IN THE COURT OF APPEALS OF NORTH CAROLINA
No. COA18-429
Filed: 19 February 2019
N.C. Industrial Commission, I.C. No. Y18900
GWENDOLYN DIANETTE WALKER, Widow of ROBERT LEE WALKER, Deceased
Employee, Plaintiff,
v.
K&W CAFETERIAS, Employer, LIBERTY MUTUAL INSURANCE COMPANY,
Carrier, Defendants.
Appeal by plaintiff from Opinion and Award entered 27 February 2018 by the
North Carolina Industrial Commission. Heard in the Court of Appeals 17 January
2019.
The Sumwalt Law Firm, by Vernon Sumwalt, for plaintiff-appellant.
Cranfill Sumner & Hartzog LLP, by Carl Newman and Roy G. Pettigrew, for
defendant-appellees.
TYSON, Judge.
I. Background
Robert Lee Walker (“Decedent”) was killed in a motor vehicle accident while
driving a truck owned by K&W Cafeterias, Inc. (“Employer”) in South Carolina on 16
May 2012. Decedent was a resident of South Carolina. Employer is a North Carolina
corporation and headquartered in Winston-Salem. Employer’s vehicle Decedent was
driving when the accident occurred was insured under an automobile liability policy
WALKER V. K&W CAFETERIAS
Opinion of the Court
underwritten by Liberty Mutual Insurance Company (“Insurer”) (Employer and
Insurer collectively referred to as “Defendants”). The automobile liability policy was
purchased and entered into within North Carolina.
On 21 August 2012, Decedent’s widow, Gwendolyn Walker (“Plaintiff”), filed a
claim for death benefits pursuant to the North Carolina Workers’ Compensation Act.
N.C. Gen. Stat. § 97-38 (2017). With the consent of the parties, the Industrial
Commission entered an opinion and award, which included several joint stipulations,
including, in relevant part:
1. . . . [Decedent] died as the result of a motor vehicle
accident arising out of and in the course of his employment
with Defendant-Employer.
2. At all relevant times, the parties hereto were subject to
and bound by the provisions of the North Carolina
Workers’ Compensation Act.
...
6. The North Carolina Industrial Commission has
jurisdiction over the parties and the subject matter
involved in this case.
...
8. On the date of [Decedent’s] death, [Decedent] had six
children. However, all children were over the age of
eighteen on the date of [Decedent’s] death. . . .
11. Plaintiff Gwendolyn Dianette Walker is the widow and
sole surviving dependent of [Decedent].
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Based upon the parties’ stipulations, and with the consent of the parties, the
Industrial Commission ordered Defendants to pay Plaintiff five hundred weekly
payments of $650.89 each and an additional payment of $8,318 for funeral expenses,
for total anticipated benefits of $333,763.
Plaintiff was appointed the personal representative of Decedent’s estate in
South Carolina. On 26 August 2014, Plaintiff, as personal representative of the
estate, filed a wrongful death and survival action against the at-fault driver and his
father in the Horry County Court of Common Pleas in South Carolina. In March
2016, Plaintiff, the at-fault driver and his father settled the lawsuit and Plaintiff
received a total of $962,500 under the settlement (“the third-party settlement”). The
total settlement amount of $962,500 came from the following sources:
1. $50,000 in liability benefits from the at-fault driver’s
insurer;
2. $12,500 in personal underinsured motorist (“UIM”)
coverage covering Plaintiff and Decedent’s own personal
vehicle from Plaintiff’s own automobile insurance carrier;
and
3. $900,000 in commercial UIM coverage covering the
vehicle Decedent was driving when the accident occurred
from Employer’s automobile insurance carrier, Insurer.
On 21 March 2016, Defendants filed a Form 33 request for hearing with the
North Carolina Industrial Commission seeking a subrogation lien against $333,763
of the $962,500 Plaintiff had received from the third-party settlement. On 30 March
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Opinion of the Court
2016, Plaintiff filed a declaratory judgment action in the Horry County Court of
Common Pleas in South Carolina seeking a declaration of “whether the Defendants
are entitled to assert a claim against any and all settlement proceeds, including those
settlement proceeds paid under the [underinsured motorist] coverage.”
