Allred v. Exceptional Landscapes, Inc.
227 N.C. App. 229
N.C. Ct. App.2013Background
- Plaintiff Allred was injured August 17, 2006 while performing work for Exceptional Landscapes, which lacked workers’ compensation insurance.
- T. Wright, Summey, and J. Wright were the principals/officer involved in Exceptional Landscapes; the corporate structure and lack of insurance were central to the dispute.
- In September 2006, Allred filed Form 18 and Form 33 with the Industrial Commission; mediation on February 27, 2007 failed to settle the workers’ compensation claim.
- An attempted mediation settlement provided a lump sum of $26,000, with no provision for medical bills, and Allred did not withdraw Form 33, so the case proceeded to hearing.
- In March 2012, the Full Commission held jurisdiction existed, found the settlement noncompliant with § 97-17, and pierced the corporate veil to impose liability on T. Wright, Summey, and J. Wright; it also imposed penalties for failing to procure insurance.
- The Commission’s order included T. Wright, Summey, and J. Wright liable for TTD and medical expenses, awarded attorney’s fees to plaintiff’s counsel, and held penalties in abeyance.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Jurisdiction with pending or noncompliant settlement | Allred invoked the Commission’s jurisdiction; settlement did not extinguish it. | Settlement could terminate Commission jurisdiction as to law claims. | Commission retained exclusive jurisdiction; settlement did not void jurisdiction. |
| Fair and justness of the settlement | Settlement should be approved if fair and just under § 97-17. | Settlement was fair under informal agreement despite lack of medical-bill provisions. | Settlement not fair and just; Commission’s finding supported by Rule 502/§97-17. |
| Attorney’s fees under § 97-88 against insurers | Fees may be awarded when insurer appealed and benefits were ordered. | Defendants were not insurers under statute; fees improper. | Fees improperly assessed; insurer not defined as present defendants. |
| Piercing the corporate veil as to J. Wright | veil piercing appropriate given control by J. Wright. | J. Wright did not exercise complete domination establishing alter ego. | Veil piercing as to J. Wright not supported by findings; reversed. |
| Civil penalties for failure to procure insurance | Court did not address civil penalties on appeal as to J. Wright; penalties stayed/in abeyance. |
Key Cases Cited
- Pearson v. C.P. Buckner Steel Erection Co., 348 N.C. 239 (1998) (limits on commission jurisdiction; continuing authority over proceedings)
- Seigel v. Patel, 132 N.C. App. 783 (1999) (claims against noncompliant employers may still fall under Commission)
- Johnson v. First Union Corp., 131 N.C. App. 142 (1998) (exclusive jurisdiction over related matters after claim filed)
- Tabron v. Gold Leaf Farms, Inc., 269 N.C. 393 (1967) (standards for settlement review and approval)
- Smythe v. Waffle House, 170 N.C. App. 361 (2005) (necessity of reviewing compromise settlements for fairness)
- Estes v. N.C. State Univ., 117 N.C. App. 126 (1994) (requirements for attorney’s fees under § 97-88)
- 41793, Glenn v. Wagner (1985) (veil piercing criteria and alter ego inquiry)