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Bartell v. Sawyer

3/2/1999

Appeal by defendants from opinion and award entered 12 February 1998 by the North Carolina Industrial Commission. Heard in the Court of Appeals 29 October 1998.


Defendants appeal from an opinion and award of the North Carolina Industrial Commission (Commission) dated 12 February 1998 denying defendants a pro-rata share of pre-judgment interest recovered by plaintiff in a third party negligence action. The opinion and award of the Commission reversed the third party distribution order entered by a deputy commissioner 26 July 1996.


The Commission found that plaintiff was injured on 16 August 1991, "when he was involved in a motor vehicle collision with a vehicle driven by a third party, Eula Norris Hargis." The Commission determined the accident arose "out of and in the course of [plaintiff's] employment with the defendant-employer," and that plaintiff was entitled to receive workers' compensation benefits. The parties entered into a Form 21 agreement for compensation for disability, which was approved by the Commission on 28 October 1991. Defendants paid compensation and medical expenses to plaintiff in the amount of $44,378.40. Plaintiff filed a third party negligence action against Eula Norris Hargis, the operator of the vehicle. Plaintiff was awarded $95,000 in damages and $5,000 in pre-judgment interest in a jury trial in December 1993.


Defendants had already paid workers' compensation benefits to plaintiff in the amount of $44,378.40. Pursuant to N.C. Gen. Stat. § 97-10.2(f)(1)(1991), defendants had a subrogation interest in plaintiff's third party recovery equaling the total amount of workers' compensation payments made to plaintiff. The Commission properly allocated these funds to defendants, and these funds are not at issue.


Defendants contend they are entitled to a pro-rata share of the pre-judgment interest plaintiff received on his third party recovery. The executive secretary of the Commission ordered the


distribution of the third party recovery on 3 February 1994. In pertinent part, the order stated, "The sum of $44,378.40 plus interest if applicable, subject to counsel fee, shall be paid the workers' compensation carrier in full settlement of its subrogation interest."


Plaintiff requested a reconsideration of this order on 24 February 1994, arguing that defendants were not entitled to a share of the pre-judgment interest. The executive secretary of the Commission reaffirmed his order on 14 March 1994, and plaintiff paid defendants the amount of their subrogation lien from his third party recovery. Plaintiff also paid defendants their pro-rata share of the pre-judgment interest on 20 July 1994, an amount equaling $1,566.67.


Plaintiff appealed, arguing that defendants were not entitled to a pro-rata share of the pre-judgment interest that plaintiff had received on his third party recovery. In an opinion and order dated 26 July 1996, the deputy commissioner concluded that defendant-carrier was entitled to receive its pro-rata share of the pre-judgment interest award " n full satisfaction of its subrogation lien."


Plaintiff appealed to the Full Commission, and based upon the foregoing facts, the Commission made the following Conclusions of law:


"1. The plaintiff is entitled to receive interest on his portion of the money judgment that represents compensatory damages, N.C.G.S. §24-5(b); Absher v. Vannoy-Lankford Plumbing Co., 78 N.C. App. 620, cert. denied, 316 N.C. 730 (1985). Interest shall be calculated based on the amount the plaintiff is actually entitled to receive after the defendant-carrier's subrogation lien amount is subtracted. Absher v. Vannoy-Lankford Plumbing Co., 78 N.C.

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