Opinion
I.C. NO. 489198
FILED: 7 October 1998
This matter is before the Full Commission upon a 6 January 1998 motion by plaintiff for the reconsideration of the 18 December 1997 Opinion and Award of the Full Commission on grounds that it "was predicated on a misapprehension of the applicable law." Subsequently, motions to submit amicus curiae briefs by the North Carolina Academy of Trial Lawyers and the North Carolina Association of Defense Attorneys were allowed by the Commission. Attached to defendants' brief to the Commission were the affidavits of Alan J. Miles and William H. Stephenson. Plaintiff has moved to strike these affidavits as improperly before the Commission on the issues raised.
Plaintiff: David Stewart, Attorney, Madison, North Carolina; Counsel of Record.
Defendants: Teague, Campbell, Dennis Gorham, Attorneys, Raleigh, North Carolina; George H. Pender, Counsel of Record.*************
The motion to strike the affidavits of Alan J. Miles and William H. Stephenson is ALLOWED, pursuant to the ruling of the Supreme Court in State ex rel. North Carolina Milk Commission v. National Food Stores, Inc., 270 N.C. 323, 154 S.E.2d 548 (1967). The Full Commission DENIES that portion of the motion which would have this order result in the exclusion of these affidavits from the settled Record on Appeal, should review be sought in the appellate courts, as such a decision must be made in accordance with Rule 18 of the North Carolina Rules of Appellate Procedure.
Plaintiff's motion for reconsideration of the Opinion and Award in this case is DENIED. Plaintiff's motion is limited to the issue of whether the filing of a Form 60 in this matter engenders the same presumptions of continuing disability as does a Form 21. For the following reasons, the undersigned hold that it does not.
"Disability" means the "incapacity because of injury to earn the wages which the employee was receiving at the time of the injury in the same or any other employment." N.C. Gen. Stat. § 97-2(9). If the Commission makes an award, payable during disability, there is a presumption that the disability lasts until the employee returns to work. Watkins v. Central Motor Lines, 279 N.C. App. 132, 181 S.E.2d 588 (1971). It is well settled that the approval by the Commission of a Form 21 Agreement constitutes an award of the Commission which is payable during disability, and raises the presumption of the claimant's continuing disability. Brown v. SN Communications, Inc. 124 N.C. App. 320, 477 S.E.2d 197 (1996). The issue before the undersigned is whether a Form 60 also constitutes an award, payable during disability, thereby raising the same presumption in favor of the claimant.
Plaintiff has placed great emphasis on the Court of Appeal's recent holding in Calhoun v. Wayne Dennis Heating Air Conditioning, ___ N.C. App. ___, 501 S.E.2d 346 (1998) in which it was held that a Form 60 properly executed by the employer or someone acting on his behalf is an "award" within the meaning of the statute because any payment made "pursuant to G.S. § 97-18(b)" constitutes an award of the Commission as defined by N.C. Gen. Stat. § 97-82(b). That the Form 60 constitutes an award is not herein in question. The issue is whether the term "disability" is implicitly included in an award of compensation and liability. The Court of Appeals did not address this issue in Calhoun; therefore, the ruling in that case does not bind us in the current matter.
To determine whether an admission of compensation and liability also constitutes an admission of disability, it is first necessary to examine the Workers' Compensation Reform Act of 1994 and the resulting amendments to the Act.
Prior to the 1994 amendments, disability compensation could be received in one of two ways: (1) by the entry of an agreement for payment of compensation and approval by the Commission of that agreement, or (2) after a hearing and decision in a disputed claim. When an agreement to pay compensation was filed with the Commission, the Commission was required to act in its judicial capacity to determine the fairness to both parties by reviewing the agreement via documentation of the facts set forth therein. Absent sufficient documentation, the agreement would not be approved. The process could take several weeks or months before the claimant could begin receiving compensation. The process of requesting a hearing and decision by the Commission in a disputed claim created greater delays in providing compensation to a claimant. The enactment of a method for direct payment enabled employers to pay compensation to injured employees without the participation of the Commission. "These changes were intended to get indemnity benefits to injured workers sooner, to reduce the incentive to pursue litigation of a compensation claim, and to reduce the administrative paperwork burden on the parties and the Commission." Henry N. Patterson, Jr./ Alan J. Miles, New Payment System, North Carolina Academy of Trial Lawyers, Workplace Torts Workers' Comp III, November 22, 1996.
