Bortolotti v. Universal Terrazzo & Tile Co., 933 N.W.2d 851

Terry Bortolotti was president and sole shareholder of Universal Terrazzo & Tile Co., an S corporation, and worked there for over 30 years; he was injured in June 2013.
Operative petition alleged weekly earnings of $3,625; earlier (superseded) pleading alleged $1,399.45; Universal denied wage allegations and produced payroll showing $3,950 in 2013.
The Workers’ Compensation Court found the injury compensable, credited Bortolotti, but—citing lack of evidentiary exhibits—relied on the superseded pleading to fix average weekly wage at $1,399.45 and awarded the statutory maximum benefit.
The compensation court also awarded $9,849.38 for out-of-pocket medical expenses based on Bortolotti’s testimony, although it said it could not rely on the supporting exhibit because it failed to comply with a rule.
The Court of Appeals reversed in part: it reduced the wage award to the statutory minimum ($49/week) based on the $3,950 payroll evidence and eliminated the medical-expense award.
The Nebraska Supreme Court affirmed the Court of Appeals’ wage determination (finding the compensation court erred by relying on a superseded pleading and that S-corp profits are not automatically wages) but reinstated the out-of-pocket medical-expense award.

Issue	Plaintiff's Argument (Bortolotti)	Defendant's Argument (Universal)	Held
Proper measure of average weekly wage for a sole-shareholder employee of an S corporation	Include corporate net/profits/weekly draw (so average wage supports maximum benefit)	Only actual wages paid as employee count; payroll/IRS wages ($3,950) control and support minimum benefit	Mixed question of fact and law; trial court erred in relying on a superseded pleading; S-corp profits are not per se "wages" under §48-126; competent evidence supported $3,950 -> minimum $49/week affirmed
Entitlement to reimbursement of $9,849.38 in out-of-pocket medical expenses	Testified he personally paid $9,849.38 and prepared Exhibit 41 listing payments; awarded by compensation court	Argued exhibit was rejected and thus no basis for award	Trial court credited Bortolotti’s testimony; on deferential review the award was not clearly wrong -> medical-expense award reinstated

Elrod v. Prairie Valley, 214 Neb. 697, 335 N.W.2d 317 (1983) (treats average weekly wage determination as involving factual and legal components)
Hull v. Aetna Ins. Co., 249 Neb. 125, 541 N.W.2d 631 (1996) (addresses computation of average weekly wage for self-employed claimants based on net income)
Bituminous Casualty Corp. v. Deyle, 225 Neb. 82, 402 N.W.2d 859 (1987) (no wages for a corporate president/stockholder who received no cash wages or reported salary)
Gase v. Gase, 266 Neb. 975, 671 N.W.2d 223 (2003) (explains S corporation pass-through tax status and relevance to income characterization)
Hare v. Watts Trucking Service, 220 Neb. 403, 370 N.W.2d 143 (1985) (workers’ compensation findings of fact will not be set aside on appeal unless clearly wrong)