{ "id": 4220641, "name": "DANNY K. ALLRED, Employee, Plaintiff v. EXCEPTIONAL LANDSCAPES, INC., Employer, NONINSURED, and TED WILLIAM WRIGHT, Individually, and JOHN THOMPSON SUMMEY, Individually, and JOY WRIGHT, Individually; and/or T&J SERVICES, Defendants", "name_abbreviation": "Allred v. Exceptional Landscapes, Inc.", "decision_date": "2013-05-21", "docket_number": "No. COA12-1278", "first_page": "229", "last_page": "237", "citations": [ { "type": "official", "cite": "227 N.C. App. 229" } ], "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": "N.C. Gen. Stat. \u00a7 97-88", "category": "laws:leg_statute", "reporter": "N.C. Gen. 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App. 142", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 11197826 ], "weight": 3, "year": 1998, "pin_cites": [ { "page": "143-44" }, { "page": "143-44" }, { "page": "143-44" } ], "opinion_index": 0, "case_paths": [ "/nc-app/131/0142-01" ] }, { "cite": "152 S.E.2d 533", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1967, "pin_cites": [ { "page": "535" } ], "opinion_index": 0 }, { "cite": "269 N.C. 393", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8563886 ], "year": 1967, "pin_cites": [ { "page": "396" } ], "opinion_index": 0, "case_paths": [ "/nc/269/0393-01" ] }, { "cite": "513 S.E.2d 602", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 3, "year": 1999, "pin_cites": [ { "page": "604" }, { "page": "604" }, { "page": "604" } ], "opinion_index": 0 }, { "cite": "132 N.C. App. 783", "category": "reporters:state", "reporter": "N.C. 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Gen. Stat.", "weight": 3, "opinion_index": 0 }, { "cite": "N.C. Gen. Stat. \u00a7 97-88", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "weight": 4, "opinion_index": 0 } ], "analysis": { "cardinality": 751, "char_count": 21079, "ocr_confidence": 0.727, "pagerank": { "raw": 1.334389935406012e-07, "percentile": 0.629824750400506 }, "sha256": "836cc29bd6ddc73d224204bd7bb1bf2635051a9fba5f3a5fb2049d17b682da15", "simhash": "1:8aa057e2f2a977dc", "word_count": 3341 }, "last_updated": "2023-07-14T17:48:13.495142+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "Judges ELMORE and STROUD concur." ], "parties": [ "DANNY K. ALLRED, Employee, Plaintiff v. EXCEPTIONAL LANDSCAPES, INC., Employer, NONINSURED, and TED WILLIAM WRIGHT, Individually, and JOHN THOMPSON SUMMEY, Individually, and JOY WRIGHT, Individually; and/or T&J SERVICES, Defendants" ], "opinions": [ { "text": "STEELMAN, Judge.\nWhere plaintiff filed a claim with the North Carolina Industrial Commission, the Commission retained exclusive and continuing jurisdiction over that claim. Where the parties\u2019 settlement agreement did not provide for the reimbursement of unpaid medical bills, the Commission properly determined it was not fair and just. Where defendants were not an \u201cinsurer\u201d as defined by statute, the Commission erred in assessing attorney\u2019s fees against defendants under N.C. Gen. Stat. \u00a7 97-88. Where one defendant did not have dominion or control over business decisions of the corporation, the Commission erred in piercing the corporate veil as to that defendant.\nI. Factual and Procedural History\nOn 17 August 2006, Danny K. Allred (plaintiff) was in a motor vehicle accident while performing duties on behalf of his employer, Exceptional Landscapes (Exceptional Landscapes), and suffered injuries. Exceptional Landscapes did not have workers\u2019 compensation insurance, nor was it self-insured at the time of the accident. Ted William Wright (T. Wright) and John Summey (Summey) were the shareholders of Exceptional Landscapes, and Joy Wright (J. Wright) was treasurer of Exceptional Landscapes and the spouse of T. Wright.\nIn September 2006, plaintiff filed a Form 18 and Form 33 with the Industrial Commission. A mediation conference was held on 27 February 2007. During the conference, the parties could not reach an agreement as to the workers\u2019 compensation claim and instead, attempted to reach an agreement as to a liability claim, based upon the assumption that plaintiff was going to withdraw his claim with the Industrial Commission. An agreement was reached under the terms of which Exceptional Landscapes would pay plaintiff a lump sum of $26,000. The agreement made no mention of the payment of plaintiff\u2019s outstanding medical bills. Pursuant to this agreement, the sum of $26,000 was paid to plaintiff and his then counsel. Plaintiff never withdrew the Form 33, and the case was scheduled for hearing in front of the Commission.