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2011-UP-094 - Alyward v. Woods ProClean

THIS OPINION HAS NO PRECEDENTIAL VALUE.  IT SHOULD NOT BE CITED OR RELIED ON AS PRECEDENT IN ANY PROCEEDING EXCEPT AS PROVIDED BY RULE 268(d)(2), SCACR.

THE STATE OF SOUTH CAROLINA
In The Court of Appeals

Louis Alyward, Employee, Respondent,

v.

Woods ProClean, Employer, Cogdell Group, Inc., Statutory Employer, St. Paul Fire & Marine, Carrier for Cogdell Group, Inc., and South Carolina Workers' Compensation Uninsured Employers' Fund, Defendants,



Of Whom Cogdell Group, Inc.,  Statutory Employer, and  St. Paul Fire & Marine, Carrier for Cogdell Group, Inc., are Appellants,



And Woods ProClean, Employer, and South Carolina Workers' Compensation Uninsured Employers' Fund are Respondents.


Appeal From Florence County
John M. Milling, Circuit Court Judge


Unpublished Opinion No. 2011-UP-094
Submitted January 4, 2011 – Filed March 10, 2011   


AFFIRMED


Jason Alexander Griggs, of Greenville, for Appellants.

Brenda Woods, of Leavenworth, Kansas; Kathryn  Williams, of Greenville; Samuel Thompson Brunson, of Florence, for Respondents.

PER CURIAM:  St. Paul Fire & Marine and its insured, Cogdell Group, Inc. (collectively Appellants), appeal the circuit court's ruling that liability for a Cogdell Group's statutory employee's injuries could not be transferred to the South Carolina Uninsured Employer's Fund (the Fund).  We affirm.[1]

FACTS

Cogdell Group managed the McLeod Medical Plaza building in Florence, South Carolina.  The janitorial services for the facility were contracted out to Woods ProClean.  One of Woods ProClean's employees, Louis Alyward, was injured on the job.  At the time of the contract between Cogdell Group and Woods ProClean, Woods ProClean provided two certificates of insurance to Cogdell Group.  The first certificate was issued on April 30, 1998, from Geller Insurance Agency, Inc. in Lenexa, Kansas, and the insured was listed as ProClean of Leavenworth, Kansas. The certificate holder was listed as "The Cogdell Group Incorpated: The McLeod Regional Medical Center of the Pee Dee."  The description of operations field was left blank.  The second certificate was received May 19, 1998, to satisfy a Cogdell Group requirement that it be listed as an additional insured on all certificates. 

The second certificate was identical to the first with two exceptions.  The certificate holder field read, "McLeod Regional Medical Center of the Pee Dee, c/o Cogdall [sic] Group/Deno Keretses, 305 E Cheves St, St 220, Florence, SC 29506," and the description of operations showed "Cogdall [sic] Group Inc. is the Management Company.  See Certificate - Addl Insured." 

After several years of litigation, it was determined Woods ProClean did not in fact have valid workers' compensation coverage in South Carolina and so liability for Alyward's claim moved upstream to Cogdell Group.  Following several hearings, the conclusion was reached that Alyward's claim was compensable and that Cogdell Group was the responsible party as the statutory employer. 

Appellants then sought reimbursement from the Fund.  The single commissioner denied the request finding the certificates of insurance provided to Cogdell Group failed on their faces to demonstrate coverage in South Carolina as required by section 42-1-415 of the South Carolina Code (2010) and Hopper v. Terry Hunt Construction, 373 S.C. 475, 646 S.E.2d 162 (Ct. App. 2007), aff'd, 383 S.C. 310, 680 S.E.2d 1 (2009).  An Appellate Panel of the South Carolina Workers' Compensation Commission (Appellate Panel) affirmed the single commissioner, and the circuit court affirmed the Appellate Panel's order.  This appeal followed. 

LAW/ANALYSIS

The South Carolina Administrative Procedures Act (APA) governs judicial review of a decision of the South Carolina Workers' Compensation Commission.  Lark v. Bi-Lo, Inc., 276 S.C. 130, 134, 276 S.E.2d 304, 306 (1981); Bass v. Isochem, 365 S.C. 454, 467, 617 S.E.2d 369, 376 (Ct. App. 2005).  Pursuant to the APA, an appellate court's review is limited to deciding whether the Appellate Panel's decision is unsupported by substantial evidence or is controlled by some error of law.  Grant v. Grant Textiles, 372 S.C. 196, 200-01, 641 S.E.2d 869, 871 (2007).  "Substantial evidence is not a mere scintilla of evidence, but evidence which, considering the record as a whole, would allow reasonable minds to reach the conclusion the agency reached."  Tennant v. Beaufort Cnty. Sch. Dist., 381 S.C. 617, 620, 674 S.E.2d 488, 490 (2009).  "In workers' compensation cases, the [Appellate Panel] is the ultimate fact finder."  Jordan v. Kelly Co., 381 S.C. 483, 486, 674 S.E.2d 166, 168 (2009).

In Hopper v. Terry Hunt Construction, 373 S.C. 475, 482-83, 646 S.E.2d 162, 166 (Ct. App. 2007), the court determined as a matter of law that section 42-1-415 of the South Caroline Code requires an upstream contractor to obtain a certificate of insurance indicating worker's compensation coverage in South Carolina exists in order to transfer liability to the Fund.  In reaching this decision the court stated:

Our ruling today does not put an extra duty upon the general contractor to inquire into the validity of the subcontractor's coverage.  However, a general contractor cannot expect to turn a blind eye to the subcontractor's obvious lack of coverage in South Carolina and have the State shoulder that burden.  A determination of what type of conduct constitutes an obvious lack of coverage in South Carolina will have to be settled on a case-by case basis. 

Id. at 483 n.1, 646 S.E.2d at 166 n.1.

In this case, the Appellate Panel determined the certificates presented were insufficient under section 42-1-415 to allow Cogdell Group to shift liability to the Fund.  The Appellate Panel did not directly address the Cogdell Group's argument regarding the identity of the certificate holder as "The McLeod Regional Medical Center of the Pee Dee."  The circuit court found, however, substantial evidence supported the Appellate Panel's findings.  The circuit court further indicated the identity of the certificate holder and the faxing of the certificate to a South Carolina location was insufficient to undermine the Appellate Panel's factual findings when the producer and insured were both listed as Kansas entities and the description of operations field was left blank.  The second certificate provided no additional information regarding the existence of coverage in a particular location but simply satisfied the Cogdell Group's requirement that it be listed as an additional insured. 

Appellants correctly note that in Hopper all three parties, the producer the insured, and the certificate holder, were listed as Georgia entities.  Hopper, 373 S.C. at 484, 646 S.E.2d at 167.  The Hopper court concluded, however, the certificate did not indicate "in which state, if any, [the subcontractor] had workers' compensation coverage."  Id.  The identity of the certificate holder in a particular state, therefore, does not necessarily demonstrate coverage in that state under Hopper.  Otherwise, the Hopper court would have concluded the certificate demonstrated coverage in Georgia, the locale of the certificate holder, instead of opining the certificate did not indicate coverage in any particular state.

Based on our standard of review, we conclude the circuit court did not err in affirming the Appellate Panel as its findings were supported by substantial evidence in the record. 

AFFIRMED.

HUFF, LOCKEMY, JJ., and GOOLSBY, A.J., concur.


[1]We decide this case without oral argument pursuant to Rule 215, SCACR.