Allmon v. Alcatel, Inc., 124 NC App 341 (94-1244) 11/05/1996 Link to original WordPerfect file

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Allmon v. Alcatel, Inc.

No. COA94-1244

(Filed 5 November 1996)

1.    Workers' Compensation § 292 (NCI4th)-- federal discrimination claim -- settlement proceeds not wages -- termination of workers' compensation benefits error

    The Industrial Commission erred in holding that the settlement proceeds from plaintiff's federal handicap discrimination claim against defendant employer constituted "wages" and she therefore was not entitled to temporary total disability benefits, since the federal discrimination claim and the worker's compensation claim were based on two separate and distinct injuries, and recovery for both would not give plaintiff double recovery for a single action.

     Am Jur 2d, Americans with Disabilities Act: Analysis and Implications §§ 1, 257; Job Discrimination § 174; Workers' Compensation §§ 381-384.

2.    Workers' Compensation § 301 (NCI4th)-- refusal to pay benefits -- assessment of penalty -- appropriate time period

    The Industrial Commission erred in assessing a penalty against defendant under N.C.G.S. § 97-18(e) only for the period running from the date of the Commission's first order to reinstate benefits to the date of the Commission's approval of defendant's Form 24 request, rather than from the date defendant unilaterally terminated plaintiff's benefits until the date of plaintiff's reinstatement, since the statute requires payment of the penalty from the date the benefits are due but not paid, and the Form 24 was effectively vacated by the Claims Examiner two months after its initial approval.

     Am Jur 2d, Workers' Compensation § 477.

     Tort liability of worker's compensation insurer for wrongful delay or refusal to make payments due. 8 ALR4th 902.

NO. COA94-1244


Filed: 5 November 1996

Patsy Allmon,




Alcatel, Inc.,


Cigna Insurance Company,



    On appeal from the opinion and award entered on 11 July 1994 by the North Carolina Industrial Commission. Heard in the Court of Appeals 24 August 1995.

     Simply put, the two injuries are not the same. The settlement of a claim for federal civil rights violations is not, nor was it intended to be, a substitute for workers' compensation benefits. The Agreement clearly reserved all rights to remedies available to plaintiff under the Workers' Compensation Act. No set-off or credit is due defendant.

    [2]The separate but connected issue of the late payment fee is resolvable by a plain reading of the applicable statute, N.C. Gen. Stat. § 97-18(e). In pertinent part, the statute reads:

        If any installment of compensation payable in accordance with the terms of an agreement approved by the Commission is not paid within 14 days after it becomes due . . . there shall be added to such unpaid installment an amount equal to ten per centum (10%) thereof . . . unless such nonpayment is excused by the Commission after a showing by the employer that owing to conditions over which he had no control such installment could not be paid within the period prescribed for the payment.

(Emphasis added.)


    As we have already concluded that plaintiff's right to temporary total disability was not foreclosed by settlement of her discrimination claim, defendant's exposure to the ten-percent § 97-18(e) penalty is evident. Defendant unilaterally suspended payment of temporary total disability to plaintiff on 28 September 1987, without Commission approval or submission of a Form 24. On 10 November 1987, the Commission ordered defendant to reinstate benefits, and to pay such benefits retroactively to the date of their initial suspension on 28 September 1987. Despite repeated orders by the Commission, defendant did not reinstate the benefits due plaintiff. In fact, the record indicates that no reinstated benefits have ever been paid plaintiff. Moreover, defendant did not comply with the Commission's administrative rules which require submission and approval of a Form 24 prior to benefit termination. Industrial Commission Rule 404 (1996); and see Kisiah v. W. R. Kisiah Plumbing, 124 N.C. App. 72, 476 S.E.2d 434 (1996).

    The Full Commission, in its opinion and award, assessed a § 97-18(e) penalty against defendant, but only for the period running from 10 November 1987 (the date of the Commission's first order to reinstate benefits), to 26 April 1988 (the date of the Commission's approval of defendant's Form 24 request). Establishment of this time frame for imposition of the penalty is error for two reasons. First, the Full Commission has failed to provide for a penalty from the date it became due, which was 28 September 1987 (the date defendant unilaterally terminated plaintiff's benefits). This failure violates § 97-18(e)'s mandate to pay the penalty from the date the benefits were due, but not paid. Second, the Full Commission erred by using the approval date of the Form 24 as the termination date for the penalty, as that Form 24 was effectively vacated by the Claims Examiner on 20 June 1988.

    Failure to award the penalty for the full time period would run afoul of the long-settled policy of interpreting the Workers' Compensation Act liberally, and in favor of the employee. Dayal v. Provident Life and Accident Ins. Co., 71 N.C. App. 131, 132, 321 S.E.2d 452, 453 (1984). By the mandate of § 97-18(e), defendant is responsible for the penalty from 28 September 1987 through plaintiff's reinstatement date at Alcatel of 4 May 1990.

    In summary the Full Commission's decision as to temporary total disability benefits due is reversed. The case is remanded to the Commission for entry of benefits and penalty consistent with this opinion.

    Reversed and remanded.

    Judge McGEE concurs.

    Judge WALKER concurs in the result.



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