JOHN DAVID SEARLE, Employee/Cross-Appellant, v. LEGACY RESTORATION HOLDINGS, LLC, and SFM MUTUAL INS. CO., Employer-Insurer/Appellants, and GRP. HEALTH PLAN D/B/A HEALTHPARTNERS, INC., REGIONS HOSP., LIFE LINK III, MAYO CLINIC, SECURA INS. CO., TWIN CITIES ANESTHESIA ASSOCS. and BLUE CROSS BLUE SHIELD OF MN, Intervenors.

The employer and insurer appeal from the compensation judge’s finding that the employee suffered a compensable injury.  The employee cross-appeals the compensation judge’s average weekly wage (AWW) determination and the denial of his claims for penalties.  We affirm as modified the decision of the compensation judge.

The employee, John David Searle, sustained significant injuries as a result of a car crash on August 28, 2021.  He began working for the employer, Legacy Restoration Holdings, on July 12, 2021, as a sales representative.  As part of the hiring process, the employee was provided with an employee handbook and a vehicle safety manual.  The vehicle safety manual outlined driver safety guidelines, cell phone safe use guidelines, driver selections, motor vehicle records, vehicle maintenance, accident reporting, and disciplinary action.  The employee signed an acknowledgement form indicating he had read and understood the policies.

Under the employer’s compensation structure, the employee would receive an annual base salary of $70,000, plus a seven percent commission for completed contracts.  If earned commissions exceeded the base salary of $70,000, the commissions would form the entirety of his income.  To earn and be paid a commission on his sales, the employee was required to secure a contract with a customer, the work performed by the employer had to be completed in its entirety, and payment had to be collected from the customer.  If the sales representative was no longer an employee at the time payment was collected from the customer, a different sales representative assigned to the contract was paid the commission, or the company would keep the commission.

At the time of his injury, the employee was also working for HomePro America (HomePro), as an independent contractor sales representative.  At hearing, the employee claimed to have earned $39,746.13 in commissions with HomePro in the 26 weeks preceding the work injury.  (Ex A.)  Conversely, the employer and insurer claimed that the employee had been paid a weekly rate of $414.09 by HomePro in the six weeks preceding the injury.  (Ex. 34.)

On August 28, 2021, the employee drove from his home in Rochester to the Twin Cities where he spent the morning working for HomePro before attending to personal errands.  The employee then drove south on Highway 52 toward Farmington, where he planned to meet up with another sales representative of the employer for work purposes.

The employee exited Highway 52 and headed towards Farmington on a single lane highway.  The employee testified that upon exiting Highway 52, he was on the normal route he would have taken to Farmington had he been traveling from his house.  Shortly before reaching the city limits, the employee was involved in a car crash.  Witnesses described the employee driving at a speed far exceeding the posted speed limit and tailgating a pickup truck.  The witnesses also testified that it appeared the employee was attempting to pass the truck several times.  During one pass attempt, the pickup truck entered the oncoming traffic lane, the employee swerved into the left shoulder to avoid a collision, and he lost control of his car.  The employee’s car spun out in the gravel shoulder, fishtailed, went back across the highway into the opposite ditch, and became airborne.  The car then hit a wooden fence and tree with such force that the tree was uprooted, and the rear of the car wrapped entirely around the tree.  A fence post pierced the underside of the employee’s car, the driver’s seat, and impaled the employee.^[1]

Witnesses stopped to assist the employee and called emergency services.  The employee was transported by helicopter to Regions Hospital.  He sustained significant blood loss leading to anemia and hemorrhagic shock, a lacerated spleen, a punctured chest injury, eight transverse process fractures throughout the spine, four spinal process fractures, bilateral pneumothoraxes, four rib fractures, and an open wound and fracture at the left elbow.  He was hospitalized for 17 days, during which he underwent an emergency splenectomy, C7-T3 fusion, chest wall debridement surgery, left elbow debridement surgery, and left elbow skin graft surgery.

