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Workers’ Compensation – Attorney’s Fees – Medical Compensation – Attendant Care – Appellate Jurisdiction

Reed v. Carolina Holdings (Lawyers Weekly No. 011-043-17, 46 pp.) (Lucy Inman, J.) (John Tyson, J., dissenting) Appealed from the Industrial Commission. N.C. App.

Holding: Defendants waited until they filed a motion to reconsider to raise the issue of the Industrial Commission’s authority to award attorney’s fees to be paid out of an award of medical compensation; consequently, that issue was not preserved for appellate review. Competent evidence supports the Commission’s findings of fact, which in turn support the Commission’s conclusion of law that the attendant care services being provided to plaintiff – the victim of traumatic brain and other injuries in 1998 – are reasonable and necessary.

We affirm the Commission’s award of attendant care services from March 18, 2011, forward, and we grant plaintiff’s motion to dismiss defendants’ appeal as to the award of attorney’s fees, which are to be deducted from the retroactive portion of the award.

In their appeal from the deputy commissioner’s opinion and award, defendants only alluded to the attorney’s fee award in their last assignment of error: “For all the reasons stated above, Award #2 is contrary to law, is not supported by the findings of fact and is contrary to the competent and credible evidence of record.”

Paragraph No. 2 in the award section of the deputy commissioner’s opinion provides for the award of attorney’s fees. However, the basis for the objection is simply “all the reasons stated above….” The “reasons stated above” relate to whether plaintiff requires attendant care and whether he and his mother are entitled to reimbursement for attendant care services. None of the prior assignments challenge the Commission’s authority to award attorney’s fees to be deducted from attendant care compensation.

The only pleadings in the record regarding this issue were filed after the Commission had issued its opinion and award. Accordingly, we hold defendants abandoned their argument that the Commission lacked the authority under the Workers’ Compensation Act to grant an award of attorney’s fees out of an award of attendant care compensation.

The award of attorney’s fees from attendant care compensation does not arise from a factual mistake or a legal error that has previously been recognized by this court or our Supreme Court. It is an issue of first impression requiring careful interpretation of the Workers’ Compensation Act. We cannot circumvent the limits of our jurisdiction to address a watershed issue with broad reaching consequences.

We dismiss defendants’ appeal regarding the Commission’s authority to award attorney’s fees from attendant care compensation based on their abandonment of the issue before the Commission.

The testimony of plaintiff’s doctor supports the Commission’s finding that attendant care services are medically necessary for plaintiff. Plaintiff’s mother’s testimony describing the attendant care she provides to plaintiff to help him with hygiene, shopping, cooking, taking medications, and managing his finances supports the Commission’s finding that the attendant care services she provides are reasonable.

Affirmed in part and dismissed in part.


(Tyson, J.) The Form 44 assignment of error quoted by the majority, along with defendants’ motion for reconsideration raised the issue of the Commission’s attorney’s fee award. Moreover, the attorney’s fee award was an inseparable part and parcel of the award of attendant care compensation, which was undoubtedly before the Commission. The Commission’s purported award of attorney’s fees from attendant care compensation is predicated on an erroneous view of the law or a misapplication of the law and is not conclusive on appeal.

This issue was preserved and is properly before this court. Plaintiff’s motion to dismiss should be denied.

Given their duty and right to direct medical care and treatment provided to their injured employee, defendants have standing to challenge an award of attorney’s fees from medical compensation, such as attendant care compensation.

Whether the Commission may order an attorney’s fee to be paid from an award of medical compensation is outside the scope of the superior court’s appellate jurisdiction under G.S. § 97-90(c) and rests within the statutes governing the Commission, subject to appeal to this court.

Payments for medical compensation are not subject to any offsets from those proceeds to pay plaintiff’s attorney additional fees under the Workers’ Compensation Act. Palmer v. Jackson, 157 N.C. App. 625, 579 S.E.2d 901 (2003).

The Workers’ Compensation Act provides very specific circumstances under which the Commission may award an attorney a fee for representation of the injured employee, none of which apply here. In the absence of specific statutory authority for such an award, each party is responsible for his own attorney’s fees.

I would vacate the Commission’s award of attorney’s fees.

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