, Oklahoma. (Dkt. 2-2) On November 18, 2017, Defendants were served by U.S. Certified Mail, Return Receipt, Restricted Delivery, with State court Summons and Petition. (Dkt. 2-6 & 2-7)

On November 27, 2017, Lewis amended his Bankruptcy Petition’s Schedule F – Creditors Holding Unsecured NonPriority Claims to include, “All possible claims related to vehicle accident involving Taylor Nail and Oklahoma lawsuit CJ-17-384” as a general unsecured claim and sent a copy of the Notice of Amendment of Schedule, the Notice of Chapter 7 Bankruptcy Case, and the Meeting of Creditors & Deadlines to Plaintiff’s Attorneys. (Dkt. 15-2) As a creditor, the Plaintiff filed a Proof of Claim (Dkt. 15-3) on February 13, 2018, and a Motion for Relief from Automatic Stay and Discharge Injunction (“Motion for Relief”) on February 15, 2018. (Dkt. 15-4) Plaintiff’s Motion for Relief informed the Bankruptcy Court of her claims against the Defendants, that she did not receive notice of Lewis’s Bankruptcy until after filing and serving the Petition with Summons on the Defendants, and that Plaintiff agreed to limit her recovery against the Defendants to the insurance policy limits of the Defendants’ available insurance coverage. On April 11, 2018, the Bankruptcy Court entered an Order stating:
3. On October 27, 2017, without any knowledge of this bankruptcy proceeding, Taylor G. Nail filed her Petition in the District Court of Muskogee County, Oklahoma, styled Taylor G. Nail v. Blue Donkey Transportation, LLC and Warren J. Lewis, Case No.: CJ-2017-384 ….
4. Because Plaintiff’s claim is a personal injury claim, the claim would be properly resolved and liquidated in the pending State Court Action. 28 U.S.C. § 157(b)(5).
*2 5. At the time Ms. Nail’s claim against Mr. Lewis and Blue Donkey Transportation, LLC arose, Mr. Lewis and Blue Donkey had liability insurance coverage in the amount of $1,000,000.00, which will provide coverage for the claims asserted by Ms. Nail.
(Dkt. 12-2) In granting Plaintiff relief from the Automatic Stay and Discharge Injunction, the Bankruptcy Court found:
Good cause exists for this Court to grant relief from the automatic stay under 11 U.S.C. § 362(d)(1), and the discharge injunction under 11 U.S.C. § 524 in order to permit Ms. Nail to proceed with her State Court Action to the extent of Mr. Lewis and Blue Donkey Transportation’s insurance policy limits.
(Id., emphasis added.) On April 27, 2018, Plaintiff filed a notice of the Bankruptcy Court’s order granting relief from the Automatic Stay and Discharge Injunction in the State District Court case and filed the Returns of Service for the Summons and Petition. (Dkt. 2-5, 2-6, & 2-7)

On May 21, 2018, the Defendants removed the State District Court Case to this Court (Dkt. 2) and filed the pending Motion to Dismiss (Dkt. 12). Subsequently, Plaintiff timely responded in opposition to the Motion to Dismiss (Dkt. 15) and re-served the Defendants1 with Summons and Petition on June 9, 2018 (Dkt. 16 & 17). As allowed under LCvR 7.1(e), Defendants filed a Reply, in part addressing the Plaintiff’s re-service on the Defendants. The Motion to Dismiss is fully briefed and ripe for review.

DISCUSSION
The Defendants move for dismissal and to quash service based upon 12(b)(2), lack of personal jurisdiction, and 12(b)(5), insufficient service of process. Secondarily, the Defendants argue Plaintiff’s Petition states a punitive damage claim in contravention of the Bankruptcy Court’s Order for Relief from the Automatic Stay and Discharge Injunction. (Dkt. 12 at 6) The second issue is not related to 12(b)(2) or 12(b)(5) but is more accurately framed as a 12(b)(6) motion, failure to state a claim upon which relief can be granted. Each of the Defendants’ defenses are addressed separately.

I. Personal Jurisdiction
While the Defendants move to dismiss based upon 12(b)(2), lack of personal jurisdiction, they do not address whether this Court has personal jurisdiction under the classic minimum contacts analysis. Rather than assume the Defendants waived this basis for lack of personal jurisdiction, the Court determines whether it can exercise personal jurisdiction under the minimum contacts analysis.

A. Minimum Contacts Requirement
In these cases, the “plaintiff bears the burden of establishing the Court has personal jurisdiction over the defendant.” OMI Holdings v. Royal Ins. Co. of Canada, 149 F.3d 1086, 1091 (10th Cir. 1998) (quoting Rambo v. American Southern Ins. Co., 839 F.2d 1415, 1417 (10th Cir. 1988) ). “When a Court rules on a Fed. R. of Civ. P. 12(b)(2) motion to dismiss for lack of personal jurisdiction without holding an evidentiary hearing, … the plaintiff need only make a prima facie showing of personal jurisdiction to defeat the motion.” Id. (citing Kuenzle v. HTM Sport-Und Freizeitgerate AG, 102 F.3d 453, 456 (10th Cir. 1996) ). A plaintiff may utilize an affidavit or other written materials stating facts if taken as true which support the Court’s exercise of jurisdiction over the defendant, and thereby, satisfying the prima facie requirement. Id. To defeat the plaintiff’s prima facie showing, the defendant is required to present “a compelling case demonstrating ‘that the presence of some other consideration would render jurisdiction unreasonable.’ ” Id. (quoting Burger King Corp. v. Rudzewicz, 471 U.S. 462, 477, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985) ). In resolving whether jurisdiction exists, the Court must accept the plaintiff’s allegations in the complaint as true:
*3 to the extent they are uncontroverted by the defendant’s affidavits. If the parties present conflicting affidavits, all factual disputes are resolved in the plaintiff’s favor, and the plaintiff’s prima facie showing is sufficient notwithstanding the contrary presentation by the moving party.
Taylor v. Phelan, 912 F.2d 429, 431 (10th Cir. 1990) (quoting Behagen v. Amateur Basketball Ass’n, 744 F.2d 731, 733 (10th Cir. 1984) (citations omitted), cert. denied 471 U.S. 1010, 105 S.Ct. 1879, 85 L.Ed.2d 171 (1985) ).

Under this analysis, the Court uses the law of the forum State to investigate whether it has personal jurisdiction over a nonresident defendant. Id. (citing Yarbrough v. Elmer Bunker & Associates, 669 F.2d 614, 616 (10th Cir. 1982); see also Fed. R. Civ. P. 4(e). The forum State’s long-arm statute and the Constitution must be satisfied before the Court may exercise jurisdiction. In this case “[b]ecause Oklahoma’s long-arm statute permits the exercise of jurisdiction that is consistent with the United States Constitution, the personal jurisdiction inquiry under Oklahoma law collapses into the single due process inquiry.” Intercon, Inc. v. Bell Atlantic Internet Solutions, Inc., 205 F.3d 1244, 1247 (10th Cir. 2000) (citing Rambo, 839 F.2d at 1416.); see also, Okla. Stat. tit. 12, § 2004(F).

