{ "id": 4161784, "name": "RANDY E. STRICKLAND, Employee, Plaintiff v. MARTIN MARIETTA MATERIALS and Employer, SPECIALITY RISK SERVICES, Carrier, Dependants", "name_abbreviation": "Strickland v. Martin Marietta Materials", "decision_date": "2008-11-18", "docket_number": "No. COA08-476", "first_page": "718", "last_page": "725", "citations": [ { "type": "official", "cite": "193 N.C. App. 718" } ], "court": { "name_abbreviation": "N.C. Ct. App.", "id": 14983, "name": "North Carolina Court of Appeals" }, "jurisdiction": { "id": 5, "name_long": "North Carolina", "name": "N.C." }, "cites_to": [ { "cite": "613 S.E.2d 746", "category": "reporters:state_regional", "reporter": "S.E.2d", "case_ids": [ 12633078 ], "year": 2005, "pin_cites": [ { "page": "748", "parenthetical": "discussing that it is an abuse of discretion to deny an employer full credit for wage-replacement benefits if solely funded by the employer" } ], "opinion_index": 0, "case_paths": [ "/se2d/613/0746-01" ] }, { "cite": "468 S.E.2d 396", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1996, "pin_cites": [ { "page": "399", "parenthetical": "holding that the Commission erred by denying the employer credit for payments made when the employer had not accepted the employee's claim as compensable" } ], "opinion_index": 0 }, { "cite": "121 N.C. App. 570", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 11918820 ], "year": 1996, "pin_cites": [ { "page": "576", "parenthetical": "holding that the Commission erred by denying the employer credit for payments made when the employer had not accepted the employee's claim as compensable" } ], "opinion_index": 0, "case_paths": [ "/nc-app/121/0570-01" ] }, { "cite": "171 N.C. App. 112", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8435124 ], "year": 2005, "pin_cites": [ { "page": "115", "parenthetical": "discussing that it is an abuse of discretion to deny an employer full credit for wage-replacement benefits if solely funded by the employer" } ], "opinion_index": 0, "case_paths": [ "/nc-app/171/0112-01" ] }, { "cite": "357 S.E.2d 671", "category": "reporters:state_regional", "reporter": "S.E.2d", "opinion_index": 0 }, { "cite": "357 S.E.2d 670", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1987, "pin_cites": [ { "page": "673" } ], "opinion_index": 0 }, { "cite": "320 N.C. 113", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 4728157 ], "weight": 3, "year": 1987, "pin_cites": [ { "page": "117" }, { "page": "115" }, { "page": "117" } ], "opinion_index": 0, "case_paths": [ "/nc/320/0113-01" ] }, { "cite": "418 S.E.2d 503", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 4, "pin_cites": [ { "page": "507-08" }, { "page": "511" }, { "page": "508" }, { "page": "509" } ], "opinion_index": 0 }, { "cite": "332 N.C. 78", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 2505309 ], "weight": 4, "pin_cites": [ { "page": "85" }, { "page": "90" }, { "page": "85" }, { "page": "87" } ], "opinion_index": 0, "case_paths": [ "/nc/332/0078-01" ] }, { "cite": "577 S.E.2d 887", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2003, "pin_cites": [ { "page": "888" } ], "opinion_index": 0 }, { "cite": "356 N.C. 678", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 1511147, 1511598, 1511217, 1511473, 1511135 ], "year": 2003, "opinion_index": 0, "case_paths": [ "/nc/356/0678-01", "/nc/356/0678-04", "/nc/356/0678-03", "/nc/356/0678-05", "/nc/356/0678-02" ] }, { "cite": "563 S.E.2d 207", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2002, "pin_cites": [ { "page": "211" } ], "opinion_index": 0 }, { "cite": "149 N.C. App. 961", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 9133544 ], "year": 2002, "pin_cites": [ { "page": "966" } ], "opinion_index": 0, "case_paths": [ "/nc-app/149/0961-01" ] }, { "cite": "585 S.E.2d 264", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2003, "pin_cites": [ { "page": "267", "parenthetical": "citation omitted" } ], "opinion_index": 0 }, { "cite": "160 N.C. App. 180", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8954923 ], "year": 2003, "pin_cites": [ { "page": "184", "parenthetical": "citation omitted" } ], "opinion_index": 0, "case_paths": [ "/nc-app/160/0180-01" ] }, { "cite": "530 S.E.2d 549", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 2000, "pin_cites": [ { "page": "553" } ], "opinion_index": 0 }, { "cite": "352 N.C. 109", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 684964 ], "year": 2000, "pin_cites": [ { "page": "116" } ], "opinion_index": 0, "case_paths": [ "/nc/352/0109-01" ] }, { "cite": "409 S.E.2d 715", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 