\nOn 30 March 2012, the Full Commission entered an Opinion and Award. The Opinion and Award found that the Commission had jurisdiction over the matter and th\u00e1t the settlement agreement did not comply with the requirements of N.C. Gen. Stat. \u00a7 97-17. The Commission did not approve the settlement because it was not fair and just. Piercing the corporate veil, the Commission held T. Wright, J. Wright, and Summey \u201cindividually hable jointly and severally for the indemnity and medical compensation due in this case.\u201d The Commission ordered: (1) T. Wright, Summey, and J. Wright to pay plaintiff temporary total disability compensation at the rate of $211.34 per week and to pay all medical expenses incurred as a result of the accident; (2) an attorney\u2019s fee to be paid to plaintiff\u2019s counsel; (3) a penalty to be assessed pursuant to N.C. Gen. Stat. \u00a7 97-94(b) against T. Wright, Summey, and J. Wright for failing to procure workers\u2019 compensation insurance; and (4) T. Wright and J. Wright to pay an additional penalty pursuant to N.C. Gen. Stat. \u00a7 97-94(d) for failing to bring Exceptional Landscapes into compliance. The Commission held the imposition of both penalties under N.C. Gen. Stat. \u00a7 97-94 in abeyance.\nDefendants appeal.\nII. Standard of Review\n\u201cAppellate review of an order and award of the Industrial Commission is limited to a determination of whether the findings of the Commission are supported by the evidence and whether the findings in turn support the legal conclusions of the Commission.\u201d Simon v. Triangle Materials, Inc., 106 N.C. App. 39, 41, 415 S.E.2d 105, 106 (1992). Unchallenged findings of fact are presumed to be supported by competent evidence and are binding on appeal. Johnson v. Herbie\u2019s Place, 157 N.C. App. 168, 180, 579 S.E.2d 110, 118 (2003). The Commission\u2019s conclusions of law are reviewable de novo. Id. at 171, 579 S.E.2d at 113.\nIII. Jurisdiction\nIn its first argument, Exceptional Landscapes contends that the Commission did not have jurisdiction over plaintiff\u2019s claim when there was a settlement agreement as to plaintiff\u2019s claim. We disagree.\n\u201cThe jurisdiction of the Commission is limited and conferred by statute.\u201d Pearson v. C.P. Buckner Steel Erection Co., 348 N.C. 239, 241, 498 S.E.2d 818, 819 (1998). Under N.C. Gen. Stat. \u00a7 97-91, the Commission has the power to administrate the Workers\u2019 Compensation Act and to hear \u201call questions arising under the Article if not settled by agreements of the parties interested therein, with the approval of the Commission . . . .\u201d N.C. Gen. Stat. \u00a7 97-91 (2011). The exclusive venue for a claim by an employee against an employer for injuries arising in the course of employment is the Commission when the employer has \u201ccomplied with provisions of the [Workers\u2019 Compensation Act].\u201d N.C. Gen. Stat. \u00a7 97-10.1 (2011); see also Seigel v. Patel, 132 N.C. App. 783, 785-86, 513 S.E.2d 602, 604 (1999). In order to invoke such jurisdiction, an employee must either file a claim for compensation or submit a voluntary settlement for approval. Tabron v. Gold Leaf Farms, Inc., 269 N.C. 393, 396, 152 S.E.2d 533, 535 (1967). Once jurisdiction is invoked, the Commission retains continuing jurisdiction of all proceedings begun before it. See Pearson, 348 N.C. at 241-42, 498 S.E.2d at 820. (\u201cThis Court has recognized that the General Assembly intended the Commission to have continuing jurisdiction of proceedings begun before it.\u201d).