DAVID M. LUSKEY, Employee/Appellant, v. RAHR MALTING CO. and LIBERTY MUT. INS. COS., Employer-Insurer.

WORKERS’ COMPENSATION COURT OF APPEALS
OCTOBER 14, 2010

No. WC10-5127

HEADNOTES

RESIDENTIAL REMODELING; STATUTES CONSTRUED - MINN. STAT. § 176.137.  The compensation judge did not err by determining that the $5,866.83 fee, paid to an architectural firm for certification that remodeling to an employee’s home and alterations to a new home design were reasonable to accommodate the employee’s disability as required by Minn. Stat. § 176.137, subd. 1, should be included in the $60,000.00 statutory limit for such projects under Minn. Stat. § 176.137, subd. 5.

Affirmed.

Determined by: Rykken, J., Stofferahn, J., and Johnson, C.J.
Compensation Judge: Catherine A. Dallner

Attorneys: Allen R. Webb, Christopher Middlebrook & Assocs., Burnsville, MN, for the Appellant.  Sandra J. Grove, Law Offices of Stilp & Grove, Golden Valley, MN, for the Respondents.

 

OPINION

MIRIAM P. RYKKEN, Judge

The employee appeals the compensation judge’s conclusion that the architect’s fees paid pursuant to the requirements of Minn. Stat. § 176.137 (2008) are included in the $60,000.00 limit under that statute.  We affirm.

BACKGROUND

On May 6, 2009, David Luskey, the employee, sustained an admitted work-related injury in the nature of a vertebral fracture resulting in lower limb paraplegia while working for Rahr Malting, the employer, which was insured for workers’ compensation liability by Liberty Mutual Insurance Companies.  The employee is permanently and totally disabled.  The insurer has paid various workers’ compensation benefits, including initial remodeling costs for the employee’s existing home under Minn. Stat. § 176.137 (2008) totaling $17,439.00.  Architects from The Foundation Architects/Consultants, P.A., worked with the employee and his contractor to plan the project, as required by Minn. Stat. § 176.137, subd 1.

The initial remodeling of the employee’s existing home did not adequately accommodate the employee’s disability, and the architectural firm developed plans for additional remodeling.  At that point, however, the employee decided to build a new home with alterations to accommodate his disability, as allowed by Minn. Stat. § 176.137, subd. 3.  The architectural firm was again involved in planning and designing the new home, and certified that the alterations to the home were reasonable to accommodate the employee’s disability, as required by Minn. Stat. § 176.137, subd. 1.

The employee’s plans were approved by the Minnesota State Council on Disability, also as required under the statute.  The architectural firm billed $5,866.83 for its services in the initial remodeling project, the proposed additional remodeling, and the design of the new home, which was paid by the insurer.  A funding request for the new home was filed at the workers’ compensation division of the Department of Labor and Industry for approval, and an Award for Residence Remodeling was issued by a commissioner’s representative on February 4, 2010, ordering the remainder of the $60,000.00 statutory limit to be paid to the employee’s builder, after subtracting the amount paid for the initial remodeling but not the $5,866.83 paid to the architectural firm.  The commissioner’s representative used $17,255.00 as the amount previously paid for the initial remodeling and ordered $42,745.00 to be paid as the available amount remaining from the $60,000.00 limit.  The parties agree that the actual amount initially paid was $17,439.00 and that $42,561.00 is the available amount remaining from the $60,000.00 limit.

The employer and insurer requested an evidentiary hearing before a compensation judge, claiming that the $5,866.83 fee paid to the architectural firm should be included in the $60,000.00 statutory limit under Minn. Stat. § 176.137, subd. 5.  At the hearing held on May 6, 2010, the matter was submitted to the compensation judge based upon stipulated facts, arguments of counsel, and exhibits.  No witnesses were called and no testimony was taken by the compensation judge.  The parties agreed that the actual construction cost of all of the alterations exceeded $60,000.00.  The compensation judge determined that the architect’s fees should be included in the $60,000.00 statutory limit under Minn. Stat. § 176.137, subd. 5.  The employee appeals.

STANDARD OF REVIEW

A decision which rests upon the application of a statute or rule to essentially undisputed facts generally involves a question of law which the Workers' Compensation Court of Appeals may consider de novo.  Krovchuk v. Koch Oil Refinery, 48 W.C.D. 607, 608 (W.C.C.A. 1993), summarily aff’d (Minn. June 3, 1993).

DECISION

An award for remodeling of a permanently totally disabled employee's principal residence is allowed under Minn. Stat. § 176.137 where remodeling is reasonably required to enable the employee to move freely into and throughout the residence and to otherwise adequately accommodate the disability.[1]  The award may also be used to purchase or lease a new or different residence if that would better accommodate the employee’s disability.  Minn. Stat. § 176.137, subd. 3.  The statute requires that a licensed architect certify that the proposed alteration or remodeling of an existing residence, or the building or purchase of a new or different residence, is reasonably required to accommodate the employee’s disability.  Minn. Stat. § 176.137, subd. 4.  A licensed architect must also supervise the project to determine that construction is in substantial compliance with the approved plans.  Id.; see also Minn. Stat. § 326.02, subd. 2 (2008).  The award under Minn. Stat. §176.137 is limited to $60,000.00.  Minn. Stat. § 176.137, subd. 5.