The due process inquiry involves a fact-specific two-step assessment: 1) a determination of whether the nonresident defendant has sufficient “minimum contacts with the forum State that they should reasonably anticipate being hauled into court there” OMI Holdings, 149 F.3d at 1091 (quoting World Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980) ); 2) if sufficient minimum contacts are found, then a determination of “whether the exercise of personal jurisdiction over the defendant offends ‘traditional notions’ of fair play and substantial justice” Id., (quoting Asahi Metal Industry Co. v. Superior Court of California, 480 U.S. 102, 105, 107 S.Ct. 1026, 94 L.Ed.2d 92 (1987) ); see also, TH Agriculture & Nutrition, LLC v. Ace European Group Ltd., 488 F.3d 1282, 1287 & 1292 (10th Cir. 2007). The Courts recognize two types of personal jurisdiction, general and specific. Bristol-Myers Squibb Co. v, Superior Court, ––– U.S. ––––, 137 S.Ct. 1773, 1780, 198 L.Ed.2d 395 (2017) (citing Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 919, 131 S.Ct. 2846, 180 L.Ed.2d 796 (2011). General jurisdiction applies when a defendant’s contacts with the forum State “are so ‘continuous and systematic’ as to render them essentially at home in the forum State.” Goodyear Dunlop, 564 U.S. at 919, 131 S.Ct. 2846 (citing International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945) ). “A court with general jurisdiction may hear any claim against that defendant, even if all the incidents underlying the claim occurred in a different State.” Bristol-Myers, 137 S.Ct. at 1780 (emphasis in original) (citing Goodyear Dunlop, 564 U.S. at 919, 131 S.Ct. 2846). Unlike general jurisdiction, specific jurisdiction “depends on an ‘affiliation between the forum and the underlying controversy,’ principally, activity or an occurrence that takes place in the forum State and is therefore subject to the State’s regulation.” Goodyear Dunlop, 564 U.S. at 919, 131 S.Ct. 2846 (citation omitted).

*4 In the instant case, the Court examines the written materials submitted and Plaintiff’s Petition to determine whether the prima facie case for either general or specific personal jurisdiction is established in the forum State of Oklahoma. From Lewis’s Bankruptcy Petition, the Court finds:
1. Lewis is a resident of Colorado (Dkt. 12-1 at 14);2
2. Blue Donkey’s business address was in Colorado (Id.);
3. Blue Donkey’s business operations involved auto hauling services (Id.);
4. Lewis lists in his Bankruptcy Assets a single 2008 Freightliner and Trailer (Id. at 19, 24, & 26);
For determining personal jurisdiction, the Court accepts and finds the following uncontroverted allegations in Plaintiff’s Petition are true:
1. Lewis and Blue Donkey were operating in Oklahoma on March 10, 2017 (Dkt. 2-2 at ¶¶ 6-7, 11-12);
2. Lewis was driving a 2008 Freightliner Truck-Tractor/Semi-Trailer when it collided with Plaintiff’s vehicle on the Muskogee Turnpike in Wagoner County, Oklahoma (Id. at ¶ 6);
3. Lewis maintains a Commercial Driver’s License (CDL) requiring him to comply with Oklahoma law.
4. Because of the collision with Plaintiff’s vehicle, Lewis was cited for violating Okla. Stat. tit. 47, § 11-801.
Upon examination, these facts fail to establish general jurisdiction because they do not show the Defendants’ contacts with Oklahoma were “ ‘continuous and systematic’.” Goodyear Dunlop, 564 U.S. at 919, 131 S.Ct. 2846 (citation omitted). Nevertheless, this Court can exercise specific personal jurisdiction because the Defendants’ conduct while driving in Oklahoma subjected them to the State’s regulation and resulted in the controversy at issue in this case. Id.

While the Court has a basis to exercise specific personal jurisdiction over the Defendants, it cannot effectuate its personal jurisdiction until the procedural requirement of service of process or its waiver is satisfied. Murphy Bros. v. Michetti Pipe Stringing, 526 U.S. 344, 350, 119 S.Ct. 1322, 143 L.Ed.2d 448 (Justice Ginsberg explained, “In the absence of service of process (or waiver of service by the defendant), a court ordinarily may not exercise power over a party the complaint names as defendant.”) (citation omitted). Whether Plaintiff’s service of process is valid forms the foundation of Defendants’ 12(b)(2) and 12(b)(5) defenses. The considerations are the same for both defenses.

B. Service of Process Requirement
To determine the sufficiency of process prior to removal, the Tenth Circuit Court instructs courts to apply the State law. Wallace v. Microsoft Corp., 596 F.3d 703, 706 (10th Cir. 2010). The Defendants contend because of the Bankruptcy filed on October 2, 2017, the Automatic Stay voids Plaintiff’s service of the Summons and Petition by U.S. Certified Mail, Return Receipt, Restricted Delivery on November 18, 2017.3 (Dkt. 12 at 3; Compare Dkt. 1-1 with Dkt. 2-6 & 2-7) Whenever a person files for bankruptcy protection, the law imposes an automatic stay on all pending proceedings and all possible proceedings based on claims that could have been brought prior to the filing date of the Petition. 11 U.S.C. 362(a).

*5 The Oklahoma Supreme Court recognizes “the automatic stay is one of the fundamental debtor protections provided by the bankruptcy laws.” Bailey v. Campbell, 1991 OK 67, ¶ 12, 862 P.2d 461. In deciding the breadth of the automatic stay in State proceedings, the Oklahoma Supreme Court explained:
¶13 The stay has two primary purposes – to give the debtor a breathing spell from creditors, allowing a fresh economic start and to provide some measure of creditor protection. Recognition that judicial proceedings prosecuted in violation of an automatic stay are a nullity ensures that these goals are met. (footnotes omitted) Id; see also, Bank of Oklahoma, N.A. v. Miller, 2017 OK CIV APP 48, ¶¶ 15-16, 403 P.3d 389 (internal citations omitted) (finding post-bankruptcy petition judgment void ab initio because of the automatic stay.)
Thus, the Court determined a “judicial proceeding undertaken in violation of an automatic stay are ineffective.” Id. at ¶ 12. While ruling “[p]ost-petition proceedings are a nullity when, as here, the underlying proceeding at its inception was one against the debtor,” the Court identified Tenth Circuit Court and other Circuit Court precedent allowing for exceptions rendering violations of the automatic stay voidable in certain circumstances. Id. at ¶ 13 (internal citations omitted) (fn. 20 discussing In re Calder, 907 F.2d 953, 956 (10th Cir. 1990) ); Matter of Matthews, 739 F.2d 249, 251 (7th Cir. 1984); Picco v. Global Marine Drilling Co., 900 F.2d 846, 850 (5th Cir. 1990). Applying Oklahoma law to Plaintiff’s November 18, 2017 service on the Defendants, this Court finds the service of process is void. However, the Court’s examination does not end there.

Because the Defendants removed the case to federal court, 28 U.S.C. § 1448 provides for service of process after removal if service was not perfected prior to removal. Wallace, 596 F.3d at 706. As Plaintiff’s service is void before removal and therefore, not perfected, Plaintiff is allowed under Fed. R. Civ. P. 4(m) to service of process on the Defendants after removal. Id. at 706-707. Here, Plaintiff utilized a process server to serve Defendants with Summons and Petition after removal, on June 9, 2018. Unlike the first service on November 18, 2017, the service after removal was effectuated after obtaining relief from the automatic stay. (Compare Dkt. 12-2 with Dkt. 16 & 17) Whatever defect in the service made prior to removal is cured when Plaintiff properly and timely served the Defendants after removal. On this basis, Defendants’ Motion to Dismiss is DENIED in part.

