What is the meaning of “last payment”?

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Lewis v. Transit Management of Charlotte, __ N.C. App. __ (6 December 2016)

In a workers’ compensation claim stemming from a compensable accident occurring in 06/2009, defendants filed no NCIC form to accept Employee’s claim, but defendants paid Employee almost $14,000.00 in TTD, and defendants paid Employee’s medical care providers almost $9,000.00 in medical compensation.  Employee was released with a 0% PPD rating to his back; Employee appears to have returned to work without a wage loss; and defendants “filed” a Form 28B.  Defendants’ last payment of compensation occurred in 12/2009; defendants’ Form 28B was dated 12/2009; and defendants’ subsequently made their last payment of medical compensation in 04/2010.  In 04/2014, approximately four years after defendants’ last payment of any kind of compensation, Employee filed a Form 18.  In 05/2014, defendants filed a Form 61, affirmatively pleading the time bars at §97-25.1 and §97-47.  The parties presented their evidence to the Industrial Commission on stipulated facts.  The Full Commission concluded that Employee had established that defendants had miscalculated Employee’s AWW/CR.  As a result of the miscalculation, the Full Commission awarded Employee an additional $714.90 in compensation to correct the underpayment.  However, the Full Commission held that Employee’s claim for additional medical compensation was time-barred.   In 12/2015, defendants voluntarily paid the additional compensation awarded by the Full Commission.

Both parties appealed to the Court of Appeals, each contending that the NCIC misapplied the applicable statutes of limitation.  The Court of Appeals strictly read the parties’ stipulations; it narrowly framed the issues for decision; and it affirmed the Full Commission.

Addressing the medical compensation issue first, the Court of Appeals gave a “straight-forward reading” to N.C. Gen. Stat. § 97-25.1.  That statute says that Employee’s “right to medical compensation shall terminate two years after the employer’s last payment of medical or indemnity compensation….”  Applying Busque v. Mid-America Apartment Communities, 209 N.C. App. 696 (2011) to the facts that existed as of the time that the Full Commission ruled, the Court of Appeals concluded that Employee’s right to recover additional medical compensation had expired in 04/2012, long before Employee made his request for additional medical compensation.  Of significance, the Court of Appeals opined that N.C. Gen. Stat. § 97-25.1 does not first require the existence of a “final award,” before there can be a “last payment of medical or indemnity compensation.”   And, in addition, the Court of Appeals rejected Employee’s argument that the “last payment of medical or indemnity compensation” occurred when defendants made the corrective indemnity payment in 12/2015, following the Full Commission’s ruling.  However, the Court of Appeals specifically stated that it was not ruling on the issue of whether the defendants’ corrective payment related back to the period when the error was made, and that it was not ruling on the issue of whether the corrective payment served to re-start the limitations period.

As to Employee’s request for additional compensation, the Court of Appeals quoted N.C. Gen. Stat. § 97-47, which provides that Employee’s claim for additional compensation is barred if it is made more than “ two years from the date of the last payment of compensation pursuant to an award under this Article.”  Citing Biddix v. Rex Mills, 237 N.C. 660 (1953) the Court of Appeals applied well established law to the effect that N.C. Gen. Stat. § 97-47 only applies when there exists a “final award.”   Even though Employee was given a 0% PPD rating by his treating physician, and a Form 28B was sent to Employee, the Court of Appeals concluded that the Industrial Commission had never issued or approved a final award, meaning that the limitations period at N.C. Gen. Stat. § 97-47 had never been triggered, and that Employee’s request for additional compensation was not time-barred.

PRACTICE POINT:

“Last payment” is a phrase that is used in multiple places in Chapter 97, including N.C. Gen. Stat. § 97-24, which is not analyzed in the Court of Appeals’ ruling.   Be aware that North Carolina case law currently suggests that the phrase “last payment” may mean one thing when evaluating the statute of limitation that applies to demands for additional medical compensation (N.C. Gen. Stat. § 97-25.1), and that it may mean another thing when evaluating the statute of limitation that applies to demands for additional compensation (N.C. Gen. Stat. §97-47).

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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