Smith v. Denross Contracting
I.C. NOS. W51771 PH-2483.
| N.C. Indus. Comm. | Oct 13, 2011Background
- In Oct. 3, 2009, Plaintiff sustained a compensable injury at Kapstone's Roanoke Rapids, NC facility while working for Denross Contracting U.S., Inc.
- Denross employed Plaintiff and contracted with Kapstone; Denross was insured by NYSIF at the time of injury.
- Deputy Commissioner Phillips issued a November 20, 2009 order directing timely benefits and information; neither Denross nor NYSIF complied.
- NYSIF materially represented coverage for out-of-state workers, enabling Plaintiff and others to rely on NYSIF coverage while Denross paid NYSIF premiums.
- The Full Commission ultimately determined NYSIF was the carrier of the risk and awarded indemnity, medical, and attendant care benefits with penalties and attorney’s fees, based on estoppel and other legal theories.
- Average weekly wage was calculated at $1,120.00 with a compensation rate of $747.04, and Plaintiff was deemed temporarily totally disabled pending return to work.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Denross and NYSIF were properly responsible for Plaintiff's workers' compensation benefits | Denross liable; NYSIF covered out-of-state employees | NYSIF questioned coverage and potential independent contractor status | Plaintiff’s entitlement affirmed; NYSIF deemed carrier on the risk |
| What benefits Plaintiff is entitled to (TTD, medical, attendant care) | Plaintiff seeks full indemnity, medical, and attendant care | Defendants contest extent and timeliness of benefits | TTD, medical, and attendant care awarded with penalties for late payments |
| Whether NYSIF is estopped from denying coverage due to conduct and representations | Reliance on NYSIF representations | NYSIF denies estoppel applicability | NYSIF estopped from denying coverage based on conduct and prior payments |
| Penalties and attorney’s fees for unreasonable denial/litigation | Unreasonable denial warrants penalties and fees | Defense contested liability for penalties | 10% penalties on overdue benefits and medical/attendant care; attorney’s fees awarded to Plaintiff’s counsel |
| Calculation of average weekly wage (AWW) and related rate | Method four or five most fair; use method five | Methods one–four not fair; method five used | AWW $1,120.00; weekly rate $747.04; penalties for delayed payment of indemnity and medical benefits |
Key Cases Cited
- Hayes v. Elon College, 224 N.C. 11, 29 S.E.2d 127 (1944) (1944) (independent-contractor factors for NC workers’ compensation)
- Hughart v. Dasco Transp., Inc., 167 N.C. App. 685, 606 S.E.2d 379 (2005) (2005) (estoppel and reliance principles in NC WC law)
- Craver v. Dixis Furn. Co., 115 N.C. App. 570, 447 S.E.2d 789 (1994) (1994) (estoppel and reasonable reliance)
- Carroll v. Daniels, 327 N.C. 616, 398 S.E.2d 325 (1990) (1990) (estoppel and reliance standards in WC context)
- Commissioners of State Insur. Fund v. Herbery J. Low, 285 A.D. 525, 138 N.Y.S.2d 437 (1955) (1955) (NYSIF characteristics and treatment as insurer for WC)
- Fisher v. Genesee Const. Co., 176 N.Y.S. 86 (1919) (1919) (NYSIF liability framework and coverage)
- Commissioners of State Insur. Fund v. Dinowitz, 39 N.Y.S.2d 34 (1942) (1942) (NYSIF rights and obligations as insurer)