II. Subject Matter Jurisdiction
In their Reply, Defendants raise a 12(b)(1), subject matter jurisdiction defense, and possibly a 12(b)(6) defense based whether the initial filing of the Petition is void because it is in violation of the automatic stay. When a court lacks subject matter jurisdiction, it is required to dismiss the case totally and without delay. Fed. R. Civ. P. 12(h)(3). As such, the Court addresses this potential defense but finds it unpersuasive and without merit.

The decision to lift and/or grant relief from the automatic stay is within the discretion of bankruptcy judge. Pursifull v. Eakin, 814 F.2d 1501, 1504 (10th Cir. 1987). As permitted under Fed. R. Evid. 201,4 this Court takes judicial notice of the Colorado Bankruptcy Court proceedings, its docket, and finds the following:
*6 1. Lewis did not list the Plaintiff of her claim in his Bankruptcy Petition (Dkt. 12-1);
2. Lewis did not give notice to the Plaintiff of his filing of the Bankruptcy Petition until after she filed her case in state court and served him with notice (Dkt. 15-2);
3. After receiving notice of the Bankruptcy Petition, Plaintiff filed a Proof of Claim and a Motion for Relief from the Automatic Stay (Dkt. 15-3);
4. The Defendants were given notice and an opportunity to object to Plaintiff’s Motion for Relief from the Automatic Stay (Co. Bnkr. Case No. 17-19142-KHT, Dkt.51);
5. The Defendants did not file an objection nor request a hearing on Plaintiff’s Motion for Relief from the Automatic Stay (Id.);
6. The Defendants did not appeal the Bankruptcy Court’s Order granting Plaintiff relief from the Automatic Stay;
7. In its Order granting relief from the Automatic Stay, the Bankruptcy Court found:
a. the Plaintiff was ignorant of the bankruptcy proceeding when she filed her case;
b. Plaintiff’s claim would be properly resolved in the pending State Court Action.
c. the Defendants have insurance coverage available that could cover Plaintiff’s claims;
d. the Plaintiff agreed to limit her damages to the insurance policy limits;
e. Good cause exists for granting relief from the stay pursuant to 11 U.S.C. § 362(d)(1);
f. Plaintiff is allowed to proceed with her State court action.
11 U.S.C. § 362(d)(1) states the bankruptcy court “shall grant relief from the stay provided under subsection (a) of this section, such as by terminating, annulling, modifying, or conditioning such stay — (1) for cause, including the lack of adequate protection in property of such party in interest.” (emphasis added) The Tenth Circuit Court recognized the authority to retroactively reinstate claims, or annul a stay, “to claimants who were honestly ignorant of the bankruptcy stay.” Franklin Savings Association v. Office of Thrift Supervision, 31 F.3d 1020, 1023 (10th Cir. 1994).5 The Bankruptcy Court found Plaintiff to be ignorant in this respect when granting relief and specifically allowing her to proceed with her State District Court case. Res judicata prevents this Court from second-guessing the propriety of the Bankruptcy Court’s order. Derringer v. Chapel, BAP No. NM-05-020, 2005 WL 2216327, *4, 2005 Bankr. Lexis 1621, *12 (10th Cir. 2005) (“a final judgment on the merits of an action precludes the parties or their privies from relitigating issues that were or could have been raised in that action.”); but see, State Bank v. Glenhill, 76 F.3d 1070, 1082-83 (10th Cir. 1996) (explaining the difference between a prohibited collateral attack and a permissible direct attack of a bankruptcy court order under res judicata). The Defendants had an opportunity to contest and/or appeal Plaintiff’s request for relief in the Bankruptcy Court. Since the stay as to Plaintiff’s State District Court case was annulled by the Bankruptcy Court’s Order, this Court is not deprived of subject matter jurisdiction.6 On this basis, Plaintiff’s Motion to Dismiss is DENIED in part.

III. Plaintiff’s Punitive Damage Claim
*7 Lastly, the Defendants move the Court to dismiss7 Plaintiff’s case because it includes a punitive damage claim. While not cited properly, the Court accepts this attempt as a motion to dismiss for failure to state a claim upon which relief can be granted, 12(b)(6). “It is clear that the purpose of Rule 12(b)(6) is to test ‘the sufficiency of the allegations within the four-corners of the complaint after taking those allegations as true.’ ” H.S. Field Serv. v. CEP Mid-Continent LLC, No. 12-CV-531-JED-PJC, 2015 WL 410683, at *3, 2014 Dist. LEXIS 181289, at *4 (N.D. Okla. Nov. 5, 2014) (quoting Mobley v. McCormick, 40 F.3d 337, 340 (10th Cir. 1994) ). Generally, such a “motion addresses a question of law – the legal sufficiency of the complaint, not its factual support.” Id. (citing Dubbs v. Head Start, Inc., 336 F.3d 1194, 1202 (10th Cir. 2003) ). The Court does not need to determine whether it should consider the inclusion of Defendants’ Exhibit 1 with their Reply converts the motion to a motion for summary judgment because the issue is resolved as a question of Colorado’s substantive law. Erie R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938) (federal courts in diversity cases apply state law when deciding substantive law questions); Hanna v. Plumer, 380 U.S. 460, 465, 85 S.Ct. 1136, 14 L.Ed.2d 8 (1965); Sim v. Great American Life Ins. Co., 469 F.3d 870, 877, (10th Cir. 2006).

For determining whether a punitive damage claim is permissible within the boundaries of the Bankruptcy Court’s Order granting the Plaintiff to proceed with her claim up to the Defendants’ insurance coverage and policy limits, the Court accepts as true the following “facts” stated in Plaintiff’s Petition:
1. Blue Donkey is a Colorado limited liability company (Dkt. 2-2 at ¶ 3);
2. Blue Donkey was in a business requiring compliance with the Federal Motor Carrier Safety Act (Id. at ¶¶ 14 -15);
3. Lewis was an employee of Blue Donkey and was driving a semi-tractor trailer for Blue Donkey at the time of the collision with Plaintiff (Id. at ¶¶ 6, 11-12);
Based upon these facts, the Federal Motor Carrier Safety regulations apply to Blue Donkey business. These Regulations require motor carriers who operate interstate to carry insurance coverage. 49 C.F.R. § 387.7. The regulations set minimum standards for coverage and requirements for maintaining coverage. 49 C.F.R. §§ 387.7-387.11. One of the requirements provides “a policy of insurance … does not satisfy the financial responsibility requirements of this subpart unless the insurer of the policy is – (b) legally authorized to issue such policies in the State in which the motor carrier has its principal place of business or domicile …” 49 C.F.R. § 387.11(b). Because Blue Donkey is a Colorado limited liability company with a policy issued under Colorado law, Colorado law controls whether punitive damages are insurable and potentially recoverable in this case.

*8 Colorado law is clear and unequivocal on this issue. “The public policy of Colorado prohibits an insurance carrier from providing insurance coverage for punitive damages.” Lira v. Shelter Ins. Co., 913 P.2d 514, 517 (1996) (citing Universal Indemnity Ins. Co. v. Tenery, 96 Colo. 10, 39 P.2d 776, 779 (1934); Gleason v. Fryer, 30 Colo.App. 106, 491 P.2d 85, 86 (1971) ). Since Plaintiff’s claims are limited to the insurance policy coverage and its policy limits, her claim for punitive damage cannot stand. The Court GRANTS Defendant’s Motion to Dismiss in part by finding and ordering Plaintiff’s punitive damage claim dismissed.