7, "year": 1991, "pin_cites": [ { "page": "717" }, { "page": "717-18" }, { "page": "718" } ], "opinion_index": 0 }, { "cite": "104 N.C. App. 411", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8521980 ], "weight": 2, "year": 1991, "opinion_index": 0, "case_paths": [ "/nc-app/104/0411-01" ] }, { "cite": "N.C. Gen. Stat. \u00a7 88.1", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "opinion_index": 0 }, { "cite": "N.C. Gen. Stat. \u00a7 97-42", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "weight": 15, "pin_cites": [ { "page": "116-17" } ], "opinion_index": 0 } ], "analysis": { "cardinality": 636, "char_count": 16292, "ocr_confidence": 0.746, "pagerank": { "raw": 4.03580807328026e-08, "percentile": 0.1357447866651685 }, "sha256": "2b26ac9ebb6233dd6c30fc3d64d567652af703e93aba95bd224b355ee8c51f20", "simhash": "1:092345c4d4db7a12", "word_count": 2521 }, "last_updated": "2023-07-14T16:30:29.332614+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "Judges TYSON and CALABRIA concur." ], "parties": [ "RANDY E. STRICKLAND, Employee, Plaintiff v. MARTIN MARIETTA MATERIALS and Employer, SPECIALITY RISK SERVICES, Carrier, Dependants" ], "opinions": [ { "text": "McCullough, Judge.\nDefendant-employer Martin Marietta Materials and defendant-insurer Specialty Risk Services appeal from an Amended Opinion and Award entered 11 January 2008 by the Full Commission (\u201cthe Commission\u201d). Defendants assigns error to the Commission\u2019s decision to reduce their credit for short-term disability benefits paid to plaintiff by twenty-five percent (25%) in order to partially fund attorney\u2019s fees for plaintiff. We hold that defendants are entitled to receive full credit, under N.C. Gen. Stat. \u00a7 97-42, for all compensation made to plaintiff under their short-term disability plan. We reverse and remand.\nPlaintiff had been employed with defendant-employer Martin Marietta Materials, a rock quarry business, for over twenty years. On 24 March 2005, plaintiff injured his right shoulder while repairing a bent engine compartment door of a rock loader. Plaintiff reported his injury to defendant-employer and immediately began receiving medical treatment for his shoulder. Plaintiff continued to work for defendant-employer until his surgery on 22 June 2005. Plaintiff\u2019s surgery included an arthroscopic rotator cuff repair procedure as well as a distal clavicle excision and subacromial decompression. Due to physician-imposed physical restrictions, plaintiff has not returned to work since his surgery.\nAfter plaintiff\u2019s surgery, defendants provided him with short-term disability benefits, pursuant to an employer-funded plan. Under this plan, plaintiff was paid for twenty-six (26) weeks in a total amount of $11,532.00. All payments to plaintiff were made during a time when defendants had not accepted plaintiffs injuries as compensable by workers\u2019 compensation benefits.\nPlaintiff filed a Form 18 notice of injury on or about 11 July 2005. On 31 October 2006, Deputy Commissioner Phillips entered an Opinion and Award denying plaintiff workers\u2019 compensation benefits. Plaintiff appealed and the case was heard before the Commission on 1 May 2007.\nOn 7 September 2007, the Commission filed an Opinion and Award, reversing the Deputy Commissioner\u2019s decision and awarding temporary total disability payments to plaintiff. The Commission concluded that (1) plaintiff was entitled to a weekly compensation rate of $512.66, beginning on 20 June 2005 and continuing until further order; and (2) plaintiff was not entitled to attorney\u2019s fees and costs because defendants had not engaged in stubborn unfounded litigiousness, pursuant to N.C. Gen. Stat. \u00a7 88.1.\nThe Commission also approved attorney\u2019s fees for plaintiff\u2019s counsel in the amount of twenty-five percent (25%) of compensation owed to plaintiff, ordering that twenty-five percent (25%) of the lump sum due to plaintiff be deducted and paid directly to plaintiff\u2019s counsel, and thereafter, every fourth compensation check due to plaintiff be deducted and paid directly to plaintiff\u2019s counsel. The Commission also held that defendants were not entitled to a credit of $11,532.00, pursuant to N.C. Gen. Stat. \u00a7 97-42, because of their delay in filing a denial of plaintiff\u2019s claim.\nDefendants filed a Motion for Reconsideration of the Commission\u2019s Opinion and Award, for denying defendants\u2019 request for a credit under N.C. Gen. Stat. \u00a7 97-42. The Commission granted defendants\u2019 motion and reviewed the matter.