CHRISTOPHER S. REED, Employee, Plaintiff,
CAROLINA HOLDINGS, WOLSELEY MANAGEMENT, Employer, ACE USA/ESIS, Carrier, Defendants.
in the Court of Appeals 7 June 2016.
by Defendants from an Opinion and Award entered 17 April 2015
by the Full North Carolina Industrial Commission I.C. No.
Lennon, Camak & Bertics, PLLC, by George W. Lennon and
Michael W. Bertics, for Plaintiff-Appellee.
Hedrick Gardner Kincheloe & Garofalo, LLP, by Paul C.
Lawrence and M. Duane Jones, for Defendant-Appellants.
defendant may not argue on appeal that the North Carolina
Industrial Commission lacks the authority to award fees for
attorneys to be paid out of an award of medical compensation
without preserving the issue before the Commission. An award
of attendant care compensation will be upheld where the
Commission's findings of fact are supported by competent
evidence and the findings of fact support the
Commission's conclusion of law that the attendant care
services are reasonable and necessary.
Holdings, Wolseley Management, and ACE USA/ESIS
("Defendants") appeal from an Opinion and Award of
the Full Commission of the North Carolina Industrial
Commission (the "Commission"), wherein the
Commission awarded retroactive and ongoing medical
compensation for attendant care services for Christopher S.
Reed ("Mr. Reed" or "Plaintiff"), and
twenty-five percent of the retroactive medical compensation
to be paid to Mr. Reed's attorney as an attorney's
contend the Commission erred in awarding attendant care
services and exceeded its authority in granting an
attorney's fee award to be deducted from the retroactive
award of attendant care. Mr. Reed filed a motion to dismiss
Defendants' appeal for failure to properly preserve their
challenge to the attorney's fee award below. After
careful review, we affirm the Commission's award of
attendant care services and grant Mr. Reed's motion to
dismiss Defendant's appeal as to the award of
and Procedural History
Reed began working with Defendants on 20 May 1998. On 26 June
1998, Mr. Reed sustained a traumatic brain injury along with
injuries to his shoulder, back, and other body parts when a
stack of building supplies collapsed on top of him.
Defendants accepted liability for Mr. Reed's injuries and
provided compensation for Mr. Reed's lost income and
medical treatment resulting from the injury. Psychological
and psychiatric evaluations over the next decade indicated
that Mr. Reed's cognitive and emotional condition
continued to deteriorate and that Mr. Reed was not reliably
taking prescribed medication. In 2010, a forensic
psychiatrist diagnosed Mr. Reed with a cognitive disorder,
obsessive compulsive disorder, and a mood disorder.
March 2011, Mr. Reed filed a Form 33 requesting that the
Commission hear his claim for attendant care compensation.
Following a hearing, Deputy Commissioner George R. Hall, III
entered an Opinion and Award requiring Defendants to pay Mr.
Reed's mother ("Mrs. Reed") ten dollars per
hour for twenty-four hours per day, seven days per week from
27 June 1998 through the date of the Opinion and Award and
continuing, and allowing Mr. Reed's counsel to deduct
twenty-five percent of the back due attendant care owed from
the award as a reasonable attorney's fee. The Deputy
Commissioner denied Mr. Reed's counsel's request to
deduct twenty-five percent of the compensation for future
attendant care as an attorney's fee.
appealed the award to the Full North Carolina Industrial
Commission pursuant to N.C. Gen. Stat. § 97-85 and Rule
701 of the North Carolina Industrial Commission. Mr. Reed
appealed to the Full Commission pursuant to N.C. Gen Stat.
§ 97-90(c) that portion of the award denying the claim
for attorney's fee to be deducted from future medical
appeal from the Deputy Commissioner's decision, the
Commission received additional evidence with respect to Mr.
Reed's attendant care claim. Defendants offered
surveillance evidence conducted from July 2012 through
November 2012 in support of their contention that Mr. Reed
does not require attendant care. This evidence included
testimony by three private investigators regarding Mr.