CONCLUSION
For the reasons detailed above, Defendants Blue Donkey Transport, LLC and Warren J. Lewis’s Motion to Dismiss and Quash Service of Process (Dkt. 12) is DENIED in part and GRANTED in part. Pursuant to Fed. R. Civ. P. 12(a)(4), the Defendants are ordered to serve a responsive pleading to Plaintiff’s Petition, with exception to the Punitive Damage claims which are DISMISSED, within 14 days of this Order.

IT IS SO ORDERED this 4th day of October, 2018.

All Citations
Slip Copy, 2018 WL 4832357

Footnotes

1
The Affidavits of Service filed in this case show a process server personally served Lewis on behalf of himself and on behalf of Blue Donkey.

2
Plaintiff’s Petition also alleges Lewis is a resident of Colorado and Blue Donkey is a Colorado limited liability company. (Dkt. 2-2 at ¶¶ 2-3)

3
OKLA. STAT. tit. 12 §§ 2004 (C)(2) and (E)(2)(c) authorize service by certified mail, return receipt, restricted delivery. The Defendants do not challenge the method or form Plaintiff used for service of process.

4
Courts frequently take judicial notice of case proceedings brought before them. In re Calder, 907 F. 2d at fn. 2 (recognizing the lower Court is permitted to take notice of the contents within bankruptcy court filings); ASARCO, LLC v. Union Pacific Railroad Co., 755 F.3d 1183, fn. 5 (10th Cir. 2014) (relying on relevant documents from a related bankruptcy case).

5
In the Motion to Dismiss, the Defendants rely on numerous cases where courts have voided post-stay proceedings regardless of later obtaining relief from the automatic stay. Even if the res judicata did not prohibit this Court from revisiting the issue decided by the Bankruptcy Court, these cases are not persuasive. Unlike the plaintiffs in Swarey, Plaintiff has not sought default judgment against Defendants at any point in time much less prior to the lifting of the stay. Compare Swarey v. Stephenson, 222 Md. App. 65, 84, 112 A.3d 534, 545 (2015). Similarly, Plaintiff has not sought or obtained summary judgment against Defendants or enforced any order that would pay Plaintiff. Compare Citibank, N.A. v. Peters, No. 2002-112, 2008 WL 5158084, at *, 2008 U.S. Dist. LEXIS 99479, at *7 (D.V.I. Dec. 9, 2008) (unpublished). This case is plainly not like the In re Laine, where the Plaintiff knew about debtor’s bankruptcy proceeding and in violation of the stay filed suit, and served the debtor when he appeared for the trial on his motion to dismiss in the bankruptcy proceeding. Compare Laine v. Gregory-Laine (In re Laine), 383 B.R. 166, 178 (Bankr. D. Kan. 2008). Unlike the plaintiffs in the cases relied upon by the Defendants, which sought to take advantage of defendants’ bankruptcy or willfully violated the stay, the Plaintiff, here, did not act in such a manner. Upon receiving notice of the Bankruptcy, Plaintiff did not continue pursuing her claims until seeking permission and relief from the Bankruptcy Court. Plaintiff never filed a motion for default and cooperated with the Defendants by extending a professional courtesy for the filing of their answer.
Some might argue the Defendants’ reliance on the stay and bankruptcy proceedings, at this stage, is disingenuous when the Bankruptcy Court has disallowed Plaintiff’s claim. The Tenth Circuit dislikes when the debtor’s “unreasonable behavior contribute[s] to [a] creditor’s plight.” In re Calder, 907 F.2d at 956. Equity demands an automatic stay not be used as a sword to defeat a creditor who lacks actual notice of a bankruptcy. Id.

6
The same analysis applies to whether the Plaintiff’s Petition survives a potential 12(b)(6) motion based upon the same theory. Because of the Bankruptcy Court’s Order, Plaintiff may proceed and, in general, states a claim upon which relief can be granted.

7
Alternatively, the Defendants request the Court enter an indefinite stay of this case pending a resolution in the Bankruptcy Court or transferring the case to the Bankruptcy Court. Neither of these are viable options. As permitted by Fed. R. Evid. 201, the Court takes judicial notice of the following Colorado Bankruptcy Court proceedings:
1. On April 18, 2018, the Bankruptcy Trustee filed an Objection to Plaintiff’s Proof of Claim. (Co. Bnkr. Ct., Case No. 14-19142-KHT, Dkt. 54)
2. The Trustee objected to Plaintiff’s claim because Plaintiff was granted relief from the stay “to pursue her claims in State Court and pursuant to the motion for relief from stay, any potential damages should be resolved from the liability insurance.” (Id. at Dkt. 54, ¶¶ 3-4)
3. After notice of the Trustee’s Objection was given to Plaintiff, no objections or requests for hearings were filed. (Id. at Dkt. 60, ¶¶ 2)
4. The Court granted the Trustee’s Objection and disallowed Plaintiff’s claim in its entirety on June 6, 2018. (Id. at Dkt. 61)
5. On June 29, 2018, the Trustee filed her Final Report stating, “any objections to the allowance of claims have been resolved.” (Id. at Dkt. 63, ¶ 6)
Based upon these court records, the Bankruptcy Court has disallowed Plaintiff’s claim and no longer has an interest in this matter.

Baykhanov v. Workers’ Comp. Appeal Bd. Onixe Express
Commonwealth Court of Pennsylvania
June 29, 2018, Submitted; October 12, 2018, Decided; October 12, 2018, Filed
No. 245 C.D. 2018

Reporter
2018 Pa. Commw. Unpub. LEXIS 554 *
Fakhriddin Baykhanov, Petitioner v. Workers’ Compensation Appeal Board (Onixe Express), Respondent
Notice: An unreported opinion of the Commonwealth Court may be cited and relied upon when it is relevant under the doctrine of law of the case, res judicata or collateral estoppel. Parties may also cite an unreported panel decision of the Commonwealth Court issued after January 15, 2008 for its persuasive value, but not as binding precedent. A single-judge opinion of the Commonwealth Court, even if reported, shall be cited only for its persuasive value, not as a binding precedent.

JUDGE COHN JUBELIRER1
Fakhriddin Baykhanov (Claimant) petitions for review of a February 2, 2018 Order of the Workers’ Compensation (WC) Appeal Board (Board), affirming a decision by a WC Judge (WCJ) that Claimant was an independent contractor, not an employee, and thus was ineligible for WC benefits. After review, finding no error, we affirm.