Eleven days after the car crash, and while the employee was still hospitalized and recovering from his injuries, the employer terminated the employee via letter.  Shortly after, the employee hired a lawyer to represent him in his workers’ compensation claims.  The employer and insurer denied liability for the employee’s injury, asserting that it did not occur in the course of employment and that any claim for workers’ compensation benefits was barred by the prohibited act defense.  Counsel for the employee indicated that a penalties claim would be made if the employee’s claims were not immediately accepted.  (Ex. V.)  The employer and insurer maintained its denial and the employee filed a claim petition on September 27, 2021, seeking various workers’ compensation benefits including penalties for frivolous defenses.  Multiple motions were filed regarding discovery, including for discovery-based penalties and sanctions, by both parties over the next three years, during which at least 22 formal motions were filed and at least seven pre-hearing motion orders were issued.

Over eight days between April 2024 and March 2025, the issues came on for hearing before a compensation judge.  Over 250 trial exhibits were offered and 13 witnesses testified.^[2]  The compensation judge issued a findings and order on July 7, 2025.  He found that the employee was in the course of his employment at the time of his injury, that he did not engage in a “prohibited act,” and that the claim was compensable.  The compensation judge also found that the employee’s AWW was $1,760.25.  Finally, the compensation judge denied the employee’s claim for penalties, stating that the two primary defenses asserted were not frivolous and that there was no basis for the claimed discovery-based penalties.  The employer and insurer appeal the conclusion that the claim is compensable, and the employee cross-appeals the AWW determination and the denial of his claims for penalties.

On appeal, the Workers’ Compensation Court of Appeals must determine whether “the findings of fact and order [are] clearly erroneous and unsupported by substantial evidence in view of the entire record as submitted.”  Minn. Stat. § 176.421, subd. 1(3).  Substantial evidence supports the findings if, in the context of the entire record, “they are supported by evidence that a reasonable mind might accept as adequate.”  Hengemuhle v. Long Prairie Jaycees, 358 N.W.2d 54, 59, 37 W.C.D. 235, 239 (Minn. 1984).  When the findings are supported by substantial evidence, the Workers’ Compensation Court of Appeals must defer to the compensation judge. Lagasse v. Horton, 982 N.W.2d 189, 202 (Minn. 2022).  Findings of fact should not be disturbed, even though the reviewing court might disagree with them, “unless they are clearly erroneous in the sense that they are manifestly contrary to the weight of evidence or not reasonably supported by the evidence as a whole.”  Northern States Power Co. v. Lyon Food Prods., Inc., 304 Minn. 196, 201, 229 N.W.2d 521, 524 (1975); see also Smith v. Carver Cnty., 931 N.W.2d 390, 79 W.C.D. 495 (Minn. 2019).

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); see also Busch v. Advanced Maint., 659 N.W.2d 772, 778-79 (Minn. 2003).

The employer and insurer appeal from the compensation judge’s conclusion that the employee suffered a compensable injury and from the denial of their affirmative defense.  The employee cross-appeals the compensation judge’s AWW determination and the denial of his claims for penalties.

The employer and insurer argue that the compensation judge erred in concluding that the employee’s August 28, 2021, injury occurred in the course of employment and is compensable.  We disagree.

Under the Minnesota’s Workers’ Compensation Act (WCA), a compensable injury must arise out of and in the course of employment.  Minn. Stat. § 176.021, subd. 1.  “In the course of” refers to the time, place, and circumstances of the incident causing the injury.  See Lange v. Minneapolis-St. Paul Metro. Airports Comm’n, 257 Minn. 54, 99 N.W.2d 915, 21 W.C.D. 61 (1959); see also Gibberd v. Control Data Corp., 424 N.W.2d 776, 40 W.C.D. 1040 (Minn. 1988).

Generally, injuries suffered while commuting to and from work are not considered “in the course of” employment and are not compensable under the WCA.  Kahn v. State, Univ. of Minn., 289 N.W.2d 737, 742, 32 W.C.D. 351, 359 (Minn. 1980).  However, there are several exceptions to the general rule, including when an employee travels as part of the work.  A traveling employee has portal-to-portal coverage, meaning any injury suffered while traveling is covered from the time the employee leaves home until the time the employee returns home.  See Voight v. Rettinger Transp., Inc., 306 N.W.2d 133, 33 W.C.D. 625 (Minn. 1981); Snyder v. Gen. Paper Corp., 277 Minn. 376, 152 N.W.2d 743, 24 W.C.D. 255 (1967).  A traveling employee “carr[ies] his working premises with him while engaged in the employer’s service.”  Cavilla v. N. States Power Co., 213 Minn. 331, 337, 6 N.W.2d 812, 816, 12 W.C.D. 429, 434-35 (1942).

