North Carolina Lawyers Weekly
Long v. Ball-Foster Glass Container Co. (Lawyers Weekly No. 10-08-0999, 5 pp.) (Bernadine S. Ballance, Commissioner) Appealed from Opinion & Award of Deputy Commissioner Myra L. Griffin. I.C. No. 591834.
Holding: Because the settlement agreement did not address the timing of the funding for the Medicare set aside and there was not “a meeting of the minds” by the parties with respect to such timing, the defendants should not be penalized by the assessment of a late payment penalty under G.S. § 97-18(g). Although the parties had different understandings concerning the timing of the funding of the MSA, such confusion was not based upon the express language of the settlement agreement.
Facts
The plaintiff sustained a work-related injury in 1995. The defendants paid ongoing temporary total disability benefits and medical compensation.
In 2005 the plaintiff filed a Form 18M seeking additional medical treatment. A deputy commissioner affirmed the approval of the plaintiff’s Form 18M, and neither party appealed the issue further.
Following a 2007 mediation, the parties reached a settlement in which the defendants agreed to pay the plaintiff $180,000, including attorney’s fees.
The defendants also agreed to fund a Medicare set aside (MSA) account in the amount of $56,532 for the purpose of paying the plaintiff’s future medical expenses. The defendants agreed to add up to $5,000 to the set aside if the Centers for Medicare & Medicaid Services (CMS) required a higher amount.
CMS required that an MSA be submitted for approval. Consequently, the MSA provisions of the settlement agreement could not be finalized until CMS made its determination.
A deputy commissioner entered an order approving the settlement in the amount of $180,000. The order did not address the MSA funding or include the $56,532 MSA in the approved award.
The settlement proceeds of $180,000 were issued by the defendant-carrier in accordance with the order.
Subsequently the plaintiff’s counsel inquired about payment of the MSA funds because the lack of such funds prevented the plaintiff from scheduling medical appointments. The adjuster issued the MSA funds to the plaintiff. CMS ultimately approved the MSA proposal and determined that the $56,532 allocation adequately considered Medicare’s interests.
The plaintiff asserted a claim for a 10 percent late-payment penalty pursuant to G.S. § 97-18(g), alleging that the defendants failed to timely pay the $56,532 to fund the MSA.
The issue is whether the plaintiff is entitled to a late payment penalty on the payment of the MSA referenced in 2007 settlement under G.S. §97-18(g).
Analysis
The time for payment of a settlement agreement is 24 days after Industrial Commission approval. The defendants timely paid the $180,000 approved in the order. The order did not address the funding of the MSA.
The issue presented in this case is controlled by the language of the settlement agreement. The agreement did not address the timing of the funding for the MSA. The parties did not agree that the MSA fund would be established within the same time the settlement proceeds were to be paid to the plaintiff.
Because the agreement did not address the timing of the funding for the MSA and there was not “a meeting of the minds” by the parties with respect to such timing, the defendants should not be penalized by the assessment of a late-payment penalty under G.S. §97-18(g). Although the parties had different understandings concerning the timing of the funding of the MSA, such confusion was not based upon the express language of the settlement agreement.
Consequently, the plaintiff’s claim for a 10 percent late payment penalty under G.S. § 97-18(g) is denied.
