State News : North Carolina

NC Risk Handling Hint - Attorneys' Fees

Ensley v. FMC Corp. is a yet another reminder of the broad discretion afforded the Industrial Commission both in awarding and denying attorney’s fees.

Grover M. Ensley worked in various jobs with FMC Corporation and was exposed to asbestos when he removed metal from“dipping cells” insulated with asbestos and installed asbestos insulation in the cells. Ensley retired from work in 1998. In 2006, he underwent chest X rays which were reviewed by a board certified pulmonologist who diagnosed Ensley with asbestosis and silicosis caused by his employment. The Industrial Commission determined that Ensley had developed compensable asbestosis and awarded indemnity and medicalbenefits. Ensley was also awarded attorney’s fees under N.C.G.S. § 97-88.1.

Defendants appealed to the Court of Appeals, contending that Ensley retired because of medical conditions unrelated to his employment, and as such, he had no loss of earning capacity in 2006 when he was diagnosed with asbestosis. The Court of Appeals disagreed and noted that the Full Commission’s unchallenged findings of fact established that Ensely was unable to work in any capacity due to asbestosis in 2006.

The case was then remanded to the Full Commission because the evidentiary record lacked any findings of fact or conclusions of law regarding whether Defendants pursued a defensewithout reasonable grounds. On remand, the Full Commission determined that Defendants defendedthe claim without reasonable grounds and that Ensley was entitled to $12,000.00 in attorney’s fees. Defendants appealed to the Court of Appeals.

On August 21, 2012, inEnsley v. FMC Corp.,the Court of Appeals first considered whether the Industrial Commission erred in awarding Plaintiff attorney’s fees under N.C.G.S. § 97-88.1. It upheld the Full Commission award of attorney’s fees, noting Defendants’ denial was unreasonable because four doctors testified that Ensley had asbestosis as a result of his employment. Although Defendants argued that none of Ensley’s witnesses testified that he was actually disabled as a result of that condition, Defendants’ own medical expert determined that Ensley was disabled due to asbestosis. The record also showed that two of Ensley’s experts testified that he was disabled from any work as a result of asbestosis.

The Court also considered whether the Full Commission erred in reducing the sanction amount from 25 percent of the compensation awarded to Ensley to $12,000.00 in attorney’s fees. In finding no error, the Court noted that during the previous appeal, the Court of Appeals only required the Industrial Commission to make findings of fact and conclusions of law in support of its award of attorney’s fees. Ensley argued that the Industrial Commission was precluded from altering the amount of attorney’s fees awarded in its original opinion and was limited to making findings of fact and conclusions of law in support of its award of sanctions.

On remand, however, the Industrial Commission concluded, in its discretion, that an award of $12,000.00 in attorney’s fees was appropriate. The Court held that in making this decision, the Industrial Commission was within the authority granted under N.C.G.S.§ 97-88.1 and did not abuse its discretion.

Consideration of requests for attorney’s fees are typically fact-intensive and the Full Commission’s findings of fact and conclusions of law will rarely be disturbed on appeal. Therefore, Defendants need to carefully consider the evidence supporting their defenses and recognize the risk of attorney’s fees when such evidence is limited.