Reed's ability to perform daily activities, his physical
limitations, and his regular residence. Mr. Reed introduced
additional deposition testimony by himself, his mother, his
friend Jessica Lloyd, and two of his doctors.
reviewing the additional evidence, the Commission entered its
Opinion and Award on 17 April 2015. The Commission made
extensive findings of fact and conclusions of law and issued
the following award:
1. Plaintiff's request for compensation for attendant
care services provided to him from March 18, 2007 to March
17, 2011 is DENIED. Plaintiff's request for attendant
care services provided to him beginning March 18, 2011 to the
present and continuing is GRANTED. From March 18, 2011,
through the present and continuing, Defendants shall pay
Plaintiff's mother, Mrs. Reed, for 8 hours per day, 7
days per week of attendant care services she has provided and
continues to provide to Plaintiff at a reasonable rate agreed
upon by the parties. The amounts awarded are subject to the
attorneys' fee set forth below.
2. As a reasonable attorney's fee, Plaintiff's
counsel is entitled to be paid 25% of all accrued retroactive
attendant care compensation herein. Defendants shall deduct
25% from the accrued amount and pay it directly to Plaintiffs
counsel as a reasonable attorney's fee. Plaintiffs
counsel request for 25% of future attendant care payments is
DENIED. However, Plaintiffs counsel may seek additional
compensation if future attendant care issues arise.
the Commission's Opinion and Award, the parties
respectively filed a series of pleadings in three forums:
• On 30 April 2015, Mr. Reed filed with the Wake County
Superior Court a notice of appeal from the Opinion and Award
pursuant N.C. Gen. Stat. § 97-90(c) regarding the
Commission's denial of his request for attorney's
fees to be deducted from future attendant care compensation.
• On 5 May 2015, Defendants filed with the Commission a
Motion for Reconsideration arguing-apparently for the first
time-that the Commission had erred in awarding any
attorney's fees from medical compensation awarded to Mr.
Reed. The Motion cited the same legal authorities that would
later be raised in Defendants' appeal to this Court. The
record does not reflect that Defendants raised this issue or
presented these legal arguments previously before either
Deputy Commissioner Hall or the Commission.
• On 13 May 2015, Defendants filed with this Court a
notice of appeal from the Commission's Opinion and Award.
• Two days later, on 15 May 2015, Defendants filed with
the Wake County Superior Court a pleading captioned
"Defendants' Response to Plaintiffs Notice of Appeal
of Award of Attorney's Fees, " asserting the same
argument Defendants presented to the Commission in their
Motion for Reconsideration. Defendants asked the Wake County
Superior Court to reverse the Commission's award of
attorney's fees to Mr. Reed "or at the very least
allow for this matter to be decided by the Full
Commission" based on Defendants' then pending Motion
• On 2 June 2015, the Commission filed an Order
concluding that Defendants' appeal to the Wake County
Superior Court deprived the Commission of jurisdiction to
reconsider its Opinion and Award.
• On 10 June 2015, Defendants filed a Motion to
Intervene in the Wake County Superior Court proceeding
initiated by Mr. Reed.
• On 23 June 2015, the Superior Court entered an order
allowing Defendants to intervene in that proceeding, but
holding the case in abeyance pending the outcome of
Defendants' appeal to this Court.
appeal before this Court, Defendants challenge the
Commission's findings of fact related to Mr. Reed's
ability to function independently, his need for around the
clock monitoring, the medical necessity of his attendant care
services, and the weight given to Defendants'
surveillance evidence. Defendants also challenge the
Commission's authority to award attorney's fees
pursuant N.C. Gen. Stat. § 97-90(c) to be deducted from
an award of attendant care compensation. Mr. Reed has filed a
motion to dismiss Defendants' appeal as to the issue of
Motion to Dismiss Defendants' Appeal
Reed's motion to dismiss asserts (1) that Defendants lack
standing to challenge an award of attorney's fees; (2)
that our Court lacks subject matter jurisdiction regarding
attorney's fees because the Superior Court has exclusive
jurisdiction regarding such fees; and (3) that our Court
lacks subject matter jurisdiction because Defendants failed
to preserve their argument regarding the Commission's
authority to grant attorney's fee awards from medical
compensation. After careful review, we agree that Defendants
failed to preserve their argument regarding the
Commission's authority to award attorney's fees to be
deducted from attendant care compensation. We therefore
dismiss Defendants' appeal with respect to that issue.