I. Background
On May 6, 2015, Claimant injured his right wrist and knee after tripping and falling while unloading an automobile from a car carrier. The car carrier was owned by Onixe Express (Defendant). Claimant operated the car carrier pursuant to an agreement he signed with Defendant.
Following his injury, Claimant filed a claim petition alleging he suffered a work-related injury while in the course and scope of his employment with Defendant. Defendant denied an employment relationship with Claimant. At a hearing before the WCJ, it was learned Defendant did not carry WC insurance. Consequently, Claimant filed a claim petition [*2] against the Uninsured Employer Guaranty Fund (UEGF).
A series of hearings was held, at which Claimant presented a deposition of his physician, detailing his injuries. Claimant also testified as to his relationship with Defendant as follows. Claimant drove a two-layer car carrier truck to various locations across the United States at which he would pick up new, old, or damaged vehicles, load them onto the car carrier, and then deliver them to a designated drop-off location. A dispatcher advised Claimant where to pick up and drop off loads. Defendant owned and insured the car carrier. Defendant also provided Claimant with a GPS and reimbursed him for gas and tolls. No one supervised his work or trained him. Defendant did not tell Claimant what routes to take when transporting cars. He was simply given a work order with an address on it. He determined how many hours to drive each day. Claimant obtained his commercial driver’s license (CDL) in 2003 and held similar jobs in the past for other companies. Claimant previously owned his own transport company but has since sold his truck. Prior to starting work, Claimant executed an independent contractor agreement with Defendant. Claimant reads [*3] “a little bit” of English but claims he did not read the agreement before initialing each paragraph or signing the bottom of the document. Although his wife speaks English and read a fee agreement with his attorney to him, Claimant did not ask his wife to read the independent contractor agreement to him prior to executing it. Claimant never told Defendant that he did not understand the agreement. Claimant was compensated by the trip, receiving 25 percent of the gross amount that Defendant received for each trip. Claimant admits taxes were not withheld from his pay, which is consistent with the terms of the independent contractor agreement. Claimant received a Form 1099. Claimant testified he did not believe he could turn down work. If he did, Defendant would find another driver. Once he did take off work for a medical condition. After signing the independent contractor agreement, he worked briefly for another trucking company while he waited for Defendant to have a truck available for him.
In opposition, Defendant presented the deposition of its owner (Owner), who testified as follows. Defendant is a car holder business that owned and insured the car carrier Claimant drove but has no [*4] employees. Claimant worked for Defendant as an independent contractor, whose duty was to transport cars. Claimant chose the routes taken, had no set schedule, was free to work for other companies, and could turn down assignments. He and Claimant communicated with one another in Russian.
Defendant also presented the deposition testimony of Defendant’s secretary (Secretary), who testified as follows. Secretary is Owner’s wife and assists with office work including contracts and human resources. She confirmed Defendant has no employees and that Claimant worked for Defendant as an independent contractor. Secretary met with Claimant and provided him a copy of the independent contractor agreement, which he signed. Claimant never indicated to her that he did not understand it. She believed Claimant read some English because that is a requirement of the Department of Transportation. Defendant contracts with another company to handle dispatching. Claimant was free to turn down assignments and did when he had a doctor’s appointment. Drivers were given a timeframe when to pick up and drop off cars. Within that timeframe, Claimant was free to do whatever he wanted. Cars that were picked up and [*5] delivered for auction were not time sensitive because the auctions occur around the clock. Claimant did not have a set number of hours he was required to work. Drivers were not told when to start or stop driving each day. The only requirement was to possess a CDL and pass a drug test, which are requirements of the Department of Transportation. Claimant determined which routes to take. Defendant paid Claimant 25 percent of the gross it received for each load. Defendant paid Claimant by check, withheld no deductions, and issued a Form 1099. Some drivers for Defendant owned their own trucks. Secretary was aware that Claimant used to own his own truck and trucking company. According to Secretary, Claimant could drive for other companies if he so desired.
Based upon the above, the WCJ accepted the testimony of Claimant’s physician as to the injuries Claimant suffered and that he was not fully recovered from them. However, the WCJ denied the claim petitions on the basis that Claimant was an independent contractor not an employee of Defendant. In making this determination, the WCJ “generally accept[ed]” Claimant’s testimony, except where it was inconsistent with Owner’s and Secretary’s testimony. [*6] (WCJ Decision, Finding of Fact (FOF) ¶ 12.) The WCJ specifically rejected Claimant’s testimony in favor of Owner’s and Secretary’s testimony, “particularly as to the issue of whether Claimant was an employee or an independent contractor.” (Id.) The WCJ accepted Owner’s and Secretary’s testimony on the issue of employment, finding there was “really no dispute as to the following facts”:
a. [Owner] contracted with Claimant for work as an independent contractor and Claimant signed [the] independent contractor agreement.
b. There was no guarantee of work by Defendant, and Claimant could refuse work. In fact, Claimant did refuse work when he had a doctor’s appointment.
c. Claimant was paid by the job. No deductions were taken from payments made to Claimant. In fact, Claimant specifically testified that he was paid by check and given a “1099.”
d. There were no restrictions imposed on Claimant in providing similar services to others. In fact, Claimant did drive a truck for another company at one time during the time he had entered into the independent contractor agreement with Defendant.
e. [Owner] did not provide direction and control over the work performed by Claimant. Rather, Claimant was [*7] simply given a pick up and drop off point and a “time frame” when to pick up and deliver the cars. Claimant could choose the routes he travelled to perform his services and what times he wanted to drive. In fact, Claimant testified, “the driver is in charge of” what time to start and stop driving . . . . No one supervised Claimant’s work and/or trained him how to do the job. He testified he had done this work before, including owning his own trucking business, UZ Trucking.
f. Finally, and perhaps most notably, Claimant signed an independent contractor agreement with Defendant for services provided. Claimant acknowledged he received a “1099” and filed taxes. Claimant never presented his tax returns to show that he reported the income as anything other than 1099 contractor income. Also, it was clear to this [WCJ] that Claimant was not an inexperienced truck driver who had no idea what he was signing. Claimant and the owner of Defendant communicated in Russian with each other. Claimant has had a CDL license since 2003. He worked for other trucking companies . . . . He then had his own truck, and he was an “owner/operator” from 2009 to 2013.[FN]1 Claimant’s trucking company was called UZ [*8] Trucking. It appears to this [WCJ] that Claimant did understand he was working as an independent contractor. Claimant possessed a skill of being able to drive a commercial truck and knew how to load and unload cars to transport them with a specialized two-layer car carrier truck.
[FN]1 This [WCJ] found this to be an important factor. This is a close case, as there are legitimate arguments that Defendant supplied the tools (i.e., the truck and GPS) and Claimant’s work is clearly part of the regular business of Defendant’s transportation business. However, the most important element in Pennsylvania is the right to control, and the [WCJ] does not believe that element weighs in favor of Claimant in this case. If Claimant was someone who had just received his CDL license and had received training from Defendant on how to perform the job, this [WCJ] may well have found an employment relationship.
(Id. ¶ 13 (internal citations omitted).)
Based upon these findings, the WCJ concluded Claimant was an independent contractor, not an employee, of Defendant, and dismissed the claim petitions.
Claimant appealed to the Board, which affirmed. Citing the WCJ’s findings that Defendant did not control Claimant’s [*9] work or the manner in which he performed it, Claimant determined his work hours, and Claimant could refuse assignments from Defendant and accept work from other companies, the Board concluded the WCJ properly determined Claimant failed to meet his burden of establishing an employment relationship.
Claimant now seeks review by this Court.2 Claimant argues the WCJ erred in finding Claimant was an independent contractor. He claims the evidence weighs in favor of finding control by Defendant not against it. He acknowledges that he owned his own transport business but he sold his truck. Further, this prior experience should not make him an independent contractor. Claimant argues he did not control his work, as he could not work elsewhere since he had no truck to use. He points out that Defendant provided the vehicle, insurance, gas, tools, and GPS. As for the independent contractor agreement he signed, he argues he does not read English and therefore did not understand its implications. He also did not believe he had the right to refuse assignments. Claimant also argues that since the WCJ found this to be a “close case,” the WC Act3 should be interpreted in his favor because it is remedial [*10] in nature.
Defendant counters that aside from the truck and GPS, it exercised no control over Claimant. According to Defendant, Claimant was simply told where to pick up and drop off loads, but was not told how to accomplish this. It points out that Claimant was paid by the job and no deductions were made. It also argues that Claimant knowingly executed the independent contractor agreement. Finally, Defendant argues the WC Act is construed in favor of the claimant-employee only if there is an ambiguity, which does not exist here.
Intervenor UEGF echoes Defendant’s arguments and adds that there is substantial evidence to support the WCJ’s findings. Further, since there is no borderline interpretation, there is no need to construe the WC Act in Claimant’s favor.

