Appeal by plaintiff from opinion and award entered 18 December
1997 and order entered 7 October 1998 by the North Carolina
Industrial Commission; appeal by defendants from order of the North
Carolina Industrial Commission entered 22 June 1999. Heard in the
Court of Appeals 14 August 2000.
David P. Stewart for plaintiff.
Teague, Campbell, Dennis & Gorham, L.L.P., by George W.
Dennis, III, Linda Stephens, George Pender, and Tracey L.
Jones, for defendants.
Lore & McClearen, by R. James Lore; Patterson, Harkavy &
Lawrence, L.L.P., by Henry N. Patterson, Jr., and Martha A.
Geer, amicus curiae, for the North Carolina Academy of Trial
Lawyers.
Lewis & Roberts, by Richard M. Lewis, Timothy S. Riordan and
Devin F. Thomas, amicus curiae, for the North Carolina
Association of Defense Attorneys.
MARTIN, Judge.
Benny Sims (“plaintiff”) injured his back lifting a case of
beef while working for Charmes/Arby's Roast Beef (along with North
Carolina Self-Insurers Fund, “defendants”) on 25 October 1994.
Defendants immediately filed Industrial Commission Form 19 and
began making temporary disability payments effective the day of
plaintiff's injury; thereafter, defendants filed a Form 60
admitting liability and plaintiff's right to compensation. Dr.
Richard O'Keeffe, Jr., diagnosed plaintiff with multiple bulging
discs. On 15 June 1995, plaintiff was given a ten percent
permanent disability rating to his back.
Meanwhile, defendants obtained evidence that plaintiff was
working on a self-employed basis and promptly filed a Form 24
Application to Terminate Payment of Compensation. On 25 July 1995,
a deputy commissioner approved defendants' Form 24 and terminated
plaintiff's benefits effective 20 March 1995, finding that
plaintiff was self-employed and earning income. Plaintiff
requested a hearing. At the hearing, held on 10 September 1996,
plaintiff testified that he owned a number of business enterprises,
including a photography studio and tax preparation service, and
that he owned and operated these businesses before, during, andafter his employment with defendant. The evidence also showed that
plaintiff began working at a K-Mart store on 29 July 1996.
The deputy commissioner awarded plaintiff compensation for
temporary total disability from 1 November 1995 through 1 December
1995 because of a re-injury to plaintiff's back which occurred 31
October 1995, as well as 30 weeks of permanent partial disability;
defendants were awarded a credit for 38 weeks of compensation
payments made between 25 October 1994 and 25 July 1995. The credit
awarded to defendants offset the award to plaintiff, who received
no further compensation.
Plaintiff appealed to the Full Commission. On 18 December
1997, the Commission entered an opinion and award in which it
concluded plaintiff was not entitled to a presumption of continuing
temporary total disability because the parties had never entered
into a Form 21 agreement; further, the Commission upheld the award
of the deputy commissioner, finding that plaintiff failed to meet
his burden of proving temporary total disability, in part because
he earned income during the period in which he collected disability
payments from defendants.
Plaintiff's Motion for Reconsideration, in which he contended
defendants' execution of the Form 60 entitled him to a presumption
of continuing temporary total disability, was denied. Plaintiff
then moved for an en banc hearing before the entire Industrial
Commission. Plaintiff's motion was granted and the Full
Commission, sitting en banc, heard oral arguments on 7 January
1999. On 22 June 1999, the Commission filed an order in which it
declined to rule en banc, and provided that the time for filing anappeal from its opinion and award of 8 May 1997 “shall lie fr
om the
date of the filing of this Order.” Plaintiff and defendants
appeal.
_______________
Plaintiff assigns error to the Full Commission's opinion and
award filed 18 December 1997, and its subsequent order filed 7
October 1998, which concluded that plaintiff was not entitled to a
presumption of continuing temporary total disability based on
defendants' filing of the Industrial Commission Form 60. Further,
plaintiff contends the Commission erred when it determined
plaintiff had failed to prove his temporary total disability
because he had earned income from self-employment businesses during
the time period in which he collected payments from defendants.
Finally, plaintiff assigns as error the Commission's method for
calculating plaintiff's average weekly wage based on G.S. § 97-
2(5).
In their separate appeal from the 22 June 1999 order,
defendants assert the Industrial Commission erred when it granted
plaintiff's request to reconsider the matter sitting
en banc, and
assign error to the provisions of the
en banc order purporting to
extend the deadline for filing an appeal from the Commission's
earlier orders.
[1]We begin by addressing defendants' assignment of error
regarding the Industrial Commission's authority to sit
en banc.
The Industrial Commission is an administrative agency of the State
and has only the limited power and jurisdiction either expressly or
impliedly granted by the legislature to enable it to administer theWorkers' Compensation Act.
Hogan v. Cone Mills Corp., 315 N.C.