Here, there is no dispute that the employee was a traveling employee who would typically have portal-to-portal coverage.  The employer and insurer assert that the employee was not traveling for work at the time of his injury but was working for a different employer and attending to personal errands.  According to the employer and insurer, the employee’s portal-to-portal coverage would not begin until he reached Farmington, where he intended to perform work for the employer.  Because the employee was injured before he reached Farmington, the employer and insurer argue the employee’s injuries did not occur in the course of employment.

In support of their position, the employer and insurer cite Kayser v. Carson Pirie Scott & Co., 203 Minn. 578, 282 N.W. 801 (1938).  In Kayser, the employee was a traveling employee who lived in St. Peter and had business to attend to in New Ulm.  The employee, his wife, and their daughter, drove from St. Peter to Pipestone for personal purposes.  They later left Pipestone heading home, with the intent of stopping in New Ulm to conduct the employee’s work-related business.  Shortly after leaving Pipestone, the employee was killed in a car crash.  His decedent’s claim for workers’ compensation death benefits was denied.  In affirming the conclusion that the employee was not in the course of employment at the time of the deadly crash, the Minnesota Supreme Court wrote:

We disagree with the employer and insurer’s application of Kayser to the unique facts of this case.  In Kayser, whether the employee had reached the city of his ultimate work-related destination was not determinative.  Rather, the court looked to the reason the employee was on the road at the time of the crash, which was exclusively for his personal errand to Pipestone.  Had the Kayser employee not taken the personal errand to Pipestone, he never would have been on the road where he was killed.

Unlike the employee in Kayser, in this case, as found by the compensation judge, the employee was injured while traveling on the route he would have taken had he left his home and directly drove to Farmington, without ever engaging in personal errands.  (Finding 31.)  According to the employee’s testimony, the reason he was on the road at the time of the crash was related to his work in Farmington.  Once he reached the same route he would have normally taken from his home, the personal errands ended and traveling specifically for work purposes began.  The compensation judge properly distinguished the employer and insurer’s application of Kayser to the facts in this case.

Inherent in the compensation judge’s finding as to the employee’s route at the time of his injury was an assessment of the employee’s credibility on that issue.  As a general rule, it is not the role of this court to make its own evaluation of witness credibility and the probative value of witness testimony.  Even v. Kraft, Inc., 445 N.W.2d 831, 42 W.C.D. 220 (Minn. 1989).  Likewise, it is generally not the role of this court to choose different inferences from the evidence than those chosen by a compensation judge.  Redgate v. Sroga’s Standard Serv., 421 N.W.2d 729, 40 W.C.D. 948 (Minn. 1988).  As the supreme court stated in Gerhardt v. Welch, 267 Minn. 206, 125 N.W.2d 721 (1964), if different inferences can justifiably be drawn from the evidence in a case, the inference drawn by the compensation judge will not be disturbed on appeal.  Here, while there were other parts of the employee testimony, on issues unrelated to his travel route, that the employer and insurer point to as calling his credibility into issue, the employee’s testimony regarding the route on which he was traveling at the time of the crash was not manifestly contrary to the evidence in the record and we will not disturb the compensation judge’s credibility assessment.

The compensation judge’s finding that the employee’s injury occurred in the course of his employment is supported by substantial evidence in the record, and we affirm.

The employer and insurer argue on appeal that the compensation judge erred in finding that the employee’s claim was not barred by the prohibited act defense.  We are not persuaded.

