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Hammer v. Uninsured Employers' Fund

Court of Workers Compensation of Montana

May 31, 1996

ALEXANDRA ENGLER HAMMER Petitioner
v.
UNINSURED EMPLOYERS' FUND Respondent/Insurer for ROBERT HELMS, d/b/a MOSTLY MONTANA CONSTRUCTION, Employer.

          Submitted: April 8, 1996

          FINDINGS OF FACT, CONCLUSIONS OF LAW AND JUDGMENT

          MIKE McCARTER JUDGE.

         Summary: 22 year old claimant suffered serious injuries when she fell from the roof of a house where she was nailing shingles on the roof. She claimed to be working as an employee for a construction company owned and operated by Robert Helms. An orphan, claimant had been a member of Helms's household for periods of her youth (he was married for a time to a woman who was her legal guardian) and was again living in Helms's household as a condition of release on her own recognizance regarding charges of writing bad checks. Helms testified he brought claimant to the job site so he could keep an eye on her and merely instructed her to pick up around the site to "earn her keep." He testified he regularly uses this phrase with his children and that it does not indicate he will pay them.

         Held: Under section 39-71-118, MCA (1991), an employee is "each person in this state...who is in the service of an employer...under any appointment or contract of hire, expressed or implied, oral or written." In Carlson v. Cain, 204 Mont. 311, 318 (1983), the Supreme Court stated that a "contract for hire" contemplates being paid, but indicated that payment can be found "in anything of value such as board and lodging." Because claimant was told she was "earning her keep," she was an employee of Helms at the time of her injury. Certain employments, however, are exempt from the Workers' Compensation Act. Among the exclusions set out in section 39-71-401, MCA (1991) is that for "a dependent member of an employer's family for whom an exemption may be claimed by the employer under the federal Internal Revenue Code (subsection (c)) and for "any person performing services in return for aid and sustenance only...." (subsection (h)). Subsection (c) does not apply where claimant would not qualify as a dependent under the federal IRC where she is not stepdaughter and did not reside in Helms's household for the entire year. Subsection (h), however, excludes claimant from the WCA where she was working only in return for aid and sustenance from Helms. Claimant's shifting testimony that Helms had agreed to pay her money was not credible. Note: this decision was affirmed by the Montana Supreme Court in Hammer v. Uninsured Employers' Fund, 280 Mont. 371, 929 P.2d 883 (1996) (No. 96-365).

         Topics:

         Constitutions, Statutes, Regulations, and Rules: Montana Code Annotated: section 39-71-401(c), MCA (1991). Claimant temporarily living with alleged employer per terms of release on her own recognizance from criminal charges was employee within WCA where she worked for board and room. She was not exempt from the WCA under section 39-71-401(c), MCA (1991) as a dependent member of the employer's family for whom an exemption may be claimed by the employer under the federal Internal Revenue Code because she was not his stepdaughter and did not live with him for an entire year. She was, however, exempt from the WCA under a provision relating to work for "aid and sustenance only." Note: this decision was affirmed by the Montana Supreme Court in Hammer v. Uninsured Employers' Fund, 280 Mont. 371, 929 P.2d 883 (1996) (No. 96-365).

         Constitutions, Statutes, Regulations, and Rules: Montana Code Annotated: section 39-71-401(h), MCA (1991). Claimant temporarily living with alleged employer per terms of release on her own recognizance from criminal charges was employee within WCA where she worked for board and room. She was, however, exempt from the WCA under the provision relating to work for "aid and sustenance only" set out in section 39-71-401(h), MCA (1991). Note: this decision was affirmed by the Montana Supreme Court in Hammer v. Uninsured Employers' Fund, 280 Mont. 371, 929 P.2d 883 (1996) (No. 96-365).

         Employment: Aid and Sustenance. Claimant temporarily living with alleged employer per terms of release on her own recognizance from criminal charges was employee within WCA where she worked for board and room. She was, however, exempt from the WCA under the provision relating to work for "aid and sustenance only" set out in section 39-71-401(h), MCA (1991). Note: this decision was affirmed by the Montana Supreme Court in Hammer v. Uninsured Employers' Fund, 280 Mont. 371, 929 P.2d 883 (1996) (No. 96-365).