Defendants removed Plaintiff’s declaratory judgment action to the United
States District Court for the District of South Carolina based upon the diversity of
state citizenship of the parties on 2 May 2016. On 13 June 2016, Plaintiff filed a
motion with the North Carolina Industrial Commission to stay the proceedings,
pending the outcome of the declaratory judgment action in the United States District
Court. The Industrial Commission denied Plaintiff’s motion to stay the proceedings
by an order filed 28 June 2016.
On 28 July 2016, Plaintiff filed an appeal for a hearing before a deputy
commissioner. Before the scheduled hearing, “the parties jointly requested that in
lieu of testimony, they be allowed to try the case on stipulated facts and exhibits with
the submission of briefs and proposed decisions[.]” Plaintiff argued South Carolina
law controlled over North Carolina law to the extent South Carolina forbids
subrogation of UIM proceeds for workers’ compensation benefits under S.C. Code §
38-77-160.
On 10 July 2017, the deputy commissioner filed an opinion and award ruling
in favor of Defendants and requiring Plaintiff to apply the $962,500 from the third-
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Opinion of the Court
party settlement to satisfy Defendants’ $333,763 subrogation lien. Plaintiff appealed
the deputy commissioner’s opinion and award to the full Industrial Commission (“the
Full Commission”).
On 26 January 2018, while Plaintiff’s appeal to the Full Commission was
pending, the United States District Court entered an order holding it “will abstain
from exercising jurisdiction over [Plaintiff’s] declaratory action, and will dismiss it
without prejudice to the parties pursuing their claims before the Industrial
Commission and the North Carolina appellate courts.”
On 27 February 2018, the Full Commission issued an opinion and award. The
Full Commission found, in relevant part:
3. . . . Decedent was killed when his vehicle was struck by
another vehicle operated by . . . “third parties,” as defined
in . . . N.C. Gen. Stat. § 97-10.2(a).
...
12. Under the terms of the Consent Opinion and Award,
Plaintiff and Defendants stipulated to the Industrial
Commission’s jurisdiction over Plaintiff’s workers’
compensation claim. Furthermore, N.C. Gen. Stat. §§ 97-
91 and 97-10.2 confer[] the Industrial Commission with
personal jurisdiction over Plaintiff and subject matter
jurisdiction over all aspects of the workers’ compensation
claim, including Defendant’s lien.
...
14. Plaintiff conceded in her brief to the Deputy
Commissioner that the distribution formula in N.C. Gen.
Stat. § 97-10.2(f) would apply to the $50,000.00 in liability
insurance proceeds.
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Opinion of the Court
15. Plaintiff’s $900,000.00 in commercial UIM proceeds
were paid pursuant to a North Carolina liability policy.
While the policy contains a South Carolina endorsement
(as well as endorsements or financial responsibility
identification cards for Florida, West Virginia, and
Virginia), the UIM policy was made in North Carolina, was
paid pursuant to the provisions of a North Carolina policy,
and is subject to the laws of this State.
The Full Commission concluded Defendants were entitled to a subrogation lien
on the entire third-party settlement proceeds “and not just [Plaintiff’s] share of the
Third-Party Recovery.” The Full Commission’s opinion and award directed the
distribution of the third-party settlement amount of $962,500 as follows:
a. The sum of $5,921.91 shall be paid to Plaintiff’s counsel
for payment of actual costs pursuant to N.C. Gen. Stat. §
97-10.2(f)(1)(a);
b. The sum of $320,833.33 shall be paid to Plaintiff’s
counsel for payment of attorney’s fees pursuant to N.C.
Gen. Stat. § 97-10.2(f)(1)(b);
c. The sum of $222,507.63 shall be paid to Defendants
pursuant to N.C. Gen. Stat. § 97-10.2(f)(1)(c) and (f)(2); and
d. The remaining sum of $413,237.13 shall be paid to
Plaintiff pursuant to N.C. Gen. Stat. § 97-10.2(f)(1)(d).
