Opinion
I.C. NOS. 516047 556630.
Filed 10 June 2008.
The Full Commission reviewed this matter on September 27, 2007 upon appeal by plaintiff from an Opinion and Award filed by Deputy Commissioner Bradley W. Houser on February 13, 2007 and appeal by defendants from an Order filed by Deputy Commissioner Houser on March 5, 2007.
Plaintiff: Grandy Martin, Attorneys, Charlotte, North Carolina; Kenneth C. Martin, appearing.
Defendants: Morris York Williams Surles Barringer, Attorneys, Charlotte, North Carolina; L. Stephen Kushner, appearing.
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The undersigned reviewed the prior Opinion and Award based upon the record of the proceedings before Deputy Commissioner Houser. The appealing party has shown good ground to reconsider the evidence and the Full Commission reverses the Deputy Commissioner's holding that the Memorandum of Agreement constituted a binding contractual agreement. In addition, the Full Commission determined the enforceability of the submitted Compromise Settlement Agreement.
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The Full Commission finds as fact and concludes as matters of law the following, which were entered into by the parties at the hearing before the Deputy Commissioner as:
STIPULATIONS
1. On March 2, 2005, plaintiff sustained an injury to his back and right leg when he fell from a ladder during the course and scope of his employment.
2. Plaintiff alleges that he sustained a second injury to his back on July 28, 2005 when he slipped and fell going down some steps in the course and scope of his employment. Defendants have denied this claim.
3. On March 2, 2005 and July 28, 2005 an employment relationship existed between plaintiff-employee and defendant-employer.
4. On all relevant dates, the parties are subject to and bound by the North Carolina Workers' Compensation Act.
5. On all relevant dates, the carrier named above was the carrier on the risk.
6. Plaintiff has not returned to work for defendant-employer since July 28, 2005. Plaintiff was terminated by defendant-employer on May 3, 2006.
7. On all relevant dates, plaintiff's average weekly wage was $800.00, yielding a compensation rate of $533.36.
8. These claims were the subject of a mediated settlement conference held on May 3, 2006. All parties participated in the mediated settlement conference. At the conclusion of the mediated settlement conference, plaintiff and plaintiff's former attorney had signed a mediated memorandum of agreement to settle plaintiff's two claims for $25,000 and payment of plaintiff's share of the mediator's fee. Defendants did not sign the settlement agreement. On May 18, 2006, the settlement agreement memorandum was signed by defendants' attorney L. Stephen Kushner on behalf of defendants and his law firm.
9. Following the execution of the mediated memorandum of agreement by defendants' attorney, a formal compromise settlement agreement was forwarded to plaintiff and his attorney for execution. Plaintiff has declined to execute the formal compromise settlement agreement.
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Based upon all of the competent evidence of record and reasonable inferences flowing therefrom, the Full Commission makes the following:
FINDINGS OF FACT
1. On March 2, 2005, plaintiff sustained an injury by accident arising out of and in the course of his employment with defendant-employer. This claim was assigned I.C. number 516047. Defendants paid medical and indemnity benefits on I.C. number 516047 pursuant to a Form 63.
2. Plaintiff alleges he sustained a second injury by accident arising out of and in the course of his employment on July 28, 2005 when he slipped and fell while going down some steps. This claim was assigned I.C. number 556630. Defendants denied the compensability of this claim.
3. Plaintiff filed a Form 33 Request for Hearing in I.C. number 556630 on or about September 14, 2005. Defendants filed a Form 33R on December 22, 2005, noting that the claim was denied.
4. The parties engaged in a mediated settlement conference pertaining to both of plaintiff's claims on May 3, 2006. Plaintiff attended the mediated settlement conference and was represented by his then-attorney, D. Baker McIntyre. Defendants were represented by Michelle Langdon of the law firm Morris York Williams Surles Barringer.
5. It is undisputed that the parties did not enter into a mediated memorandum of agreement at the conclusion of their mediated settlement conference on May 3, 2006. Plaintiff and his attorney signed a settlement agreement memorandum proposing to settle plaintiff's claims for the sum of $25,000.00. Defendants did not sign the settlement agreement memorandum. The parties left the settlement conference without an executed agreement.
6. On May 18, 2006, the settlement agreement memorandum was signed by defendants' attorney, L. Stephen Kushner, on behalf of defendants and his law firm. Following the execution of the settlement agreement memorandum by defendants' attorney, a formal compromise settlement agreement was forwarded to plaintiff and his attorney for execution. Plaintiff refused to execute the formal compromise settlement agreement.
7. Pursuant to the order of the Deputy Commissioner in the Interlocutory Opinion and Award, the parties signed and submitted a compromise settlement agreement for review.
8. Based on the greater weight of the evidence, the undersigned find that there was no meeting of the minds creating a valid contract between the parties. However, even if the Commission did find a valid contract between the parties, based on review of the competent evidence of record and considering all relevant factors, including the potential causal connection between plaintiff's initial March 2, 2005 admittedly compensable injury by accident and the alleged injury occurring on July 28, 2005, the undersigned find that the submitted compromise settlement agreement is not fair and just to all parties.
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Based upon the foregoing stipulations and findings of fact, the Full Commission reaches the following:
CONCLUSIONS OF LAW
1. In Lemly v. Colvard Oil Co., 157 N.C. App. 99, 577 S.E.2d 712 (2003), the Court held that a memorandum of agreement, signed by the parties and containing all requirements for a valid contract, is enforceable upon approval by the Commission so long as there has been a meeting of the minds as to all essential terms of the agreement. In the instant case, the memorandum of agreement was not signed by all of the parties, and the parties left the settlement conference without an executed agreement. The greater weight of the evidence fails to demonstrate that there was a meeting of the minds creating a valid contract between the parties.