701 of the North Carolina Industrial Commission states:
(2) After receipt of notice of appeal, the Industrial
Commission will supply to the appellant a Form 44 Application
for Review upon which appellant must state the grounds for
appeal. The grounds must be stated with particularity,
including the specific errors allegedly committed by the
Commissioner or Deputy Commissioner and, when applicable, the
pages in the transcript on which the alleged errors are
(3) Particular grounds for appeal not set forth in the
application for review shall be deemed abandoned, and
argument thereon shall not be heard before the Full
Workers' Comp. R. of N.C. Indus. Comm'n 701, 2011
Ann. R. ( N.C. ) 1070-71. It is well established that
"the portion of Rule 701 requiring appellant to state
with particularity the grounds for appeal may not be waived
by the Full Commission." Roberts v. Wal-Mart,
Inc., 173 N.C.App. 740, 744, 619 S.E.2d 907, 910 (2005).
"[T]he penalty for non-compliance with the particularity
requirement is waiver of the grounds, and where no grounds
are stated, the appeal is abandoned." Wade v.
Carolina Brush Mfg. Co., 187 N.C.App. 245, 249, 652
S.E.2d 713, 715-16 (2007) (citations omitted). Applying
established precedent to the record in this case, we conclude
that although Defendants preserved their objection to the
award of attorney's fees as a derivative of their
objection to the award of attendant care compensation,
Defendants failed to preserve a challenge to the
Commission's authority to award attorney's fees
deducted from such compensation. There is no indication in
the record that this issue was raised at all before the
Commission prior to the Opinion and Award from which this
appeal arises. Defendants pleaded only a generalized
assignment of error regarding the attorney's fee award.
There is no indication in the record that Defendants stated
in any form or fashion the basis of their objection to the
award of attorney's fees with sufficient particularity to
give Mr. Reed or the Commission notice of a legal issue to be
addressed on appeal from the Deputy Commissioner's
argue they preserved the issue of attorney's fees on
appeal to the Full Commission because the fifteenth-and
last-assignment of error in their Form 44 referred to the
Deputy Commissioner's award of attorney's fees.
Assignment of Error 15 stated:
For all the reasons stated above, Award #2 is contrary to
law, is not supported by the findings of fact and is contrary
to the competent and credible evidence of record.
neither the word "attorney" nor the word
"fee" is mentioned in the assignment of error,
Paragraph No. 2 under the heading "Award" in the
Deputy Commissioner's Opinion and Award provides for the
award of attorney's fees. Therefore, the fifteenth
assignment of error could be said to identify the
attorney's fee award in general. As for the basis of the
objection, however, the assignment simply states it is
"[f]or all the reasons stated above . . . ." The
reasons stated above, i.e., assignments of error 1
through 14, challenge factual findings and conclusions of law
related to whether Mr. Reed requires attendant care and
whether Mr. Reed and his mother are entitled to reimbursement
for attendant care services. So Defendants' objection to
the award of attorney's fees appears to be based solely
on their objections to the award of attendant care
compensation. None of the prior assignments challenge the
Commission's authority to award attorney's fees to be
deducted from attendant care compensation.
fifteenth assignment of error is similar to the assignment of
error that this Court found insufficient to preserve a
challenge to a deputy commissioner's award of
attorney's fees in Adcox v. Clarkson Bros. Constr.
Co., 236 N.C.App. 248, 254, 773 S.E.2d 511, 516 (2015).