\nIn an Amended Order and Award issued on 11 January 2008, defendants were granted a credit for the short-term disability payments received by plaintiff. The Commission concluded that defendants had been formally notified about plaintiff\u2019s claim on 13 January 2006 and had filed a Form 61 denying the claim on 22 February 2006. However, the Commission reduced defendants\u2019 credit by twenty-five percent (25%) in order to partially fund attorney\u2019s fees for plaintiff and stated the follpwing:\nDefendants are entitled to a credit for the employer-funded short-term disability plan payments received by Plaintiff for the 26 weeks following Plaintiff\u2019s June 22, 2005, shoulder surgery. N.C. Gen. Stat. \u00a797-42. However, the Full Commission, in its discretion, reduces the credit by twenty-five percent (25%) in order to fund an attorney\u2019s fee based upon the full workers\u2019 compensation award. Church v. Baxter Travenol Laboratories, Inc., 104 N.C. App. 411, 409 S.E.2d 715 (1991).\nDefendants argue that the Commission erred when it reduced their credit for payments made through their short-term disability plan by twenty-five percent (25%). Defendants contend that under N.C. Gen. Stat. \u00a7 97-42, they are entitled to full credit in the amount of $11,532.00 for all benefits paid to plaintiff. We agree.\nAppellate review of an Opinion and Award of the Commission is \u201climited to reviewing whether any competent evidence supports the Commission\u2019s findings of fact and whether the findings of fact support the Commission\u2019s conclusions of law.\u201d Deese v. Champion Int\u2019l Corp., 352 N.C. 109, 116, 530 S.E.2d 549, 553 (2000). We review the Commission\u2019s conclusions of law de novo. Deseth v. LensCrafters, Inc., 160 N.C. App. 180, 184, 585 S.E.2d 264, 267 (2003) (citation omitted).\nIn its conclusions of law, the Commission determined that under N.C. Gen. Stat. \u00a7 97-42, defendants were entitled to a credit in the amount that they had already paid plaintiff in short-term disability benefits. However, the Commission reduced their credit by twenty-five percent (25%) \u201cin order to fund an attorney\u2019s fee based upon the full workers\u2019 compensation award.\u201d N.C. Gen. Stat. \u00a7 97-42 provides, in pertinent part:\nPayments made by the employer to the injured employee during the period of his disability, or to his dependents, which by the terms of this Article were not due and payable when made, may, subject to the approval of the Commission be deducted from the amount to be paid as compensation.\nN.C. Gen. Stat. \u00a7 97-42 (2007). \u201cThe decision of whether to grant a credit is within the sound discretion of the Commission\u201d and \u201cwill not be disturbed on appeal in the absence of an abuse of discretion.\u201d Shockley v. Cairn Studios, Ltd., 149 N.C. App. 961, 966, 563 S.E.2d 207, 211 (2002), disc. review denied, 356 N.C. 678, 577 S.E.2d 887, 888 (2003). Our Supreme Court has clarified the extent of the Commission\u2019s discretion by holding that it is an abuse of discretion for the Commission to deny an employer full credit for benefits paid under an employer-funded plan if the benefits were not due and payable when made. See Evans v. AT&T Technologies, Inc., 332 N.C. 78, 85, 418 S.E.2d 503, 507-08 (\u00cd992); Foster v. Western-Electric Co., 320 N.C. 113, 117, 357 S.E.2d 670, 673 (1987).\nIn Foster, the employer was denied a credit for payments it made to the employee under its private disability benefits plan. Id. at 114, 357 S.E.2d 671-72. On appeal, our Supreme Court reversed and held that the employer was entitled to full credit, under N.C. Gen. Stat. \u00a7 97-42, because the employer \u201chad not accepted [the employee\u2019s] injury as compensable under workers\u2019 compensation at the time the payments were made[.]\u201d Foster, 320 N.C. at 115, 357 S.E.2d at 672. The Court discussed the importance of granting credit to employers in order to further the legislative intent of N.C. Gen. Stat. \u00a7 97-42 to encourage employers to make voluntary payments to injured employees. Id. at 116-17, 357 S.E.2d at 673. The Court stated:\nPayment by the employer under a private disability plan accomplishes sound policy objectives by providing immediate financial assistance to the disabled worker while she is disabled. Through its plan, [the employer] affords a much-needed continuity of income to injured employees fully consistent with the expressed policies of workers\u2019 compensation.\nId.