Plaintiff filed timely notice of appeal to this Court.
II. Jurisdiction
Jurisdiction lies in this Court pursuant to N.C. Gen. Stat. § 97-86 (2017).
III. Issues
Plaintiff argues: (1) the Full Commission exceeded its subject matter
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Opinion of the Court
jurisdiction by ordering the distribution of out-of-state UIM proceeds to satisfy a
workers’ compensation lien, when the proceeds were shares of an out-of-state
wrongful death recovery for some recipients who never received workers’
compensation benefits under North Carolina law; (2) the UIM insurance proceeds
were paid under South Carolina insurance policies; and (3) S.C. Code. § 38-77-160
immunizes the South Carolina UIM proceeds from all subrogation.
IV. Standard of Review
An opinion and award from the Industrial Commission is reviewed to
determine:
(1) whether its findings of fact are supported by any
competent evidence in the record; and (2) whether the
Industrial Commission’s findings of fact justify its legal
conclusions. The Industrial Commission’s conclusions of
law are reviewable de novo by this Court.
Moore v. City of Raleigh, 135 N.C. App. 332, 334, 520 S.E.2d 133, 136 (1999) (citation
and quotation marks omitted).
“Whether North Carolina law or South Carolina law governs is a question of
law which we review de novo.” Anglin v. Dunbar Armored, Inc., 226 N.C. App. 203,
206, 742 S.E.2d 205, 207 (2013).
V. Analysis
A. In re Bullock
Plaintiff acknowledges she “does not dispute that Defendants have a workers’
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Opinion of the Court
compensation lien.” Plaintiff argues the Full Commission exceeded its subject matter
jurisdiction “to the extent that the Full Commission held that the workers’
compensation lien extends to funds other than [Plaintiff’s] share of the wrongful
death recovery[.]”
N.C. Gen. Stat. § 97-10.2 (2017) provides authority for an employer to obtain a
subrogation lien for workers’ compensation benefits paid by the employer against
amounts recovered from and against a third-party tortfeasor. The statute provides,
in relevant part:
(f)(1) . . . if an award final in nature in favor of the employee
has been entered by the Industrial Commission, then any
amount obtained by any person by settlement with,
judgment against, or otherwise from the third party by
reason of such injury or death shall be disbursed by order
of the Industrial Commission for the following purposes
and in the following order of priority:
...
c. Third to the reimbursement of the employer for all
benefits by way of compensation or medical compensation
expense paid or to be paid by the employer under award of
the Industrial Commission.
...
(h) In any . . . settlement with the third party, every party to
the claim for compensation shall have a lien to the extent of
his interest under (f) hereof upon any payment made by the
third party by reason of such injury . . . . and such lien may
be enforced against any person receiving such funds.
N.C. Gen. Stat. §§ 97-10.2(f)(1), (h) (emphasis supplied).
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Plaintiff contends the Full Commission lacks subject matter jurisdiction to
order subrogation of the portions of the third-party settlement that are the
distributive shares of the wrongful death recovery of Decedent’s six adult children.
Plaintiff acknowledges this Court’s binding and prior published opinion in In
re Estate of Bullock, 188 N.C. App. 518, 655 S.E.2d 869 (2008). Plaintiff states
“Bullock is the only opinion indicating that the distributive shares of a wrongful death
recovery can be used to satisfy a workers’ compensation lien, even when the recipients
of that recovery never received workers’ compensation.”
In Bullock, a construction worker was killed in the course of his employment.
Bullock, 188 N.C. App. at 519, 655 S.E.2d at 870. The decedent construction worker
was not married and had no children. Id. The decedent’s girlfriend and his two minor
nephews had lived with him prior to his death. Id. The decedent died intestate and
his only heir, pursuant to the Intestate Succession Act, was his mother. Id.
The construction worker’s family members filed a workers’ compensation claim
for death benefits. Id. The Industrial Commission issued an opinion and award
finding that the minor nephews were wholly and fully dependent on the decedent for
support and that they were the only persons entitled to receive death benefits. Id.