N.C. Gen. Stat. § 97-18, as amended under the Reform Act, provides an employer with three alternative courses of action upon receiving "written or actual notice of the injury or death" of an employee. Under subsection (b), the employer may admit the employee's right to compensation. Subsection (c) provides that an employer may deny the employee's right to compensation. If the employer is uncertain "whether the claim is compensable or whether it has liability for the claim," subsection (d) allows the employer to make payments without prejudice and without admitting liability.
When an employer chooses to admit the employee's right to compensation under subsection (b), payments of compensation may be made directly to the claimant, without the approval of the Commission. "Direct payments" of this nature are governed by N.C. Gen. Stat. § 97-82. The Commission requires that an employer wishing to make direct payments pursuant to an admission as to the compensability of the injury and the employer's liability therefore, must file with the Commission a Form 60, Employer's Admission of Employee's Right to Compensation Pursuant to G.S. § 97-18(b). The form is unilaterally prepared and submitted by the employer. The employer, employee, and insurer, if any, must be identified, and the employer must admit to the employee's right to compensation for an injury by accident or an occupational disease occurring or developing on a date certain. The remainder of the form consists of queries which come under the heading " The Following Is Provided For Informational Purposes Only And Does NOT Constitute An Agreement." The employer is asked to provide a description of the injury or occupational disease, whether the employee was paid for the entire day of injury, the employee's average weekly wage and compensation rate, the nature of the compensation the employer is paying, and the dates disability and payments of compensation began.
As the form itself expressly states, it is not an agreement between the parties. The Commission does not review the form for fairness or accuracy, and most importantly, does not approve the form. Therefore, the Commission in accepting the form, does not act in its judicial capacity. See Vernon v. Mabe, 336 N.C. 425, 444 S.E.2d 191 (1994). The only admission contained in the form is on the part of the employer, and is limited to accepting liability for an employee's injury by accident arising out of and in the course of his employment or an occupational disease. The admission is significant in that it establishes the jurisdiction of the Commission over the claim, and automatically entitles the employee to compensation for medical treatment for the injury or occupational disease. Charlotte-Mecklenburg Hosp. v. N.C. Indus. Comm., 336 N.C. 200, 443 S.E.2d 716 (1994). It does not, however, necessarily establish that the employee is disabled as defined by the Act. It is possible to be entitled to compensation without having sustained a disability which results in an incapacity for work. If, for example, a claimant is entitled to medical payments for treatment for a work-related injury which has not required him to miss any work, he would be receiving compensation without having a disability.
Nothing in the amendments prevents employers and employees from entering into an agreement for wage loss compensation or from requesting a hearing before the Commission on a disputed claim. Further, the Reform Act made no amendments to N.C. Gen. Stat. § 97-17, which permits settlements on form agreements approved by the Commission. Therefore, there now exists a dual system for payment of compensation which allows direct payment of compensation or entry of a memorandum of agreement for payment of compensation. See Patterson/Eichner, 1994 Workers' Compensation Reform Act, North Carolina Academy of Trial Lawyers, Workplace Torts Workers' Compensation, Cutting Edge Workplace Litigation Issues Presented by the Architects of the 1994 Workers' Comp Reform Act.
The difference in nature and legal effect of payments made pursuant to N.C. Gen. Stat. § 97-18(b) and those made pursuant to N.C. Gen. Stat. § 97-17 are found in the amended language of N.C. Gen. Stat. § 97-82(b). The statute provides that a memorandum of agreement, approved by the Commission, shall for all purposes be enforceable by court decree as an award of the Commission (emphasis added). On the contrary, payments made pursuant to G.S. § 97-18(b) "shall constitute an award of the Commission on the question of compensability of and the insurer's liability for the injury for which the payment was made." (Emphasis added). Plaintiff contends that the term "disability" must necessarily be included in an award based on compensability and liability. The undersigned disagree.
Within the meaning of the Act, a "compensable injury" is an injury by accident arising out of and in the course of employment or an occupational disease. Minter v. Osborne Company, 127 N.C. App. 134, 487 S.E.2d 835 (1997). As stated above, "disability" is defined by the Act as an incapacity to earn wages. Therefore, a compensable injury is not the equivalent of a disabling injury. To be compensable, an injury must have occurred in the course of the performance of the claimant's employment. In order to be entitled to wage loss compensation pursuant to a disability, the claimant must prove that (1) he was incapable after the injury of earning the same wages earned prior to the injury in the same employment; (2) that post-injury he was incapable of earning pre-injury wages in any other employment; and (3) that the incapacity to earn wages (his disability) is the result of his compensable injury. Hilliard v. Apex Cabinet Co., 305 N.C. 593, 290 S.E.2d 682 (1982).