Fault and negligence are generally irrelevant in determining whether a work injury is compensable under the WCA.  Minn. Stat. § 176.021, subd. 1.  One exception is when an employee suffers an injury while engaged in a prohibited act.  First adopted in Minnesota over 100 years ago, the prohibited act defense is an affirmative defense shifting the burden of proof to the employer and insurer.  See Olson v. Robinson, Straus & Co., 168 Minn. 114, 210 N.W. 64 (1926); see also Prentice v. Twin City Wholesale Grocery, 202 Minn. 455, 278 N.W. 895 (1938); Rautio v. Int’l Harvester Co., 180 Minn. 400, 231 N.W. 214, 6 W.C.D. 213 (1930).  To meet this burden, an employer and insurer must show that there was a prohibition of a specific act, that the prohibition was clearly and unequivocally communicated to the employee, that the employer enforced the prohibition, that the employee nevertheless committed the prohibited act, and that the commission of this act caused the work injury.  See Brown v. Arrowhead Tree Serv., Inc., 332 N.W.2d 28, 30, 35 W.C.D. 818, 822 (Minn. 1983); Bartley v. C-H Riding Stables, Inc., 296 Minn. 115, 120, 206 N.W.2d 660, 663, 26 W.C.D. 675, 679-80 (1973).  Cases in which the defense is asserted must be decided on the merits and based on the record as a whole.^[3]

The employer and insurer asserted the prohibited act defense, maintaining that the cause of the employee’s injury was his reckless driving behavior in violation of the safe driving policy.  In support of its burden to prove that the employee violated this policy, the employer and insurer offered the vehicle safety manual and the acknowledgment forms signed by the employee.^[4]  The employer and insurer also offered evidence to show that the employee was engaged in reckless driving behavior immediately prior to losing control of his car.  The compensation judge concluded that the employer and insurer failed to meet their burden of proof to establish the prohibited act defense.

In rejecting the defense, the compensation judge outlined in his findings and memorandum that there is no evidence in the record that the employer enforced the policies contained in the handbook or vehicle safety manual, nor was there evidence in the record that other employees were disciplined for instances of speeding or aggressive driving behavior prior to the employee’s injury.  There was no training regarding the policies, and there was no evidence of a company-wide consensus as to what constituted “safe driving” or what specific types of driving conduct violated the policies.  Substantial evidence in the record supports the compensation judge’s conclusion that the employer’s policies did not prohibit the manner in which the employee drove at the time of his injury.^[5]

Moreover, the “act” that the employee was performing at the time of his injury was driving, which is a permissible act.  The prohibited act defense does not apply when an employee is engaged in a permissible act, conducted in an impermissible manner.  Bartley, 296 Minn. at 118, 206 N.W.2d at 662, 26 W.C.D. at 678; see also Camarena v. Piat, Inc., No. WC24-6563 (W.C.C.A. Nov. 4, 2024) (the employee’s eye injury was compensable where, while performing the permissible act of removing drywall, he failed to wear eye protection, which was prohibited).  As a travelling sales representative, the employee’s driving was a permissible act, even if the driving was reckless, dangerous, or was done in an impermissible manner.^[6]

Substantial evidence supports the compensation judge’s finding that the employer and insurer did not meet their burden of proving the prohibited act defense by a preponderance of the evidence, and we affirm.

The employee appeals the compensation judge’s AWW determination.  The employee argues that the compensation judge erred in omitting commissions earned by the employee for both employers prior to the injury.  At the time the employee was terminated by the employer, the employee claims that there were multiple contracts that had been secured by the employee with expected commissions of over $27,000.  (Ex. HHHHHH.)  Pursuant to the terms of his employment, those commissions were not paid to the employee because he was not employed by the employer at the time the contracts were fulfilled.  (Ex. 31.)  The employee also claims he earned almost $40,000 in commissions working for HomePro that the compensation judge did not include in the AWW calculation.  The employee argues that regardless of whether any or all of these commissions were paid, the commissions more accurately reflect his earning capacity in calculating his AWW.^[7]  We disagree.