That assignment of error challenged an award
on the grounds that it is based upon Findings of Fact and
Conclusions of Law which are erroneous, not supported by
competent evidence or evidence of record, and are contrary to
the competent evidence of record, and are contrary to law:
Award Nos. 1-3.
the assignment of error in Adcox mentioned the
paragraph number corresponding to attorney's fees in the
deputy commissioner's award, this Court held that the
generalized assignment "covers everything and touches
nothing." Id. at 255, 773 S.E.2d at 516
(citation and quotation marks omitted). The assignment did
"not state the basis of any objection to the
attorneys' fee award with sufficient particularity to
give [the] plaintiff notice of the legal issues that would be
addressed by the Full Commission such that he could
adequately prepare a response." Id. (citation
omitted). The Court in Adcox compared the
insufficient assignment of error there to the appellant's
assignment of error in Walker v. Walker, 174
N.C.App. 778, 782, 624 S.E.2d 639, 642 (2005).
Adcox, 236 N.C.App. at 255, 773 S.E.2d at 516. The
assignment of error in Walker, analogous to that in
Adcox and in this case, asserted that several
rulings of the trial court were "erroneous as a matter
of law." Walker, 174 N.C.App. at 782, 624
S.E.2d at 642. This Court held that the assertion "that
a given finding, conclusion, or ruling was 'erroneous as
a matter of law' completely fails to identify
the issues actually briefed on appeal." Id.
(emphasis in original).
contend that they did properly raise sufficient grounds in
their brief to the Commission to preserve their challenge to
the Commission's authority to grant attorney's fees
from an award of attendant care compensation. They rely on
this Court's decision in Cooper v. BHT Enters.,
195 N.C.App. 363, 672 S.E.2d 748 (2009). In Cooper,
the plaintiff asserted that the defendant's failure to
file a Form 44 constituted abandonment of the grounds for the
defendant's appeal from a deputy commissioner's
decision to the Commission, and therefore the Commission
erred in hearing the appeal. Id. at 368, 672 S.E.2d
at 753. But this Court concluded that "both this Court
and the plain language of the Industrial Commission's
rules have recognized the Commission's discretion to
waive the filing requirement of an appellant's Form 44
where the appealing party has stated its grounds for appeal
with particularity in a brief or other document filed with
the Full Commission, " and overruled the plaintiff's
argument. Id. at 369, 672 S.E.2d at 753-54. Thus,
the Court in Cooper refused to put form over
substance and affirmed the Commission's discretion to
hear an issue that had been stated with particularity.
unlike in Cooper, we find in the record no substance
that can mend the insufficiency of Defendants' Form 44.
Although Defendants contend in response to the Motion to
Dismiss that they stated their challenge to the
Commission's authority to award attorney's fees in
their brief to the Commission on appeal from the Deputy
Commissioner's decision, they did not include the
referenced brief in the record. Nor did Defendants seek to
supplement the record with the referenced brief in response
to the Motion to Dismiss. We have searched the record and
find no such pleading filed with the Commission by Defendants
regarding attorney's fees other than the Defendants'
Motion for Reconsideration, which Defendants filed
after the Commission had issued its Opinion and
Award. Like the defendants in Adcox, Defendants do
not point to any support in the record indicating that they
raised this issue in their appeal from the Deputy
Commissioner's decision. Nor do Defendants point to any
indication in the record that the Commission sought to
exercise its discretion to determine this issue. As discussed
further infra, the only pleadings in the record
regarding this issue were filed after the Commission
had issued its Opinion and Award. Accordingly, we hold
Defendants abandoned their argument that the Commission
lacked the authority under the Act to grant an award of
attorney's fees out of an award of attendant care
compensation, and dismiss Defendants' appeal as to this
dissenting opinion asserts that we decline to address the
issue of attorney's fees "solely because Defendants
did not include a copy of their supporting legal brief to the
Full Commission in the long settled record on appeal."