\nExceptional Landscapes contends that plaintiff elected a remedy \u201cat law\u201d and that the Commission thereby lost its jurisdiction. N.C. Gen. Stat. \u00a7 97-94(b) states:\n(b) Any employer required to secure the payment of compensation under this Article who refuses or neglects to secure such compensation shall be punished by a penalty ... and the employer shall be hable during continuance of such refusal or neglect to an employee either for compensation under this Article or at law at the election of the injured employee.\nN.C. Gen. Stat. \u00a7 97-94(b) (2011) (emphasis added). While this section \u201cmay arguably permit plaintiff to bring her claim at law,\u201d the Commission is not precluded from hearing claims against noncompliant employers. Seigel, 132 N.C. App. at 786, 513 S.E.2d at 604. In fact, when a claim is filed with the Commission and jurisdiction is invoked, the Commission will retain \u201cexclusive jurisdiction over workers\u2019 compensation claims and all related matters____\u201d Johnson v. First Union Corp., 131 N.C. App. 142, 143-44, 504 S.E.2d 808, 809 (1998). In Johnson, a plaintiff-employee filed suit in superior court alleging various claims against the defendant-employer, including that the employer had committed fraud in submitting certain forms to the Industrial Commission. Id. We held that the Industrial Commission retained exclusive jurisdiction over that matter, including the claims for fraud and all related matters. Id.\nIn the instant case, Exceptional Landscapes does not challenge any of the findings of fact of the Industrial Commission and they are therefore binding on appeal. Johnson, 157 N.C. App. at 180, 579 S.E.2d at 118. When plaintiff filed Form 18 and Form 33 with the Commission regarding plaintiff\u2019s 17 August 2006 work-related injury, plaintiff invoked the jurisdiction of the Commission. Once filed, the Commission retained \u201cexclusive jurisdiction over workers\u2019 compensation claims and all related matters____\u201d Johnson, 131 N.C. App. at 143-44, 504 S.E.2d at 809. The parties negotiated an agreement at the mediation conference for what they believed to be a liability claim \u201cat law.\u201d While the language of N.C. Gen. Stat. \u00a7 97-94(b) \u201cmay arguably permit plaintiff to bring [his] claim at law,\u201d Seigel, 132 N.C. App. at 786, 513 S.E.2d at 604, plaintiff did not bring his claim at law. Instead, plaintiff initiated a workers\u2019 compensation claim before the Commission when he filed his Form 33. Once filed, the Commission retained continuing and exclusive jurisdiction over that claim and all related matters. See Pearson, 348 N.C. at 241-42, 498 S.E.2d at 820; Johnson, 131 N.C. App. at 143-44, 504 S.E.2d at 809. While nothing in the Workers\u2019 Compensation Act \u201cprevents] settlements made by and between the employee and employer[,]\u201d the Act requires \u201c[a] copy of a settlement agreement [to] be filed by the employer with and approved by the Commission.\u201d N.C. Gen. Stat. \u00a7 97-17 (2011). The settlement agreement in this case was not filed with nor approved by the Industrial Commission. The Commission\u2019s findings of fact therefore support its conclusion that the Industrial Commission had jurisdiction over the claim and the subject matter of this case.\nThis argument is without merit.\nIV. Fair and Just Settlement\nIn its second argument, Exceptional Landscapes contends that if this Court holds that the Commission had jurisdiction over plaintiff\u2019s claim, then the Commission erred in ruling that the parties\u2019 settlement was not fair and just. We disagree.\n\u201cThe Industrial Commission must review all compromise settlement agreements to make sure they comply with the Workers\u2019 Compensation Act and the Rules of the Industrial Commission, and to ensure that they are fair and reasonable.\u201d Smythe v. Waffle House, 170 N.C. App. 361, 364, 612 S.E.2d 345, 348 (2005). In the instant case, Exceptional Landscapes does not challenge any of the Commission\u2019s findings of fact, and thus, the findings of fact are binding on appeal. Johnson, 157 N.C. App. at 180, 579 S.E.2d at 118. Finding of fact 37 states that the settlement agreement did not comply with the statutory requirements of N.C. Gen. Stat. \u00a7 97-17, in that the agreement did not make any provision for payment of plaintiff\u2019s medical expenses, and that the agreement did not provide adequate indemnity compensation given plaintiff\u2019s physical and vocational limitations at the time of the settlement. Further, finding of fact 35 states, \u201c[t]he Mediated Settlement Agreement made no mention of payment of unpaid medical bills and did not include all of the terms required by Rule 502 of the Rules of the Industrial Commission.