\nOur Supreme Court also reversed the earlier decision in Evans v. AT&T Technologies, which only granted the employer partial credit for payments made to an injured employee under the employer\u2019s disability plan. 332 N.C. at 90, 418 S.E.2d at 511. The Court clarified that, under N.C. Gen. Stat. \u00a7 97-42, employers are entitled to receive \u201cfull dollar-for-dollar credit\u201d for all benefits paid under a private plan, so long as payments were not due and payable when made. Evans, 332 N.C. at 85, 418 S.E.2d at 508. Our Court has also recognized that the Commission has limited discretion in denying an employer full credit under N.C. Gen. Stat. \u00a7 97-42. See Cox v. City of Winston-Salem, 171 N.C. App. 112, 115, 613 S.E.2d 746, 748 (2005) (discussing that it is an abuse of discretion to deny an employer full credit for wage-replacement benefits if solely funded by the employer); Lowe v. BE&K Construction Co., 121 N.C. App. 570, 576, 468 S.E.2d 396, 399 (1996) (holding that the Commission erred by denying the employer credit for payments made when the employer had not accepted the employee\u2019s claim as compensable). In this case, defendants\u2019 short-term disability plan was fully funded by defendant-employer. Furthermore, when plaintiff received the short-term disability benefits, defendants had not accepted his injury as compensable, nor had there been a determination of compensability by the Industrial Commission. Thus, pursuant to Foster and Evans, defendants are entitled to full credit of $11,532.00 for all benefits paid to plaintiff.\nIn its Amended Opinion and Award, the Commission cited Church v. Baxter Travenol Laboratories, 104 N.C. App. 411, 409 S.E.2d 715, (1991), when referring to its discretion to reduce defendants\u2019 credit. In Church, the employer\u2019s private insurer paid the plaintiff benefits in the amount of $2,797.44 while he was injured. Id. at 416, 409 S.E.2d at 717. The plaintiff in Church was later awarded $3,769.79 in workers\u2019 compensation benefits. Id. Instead of awarding attorney\u2019s fees from the difference of $972.35, the Commission reduced the employer\u2019s credit so that the plaintiff\u2019s attorney in Church could be adequately compensated. Id. at 416-17, 409 S.E.2d at 717-18. We affirmed the Commission\u2019s decision reasoning that \u201c[i]f attorney\u2019s fees were allowed to be calculated from only the difference between the workers\u2019 compensation award and the private insurer\u2019s payment, then almost no attorney could afford to take a contested case where voluntary payments had already been made.\u201d Id. at 416, 409 S.E.2d at 718. This would leave \u201cinjured employees without the representation they need to obtain the complete and total amount of their workers\u2019 compensation award [and] would defeat the purposes of the Act.\u201d Id.\nAfter careful review of our Supreme Court\u2019s decisions in Foster and Evans, it is unclear whether Church is still binding on this Court. If Church remains binding, it applies only in the limited circumstance when the difference between the amount already paid by the employer and the amount awarded to the employee is so small that the claimant would be unable to obtain competent counsel if attorney\u2019s fees were only awarded from that amount.\nNevertheless, Church is not applicable to the facts of this case. Unlike the circumstances in Church, plaintiff\u2019s counsel will be adequately compensated. In addition to receiving twenty-five percent (25%) of all back compensation owed to plaintiff, plaintiff\u2019s counsel will also receive monthly payments of $512.66 for an indefinite duration. This is a substantial award of attorney\u2019s fees, and therefore, cannot fall under the rationale of Church.\nAs in Foster and Evans, the legislative intent of N.C. Gen. Stat. \u00a7 97-42 clearly supports granting defendants full credit for all short-term disability benefits paid to plaintiff. Defendants provided plaintiff with wage-replacement benefits after he was injured, but before he was entitled to receive workers\u2019 compensation. Defendants\u2019 voluntary payments furthered the overall intent of the statute to provide compensation to individuals with work-related injuries as soon as possible. See Evans, 332 N.C. at 87, 418 S.E.2d at 509.\nWhile we do not think that the Commission intended to penalize defendants by reducing their credit, the Commission\u2019s decision had the effect of doing so. An employer who has \u201cpaid an employee wage-replacement benefits at the time of that employee\u2019s greatest need, should not be penalized by being denied full credit for the amount paid as against the amount which was subsequently determined to be due the employee under workers\u2019 compensation.