The decedent’s estate separately brought a wrongful death claim against the
dump truck driver, who had run over decedent, and the driver’s employer. After the
decedent’s estate entered into a settlement agreement of the wrongful death claim
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Opinion of the Court
with the dump truck driver and the driver’s employer, the estate sought approval of
the agreement by the trial court. Id. The decedent’s employer and insurer filed a
motion seeking to set aside the settlement agreement and for a declaration they
possessed a workers’ compensation lien on the settlement proceeds. Id.
The trial court denied decedent’s employer and insurer’s motion to set aside
the settlement agreement, approved the settlement agreement, and ruled in part that
the decedent’s employer and its insurance carrier did not have a valid workers’
compensation lien on the settlement proceeds. Id. at 520-21, 655 S.E.2d at 871.
This Court reversed the trial court’s ruling. Id. at 521, 655 S.E.2d at 871. The
Court analyzed the plain language of N.C. Gen. Stat. § 97-10.2 and held the
decedent’s employer and insurance carrier had “a statutory lien against any payment
made by a third-party tortfeasor arising out of an injury or death of an employee
subject to the [Workers’ Compensation] Act.” Id. at 524, 655 S.E.2d at 873 (emphasis
in original). This Court also held “[t]his lien may be enforced against ‘any person
receiving such funds.’” Id. (quoting N.C. Gen. Stat. § 97-10.2(h)) (emphasis in
original)).
In reaching its holding, this Court stated:
Although the General Assembly expressly subrogated the
rights of an employer’s insurance carrier to that of an
employer, see N.C. Gen. Stat. § 97-10.2(g), we find no
language in section 97-10.2 subrogating the rights of an
employer to that of the beneficiaries of the workers’
compensation award. If the General Assembly intended to
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Opinion of the Court
subrogate the employer’s rights to that of the beneficiaries
of the award, they would have done so expressly as they did
in subsection (g). Instead, the extent of an employer’s
subrogation interest under subsection (f) is measured by
compensation paid or to be paid by the employer.
Id.
Bullock holds that even though the beneficiaries under the third-party
wrongful death claim never received any workers’ compensation benefits, they were
nevertheless subject to the subrogation lien statute under N.C. Gen. Stat. § 97-
10.2(h). See id.
Plaintiff does not contend that Bullock is distinguishable from the matter at
hand nor does she argue Bullock is not controlling. Plaintiff instead contends that
Bullock was wrongly decided and places her, as the personal representative of
Decedent’s estate, in a conflict of interest vis-à-vis Decedent’s six adult children.
Plaintiff requests that “[t]o the extent that the Court feels obligated to follow Bullock,
which produces this conflict of interest, [Plaintiff] asks the panel members of the
Court for at least a dissenting opinion[.]”
The Supreme Court of North Carolina and this Court have long recognized that
“[w]here a panel of the Court of Appeals has decided the same issue, albeit in a
different case, a subsequent panel of the same court is bound by that precedent,
unless it has been overturned by a higher court.” In re Civil Penalty, 324 N.C. 373,
384, 379 S.E.2d 30, 37 (1989). This Court recently discussed In re Civil Penalty in
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State v. Gonzalez and stated:
In re Civil Penalty stands for the proposition that, where a
panel of this Court has decided a legal issue, future panels
are bound to follow that precedent. This is so even if the
previous panel’s decision involved narrowing or
distinguishing an earlier controlling precedent—even one
from the Supreme Court—as was the case in In re Civil
Penalty. Importantly, In re Civil Penalty does not authorize
panels to overrule existing precedent on the basis that it is
inconsistent with earlier decisions of this Court.
State v. Gonzalez, __ N.C. App. __, __, __ S.E.2d __, __, 2019 WL 189853 at *3 (2019).