To be clear, we hold that because there is no indication in
the record that Defendants raised the issue before the
Commission and there is no indication that the Commission
addressed the issue, we have no jurisdiction to review it.
This is not a case of a technicality foreclosing review based
on an inadvertent omission in the record. Not only did
Defendants not include in the record the brief they now claim
preserved the issue, but they failed to supplement the record
with the referenced brief when challenged to point to any
portion of the record preserving the issue for review.
Indeed, the record reflects only that after the Commission
issued its Opinion and Award, Defendants filed a Motion for
Reconsideration regarding the attorney's fee issue. That
pleading tellingly does not refer to Defendants having raised
the issue in any prior brief or argument to the Commission.
dissent seeks to justify a different result by relying on
inapposite case authority. In Tucker v. Workable
Company, 129 N.C.App. 695, 701, 501 S.E.2d 360, 365
(1998) the parties had mistakenly stipulated before the
Commission that the worker's weekly salary was $659.70
per week although it was actually $157.80 per week. The
employer discovered the error after the Commission's
Opinion and Award and sought reconsideration, which the
Commission denied. Id. This Court reversed the
denial and remanded the matter to the Commission.
award of attorney's fees from attendant care compensation
does not arise from a factual mistake or a legal error that
has previously been recognized by this Court or the Supreme
Court of North Carolina. It is an issue of first impression
requiring careful interpretation of the Workers'
Compensation Act. We cannot circumvent the limits of our
jurisdiction to address a watershed issue with broad reaching
we dismiss Defendants' appeal regarding the
Commission's authority to award attorney's fees from
attendant care compensation based on their abandonment of the
issue before the Commission, we need not address the other
arguments presented by Plaintiff in his Motion to Dismiss.
of Attendant Care Compensation
assign error to the Commission's award of attendant care
compensation by asserting there was insufficient evidence to
support the Commission's findings of fact and therefore,
the findings of fact do not support the Commission's
conclusions of law. We disagree.
Standard of Review
reviewing an award from the Commission, our review is limited
to determining: (1) whether the findings of fact are
supported by competent evidence, and (2) whether those
findings support the Commission's conclusions of law.
Chambers v. Transit Mgmt., 360 N.C. 609, 611, 636
S.E.2d 553, 555 (2006). Unchallenged findings of fact
"are 'presumed to be supported by competent
evidence' and are, thus 'conclusively established . .
. .' " Chaisson v. Simpson, 195 N.C.App.
463, 470, 673 S.E.2d 149, 156 (2009) (quoting Johnson v.
Herbie's Place, 157 N.C.App. 168, 180, 579 S.E.2d
110, 118 (2003)). "The Commission's conclusions of
law are reviewed de novo." McRae v.
Toastmaster, Inc., 358 N.C. 488, 496, 597 S.E.2d 695,
701 (2004) (citation omitted). "An opinion and award of
the Industrial Commission will only be disturbed upon the
basis of a patent legal error." Roberts v.
Burlington Indus., Inc., 321 N.C. 350, 354, 364 S.E.2d
417, 420 (1988).
North Carolina, the Workers' Compensation Act provides
employees compensation for injuries sustained within the
course and scope of employment, charging employers with the
responsibility to cover costs such as medical compensation.
N.C. Gen. Stat. § 97-1 et seq. (2015). The Act
defines medical compensation as:
medical, surgical, hospital, nursing, and rehabilitative
services, including, but not limited to, attendant care
services prescribed by a health care provider authorized by
the employer or subsequently by the Commission, vocational
rehabilitation, and medicines, sick travel, and other
treatment, including medical and surgical supplies, as may
reasonable be required to effect a cure or give relief and
for such additional time as, in the judgment of the
Commission, will tend to lessen the period of disability; and
any original artificial members as may reasonably be
necessary at the end of the healing period and the
replacement of such artificial members when reasonably
necessitated by ordinary use or medical circumstances.