127, 337 S.E.2d 477 (1985). The procedure for the Full Commission
to hear cases is established by G.S. § 97-85. The statute
provides:
If application is made to the Commission
within 15 days from the date when notice of
the award shall have been given, the full
Commission shall review the award, and, if
good ground be shown therefor, reconsider the
evidence, receive further evidence, rehear the
parties or their representatives, and, if
proper, amend the award: Provided, however,
when application is made for review of an
award, and such an award has been heard and
determined by a commissioner of the North
Carolina Industrial Commission, the
commissioner who heard and determined the
dispute in the first instance, as specified by
G.S. 97-84, shall be disqualified from sitting
with the full Commission on the review of such
award, and the chairman of the Industrial
Commission shall designate a deputy
commissioner to take such commissioner's place
in the review of the particular award. The
deputy commissioner so designated, along with
the two other commissioners, shall compose the
full Commission upon review. Provided
further, the chairman of the Industrial
Commission shall have the authority to
designate a deputy commissioner to take the
place of a commissioner on the review of any
case, in which event the deputy commissioner
so designated shall have the same authority
and duty as does the commissioner whose place
he occupies on such review.
The statute does not provide the Commission with the express
authority to sit
en banc to hear cases nor does it evince any
intent by the legislature that the Commission do so. Indeed, the
statute is explicit in setting forth that, for the purposes of
reviewing awards, the Full Commission shall be composed of three
member panels, appeals from which are taken to the Court of
Appeals. Because the Commission is without authority to sit
en banc, it
follows that its 22 June 1999 order, including the provisions
extending the time for filing an appeal from the earlier orders, is
a nullity and must be vacated. Nevertheless, in the exercise of
the discretion granted us by N.C.R. App. P. 2, we treat plaintiff's
purported appeal as a petition for writ of certiorari, allow the
petition, and proceed to consider plaintiff's appeal on the merits.
[2]Plaintiff argues the Commission erred when it concluded
that plaintiff was not entitled to a presumption of continuing
temporary total disability based on defendants' filing of the
Industrial Commission Form 60, entitled “Employer's Admission of
Employee's Right To Compensation Pursuant to N.C. Gen. Stat. 97-
18(b).” Form 60, plaintiff argues, carries with it the same
presumption of continuing disability as the Form 21. Although this
question has never been addressed directly by our courts, a careful
reading of G.S. § 97-18(d) and recent case law requires that we
decide the issue adversely to plaintiff's contentions.
As a general rule, an employee is entitled to compensation if
he is disabled as a result of an injury by accident occurring in
the course of employment.
Rhinehart v. Market, 271 N.C. 586, 157
S.E.2d 1 (1967). The employee has the burden of proving a
disability as a result of a work-related injury.
One method for
establishing disability is the use of the Industrial Commission
Form 21; written agreements between employers and employees using
Form 21 and approved by the Commission qualify as awards of the
Commission and entitle employees to a presumption of disability.
Kisiah v. W.R. Kisiah Plumbing, Inc., 124 N.C. App. 72, 476 S.E.2d434 (1996).
The General Assembly has also provided more direct methods for
employers to compensate injured employees without admitting
liability. G.S. § 97-18(b) permits an employer to admit that the
injury suffered by the employee is compensable, that the employer
is liable for compensation, and to notify the Commission of such
action by use of the Form 60, “Employer's Admission of Employee's
Right to Compensation Pursuant to N.C. Gen. Stat. § 97-18(b).” By
contrast, G.S. § 97-18(d) provides the employer with the option of
making payments to an injured employee for a period of 90 days
without admitting the compensability of or the liability for the
injury. After the 90-day period, however, if the employer does not
contest liability or compensability, “it waives its right to do so
and the entitlement to compensation becomes an award of the
Commission pursuant to G.S. § 97-82(b).”
Higgins v. Michael Powell
Builders, 132 N.C. App. 720, 724, 515 S.E.2d 17, 20 (1999)
.
In
Olivares-Juarez v. Showell Farms, 138
N.C. App. 663, 532
S.E.2d 198 (2000), the employer made direct payments to the injured
employee pursuant to G.S. § 97-18(d), using the Industrial
Commission Form 63, Payment of Compensation Without Prejudice. The
employer, however, made these payments beyond the 90-day statutory
period, from 14 August 1995 until 2 January 1996. Thus, this Court
held, according to the statute, the employer had waived its right
to contest the compensability of or its liability for the
employee's injury. The status of the employer who pays
compensation without prejudice beyond the statutory period is
therefore the same as the employer who files Form 60 pursuant toG.S. § 97-18(b). That is, in both circumstances the employers will
be deemed to have admitted liability and compensability. In
Olivares-Juarez, the Court held that because a Form 21 agreement
was not approved by the Commission, “a presumption of disability in
favor of plaintiff did not arise.” 138 N.C. App. at 667, 532 S.E.2d
at 202 . The employer in
Olivares-Juarez, therefore, was held to
have admitted compensability and liability, but not the employee's
disability. Accordingly, admitting compensability and liability,
whether through notification of the Commission by the use of a Form
60 or through paying benefits beyond the statutory period provided
for in G.S. § 97-18(d), does not create a presumption of continuing
disability as does a Form 21 agreement entered into between the
employer and the employee.