\u201d Rule 502 sets forth the requirements of compromise agreements, including: that the employer, if liability is admitted, undertakes to pay all medical expenses to date of the agreement; that the employer, if liability is denied, undertakes to pay all unpaid medical expenses to the date of the agreement; that the employer will pay all costs incurred; and that no rights other than those arising under the Workers\u2019 Compensation Act are compromised or released. 4 N.C. Admin. Code 10A.0502 (2012). The Commission\u2019s findings of fact support the conclusion that the settlement agreement did not comply with the Worker\u2019s Compensation Act or Industrial Commission Rule 502. The Commission\u2019s conclusion that the agreement was not fair and just was supported by its findings of fact.\nThis argument is without merit.\nV. Attorney\u2019s Fees\nExceptional Landscapes and J. Wright contend that the Commission erred in assessing attorney\u2019s fees under N.C. Gen. Stat. \u00a7 97-88. We agree.\nUnder N.C. Gen. Stat. \u00a7 97-88, \u201cthe Commission may award attorney\u2019s fees to an injured employee if (1) the insurer has appealed a decision to the full Commission or to any court, and (2) on appeal, the Commission or court has ordered the insurer to make, or continue making, payments of benefits to the employee.\u201d Estes v. N.C. State Univ., 117 N.C. App. 126, 128, 449 S.E.2d 762, 764 (1994) (emphasis added); see also N.C. Gen. Stat. \u00a7 97-88 (2011). The term \u201cinsurer\u201d is defined as \u201cany person or fund authorized under G.S. 97-93 to insure under this Article, and includes self-insurers.\u201d N.C. Gen. Stat. \u00a7 97-2(7) (2011). A \u201cself-insurer\u201d must be licensed by the Commissioner of Insurance under the provisions of N.C. Gen. Stat. \u00a7 58-47-65 (2011).\nIn the instant case, none of the defendants are \u201cinsurers\u201d as defined by statute. \u201c[I]f the language of the statute is clear and not ambiguous, we must conclude that the General Assembly intended the statute to be implemented according to the plain meaning of its terms.\u201d Childress v. Trion, Inc., 125N.C. App. 588, 591, 481 S.E.2d 697, 699 (1997). Although defendants appealed the decision of the Deputy Commissioner to the Full Commission, the plain language of the statute precludes the application of attorney\u2019s fees in this case because the \u201cinsurer\u201d did not appeal this decision. The Commission erred in assessing attorney\u2019s fees against defendants.\nWe note that the remedy for failure to procure workers\u2019 compensation insurance is governed by N.C. Gen. Stat. \u00a7 97-94, which provides for civil penalties against the employer and civil and criminal sanctions against individual employees. N.C. Gen. Stat. \u00a7 97-94 (2011). In the instant case, the Commission assessed civil penalties pursuant to N.C. Gen. Stat. \u00a7 97-94(b) against T. Wright, Summey, and J. Wright and pursuant to N.C. Gen. Stat. \u00a7 97-94(d) against T. Wright and J. Wright.\nVI. Piercing the Corporate Veil\nIn J. Wright\u2019s second argument, she contends that the Commission erred in piercing the corporate veil as to her because she was not a shareholder of the corporation. We agree.\nNorth Carolina courts will \u201cpierce the corporate veil\u201d to extend liabilities of the corporation beyond the confines of the corporation\u2019s entity when it is necessary to achieve equity. Glenn v. Wagner, 313 N.C. 450, 454, 329 S.E.2d 326, 330 (1985). Liability may be imposed on an individual who is operating a corporation as a mere instrumentality when the individual has:\n(1) Control, not mere majority or complete stock control, but complete domination, not only of finances, but of policy and business practice in respect to the transaction attacked so that the corporate entity as to this transaction had at the time no separate mind, will or existence of its own; and\n(2) Such control must have been used by the defendant to commit fraud or wrong, to perpetrate the violation of a statutory or other positive legal duty, or a dishonest and unjust act in contravention of plaintiff\u2019s legal rights; and\n(3) The aforesaid control and breach of duty must proximately cause the injury or unjust loss complained of.