The difference is clear. A claimant may be the beneficiary of an admission by his employer that an injury is compensable, and still have not satisfied all the elements necessary to establish a right to wage loss compensation due to a disability. The Form 60 does no more than obtain for the claimant that admission as to compensability. Applying the maxim expressio unius est exlusio alterius (mention of specific matters implies the exclusion of others), see, Campbell v. Church, 298 N.C. 476, 259 S.E.2d 558 (1969), it must be presumed that had the Legislature intended for the employer to make an additional admission as to disability, the term would have been included in the language of G.S. § 97-82.
There are also equitable arguments which have been considered in the undersigned's' determination that a Form 60 does not establish a plaintiff's right to an award for disability. As noted above, a Form 60 is filed with the Commission without agreement of the parties, and without review for fairness and approval by the Commission. In the absence of Commission approval, the rights of the parties are not protected and manifest unfairness could result by binding a claimant to unverified facts contained in the Form 60. If treated otherwise, in order for a claimant to challenge an award pursuant to a Form 60 the claimant would be required to show fraud, misrepresentation, duress, or mutual mistake pursuant to G.S. § 97-17; a showing which would be nearly impossible given that the claimant did not participate in the preparation of the Form.
In conclusion, the undersigned hold that there is nothing in the usage of a Form 60 which dictates that it constitute an award for continuing disability. There is no admission by the employer as to the nature or duration of the claimant's disability, and absent an agreement approved by the Commission which establishes the same, the burden of doing so remains with the claimant. Accordingly, the undersigned finds no basis upon which to allow plaintiff's motion to reconsider the prior Opinion and Award of the Full Commission filed in this matter.
This the ___ day of September 1998.
S/ ________________________ DIANNE C. SELLERS COMMISSIONER
CONCURRING:
S/ ______________________ KIM L. CRAMER DEPUTY COMMISSIONER
DISSENTING:
S/ ______________________ THOMAS J. BOLCH COMMISSIONER
By its decision in this case, the majority of this Full Commission panel eviscerates what the General Assembly did in enacting the Workers Compensation Reform Act of 1994. I disagree with their interpretation and their evisceration and therefore dissent.
Following the plaintiff's injury by accident on October 25, 1994, the defendants began paying temporary total disability benefits to the plaintiff at the rate of $160.01 per week. On May 9, 1995, the defendants prepared and submitted to the Commission a Form 24 application to stop payment of compensation to the plaintiff. Simultaneously, the defendants also prepared and submitted a Form 60 admission of employee's right to compensation. At the time of his injury, Mr. Sims had been working for defendant employer Charmes/Arby's for only a brief period of time as an assistant manager trainee.
In this case the defendants' began paying temporary total disability benefits to the plaintiff following his injury without entering into a compensation agreement or otherwise admitting liability for the compensation they were paying. Months later, when the defendants sought to terminate the plaintiff's benefits based upon his concurrent self-employment, the defendants prepared and submitted a Form 60 admission of employee's right to compensation. In other words, the defendants paid disability compensation, and thereafter — with complete knowledge of all relevant facts — admitted that they owed it.
This matter was originally heard before Deputy Commissioner Theresa B. Stephenson on September 10, 1996 in Winston-Salem. In an Opinion and Award entered on May 8, 1997, Deputy Commissioner Stephenson concluded that because the defendants accepted liability by way of a Form 60 admission instead of a Form 21 agreement, the plaintiff had not met his initial burden of proving his disability and was not entitled to a presumption of continuing disability. After hearing the facts, the Deputy Commissioner did find that plaintiff suffered a compensable injury to his back when he lifted a 50 pound box of meat and that plaintiff reported his injury and received treatment from Kernersville Immediate Care where he was diagnosed with lumbosacral strain.
The issue before the Commission on reconsideration of the majority's 18 December 1997 Opinion and Award is whether an employer's acknowledgment of liability through the "direct pay" mechanism added by the Workers' Compensation Reform Act of 1994 gives rise to the same presumption of disability recognized when an employer admits liability through a Form 21. The majority's original conclusion and defendants' contention that it does not give rise to a presumption divorces the presumption from its analytical underpinnings and disregards the intent of the amended statute to equate "direct pay" and Form 21 agreements.