II. Discussion
In order to prevail on a claim petition, a claimant must establish all of the necessary elements, including the existence of an employment relationship. Edwards v. Workers’ Comp. Appeal Bd. (Epicure Home Care, Inc.), 134 A.3d 1156, 1162 (Pa. Cmwlth. 2016). Because independent contractors cannot recover benefits under the WC Act, the existence of an employment relationship is a threshold matter. Am. Road Lines v. Workers’ Comp. Appeal Bd. (Royal), 39 A.3d 603, 610 (Pa. Cmwlth. 2012). The existence of an employment relationship is a question of law to be determined based upon the unique facts [*11] presented in each case. Id.
The Pennsylvania Supreme Court has recognized that there is “no hard and fast rule” as to when an employment relationship exists, but has set forth a number of factors to be considered. Hammermill Paper Co. v. Rust Eng’g Co., 243 A.2d 389, 392 (Pa. 1968). These factors include: (1) control of the manner in which work is to be done; (2) “responsibility for result only”; (3) “terms of agreement between the parties”; (4) “the nature of the work or occupation”; (5) “skill required for performance”; (6) “whether one employed is engaged in a distinct occupation or business”; (7) “which party supplies the tools”; (8) “whether payment is by the time or by the job”; (9) whether work is part of the regular business of the alleged employer; and (10) whether the alleged employer has the right to terminate the employment at any time. Id. “[N]o one factor is dispositive.” Edwards, 134 A.3d at 1162. However, “there are certain guidelines that have been elevated to be dominant considerations.” Universal Am-Can, Ltd. v. Workers’ Comp. Appeal Bd. (Minteer), 762 A.2d 328, 333 (Pa. 2000). A key factor is the right to control the work to be done and the manner in which it is performed. Id.
With the above principles in mind, we turn to the facts of this case. Claimant argues the WCJ erred in finding Defendant did not exercise control over Claimant’s work or [*12] the manner in which he performed it. In reaching his decision, the WCJ concluded the following “are suggestive of an independent contractor relationship”:
a. Defendant did not train Claimant; indeed, by Claimant’s own testimony, he previously had his own transporting business, and was therefore already familiar with the services provided to Defendant.
b. No one supervised Claimant while he was doing his work. Claimant was not told what to do when it comes to the loading and unloading of cars. Defendant did not set the routes to be taken in transporting the vehicles; rather, Claimant chose his own routes. Defendant’s only role was in providing the truck, and informing Claimant of the locations for pick-up and drop-off.
c. The agreement between Claimant and Defendant is probative of an independent contractor relationship. Claimant now suggests that he did not understand English, but Claimant did not request assistance in translating the agreement at the time it was signed and communicated with the owner of Defendant in Russian.
d. Rather than being paid by time, Claimant agreed to a payment of a percentage of the gross trip paid to [Defendant]. This amount would be paid no matter how much [*13] time Claimant spent performing his services.
e. No taxes were withheld from Claimant’s pay. He received 1099s at the end of each year and he filed taxes.
f. Claimant possessed a skill of being able to drive a commercial truck and knew how to load and unload cars to transport them with knowledge of how to operate and load, secure, and unload cars on a specialized two-layer car carrier truck.
(WCJ Decision, Conclusion of Law (COL) ¶ 5.)
Claimant does not appear to challenge these findings based on a lack of substantial evidence. Instead, Claimant argues that, as a matter of law, these factors weigh in his favor. We disagree. The WCJ did not view any one factor as dispositive. Rather, the WCJ weighed all of the Hammermill factors, and concluded that Claimant failed to sustain his burden of proving he was an employee of Defendant.
It is important to bear in mind that the WCJ rejected Claimant’s testimony to the extent it conflicted with the testimony of Owner and Secretary.4 Therefore, based upon the credited testimony, the facts are as follows. Claimant had no guarantee of work and was free to refuse work or even work for another company. He was paid by the job regardless of how long it took [*14] him to complete it and no deductions were made; instead, Claimant received a Form 1099 and was responsible for paying his own taxes. As to the element of control, Defendant provided Claimant with a pick-up and drop-off location and a timeframe to complete each load, but did not give him any direction as to how to complete the job, which routes to travel, what times to drive each day or for how long. In addition, he was not trained by Defendant and signed an independent contractor agreement. While alone, none of these factual findings are dispositive, taken as a whole, we cannot conclude the WCJ erred in finding Claimant was an independent contractor instead of an employee.
We have recognized that “the trucking industry presents unique challenges in determining employment status.” Am. Road Lines, 39 A.3d at 611. “Truck drivers who direct their own routes, come and go as they see fit, and control their transport as owner-operators are often deemed independent contractors.” Id. For instance, in Universal Am-Can, the Supreme Court reversed this Court’s decision that affirmed a WCJ’s and Board’s decision finding the claimant was an employee. The Supreme Court held the claimant was an independent contractor instead. The [*15] Supreme Court agreed with the defendant that the record evidence did not establish the defendant had the right to exercise the requisite degree of control over claimant’s work or the manner of performance. Universal Am-Can, 762 A.2d at 333. In that case, the claimant owned the tractor-trailer unit and contracted with defendant to haul cargo. He was required to contact the dispatcher every 12 to 24 hours, depending on the load. He was free to choose his own travel routes. He could haul cargo for other companies, but only if the defendant did not have any cargo to haul and consented to the claimant doing so. The defendant also required regular inspections, all loads be covered with tarps, and claimant to obey the speed limit. In addition, the defendant’s driving manual required a one-hour stop for meals. The defendant also reserved the right to approve drivers of the claimant’s truck. The WCJ found these factors were sufficient to establish that the defendant controlled the claimant’s work. The Supreme Court disagreed, concluding many of the factors relied upon by the WCJ were dictated by federal regulation, which was not indicative of the defendant’s control, but the government’s control. Id. at 334-36.
In contrast, in Sarver Towing v. Workers’ Compensation Appeal Board (Bowser), 736 A.2d 61 (Pa. Cmwlth. 1999), this Court [*16] affirmed an award of benefits to a tow truck driver on the ground he was an employee not an independent contractor. There, the defendant hired the claimant as a trainee and paid him an hourly wage. A few months later, the claimant signed a contract agreeing to be paid a commission and be responsible for paying his own taxes. The defendant provided the claimant with a truck bearing its name, as well as all tools and equipment needed. Claimant kept the truck at his home and was contacted by either telephone or pager when he had an assignment. He was on call 24 hours a day, 7 days per week. He was not permitted to use the truck to perform work for another company and did not work for anyone else. The defendant did not advise the claimant as to what routes to take or directly supervise the claimant as he was towing vehicles.
Several months later, the claimant injured his back while lifting a computer at the defendant’s premises at the direction of the defendant’s owner. The WCJ concluded the claimant was an independent contractor and denied benefits. The Board reversed, and we affirmed the Board’s order. In applying the Hammermill factors, we found it was “particularly important” that the [*17] defendant provided the tow truck and equipment. Sarver Towing, 736 A.2d at 63. We also noted that the routes chosen by the claimant were not important in determining whether the defendant exercised control over the claimant. Id. Rather, we said the fact that the claimant could not use the defendant’s truck to perform work for other companies and was on call 24 hours a day, 7 days per week evidenced substantial control over the claimant. Id. Finally, we agreed with the Board that the claimant was injured while moving a computer for the defendant pursuant to the owner’s directions. Id. As the Board concluded:
[m]oving a computer is not a duty which one would normally associate with operation of a tow truck. The fact that [the defendant] believed it had the ability to order [c]laimant to move a computer, which had nothing to do with [c]laimant’s performance as an operator of a tow truck, is clearly indicative of the fact that [the defendant] had the control over [c]laimant to tell him what to do and the manner of how he was to do it.
Id. (quoting Board opinion) (emphasis added). Accordingly, we affirmed the Board’s conclusion that the claimant was an employee.
Here, Defendant provided Claimant with the car carrier and [*18] left which routes he traveled to Claimant, similar to Sarver Towing. However, in Sarver Towing, these acts really had no relation to the claimant’s injury because he was not injured driving the tow truck. Rather, he was injured lifting a computer at the owner’s direction, something we noted was outside his normal responsibilities as a tow truck driver. This distinction is important because here, Claimant was injured doing what he contracted to do. Sarver Towing is also distinguishable because there, the claimant was on call for owner around the clock. To the contrary, here, the credited evidence shows Claimant was free to refuse assignments and controlled when and for how long he worked.
It bears emphasis that “[t]he existence of an employer-employee relationship is a question of law based on the facts presented in each case.” Edwards, 134 A.3d at 1162 (emphasis added). Furthermore, no single Hammermill factor is dispositive. Id. Based upon the findings of the WCJ, we cannot find the WCJ or Board erred in concluding that the factors weigh in favor of finding that Claimant was an independent contractor, not an employee of Defendant.
Finally, we address Claimant’s second argument that because this is a “close [*19] case” in the WCJ’s eyes, given the remedial nature of the WC Act, he should be awarded benefits. While true that the WC Act has a humanitarian purpose and intends to benefit injured workers, this does not mean claimants are excused from meeting their burden of proof, including establishing an employment relationship. The principle that the WC Act is to be liberally construed is only when there are ambiguities in the WC Act. Here, while it is a close case, there is no such ambiguity.