2. Rule 502(1) charges that "Only those agreements deemed fair and just and in the best interest of all parties will be approved." The Commission must determine the fairness and justness of the agreement from the medical evidence filed with the agreement at the time it was originally submitted to the Commission for approval. Lewis v. Craven Regional Medical Center, 134 N.C. App. 438, 518 S.E.2d 1 (1999). In the instant case, there was more than enough information from the medical evidence available at the time, including the potential causal connection between plaintiff's initial March 2, 2005 admittedly compensable injury by accident and the alleged injury occurring on July 28, 2005, that renders the submitted compromise settlement agreement unfair to plaintiff. Accordingly, the agreement cannot be approved by the Commission as being in the best interest of all parties.
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Based upon the foregoing findings of fact and conclusions of law, the Full Commission enters the following:
ORDER
1. Enforcement of the memorandum of agreement in this case must be and is hereby denied.
2. The submitted compromise settlement agreement is not fair and just to all parties and is hereby disapproved.
3. This matter is remanded to the Deputy Commissioner Section for a full evidentiary hearing.
This the 11th day of January, 2008.
S/___________________ DANNY LEE McDONALD COMMISSIONER
CONCURRING:
S/___________________ BERNADINE S. BALLANCE COMMISSIONER
DISSENTING:
S/___________________ BUCK LATTIMORE COMMISSIONER
The undersigned respectfully dissents from the Opinion and Award of the majority denying the enforcement of the memorandum of agreement and finding that the compromise settlement agreement is not fair and just. Under the law the greater weight of the competent evidence supports a finding that the memorandum of agreement is an enforceable contract and the compromise settlement agreement is fair and just to all parties.
Compromise settlement agreements, including mediated settlement agreements are governed by the general principles of contract law. Chappel v. Roth, 353 N.C. 690, 548 S.E. 2d 499 (2001). Where no time has been set or stipulated to for the acceptance of an offer, the offeree has a reasonable time within which to accept the offer. Jackson v. N.C. Joint Stock Land Bank of Durham, 208 N.C. 705, 182 S.E. 110 (1935). Although a contract was not formed at the mediation in this case, plaintiff signed the memorandum of agreement indicating his intent to agree to the terms of the settlement and that the settlement of the claim remained open for a reasonable period of time in order to allow defendants to obtain settlement authorization.
On May 18, 2006, only 15 days after the May 3, 2006 mediation, defendants agreed to the terms of the settlement by signing the memorandum of agreement and submitting the settlement documents to plaintiff within a reasonable time following the mediation. It was only after defendants notified plaintiff and executed the memorandum of agreement that defendants were notified that plaintiff was having second thoughts. However, once defendants executed the memorandum of agreement, the memorandum became an enforceable binding contract.
Plaintiff contends that the notation in the memorandum that defendants would prepare and submit the settlement documents by May 15, 2006 was a stipulation that acceptance must be indicated by that deadline. However, the memorandum did not specify the manner or the date in which the offer of settlement would lapse or otherwise be considered as a rejection. Even if this clause were a stipulation that acceptance was required by May 15, 2007, such a time limit for acceptance can be waived if the offeror takes steps to complete the transaction after the late acceptance is received. Carver v. Britt, 241 N.C. 538, 85 S.E.2d 888(1955). In the case sub judice plaintiff proceeded with the transaction. After defendants submitted the settlement agreement to plaintiff, plaintiff responded with requests to include additional language, which defendants added to the agreement. Plaintiff through his actions acknowledged defendants acceptance of the settlement agreement and plaintiff's intent to proceed with the execution of the settlement agreement. Therefore, the parties in this claim are bound by the terms of the memorandum of agreement.
Further, the compromise settlement agreement is fair and just to all parties pursuant to N.C.I.C. Rule 502(2) and Lemly v. Colvard Oil Co., 157 N.C. App. 99, 577 S.E.2d 712 (2003). In making a determination of whether an agreement is fair and just, the Industrial Commission must consider the evidence presented at the time of the agreement. Lewis v. Craven Reg'l Med. Ctr., 134 N.C. App. 438, 518 S, E, 2d 1 (1999).
After entering into the memorandum of agreement, plaintiff now seeks to avoid the enforcement of the agreement by declaring that the settlement was not fair and just. The majority has found that there was sufficient evidence available at the time of the parties' settlement conference to rule that the agreement was not fair and just. However the greater weight of the evidence is to the contrary. At the time of the agreement, plaintiff had reached maximum medical improvement with regard to his back and had been released to return to work without restrictions, and plaintiff had been assigned a 15% permanent partial impairment rating to his leg. Defendants contend that plaintiff does not have permanent impairment and that plaintiff is not entitled to further benefits. Plaintiff knew, at the time of the agreement, what his current and potential medical conditions were. Plaintiff was aware of his medical condition and had the advise of counsel in making the determination to settle his claim. Based upon the greater weight of the medical evidence, the compromise settlement agreement is fair and just to all parties.
For the foregoing reasons the undersigned respectfully dissents from the majority.
This the 14th day of February, 2008.
S/___________________ BUCK LATTIMORE COMMISSIONER