N.C. Gen. Stat. § 97-2(19). To award medical
compensation, and specifically attendant care services, the
Commission must make findings from competent evidence to
support its conclusion that the attendant care services were
reasonable and necessary as a result of the employee's
injury. See Shackleton v. Southern Flooring
& Acoustical Co., 211 N.C.App. 233, 245, 712 S.E.2d
289, 297 (2011). Such competent evidence includes, but is not
limited to: "a prescription or report of a healthcare
provider; the testimony or a statement of a physician, nurse,
or life care planner; the testimony of the claimant or the
claimant's family member; or the very nature of the
injury." Id. at 250-51, 712 S.E.2d at 300.
the Commission made the following findings of fact, which
Defendants challenge, in support of its conclusion that Mr.
Reed's attendant care services were reasonable and
6. Dr. Prakken [Mr. Reed's physician] also opined that
Plaintiff is not able to function independently. Plaintiff
cannot effectively shop for himself, pay his own bills, or
set up his own appointments because of his obsessive
compulsive symptoms and his high level of anxiety. He is
inconsistent with his activities of daily living. Dr. Prakken
compared Plaintiff's levels of function with that of an
8-year-old child and testified that Plaintiff could not
function outside an institution without his mother, Elizabeth
7. Since Plaintiff's injury, Mrs. Reed has been caring
for him. The attendant care services Mrs. Reed provides for
Plaintiff include shopping for him, cooking, transporting and
attending with Plaintiff most medical visits, cleaning,
providing money management, scheduling medical appointments,
reminding him to bathe and attend to personal hygiene, making
sure he takes his prescription medications, monitoring his
status 24 hours per day, seven days per week since
Plaintiff's behavior and sleeping habits are
unpredictable, calming him down during an anxiety attack or
other crisis. Mrs. Reed has not worked in the competitive
labor market since Plaintiff's accident.
8. Prior to his injury, Plaintiff was a fully functional
college student who was able to function independently. There
is no evidence that he would have become wholly dependent on
the care of his mother, but for the compensable accident at
work and resulting traumatic brain injury.
. . .
33. Dr. Prakken was deposed for a second time after the
reopening of the record in this matter. Dr. Prakken is board
certified in psychiatry and pain management. He reviewed the
surveillance taken by Defendants and testified that the
surveillance evidence did not show Plaintiff's mental or
emotional states and that Plaintiff's impairment is not
the kind of impairment you can easily see in a snapshot. Dr.
Prakken testified that his opinion regarding Plaintiff's
need for attendant care has not changed and that Plaintiff
need around the clock passive medical monitoring. Dr. Prakken
explained that Plaintiff was one of the most anxious and ill
patients he has had in his practice and that Plaintiff
required attendant care because he has grave difficulties
from his traumatic brain injury. Dr. Prakken testified that
Plaintiff's decision-making process is so concrete and
centered on what he feels at that moment that it leaves him
very impulsive and he doesn't have the capacity to
modulate those feelings and understand that he may feel
differently later. Dr. Prakken further testified that
Plaintiff's actions and his choices change moment to
moment like his feelings do and that is something that
requires management and he cannot live independently for even
a moderate amount of time. For example, Dr. Prakken testified
that living independently would leave Plaintiff impulsive
about potential medication use and he would not be able to
consistently pay bills, feed himself, or take care of his
activities of daily living.
34. As a part of his anxiety, Plaintiff also suffers from
obsessive compulsive disorder which according to Dr. Prakken
is like a "double whammy, where he's not only in
this very, very short decision-making loop based solely on
how he feels, but how he feels is just profused with
anxiety." Dr. Prakken testified that if Plaintiff did
not have attendant care he would need to be institutionalized
and that Plaintiff has difficulty getting out of his internal
anxiety state long enough to attend to the social needs of
others and to efficiently be able to hold a job. With respect
to Plaintiff's relationship with Ms. Lloyd, Dr. Prakken
testified that Plaintiff longs to be normal and has a