The presumption at issue is not a "Form 21 presumption"; it is not conditioned on the existence of an agreement. Instead, the rule — established more than 25 years ago — is: "If an award is made by the Industrial Commission, payable during disability, there is a presumption that disability lasts until the employee returns to work. . . ." Watkins v. Central Motor Lines, Inc., 279 N.C. 132, 137, 181 S.E.2d 588, 592 (1971) (emphasis added). As the Court of Appeals explained in Kisiah v. W.R. Kisiah Plumbing, Inc., 124 N.C. App. 72, 82, 476 S.E.2d 434 (1996), "the presumption of disability inures to the benefit of an employee whenever a disability award is made by the Commission." See also Hoyle v. Carolina Associated Mills, 122 N.C. App. 462, 464, 470 S.E.2d 357, 358 (1996) ("Under the Watkins presumption, if the Commission makes an award payable during disability, it is presumed that the disability continues until the employee returns to work. . . .").
The focus thus is on whether there has been an "award" or other determination of disability. A Form 21 agreement gives rise to the presumption because it is an award — not because of any particular characteristics of the agreement:
A Form 21 agreement has long been regarded by this Court as "constitut[ing] an award by the Commission, enforceable if necessary, by a court decree." . . . Such an award is "conclusive and binding as to all questions of fact." N.C. Gen. Stat. § 97-86 (1991).
Kisiah, 124 N.C. App. at 81, 476 S.E.2d at 439. See also Watkins, 279 N.C. at 138, 181 S.E.2d at 593 (Form 21 constitutes an award enforceable by a court decree and, therefore, gives rise to the presumption). The Court of Appeals has also found significant the fact that a Form 21 agreement constitutes an admission of liability by the defendant. Dalton v. Anvil Knitwear, 119 N.C. App. 275, 458 S.E.2d 251, 257 (1995); Radica v. Carolina Mills, 113 N.C. App. 440, 447, 439 S.E.2d 185, 190 (1994). Nothing in these cases suggests that an "agreement" is required as opposed to an award or an admission of liability.
"Direct payment" or payment based on a Form 60 cannot be distinguished from a Form 21 agreement. First, it constitutes an award enforceable in court, as the Court of Appeals confirmed on June 16, 1998:
The plaintiff argues that the defendants' execution of a Form 60 constitutes an award of the Commission and thus entitles him to seek the imposition of a judgment, which in turn entitles him to seek execution for past due installments and future installments as they become due. We agree.
*************
A Form 60 properly executed by the employer or someone acting on his behalf is an "award" within the meaning of section 97-87. This is so because any payment made "pursuant to G.S. 97-18(b)" constitutes an award of the Commission, N.C.G.S. § 97-82(b) (Supp. 1997), and payments voluntarily made by an employer pursuant to a Form 60 are payments made consistent with 97-18(b), see N.C.G.S. § 97-18(b) (Supp. 1997) (setting out procedures for payment where employer "admits the employee's right to compensation"). Indeed, the Form 60 specifically provides that it is entered "pursuant to N.C. Gen. Stat. § 97-18(b)."
Calhoun v. Wayne Dennis Heating Air Conditioning, No. COA97-1270, Slip op. at 4, 5-6 (N.C.App. June 16, 1998) (holding that a Form 60 obligation to pay could be converted into a judgment). In short, there can be no dispute based on Calhoun and the language of the statute that payment pursuant to a Form 60 constitutes an "award" that may be enforced in court.
Further, direct pay — like a Form 21 agreement — constitutes an admission of liability by the employer. The statutory provision authorizing "direct pay" states: "When the employer admits the employee's right to compensation, the first installment of compensation payable by the employer shall become due on the fourteenth day after the employer has written or actual notice of the injury or death." N.C. Gen. Stat. § 97-18(b) (emphasis added). If the employer does not wish to admit liability, then it must either notify the Commission that it is refusing to pay compensation, § 97-18(c), or it "may initiate compensation payments without prejudice and without admitting liability," § 97-18(d). In order to do the latter, the employer must submit a form stating that payments are being made without prejudice. § 97-18(d). If, however, "the employer or insurer does not contest the compensability of the claim or its liability therefor within 90 days from the date it first has written or actual notice of the injury or death, or within such additional period as may be granted by the Commission, it waives the right to contest the compensability of and its liability for the claim under this Article." Id___:. (emphasis added). Consistent with these provisions, the Form 60 is titled "Employer's Admission of Employee's Right to Compensation Pursuant to N.C. Gen. Stat. § 97-18(b)" and notifies the employee that "[y]our employer admits your right to compensation". . . .