In the present case, defendants filed a Form 60 admitting
compensability and liability for plaintiff's injury. The
Commission, in its order filed 7 October 1998, determined that use
of the Form 60 did not entitle plaintiff to a presumption of
continuing temporary disability as would have been the case had the
parties filed the Form 21 agreement. Based on our reading of both
the statute and the decision in
Olivares-Juarez, this Court must
agree. The burden of proving disability, therefore, remains with
plaintiff.
[3]Plaintiff next contends the Commission erred when it
determined plaintiff had failed to prove his temporary total
disability because he had earned income from self-employment
businesses during the period in which he collected workers'
compensation payments. Specifically, plaintiff asserts that sincehe conducted these businesses before his injury, the businesses
represented concurrent employment and could not be considered when
determining whether his earning capacity had diminished as a result
of his injury.
Under the Workers' Compensation Act, a disability is defined
as an “incapacity because of injury to earn the wages which the
employee was receiving at the time of injury in the same or any
other employment.” N.C. Gen. Stat. § 97-2(9). Thus, an employee
who cannot command wages in the competitive job market because of
injury will be classified as disabled under the statute. An
employee's earning capacity “is based on his ability to command a
regular income in the labor market.”
McGee v. Estes Express Lines,
125 N.C. App. 298, 300, 480 S.E.2d 416, 418 (1997). In
McGee, this
Court held that an employee's ownership of a business could support
a finding of earning capacity if the employee is actively engaged
in the business, but only if the work involves skills marketable in
the labor market.
Id. Thus, the relevant inquiry, even in
circumstances involving an employee's on-going business operations,
is whether the injury has diminished the employee's earning
capacity.
In the present case, the Full Commission found that plaintiff
operated three businesses following his injury on 25 October 1994,
and that gross profits from these businesses expanded considerably
in 1995 compared to 1994 figures. According to the Commission,
plaintiff's photography and Race Fan businesses increased gross
profits from $14,360.00 in 1994 to $23,580.00 in 1995. Based in
part on these findings, the Commission concluded this increase ingross profits reflected plaintiff's ability to earn wages.
Further, the Commission found plaintiff made no attempt to find
employment between 25 October 1994 and 25 July 1995; in fact, he
did not accept a new job until 29 July 1996, when he was hired as
a manager-trainee at K-Mart. Plaintiff has the burden of proving
“ . . . not only that he had obtained no other employment but that
he was
unable to obtain other employment.”
Hilliard v. Apex
Cabinet Co., 305 N.C. 593, 595, 290 S.E.2d 682, 684 (1982)
(emphasis in original). Here, the Commission found that plaintiff
failed to prove he was unable to earn income as a result of his on-
the-job injury; indeed, the evidence shows that plaintiff earned
income throughout the time he received temporary disability
payments from defendants. The Commission's finding that plaintiff
failed to sustain his burden of proving temporary total disability
between 25 October 1994 and 25 July 1995 is supported by competent
evidence. Plaintiff's assignment of error is therefore overruled.
[4]Finally, plaintiff assigns as error the Commission's
method of calculating his average weekly wage pursuant to G.S. §
97-2(5). Because of his brief period of employment, plaintiff
contends his wage should have been calculated using a comparable
employee's 52-week wage. We disagree.
G.S. § 97-2(5) establishes several methods for calculating
wages under the Workers' Compensation Act. As pertinent to this
appeal, the statute provides:
Where the employment prior to the injury
extended over a period of less than 52 weeks,
the method of dividing the earnings during
that period by the number of weeks and parts
thereof during which the employee earned wagesshall be followed; provided, results fair and
just to both parties will be thereby obtained.
Where, by reason of a shortness of time during
which the employee has been in the employment
of his employer or the casual nature or terms
of his employment, it is impractical to
compute the average weekly wages as above
defined, regard shall be had to the average
weekly amount which during the 52 weeks
previous to the injury was being earned by a
person of the same grade and character
employed in the same class of employment in
the same locality or community.
Thus, in circumstances where determining the weekly wage is too
uncertain, the statute provides an alternative: using the wage of
a comparable employee.
In this case, the Commission had ample evidence to permit the
weekly wage to be calculated based on plaintiff's actual wages
during his employment. Plaintiff earned $240.00 a week in a
probationary period as a manager-trainee. Although some dispute
arose concerning the test administered to plaintiff during this
training period, it appears undisputed that some trainees fail to
advance to permanent employment. If the Commission were to
determine plaintiff's weekly wage by using the wages earned by a
permanent employee, it would have had to make the assumption that
plaintiff would one day move into a permanent position. The
statutory language of G.S. § 97-2(5) permits the use of a
comparable employee's wages when it is impractical to use the
injured employee's weekly wages. Here, plaintiff's weekly wages
were undisputed and the Commission was justified in calculating
plaintiff's wage using his actual wages. This assignment of error
is overruled.
For the foregoing reasons, we affirm both the FullCommission's opinion and award filed 18 December 1997 and its
subsequent order filed 7 October 1998.
Affirmed.
Chief Judge EAGLES and Judge HORTON concur.
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