This Court is bound by our prior holding in Bullock. In re Civil Penalty, 324
N.C. at 384, 379 S.E.2d at 37. Any recovery obtained by “any person receiving such
funds” through a wrongful death claim against third parties is subject to a
subrogation lien under N.C. Gen. Stat. § 97-10.2(h) when workers’ compensation
benefits have been advanced because of a covered employee’s death, even if the
claimants never received any workers’ compensation benefits. Bullock, 188 N.C. App.
at 524, 655 S.E.2d at 873.
Being bound by In re Civil Penalty, we are without authority to overturn a
prior panel of this Court. 324 N.C. at 384, 379 S.E.2d at 37. Plaintiff’s argument is
overruled.
B. Jurisdiction Over Property Located Outside North Carolina
Plaintiff argues that “[e]ven if the Industrial Commission could reach the
property belonging to non-‘employees’ and non-‘dependents’ under N.C. Gen. Stat. §
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Opinion of the Court
97-10.2, the Commission cannot exercise its jurisdiction to affect the rights to that
property when it is located outside of North Carolina.”
Plaintiff asserts the UIM proceeds are “located in South Carolina and paid
under South Carolina law in a South Carolina wrongful death action before a South
Carolina court” and the Industrial Commission lacks in rem jurisdiction over the
proceeds and lacks the jurisdiction to order distribution of the UIM proceeds.
Plaintiff does not contend the Industrial Commission lacked in personam
jurisdiction over her. Plaintiff jointly stipulated with Defendants to the North
Carolina Industrial Commission that “[a]ll parties are properly before the Industrial
Commission and the Industrial Commission has subject matter jurisdiction over this
matter.” (Emphasis supplied). Regarding the location of the funds from the third-
party settlement, the parties stipulated “Plaintiff’s attorneys are currently holding
the entirety of Plaintiff’s $962,500.00 from the Third-Party Recovery in their trust
account.”
“‘In rem’ proceedings encompass any action brought against a person in which
essential purpose of suit is to determine title to or affect interests in specific property
located within territory over which court has jurisdiction.” Green v. Wilson, 163 N.C.
App. 186, 189, 592 S.E.2d 579, 581 (2004) (quoting Black’s Law Dictionary 793 (6th
ed. 1990)). In Green, this Court recognized
that a foreign court with in personam jurisdiction could
render judgments that indirectly affect ownership of
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Opinion of the Court
property over which that court would have no in rem
jurisdiction in certain specific instances. However, a court
in a jurisdiction foreign to the subject property could not
determine title to the property. An example of the former
would be an equitable distribution in which the divorcing
couple hold property in North Carolina but bring the
divorce action in another state. The foreign court would
have the authority, under principles of in personam
jurisdiction, to divide the commonly held title. But where
the ownership of the deed is in dispute or there is a cloud
on the title, a court must have in rem jurisdiction to decide
such matters.
Id. “By means of its power over the person of the parties before it, a court may, in
proper cases, compel them to act in relation to property not within its jurisdiction,
but its decrees do not operate directly upon the property nor affect its title.” McRary
v. McRary, 228 N.C. 714, 718, 47 S.E.2d 27, 30 (1948).
The Industrial Commission acted within its proper and stipulated personal
jurisdiction over Plaintiff to order her to distribute the amount she had obtained from
the third-party settlement in accordance with N.C. Gen. Stat. § 97-10.2. Even if the
$962,500 from the third-party settlement is not present within North Carolina,
Defendants may enforce the Commission’s opinion and award in South Carolina
under South Carolina’s version of the Uniform Enforcement of Foreign Judgments
Act, S.C. Code. §§ 15-35-900 to -960 (2018).
Plaintiff’s argument is also suspect in light of her stipulation that the
Industrial Commission’s order of distribution could be applied to the $50,000 portion
of the third-party settlement obtained from the liability insurance proceeds from the
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at-fault driver’s South Carolina insurance policy. It is uncontested by the parties
that the $50,000 portion of the third-party settlement from the liability insurance
proceeds is located within South Carolina, was obtained from a South Carolina
insurance policy from the wrongful death action brought in South Carolina.
Plaintiff’s argument is overruled.