III. Conclusion
Based upon the WCJ’s findings of fact, which are supported by substantial evidence, we discern no error in the WCJ’s or Board’s determination that Claimant was an independent contractor not an employee of Defendant. Accordingly, we affirm the Board’s Order.
RENÉE COHN JUBELIRER, Judge

ORDER
NOW, October 12, 2018, the Order of the Workers’ Compensation Appeal Board, in the above-captioned matter, is AFFIRMED.
RENÉE COHN JUBELIRER, Judge
Dissent by: ANNE E. COVEY
Dissent

DISSENTING OPINION BY JUDGE COVEY
I respectfully dissent from the Majority’s conclusion that “[b]ased upon the [Workers’ Compensation Judge’s (WCJ)] findings of fact, which are supported by substantial evidence, we discern no error in the WCJ or [the [*20] Workers’ Compensation (WC) Appeal Board’s (Board)] determination that [Fakhriddin Baykhanov (]Claimant[)] was an independent contractor not an employee of [Onixe Express, Inc. (OEI)].” Majority Op. at 14. Because the factors established in Hammermill Paper Co. v. Rust Engineering Co., 243 A.2d 389 (Pa. 1968), are not to be considered in a vacuum, but rather in the context of the business to which they are being applied, and in the context of OEI’s trucking/transportation business, the “inferences favoring [Claimant as an employee] [] make [a] stronger appeal to reason than those opposed[,]” Edwards v. Workers’ Comp. Appeal Bd. (Epicure Home Care, Inc.), 134 A.3d 1156, 1162 (Pa. Cmwlth. 2016), the WCJ’s conclusion that Claimant was not an employee was not supported by the facts, was not reasonable and was error as a matter of law. Thus, I would reverse the Board’s order.
Initially, “[t]o be eligible for [WC] benefits, Claimant must first prove that he was injured while in an employee-employer relationship.” Haines v. Workmen’s Comp. Appeal Bd. (Clearfield Cty.), 606 A.2d 571, 572 (Pa. Cmwlth. 1992). “Whether an employer-employee relationship exists is a question of law based upon findings of fact.” B & T Trucking v. Workers’ Comp. Appeal Bd. (Paull), 815 A.2d 1167, 1171 (Pa. Cmwlth. 2003) (emphasis added). “In determining employee or independent contractor status, certain criteria have come to serve as guideposts for the reviewing tribunal.” Universal Am-Can, Ltd. v. Workers’ Comp. Appeal Bd. (Minteer), 762 A.2d 328, 332 (Pa. 2000). The Pennsylvania Supreme Court in Hammermill, “set[] forth the relevant factors in undertaking [*21] this analysis.” Universal Am-Can, Ltd., 762 A.2d at 333.
[N]o hard and fast rule exists to determine whether a particular relationship is that of employer-employee or owner-independent contractor, [but] certain guidelines have been established and certain factors are required to be taken into consideration:
Control of manner work is to be done; responsibility for result only; terms of agreement between the parties; the nature of the work or occupation; skill required for performance; whether one is engaged in a distinct occupation or business; which party supplied the tools; whether payment is by the time or by the job; whether work is part of the regular business of the employer, and also the right to terminate the employment at any time.
Hammermill, 243 A.2d at 392 (emphasis added) (quoting Stepp v. Renn, 135 A.2d 794, 796 (Pa. Super. 1957)). “Whether some or all of these factors exist in any given situation is not controlling.” Universal Am-Can, Ltd., 762 A.2d at 333.
“Moreover, payment of wages and payroll deductions are significant factors, as is provision of [WC] coverage. However, payment is not determinative.” Edwards, 134 A.3d at 1163 (emphasis added; citations omitted). “In addition, a tax filing denoting self-employment, while a relevant factor, is not dispositive on the issue. Similarly, the existence of an employment or independent contractor agreement [*22] is another factor to consider, but it is not, by itself, dispositive.” Id. (emphasis added; citation omitted). Finally,
‘[a]lthough it is a claimant’s burden to demonstrate an employer/employee relationship, our [Supreme] [C]ourt has decided that ‘neither the [WC] authorities nor the courts should be solicitous to find contractorship rather than employment, and that inferences favoring the claim need make only slightly stronger appeal to reason than those opposed.” Universal Am-Can, [Ltd.,] 762 A.2d at 330 (quoting Diehl v. Keystone Alloys Co., . . . 156 A.2d 818, 820 ([Pa.] 1959)).
Edwards, 134 A.3d at 1162 (emphasis added).
Here, the WCJ expressly found:
Finally, and perhaps most notably, Claimant signed an independent contractor agreement with [OEI] for services provided. Claimant acknowledged he received a[n Internal Revenue Service Form] ‘1099’ and filed taxes. Claimant never presented his tax returns to show that he reported the income as anything other than 1099 contractor income. Also, it was clear to [the WCJ] that Claimant was not an inexperienced truck driver who had no idea what he was signing. Claimant and the owner of [OEI] communicated in Russian with each other. Claimant has had a [commercial driver’s license (CDL)] since 2003. He worked for other trucking companies, including [*23] Roadtex from about 2002 to 2007. He then had his own truck, and he was an ‘owner/operator’ from 2009 to 2013.[FN]1 Claimant’s trucking company was called UZ Trucking. It appears to [the WCJ] that Claimant did understand he was working as an independent contractor. Claimant possessed a skill of being able to drive a commercial truck and knew how to load and unload cars to transport them with a specialized two-layer car carrier truck.
[FN]1 [The WCJ] found this to be an important factor. This is a close case, as there are legitimate arguments that [OEI] supplied the tools (i.e., the truck and [global positioning system (]GPS[)] and Claimant’s work is clearly part of the regular business of [OEI’s] transportation business. However, the most important element in Pennsylvania is the right to control, and the [WCJ] does not believe that element weighs in favor of Claimant in this case. If Claimant was someone who had just received his CDL license and had received training from [OEI] on how to perform the job, [the WCJ] may well have found an employment relationship.