The architectural firm hired by the employee in this case assisted the employee in the initial remodeling project, the proposed additional remodeling, and the design of the new home.  The architectural firm billed $5,866.83 for its services, which were paid by the insurer.  A funding request to the workers’ compensation division of the Department of Labor and Industry for the new home was approved by a commissioner’s representative.  See Weston v. University of Minn./Duluth, slip op. (W.C.C.A. May 20, 1999) (delineating appropriate procedure for claims under Minn. Stat. § 176.137).  The remainder of the $60,000.00 statutory limit was ordered to be paid to the employee’s builder after subtracting the $17,439.00 paid for the initial remodeling, but not the $5,866.83 paid to the architectural firm.  The employer and insurer claimed that the $5,866.83 fee paid to the architectural firm should have been included in the $60,000.00 statutory limit under Minn. Stat. § 176.137, subd. 5.

The compensation judge agreed that the architect’s fees are included in the $60,000.00 statutory limit under Minn. Stat. § 176.137, subd. 5, which provides that an employee is limited to $60,000.00 “under this section.”  The employee argues on appeal that the compensation judge erred by focusing solely on that subdivision of the statute and ignoring language in the statute which contradicts that subdivision, and also that it contravenes the intent of the legislature.

The compensation judge stated:

An award of benefits cannot be made under the remodeling statute without the certification of a licensed architect that the proposed remodeling of an existing residence or the building of a new residence “is reasonably required to enable the employee to move freely into and throughout the residence and to otherwise adequately accommodate the disability.”  [Citation omitted.]  The services of an architect are necessitated by the remodeling statute itself.  Therefore, these services are “under this section” and the cost of these services is included in the $60,000 limit.

The employee argues that Minn. Stat. § 176.137, subd. 2, contradicts the portion of subdivision 5 that refers to the $60,000.00 limit “under this section.”  Subdivision 2 states: “The pecuniary liability of an employer for remodeling or alteration required by this section is limited to prevailing costs in the community for remodeling or alteration of that type.”  The employee argues that only actual construction costs could be limited by the phrase “prevailing cost” and that the cost of an architect’s plan could not be subject to limit by a “prevailing cost” analysis.  We disagree.  We see no reason why an architect’s fee could not be judged under a prevailing cost analysis if such a fee was challenged as being too high.  Minn. Stat. § 176.137, subd. 2, does not exclude an architect’s fee from the $60,000.00 limit under subdivision 5.

The employee also argues that the architect’s fee for a remodeling plan or alteration of a home design should be paid as a necessary rehabilitation expense.  The employee argues that the architect’s fee should be considered “not as part of the corpus of the remodeling expenses, but rather as [a] cost necessary to the preparation of the remodeling plan.”  (Employee’s brief, p. 5.)  We disagree.  There is no other provision in the workers’ compensation statute, other than Minn. Stat. § 176.137, subd. 2, for the compensability of architectural fees related to remodeling of an employee’s home or alteration of a new home.

Finally, the employee argues that since Minn. Stat. § 176.137 does not clearly include architectural fees in the $60,000.00 limit, the legislature must have intended for the fees to be paid outside of that limit and that the entire $60,000.00 should be available for actual construction costs.  Again, we disagree.  Many aspects of construction, including electrical, plumbing, heating, and cooling, require plans which are integral to the construction project.  There is no basis for excluding the cost for such plans or for required architectural plans from the cost of a remodeling or alteration project and the $60,000.00 limitation.

We affirm the compensation judge’s determination that the $5,866.83 fee paid to the architectural firm is included in the $60,000.00 statutory limit under Minn. Stat. § 176.137, subd. 5.



[1] Minn. Stat. § 176.137 provides:

Remodeling of residence; handicapped employees.
Subdivision 1.  Requirement; determination.  The employer shall furnish to an employee who is permanently disabled because of a personal injury suffered in the course of employment with that employer such alteration or remodeling of the employee’s principal residence as is reasonably required to enable the employee to move freely into and throughout the residence and to otherwise adequately accommodate the disability.  Any remodeling or alteration shall be furnished only when the division or Workers’ Compensation Court of Appeals determines that the injury is to such a degree that the employee is substantially prevented from functioning within the principal residence.
Subd. 2.  Cost.  The pecuniary liability of an employer for remodeling or alteration required by this section is limited to prevailing costs in the community for remodeling or alteration of that type.
Subd. 3.  New residence.  Where the alteration or remodeling of the employee’s residence is not practicable, the award may be to purchase or lease a new or different residence if the new or different residence would better accommodate the disability.
Subd. 4.  Certification.  No award may be made except upon the certification of a licensed architect to the division or Workers’ Compensation Court of Appeals that the proposed alteration or remodeling of an existing residence or the building or purchase of a new or different residence is reasonably required for the purposes specified in subdivision 1.  The Council on Disability shall advise the division or Workers' Compensation Court of Appeals as provided in section 256.482, subdivision 5, clause (7).  The alteration or remodeling of an existing residence, or the building or purchase of a new home must be done under the supervision of a licensed architect relative to the specific needs to accommodate the disability.
Subd. 5.  Limitation.  An employee is limited to $60,000 under this section for each personal injury.