IN BETTS V. NORTH CAROLINA DEPARTMENT OF HEALTH AND HUMAN SERVICES – CHERRY HOSPITAL (NO. COA22-324), THE NORTH CAROLINA COURT OF APPEALS HAS REMANDED THE CASE TO THE FULL COMMISSION FOR FURTHER PROCEEDINGS, FINDING THAT THE FULL COMMISSION MISCONSTRUED THE MEANING OF “TOTAL LOSS OF WAGE-EARNING CAPACITY.”

Background

In 2011 the North Carolina Workers’ Compensation Act was amended to reinstate a cap on eligibility for temporary total disability benefits of 500 weeks unless the employee qualifies for extended compensation under N.C. Gen. Stat. § 97-29(c).  The amendment applies to all injuries that occurred on or after June 24, 2011.

On August 12, 2011, the Betts Plaintiff was involved in a confrontation with a combative patient during the course and scope of her employment as a Health Care Technician at Cherry Hospital.  Defendants accepted the compensability of Plaintiff’s right ankle injury, and began paying temporary total disability benefits on August 13, 2011.

On December 18, 2019, Plaintiff filed an Industrial Commission Form 33: Request for Hearing, seeking payment of extended compensation beyond the 500-week cap under N.C. Gen. Stat. § 97-29(c). 

Deputy Commissioner Robert J. Harris filed an Opinion and Award on March 12, 2021 approving Plaintiff’s claim for extended compensation.  Defendants appealed and on February 1, 2022, the Full Commission reversed the Opinion and Award and denied Plaintiff’s claim for extended compensation.  The Full Commission employed statutory construction, and determined that N.C. Gen. Stat. § 97-29(c) required Plaintiff to prove by a preponderance of the evidence that she sustained a complete destruction of the ability to earn wages.

Court of Appeals Decision

On February 23, 2022, Plaintiff appealed the Full Commission’s Opinion and Award to the Court of Appeals.  Plaintiff specifically argued that the Full Commission: (i) erred by resorting to a collegiate dictionary, rather than decades of appellate precedent, to define the term of art “total loss of wage-earning capacity;” and (ii) erred by concluding that plaintiff was not entitled to extended compensation on grounds that she has the capacity to earn some wages.

The Court of Appeals agreed with Plaintiff’s arguments.  The Court determined that it must refrain from statutory construction[i], as it was guided by its recent decision in Sturdivant v. State Dep’t of Pub. Safety[ii], where the proper interpretation of N.C. Gen. Stat. § 97-29(c) was addressed as “an issue of first impression.”

In Sturdivant the Court of Appeals held that the Full Commission erred “by conclud[ing] that an employee who has some work capabilities but cannot find a compatible job, though ‘totally disabled,’ has not suffered a ‘total loss of wage-earning capacity’ to qualify for extended benefits under Section 97-29(c).”  In reaching that Holding the Court of Appeals reasoned “that ‘total disability’ (under Section 97-29(b)) and ‘total loss of wage-earning capacity’ are synonymous.”  The Sturdivant Court held that Plaintiff’s “burden of showing a ‘total loss of wage-earning capacity’ under Section 97-29(c) is the same as his burden of showing a ‘total disability’ to receive benefits under Section 97-29(b).”

The Betts Court found that the Full Commission erroneously concluded that “N.C. Gen. Stat. § 97-29(c) does not invoke ‘disability’ as defined by N.C. Gen. Stat. § 97-2(9),” and erred by determining that plaintiff failed to meet her burden to prove “a total loss of wage-earning capacity” based exclusively upon a finding that “plaintiff has the capacity to earn some wages.”

In Sturdivant the Court of Appeals ultimately upheld the Full Commission’s Decision and Order because, “in other parts of its order, the Commission seem[ed] to apply the correct analysis and d[id] make findings of fact which support[ed] its ultimate decision based on our interpretation of Section 97-29(c).”  The Betts Court found that unlike in Sturdivant, the Commission failed to make findings demonstrating that it considered all of the proper factors for determining disability.  The Betts Court found that per Russell v. Lowe’s[iii], an employee can meet his burden of showing a total-loss of wage-earning capacity:

• by showing he is incapable of performing any work;

• by showing that he is capable of work but that “after a reasonable effort on his part, been unsuccessful” in finding employment;

• by showing that he is capable of work but that “it would be futile” to seek other employment “because of preexisting conditions; i.e. age, inexperience, lack of education.”

Therefore, the Betts Court remanded the case to the Full Commission with instructions to consider the appropriate factors in determining whether Plaintiff met her burden of proof in showing she is qualified for extended benefits.

The Future of 500-Week Extension Cases and Practice Note

At present, the case law is that ‘total disability’ (under Section 97-29(b)) and ‘total loss of wage-earning capacity’ are synonymous.  Therefore, a Plaintiff can meet her burden of proof for extended benefits if she can meet one of the Russell factors discussed above.

However, this may not be settled law.  The Sturdivant Defendants have filed a petition for certiorari with the North Carolina Supreme Court, and the Plaintiff has responded.  The parties are waiting on the Supreme Court to rule on the petition.  The Supreme Court’s ultimate decision will settle the issue.

It is very important for Defendants to closely monitor claims to be cognizant of the 500-week time frame.  It will often be beneficial to try to resolve claims for an advantageous amount before the 500-week extension application becomes an issue.

In any case in which an employee is applying for benefits beyond 500 weeks, it is highly recommended that Defendants employ vocational rehabilitation and obtain a labor market survey to aid in defense.

[i] At the time the Full Commission engaged in statutory construction to reach its Opinion and Award, the Court of Appeals had not yet issued its ruling in Sturdivant.

[ii] The Sturdivant decision was entered by the Court of Appeals on April 18, 2023.

[iii] There is a fourth Russell method of “showing he has obtained employment, but at a lower wage than he was earning before the accident” but it is not relevant to post-500 week benefit applications as it concerns partial loss of wage-earning capacity.