In calculating an employee’s wage loss, “the object of wage determination is to ‘arrive at a fair approximation of [the employee’s] probable future earning power which has been impaired or destroyed because of the injury.’”  Knotz v. Viking Carpet, 361 N.W.2d 872, 874, 37 W.C.D. 452, 455 (Minn. 1985) (quoting Sawczuk v. Special Sch. Dist. No. 1, 312 N.W.2d 435, 437‑38, 34 W.C.D. 282, 287 (Minn. 1981)).  Where an employee was regularly employed by two or more employers, the employee’s days of work for all such employments are included in calculating the employee’s weekly wage.  Minn. Stat. § 176.011, subd. 18.  “In cases involving unusual factual circumstances, application of the statutory wage calculation may result in a weekly wage which does not fairly reflect the injured employee’s lost earning capacity, and the factfinder may use another reasonable method of wage calculation which results in a fair approximation of that loss.”  Bach v. Upper Mississippi Mental Health Ctr., No. WC16-5911 (W.C.C.A. Aug. 15, 2026); Loberg v. Northome Healthcare Ctr., 57 W.C.D. 113, 119 (W.C.C.A. 1997) (citing Boelter v. City of Ham Lake, 481 N.W.2d 50, 51, 46 W.C.D. 220, 221 (Minn. 1992), summarily aff’d (Minn. Sept. 22, 1997)); see also Decker v. Red Wing Shoe Co., 41 W.C.D. 763, 766 (W.C.C.A. 1988), summarily aff’d (Minn. Mar. 30, 1989).

In declining to include the commissions from the employer, the compensation judge characterized these commissions as “speculative” and stated that the pending commissions were not guaranteed because the contracts had not been fulfilled at the time of the injury.  (Mem. at 13.)  The employee’s argument that these commissions demonstrate a higher earning capacity is compelling, however, we agree with the compensation judge that, based on the testimony taken at hearing and the admitted exhibits, the amounts are speculative.  Despite having offered upwards of 200 exhibits and calling 13 witnesses over eight days of hearing before the compensation judge, the employee offered no evidence establishing that he fully earned the commissions solely by getting customers to sign contracts.  If such evidence had been offered, then the employee’s argument might be more persuasive.  Because of the paucity of evidence to establish that the employee “earned” the commissions as alleged, we agree with the compensation judge that the employee failed to meet his burden of proof in this regard.

The employee also argues that there were two commissions, $13,251.01 and $26,495.12, from HomePro for his work done in 2021.  (Ex. A.)  Yet, the employee did not cite to any evidence in his briefs to this court, whether exhibits or testimony, to support the alleged $26,495.12 commission from HomePro as cited in Exhibit A.

The compensation judge, relying upon Exhibits 32 and 33, found the employee’s combined AWW to be $1,760.25.  (Finding 52.)  First, based on the employer’s pay stubs (Ex. 32), the compensation judge took the employee’s earnings from the employer ($9,423.09) and divided that number by the seven^[8] total weeks the employee worked, resulting in a weekly wage of $1,346.16, which comports with the employee’s $70,000 annual base salary.  Second, purportedly relying upon Exhibit 33, the compensation judge found the employee’s earnings from HomePro to be $2,484.54, divided by six weeks worked before the work injury, resulting in a weekly wage of $414.09.  The compensation judge then combined the two wages for an AWW of $1,760.25.

Exhibit 33 does not support the findings of the compensation judge regarding the weekly wages with HomePro, however.  Rather the evidence from Exhibit 33 and from elsewhere in the record establishes three things regarding the weekly wages with HomePro.  One, according to the employee’s testimony, he was a commissions-only sale representative for HomePro and had no weekly paychecks.  Two, based on Exhibit 33, the employee received a 1099 from HomePro for the 2022 calendar year showing $13,251.01 paid to the employee, although the employee testified that he did not work for HomePro in 2022.  Three, Exhibit 33 shows that the employee worked 32 weeks for HomePro prior to the August 2021 work injury.  From this evidence, it is reasonable to conclude that the employee was not paid for his 2021 work for HomePro until 2022, and that the employee earned $13,251.01 in commissions over 32 weeks of work in 2021.  $13,251.01, divided by 32 weeks worked, equates to $414.09 per week, the same number reached by the compensation judge.^[9]

Accordingly, we affirm, but modify Finding 52 to read, “The preponderance of the evidence establishes that the employee’s weekly wage at the time of the injury was $1,760.25 ($9,423.09 earned at the employer, divided by his seven weeks of work there, plus $414.09, the employee’s average weekly earnings based upon his 2021 commissions of $13,251.01 earned over the 32 weeks he worked for HomePro in 2021 prior to the work injury).  (Exs. 32 and 33.)”

The goal of determining the AWW, as set out in Knotz, is to accurately reflect the employee’s earning capacity.  We conclude that because of the dearth of evidence offered by the employee with respect to some or all of the commissions the employee may have earned with the employer and with HomePro, it was not unreasonable for the compensation judge to conclude that the employee failed to meet his burden of proof and to exclude the speculative commissions in calculating the employee’s AWW.  We affirm the compensation judge’s AWW determination as modified.