WCJ Dec. at 8 (emphasis added). The Board affirmed the WCJ’s determination that Claimant failed to meet his burden of proving an employment [*24] relationship between him and OEI. “Because the determination as to the existence of an employer[-]employee relationship is a question of law, on this issue, our scope of review is plenary and our standard of review is de novo.” Dep’t of Labor & Indus. v. Workers’ Comp. Appeal Bd. (Lin & E. Taste), 155 A.3d 103, 109 (Pa. Cmwlth. 2017), aff’d, 187 A.3d 914 (Pa. 2018). “Importantly, although the question of whether one is an employee is a question of law, it must be answered based on the unique facts of each case.” Id. Thus, while this Court is bound by the WCJ’s findings of facts, “it is [this C]ourt’s duty to determine if the [WCJ] correctly applied the law to the facts.” McShea v. City of Phila., 995 A.2d 334, 339 (Pa. 2010) (quoting Triffin v. Dillabough, 716 A.2d 605, 607 (Pa. 1998)).
The Dissent acknowledges that “[t]ruck drivers who direct their own routes, come and go as they see fit, and control their transport as owner-operators are often deemed independent contractors.” Am. Rd. Lines v. Workers’ Comp. Appeal Bd. (Royal), 39 A.3d 603, 611 (Pa. Cmwlth. 2012) (emphasis added). However, the American Road Lines Court held:
Unlike claimants in many truck driver cases, [the d]ecedent was not an owner-operator of the tractor involved. . . . [The d]ecedent only operated the tractor through [the defendant’s] authority . . . . He had no control over his assignments.
Though [the d]ecedent signed an agreement stating he was an independent contractor to obtain occupational insurance, that is but one factor, [*25] and not determinative. . . . The facts reflect that [the d]ecedent did not engage in an independent trade or profession and could not control his time or manner of work. The record thus supports the Board’s conclusion that [the d]ecedent was not an independent contractor as he had no right to control the work to be done or manner of performance.
Id. at 612 (citation omitted). Accordingly, here,
[u]nlike claimants in many truck driver cases, [Claimant] was not an owner-operator of the [truck] involved. In contrast, he drove a [specialized two-layer car carrier truck owned and insured] by [OEI]. [Claimant] only operated the [truck] through [OEI’s] authority as directed by [OEI]. He had no control over his assignments.
Though [Claimant] signed an agreement stating he was an independent contractor . . . , that is but one factor, and not determinative. . . . The facts reflect that [Claimant] did not engage in an independent trade or profession1 and could not control his time or manner of work. The record thus supports the [] conclusion that [Claimant] was not an independent contractor as he had no right to control the work to be done. . . .
Id. at 612. OEI is a trucking/transportation business which paid Claimant [*26] directly. Further, OEI told Claimant where to travel, how many days he had to travel to his destination, and provided the GPS, gas and tolls to accomplish the required task. The fact that “Claimant was [not] someone who had just received his CDL license [nor] had received training from [OEI] on how to perform the job,” does not preclude the existence of an employment relationship. WCJ Dec. at 8 n.1. Similarly, the fact that Claimant had a trucking company in the past, at which time he was an owner-operator of a truck, is not relevant to whether he is currently an independent contractor or an employee of OEI.
In Sarver Towing v. Workers’ Compensation Appeal Board (Bowser), 736 A.2d 61 (Pa. Cmwlth. 1999), this Court affirmed the Board’s reversal of the WCJ’s conclusion that the claimant was an independent contractor based on the towing company’s lack of control over the claimant. This Court held:
[I]t is the existence of the right to control the manner of [the c]laimant’s work which is critical, even when that right is not exercised. Although [the employer] exerted little direct supervision over [the c]laimant, this was due to lack of need rather than lack of capacity, as [the employer] itself trained [the c]laimant to operate the tow truck and supplied [the c]laimant with all equipment necessary [*27] to do the job.
Id. at 63 (citation omitted). In addition, the Sarver Towing Court opined: “In this case, we find it particularly important that [the employer] owned the tow truck and equipment – obviously, very substantial assets – which [the c]laimant used.”2 Id. (emphasis added). Here, although OEI did not train Claimant, OEI owned and provided the truck, and OEI “certainly could have taken back the [] truck and equipment at any time if it was not satisfied with Claimant’s work.” Id.
While the WCJ states: “[OEI’s] only role was in providing the truck, and in informing Claimant of the locations for pick-up and drop-off[,]” those facts in relation to OEI’s trucking/transportation business cannot be easily dismissed. WCJ Dec. at 9 (emphasis added). The Hammermill factors are not to be considered in a vacuum, but rather in the context of the business to which they are being applied. In the context of OEI’s trucking/transportation business, these factors clearly “favor[] the claim [and] make . . . stronger appeal to reason than those opposed.” Edwards, 134 A.3d at 1162.
Finally, the Majority rejects Claimant’s second argument that given the remedial nature of the WC Act,3 he should be awarded benefits, [*28] by stating: “The principle that the WC Act is to be liberally construed is only when there are ambiguities in the WC Act. Here, while it is a close case, there is no such ambiguity.” Majority Op. at 13-14 (emphasis added). However, the Pennsylvania Supreme Court held:
‘[O]ur basic premise in work[ers’] compensation matters is that the [WC] Act is remedial in nature and intended to benefit the worker, and, therefore, the [WC] Act must be liberally construed to effectuate its humanitarian objectives.’ Hannaberry HVAC v. Workers’ Comp[.] Appeal [Bd.] (Snyder, Jr.), . . . 834 A.2d 524, 528 ([Pa.] 2003) (quoting Peterson v. Workmen’s Comp. Appeal [Bd.] (PRN Nursing Agency), . . . 597 A.2d 1116, 1120 ([Pa.] 1991)).
Giant Eagle, Inc. v. Workers’ Comp. Appeal Bd. (Givner), 39 A.3d 287, 290-91 (Pa. 2012) (emphasis added); see also Schriver v. Workers’ Comp. Appeal Bd. (Dep’t of Transp.), 173 A.3d 459 (Pa. Cmwlth. 2017). This requirement is not limited to circumstances involving ambiguities in the WC Act.
Because the WCJ’s conclusion that Claimant was not an employee was not supported by the facts, was not reasonable and was error as a matter of law, I would reverse the Board’s order.
ANNE E. COVEY, Judge