\nId. at 455, 329 S.E.2d at 330. Factors which have been considered in piercing the corporate veil include: inadequate capitalization, non-compliance with corporate formalities, complete domination and control of the corporation so that it had no independent identity, and excessive fragmentation of a single enterprise into separate corporations. Id. at 455, 329 S.E.2d at 330-31.\nThe only findings of fact made by the Industrial Commission that refer to any level of J. Wright\u2019s control are that she was an officer of Exceptional Landscapes, that T. Wright and J. Wright \u201cdid not observe any corporate formalities in the operation of Exceptional Landscapes, Inc.,\u201d that Exceptional Landscapes was not adequately capitalized, that J. Wright was treasurer of Exceptional Landscapes, that she \u201csigned the banking authorization for the company,\u201d and that she \u201chad the authority to write checks for the corporation.\u201d The Commission\u2019s findings do not demonstrate that J. Wright had complete domination of policy, finances, and business practices, nor that she exercised such control over Exceptional Landscapes that the corporate entity had no separate existence. These findings of fact are insufficient to support a conclusion of law that J. Wright was an alter ego of Exceptional Landscapes. The Industrial Commission\u2019s conclusion of law that pierced the corporate veil as to J. Wright and then imposed personal liability upon her is not supported by the Industrial Commission\u2019s findings of fact. We reverse the holding of the Industrial Commission imposing liability upon J. Wright.\nVII. Civil Penalty\nIn J. Wright\u2019s third argument, she contends that the Commission erred in ordering her to pay a civil penalty for the failure to bring Exceptional Landscapes into compliance with the requirements of N.C. Gen. Stat. \u00a7 97-93 because she did not have the ability and authority to bring them into compliance. The Commission held the imposition of this penalty in abeyance. On 13 November 2012, J. Wright filed a motion to withdraw her appeal as to PH-1887 because the Commission\u2019s Opinion and Award as to PH-1887 was not a final award of the agency. We subsequently granted this motion and therefore do not address J. Wright\u2019s appeal as to the civil penalty.\nVIII The Anneals of T. Wright and Summev\nDefendants T. Wright and Summey filed pro se briefs incorporating and adopting by reference all of the sections of the briefs of Exceptional Landscapes and J. Wright. While T. Wright and Summey incorporated the arguments of J. Wright, her contentions that the Industrial Commission erred by piercing the corporate veil relate only to her, and not to any other defendant. Since T. Wright and Summey have made no argument on appeal as to the Commission\u2019s findings of fact and conclusions of law piercing the corporate veil as to them, any argument as to those two defendants has been waived and is deemed abandoned. N.C.R. App. P. 28(b)(6). We note that defendants T. Wright and Summey also filed motions to withdraw their appeal as to PH-1887, which was granted by this Court.\nIX. Conclusion\nWe affirm the Industrial Commission\u2019s holding that the Commission had jurisdiction over plaintiff\u2019s claim and that the settlement agreement was not fair or just. We also affirm the holding of the Industrial Commission piercing the corporate veil as to T. Wright and Summey and imposing individual liability as to those defendants.\nWe reverse the Industrial Commission\u2019s ruling imposing attorney\u2019s fees against all defendants. We also reverse the Industrial Commission\u2019s holding imposing personal liability upon J. Wright.