At the hearing below, the employee sought penalties against the employer and insurer for alleged frivolous defenses and for alleged discovery abuses.  The compensation judge imposed an evidentiary sanction against the employer and insurer but otherwise denied the employee’s claims for penalties.  The employee appeals.

The employee sought penalties for claimed frivolous defenses.  The employee argued that the employer knew that the employee was driving to Farmington to meet with a co-worker to perform work for the employer when he was injured and therefore knew that he was in the course of his work at the time of the injury.  The employee also argued that the prohibited act defense was frivolous because the employer had no policy prohibiting passing another vehicle while driving, and further, to the extent the safe driving policy prohibited any specific type of driving behaviors, the employer did not unequivocally communicate or enforce that policy.  The compensation judge denied the employee’s claim for penalties.

Under Minn. Stat. § 176.225, subd. 1, a compensation judge shall award compensation where an employer or insurer has frivolously denied a claim.  “‘Frivolously’ means without a good faith investigation of the facts or on a basis that is clearly contrary to fact or law.”  Id.  Whether a defense is frivolous is a fact question made under the compensation judge’s discretion and based on the entire record.  Carroll v. Alina Mercy Hosp., 74 W.C.D. 567, 578 (W.C.C.A. 2014).  A party’s disagreement with a defense or a compensation judge rejection of a defense at a hearing does not make the defense frivolous.  See Crowley v. Plehal Blacktopping, Inc., 66 W.C.D. 135 (W.C.C.A. 2006).  On appeal, this court is to consider whether the compensation judge’s denial of the employee’s penalty claim is supported by substantial evidence in the record and whether the denial was an abuse of the compensation judge’s discretion.  See Peterson v. City of Minneapolis, 23 N.W.3d 582 (Minn. 2025).

The compensation judge concluded that the preponderance of the evidence did not support the employee’s contentions, and instead, that the employer and insurer presented reasonable, colorable, and good faith defenses to the claims.  We agree.  The defenses presented by the employer and insurer required resolution of conflicting facts.  The employer and insurer’s defense as to compensability required the compensation judge to assess the credibility of the employee with regard to his claim that he was driving on the route that he would have had he taken a direct route from his home.  The employer and insurer’s prohibited act defense also required the compensation judge to assess the credibility of the employee and other witnesses, and to weigh the probative value of other evidence relevant to the employer’s policies.

The defenses raised by the employer and insurer presented issues that could only be resolved by a compensation judge.  A different compensation judge could have come to different conclusions on one or both defenses based upon the facts and evidence presented in the record.  We therefore reject the argument that the defenses were made without good faith and were not colorable.  The compensation judge did not err or abuse his discretion in denying penalties as the defenses raised were not frivolous, and we affirm.

The employee sought penalties alleging the employer and insurer committed various discovery abuses.^[10]  The compensation judge sanctioned the employer and insurer with an adverse evidentiary inference^[11] and declined to award penalties for claimed abuses by the employer and insurer with regard to discovery and for violating court orders.  We will defer to the compensation judge absent a clear and convincing showing that there was an abuse of discretion.  We see no evidence of such an abuse and conclude he was within his discretion to deny the employee’s claim for penalties for alleged discovery abuses and order violations.  See Folstrom v. Northgate Liquors, 77 W.C.D. 955 (W.C.C.A. 2017); Welter v. Ray N. Welter Heating Co., 76 W.C.D. 961 (W.C.C.A. 2016); Ziehl v. Vreeman Constr. Co., slip op. (W.C.C.A. Oct. 15, 1991).

The compensation judge presided over this case for nearly four years.  In his memorandum, the judge noted that, “[b]oth sides contributed to the tone of the case being more antagonistic than was necessary. . .  [and that] this matter could have moved more quickly to hearing and been heard more efficiently if all the parties had cooperated more effectively and considered the numerous opportunities to temper rather than inflame their interactions with one another.”  (Mem. at 15.)  Our review of the appellate record confirms this assessment.

Substantial evidence supports the compensation judge’s findings and order in its entirety.  We affirm as modified.