\u201d Foster, 320 N.C. at 117, 357 S.E.2d at 673. Denying employers full credit could be detrimental in that it \u201cwould inevitably cause employers to be less generous and the result would be that the employee would lose his full salary at the very moment he needs it most.\u201d Id.\nIn the case sub judice, the purpose of the statute was thwarted when defendants were required to pay significantly more solely due to the fact that they had provided short-term disability benefits to plaintiff. If defendants had not provided plaintiff with compensation under their disability insurance plan, they still would have been required to pay the amount of $11,532.00 once plaintiff was awarded workers\u2019 compensation benefits. Here, plaintiff\u2019s claim was not adjudged to be compensable until over two years after his injury. If defendants had waited until that time to compensate plaintiff in the amount of $11,532.00, plaintiff would have only been permitted to retain $8,649.00, seventy-five percent (75%) of that amount, as the remaining $2,883.00 would have been paid directly to plaintiff\u2019s attorney.\nHowever, because defendants had already voluntarily paid $11,532.00 to plaintiff, the Commission denied their request for a full credit and ordered them to pay an additional $2,883.00 to plaintiff\u2019s attorney \u2014 an amount they would not otherwise have been required to pay. This discourages employers from providing disability benefits, resulting in injured employees having to wait until awarded workers\u2019 compensation benefits to be compensated. This ruling is inconsistent with the legislative intent of N.C. Gen. Stat. \u00a7 97-42, which is to encourage employers to make voluntary payments to injured employees before workers\u2019 compensation benefits are awarded and due.\nFor the above-mentioned reasons, we hold that defendants are entitled to full credit for all short-term disability payments made to plaintiff and find that the Commission erred in reducing defendants\u2019 credit by ordering additional payment of plaintiff\u2019s attorney fees. We reverse and remand for appropriate modification of the Commission\u2019s Opinion and Award.\nReversed and remanded.\nJudges TYSON and CALABRIA concur.", "type": "majority", "author": "McCullough, Judge." } ], "attorneys": [ "Regan & Regan PLLC, by James W. Ragan, for plaintiff appellee.", "Teague, Campbell, Dennis & Gorham, L.L.P, by George H. Pender, for defendant appellants." ], "corrections": "", "head_matter": "RANDY E. STRICKLAND, Employee, Plaintiff v. MARTIN MARIETTA MATERIALS and Employer, SPECIALITY RISK SERVICES, Carrier, Dependants\nNo. COA08-476\n(Filed 18 November 2008)\nWorkers\u2019 Compensation\u2014 short-term disability benefits\u2014 improper reduction in employer\u2019s credit to pay employee\u2019s attorney fees\nThe full Industrial Commission abused its discretion by reducing defendant employer\u2019s credit for short-term disability benefits paid to plaintiff employee by twenty-five percent in order to partially fund attorney fees for plaintiff because: (1) our Supreme Court has held that it is an abuse of discretion for the Commission to deny an employer full credit for benefits paid under an employer-funded plan if the benefits were not due and payable when made; (2) N.C.G.S. \u00a7 97-42 provides that employers are entitled to receive full dollar-for-dollar credit for all benefits paid under a private plan so long as payments were not due and payable when made; (3) defendant\u2019s short-term disability plan was fully funded by defendant employer, and defendants had not accepted plaintiff\u2019s injury as compensable when plaintiff received the short-term disability benefits, nor had there been a determination of compensability by the Industrial Commission; (4) plaintiff\u2019s counsel will be adequately compensated; and (5) the ruling was inconsistent with the legislative intent of N.C.G.S. \u00a7 97-42 to encourage employers to make voluntary payments to injured employees before workers\u2019 compensation benefits are awarded and due.\nAppeal by defendants from Opinion and Award entered 11 January 2008 by the Full Commission for the North Carolina Industrial Commission. Heard in the Court of Appeals 25 September 2008.\nRegan & Regan PLLC, by James W. Ragan, for plaintiff appellee.\nTeague, Campbell, Dennis & Gorham, L.L.P, by George H. Pender, for defendant appellants." }, "file_name": "0718-01", "first_page_order": 750, "last_page_order": 757 }