As a result, the sole factors necessary to give rise to the presumption are present in the Form 60 or "direct pay" context just as with a Form 21: an award enforceable in court and an admission by the employer/insurer of liability. Under the North Carolina appellate decisions, since there has been an "award . . . made by the Industrial Commission, payable during disability, there is a presumption that disability lasts until the employee returns to work at wages equal to those he was receiving at the time his injury occurred." Watkins, 279 N.C. at 137, 181 S.E.2d at 592.
The plaintiff's bar contends that the Form 60 admission gives rise to the presumption of continuing disability because it establishes every element-including disability — of the employee's entitlement to compensation. The defense bar argues that while the Form 60 admission establishes the compensability of the claim and the liability of the employer, it does not address the issue of disability. Since the plaintiff has not met his initial burden of proving disability, the argument goes, there can be no presumption that the disability continues.
The question is, then, what does the employer admit pursuant to a Form 60. Specifically, does the employer admit the employee's disability? A careful analysis of the provisions of the Workers' Compensation Reform Act concerning direct payment of benefits clearly establishes that the employer admits the employee's disability when directly paying benefits pursuant to a Form 60.
The plain language of G.S. § 97-18(b) compels the conclusion that an employer utilizing the direct pay procedure admits that the employee is disabled. G.S. § 97-18(b), as amended, sets forth the procedure for payment of disability benefits "when the employer admits the employee's right to compensation. ."
In Hollman v. City of Raleigh, 273 N.C. 240, 159 S.E.2d 874 (1968), the North Carolina Supreme Court set forth the four conditions antecedent to the right to compensation under the North Carolina Workers' Compensation Act. The claimant must show: (1) That he suffered an injury by accident; (2) That such injury arose in the course of the employment; (3) That such injury arose out of the employment; and (4) That such injury caused him disability. Logically, one cannot be entitled to disability benefits unless one is disabled.
The conclusion that an employer who admits the employee's right to compensation under G.S. § 97-18(b) also admits that the employee is disabled is bolstered by consideration of the corresponding changes to G.S. § 97-82(b), which now specifically provides that direct payment of compensation constitutes "payment of compensation pursuant to an award." While G.S. § 97-82(b) also provides that direct payment "pursuant to G.S. § 97-18(b) shall constitute an award of the Commission on the question of compensability of and the insurer's liability for the injury for which payment is made," the words "compensability" and "liability" are properly construed here to include disability. This is so because G.S. § 97-82(b) must be interpreted together with G.S. § 97-18(b), to which it refers. When the statutes are so construed, the word "compensability" is clearly used in its broadest sense, to include disability, and the word "liability" can only mean liability for compensation.
If direct payment of benefits does not establish the fact of the employee's disability, the anomalous result is that an employee who has been awarded compensation for disability has not yet met his initial burden of proving that he is disabled. This result is even more absurd in light of Calhoun's holding that a Form 60 admission can be reduced to judgment and enforced in the Superior Court like any other award of compensation under the Act.
A number of other logical anomalies flow from the conclusion that the Form 60 admission does not establish the employee's disability. First, although the employer must file a Form 24 application prior to terminating the payment of compensation pursuant to the Form 60 admission, presumably, the employee would bear the burden of proving his disability in the telephonic hearing. Second, this interpretation of the direct payment system eliminates the need for the new payment without prejudice provisions of G.S. § 97-18(d). It is difficult to understand why an employer would want to utilize the payment without prejudice procedure at all, if under the direct payment system the employer could change its mind about payment of benefits at any time and force the employee to prove his claim. This is the ultimate payment without prejudice.
Finally, if the Form 60 admission does not establish the employee's disability, then a procedure which was intended to lessen the administrative burden on the parties and the Commission would be transformed into a bureaucratic nightmare. Presumably, in every Form 60 case, the employee would be required to request a hearing in order to establish the fact of his disability and preserve his rights under the Act. Thus the interpretation of the majority eviscerates the Workers Compensation Reform Act of 1994.
Finally, the affidavits proffered to show legislative intent should not be part of the record in this case. Including them, without counter affidavits, gives some credence to them, while our Supreme Court has said time and time again that the legislative words speak for themselves and not even a legislator will be permitted to testify as to what the legislature intended when it enacted the words. The words mean what they say. DW, Inc. v. City of Charlotte, 268 N.C. 577, 581, 151 S.E.2d 241,244 (1966).
This 1st day of October 1998.
S/ ________________________ THOMAS J. BOLCH COMMISSIONER