\nAFFIRMED IN PART, REVERSED IN PART.\nJudges ELMORE and STROUD concur.", "type": "majority", "author": "STEELMAN, Judge." } ], "attorneys": [ "Holt, Longest, Wall, Blaetz & Moseley, PLLC, by W. Phillip Moseley, for plaintiff-appellee.", "CranJUl Sumner & Hartzog LLP, by W. Scott Fuller and Jaye E. Bingham-Hinch, for defendant-appellant Exceptional Landscapes, Inc., and/or T&JServices.", "McCullers & Whitaker, PLLC, by Christopher Mann, for defendant-appellant Joy Wright.", "Ted William Wright, pro se, for defendant-appellant.", "John Thompson Summey, pro se, for defendant-appellant." ], "corrections": "", "head_matter": "DANNY K. ALLRED, Employee, Plaintiff v. EXCEPTIONAL LANDSCAPES, INC., Employer, NONINSURED, and TED WILLIAM WRIGHT, Individually, and JOHN THOMPSON SUMMEY, Individually, and JOY WRIGHT, Individually; and/or T&J SERVICES, Defendants\nNo. COA12-1278\nFiled 21 May 2013\n1. Workers\u2019 Compensation \u2014 jurisdiction\u2014Form 33 filed\nThe Industrial Commission had jurisdiction over plaintiffs workers\u2019 compensation claim. Plaintiff initiated a workers\u2019 compensation claim before the Commission when he filed his Form 33. Once filed, the Commission retained continuing and exclusive jurisdiction over that claim and all related matters.\n2. Workers\u2019 Compensation \u2014 settlement agreement \u2014 not fair and just\nThe Industrial Commission did not err in a workers\u2019 compensation case by ruling that the parties\u2019 settlement was not fair and just. The settlement agreement did not comply with the statutory requirements in that the agreement did not make any provision for payment of plaintiffs medical expenses, and did not provide adequate indemnity compensation given plaintiff\u2019s physical and vocational limitations at the time of the settlement. Further, the agreement made no mention of payment of unpaid medical bills, as required by Industrial Commission Rule 502.\n3. Worker\u2019s Compensation \u2014 attorney fees \u2014 insurer\nThe Industrial Commission erred in a workers\u2019 compensation case by assessing attorney fees against defendants under N.C. Gen. Stat. \u00a7 97-88. Defendants were not \u201cinsurers\u201d and the \u201cinsurer\u201d did not appeal the decision of the Deputy Commissioner to the Full Commission.\n4. Corporations \u2014 piercing the corporate veil \u2014 no alter ego\nThe Industrial Commission erred in a worker\u2019s compensation case by piercing the corporate veil as to defendant J. Wright because she was not a shareholder of the defendant corporation. The findings of fact were insufficient to support a conclusion of law that J. Wright was an alter ego of the corporation.\n5. Appeal and Error \u2014 issue not addressed \u2014 motion to withdraw appeal \u2014 previously granted\nDefendant J. Wright\u2019s argument that the Industrial Commission erred in a workers\u2019 compensation case by ordering her to pay a civil penalty for the failure to bring defendant Exceptional Landscapes into compliance with the requirements of N.C.G.S. \u00a7 97-93 was not addressed. Wright\u2019s motion to withdraw her appeal of that issue had been previously granted.\n6. Appeal and Error \u2014 issue on appeal \u2014 deemed abandoned\nDefendants\u2019 argument on appeal concerning the Industrial Commission\u2019s findings of fact and conclusions of law piercing the corporate veil as to them was deemed abandoned pursuant to N.C.R. App. P. 28(b)(6).\nAppeal by defendants from the Opinion and Award entered 30 March 2012 by the North Carolina Industrial Commission. Heard in the Court of Appeals 28 March 2013.\nHolt, Longest, Wall, Blaetz & Moseley, PLLC, by W. Phillip Moseley, for plaintiff-appellee.\nCranJUl Sumner & Hartzog LLP, by W. Scott Fuller and Jaye E. Bingham-Hinch, for defendant-appellant Exceptional Landscapes, Inc., and/or T&JServices.\nMcCullers & Whitaker, PLLC, by Christopher Mann, for defendant-appellant Joy Wright.\nTed William Wright, pro se, for defendant-appellant.\nJohn Thompson Summey, pro se, for defendant-appellant." }, "file_name": "0229-01", "first_page_order": 239, "last_page_order": 247 }