         Employment: Employee. Claimant temporarily living with alleged employer per terms of release on her own recognizance from criminal charges was employee within WCA where she worked for board and room. She was, however, exempt from the WCA under the provision relating to work for "aid and sustenance only" set out in section 39-71-401(h), MCA (1991). Note: this decision was affirmed by the Montana Supreme Court in Hammer v. Uninsured Employers' Fund, 280 Mont. 371, 929 P.2d 883 (1996) (No. 96-365).

         Employment: Exempt Employments. Claimant temporarily living with alleged employer per terms of release on her own recognizance from criminal charges was employee within WCA where she worked for board and room. She was, however, exempt from the WCA under the provision relating to work for "aid and sustenance only" set out in section 39-71-401(h), MCA (1991). Note: this decision was affirmed by the Montana Supreme Court in Hammer v. Uninsured Employers' Fund, 280 Mont. 371, 929 P.2d 883 (1996) (No. 96-365).

         This matter was initially scheduled for trial on December 12, 1995. However, at that time counsel and the Court agreed that petitioner, who was then in Georgia, should be personally present at trial. The case was rescheduled for March 18, 1996, and began on that date. Trial continued through March 19, 1996. The Court then permitted the parties to submit post-trial briefs. The final brief was filed April 8, 1996, at which time the case was deemed submitted and ready for decision.

         The petitioner, Alexandra Engler Hammer (claimant), was present at trial and represented by Mr. David W. Lauridsen. The respondent, Uninsured Employers' Fund (UEF), was represented by Mr. Kevin M. Braun. The employer, Robert Helms was present and represented by Mr. Richard DeJana.

         Witnesses and Depositions: Claimant, Robert Helms, Cookie Lowitz, and Thomas Wynne, C.P.A., were sworn and testified. The depositions of claimant, Ray Rester, and Robert Helms were also submitted for the Court's consideration.

         Exhibits: Exhibits 1 through 12 were admitted without objection. Exhibit 13, which is the transcript of an earlier hearing before the Department of Labor and Industry, was not admitted except for use in cross-examining the witnesses.

         Issues presented: Claimant seeks medical and compensation benefits from the UEF. Both UEF and Helms contend that claimant was an exempt employee and is therefore not covered under the Workers' Compensation Act. Also at issue is whether a prior decision by the Department of Labor and Industry finding claimant was an employee estops the UEF and Helms from asserting that she was not.

         Having considered the Pretrial Order, the testimony presented at trial, the demeanor and credibility of the witnesses, the depositions and exhibits, and the arguments of the parties, the Court makes the following:

         FINDINGS OF FACT

         1.Claimant is 22 years old, married and has one small child. Her married name is Hammer, her maiden name is Engler. She presently lives in St. Mary's, Georgia with her husband. She is a high school graduate.

         2.Claimant's parents are both deceased. She was nine years old when her father died, eleven when her mother died. After the death of her mother, claimant went to live with her mother's brother Earl, who was at that time married to Mary Alexine (Mary). Mary and Earl then divorced but claimant continued to live with Mary. Mary was appointed claimant's legal guardian.

         3.Robert Helms (Bob) is the sole proprietor of Mostly Montana Construction (MMC). He and Mary began dating and were married in 1989. Upon their marriage, claimant was integrated into Bob's expanded family, which included his own children from a prior marriage. Bob has always treated claimant as one of his children.

         4.Bob and Mary separated sometime in 1991 and ultimately divorced in May of 1993. Claimant lived with Mary and Bob until they separated. Following their separation, claimant lived at various times with Bob, Mary, and a boyfriend. Between January and May of 1992, she alternated living with Bob and Mary but testified that she spent more time with Mary. In April or May of 1992, she began living with her boyfriend.

         5.Claimant turned 18 years old in February 1992. Up to that time, Mary was her designated legal guardian.

         6.Helms did not list claimant as a dependent exemption on his tax return in 1992, rather Mary took the exemption. Helms and Mary were still married at the time but filed separate returns.

         7.During the summer of 1992, claimant began writing bad checks. In September 1992 she was arrested and jailed. She called Bob and sought his help.

         8.On September 25, 1992, claimant was released on her own recognizance based on her agreement to abide by a list of conditions. Those conditions were as follows:

1.She shall live with Bob Helms at 388 Daly Lane, Kalispell, Mt.
2.She shall follow the rules set for her by Bob Helms as a condition of residing in his home including:
a. curfew
b. household duties
c. who can be brought into his ...

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