C. Anglin v. Dunbar Armored
The Full Commission’s opinion and award also relied, in part, upon this Court’s
opinion in Anglin v. Dunbar Armored, Inc., 226 N.C. App. 203, 742 S.E.2d 205 (2013),
to conclude North Carolina law allowing for subrogation liens over third-party
wrongful death awards in workers’ compensation cases applies in this situation.
The Commission concluded, in part:
2. Under traditional conflict of laws rules, matters affecting
the parties’ substantive rights are determined by lex loci,
the law of the situs of the claim, while procedural or
remedial issues are determined by the lex fori, or law of the
forum where the remedy is sought . . . It is well-established
that rights arising from the subrogation lien under N.C.
Gen. Stat. § 97-10.2 are remedial or procedural in nature,
not substantive. . . . Therefore, the forum where relief is
sought is North Carolina, specifically, the Industrial
Commission. . . . Thus, N.C. Gen. Stat. § 97-10.2, rather
than South Carolina law, controls the rights of parties
concerning Defendants’ statutory subrogation lien. Anglin
v. Dunbar Armored 226 N.C. App. 203, 209-10, 742 S.E.2d
205, 209 (2013).
Plaintiff asserts “[i]n Anglin, the Court considered if the proceeds from a South
Carolina UIM policy affected the existence of a workers’ compensation lien under
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Opinion of the Court
North Carolina Law against those proceeds[,]” but did not consider how parties may
attach property to satisfy the lien.
In Anglin, a South Carolina resident who worked for Dunbar Armored, Inc., a
company doing business out of North Carolina, was injured in the course and scope
of his employment in an automobile accident which occurred in South Carolina. 226
N.C. App. at 204, 742 S.E.2d at 206. The injured employee received workers’
compensation benefits from Dunbar under the North Carolina Workers’
Compensation Act. Id. The injured employee subsequently settled a liability claim
with the at-fault driver. Id.
Dunbar agreed to settle its subrogation lien on the liability settlement for one-
third of the amount of the lien. Id. A few months later, the injured employee settled
with his UIM insurance carrier. Id. Dunbar was unaware of the UIM funds at the
time it settled its lien with the injured employee. Id.
The injured employee then filed a complaint in superior court seeking
“declaratory relief and to eliminate or reduce [Dunbar’s] subrogation interest[,]”
pursuant to N.C. Gen. Stat. § 97-10.2(j). Id. The injured employee “contend[ed] that
South Carolina law applies because [he] was entitled to UIM funds pursuant to a
South Carolina Policy.” The employee further contended that Dunbar could not
subrogate UIM funds under South Carolina law, S.C. Code Ann. § 38-77-160. Id. The
trial court ruled, in part, that North Carolina law applied over South Carolina law
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Opinion of the Court
and that Dunbar was entitled to the full amount of its subrogation lien. Id.
On appeal, this Court analyzed the case of Cook v. Lowe’s Home Centers, Inc.,
209 N.C. App. 364, 704 S.E.2d 567 (2011), which had held “that N.C. Gen. Stat. § 97-
10.2(j) ‘is remedial in nature’ and that ‘remedial rights are determined by the law of
the forum.’” Anglin, 226 N.C. App. at 207, 742 S.E.2d at 208 (quoting Cook, 209 N.C.
App. at 367-68, 704 S.E.2d at 570-71).
This Court reasoned in Cook:
As to substantive laws, or laws affecting the cause of
action, the lex loci—or law of the jurisdiction in which the
transaction occurred or circumstances arose on which the
litigation is based—will govern; as to the law merely going
to the remedy, or procedural in its nature, the lex fori—or
law of the forum in which the remedy is sought—will
control.
Where a lien is intended to protect the interests of those
who supply the benefit of assurance that any work-related
injury will be compensated, it is remedial in nature. A
statute that provides a remedial benefit must be construed
broadly in the light of the evils sought to be eliminated, the
remedies intended to be applied, and the objective to be
attained.
Cook, 209 N.C. App. at 366-67, 704 S.E.2d at 569-70 (emphasis supplied) (citations,
quotation marks, ellipses, and brackets omitted).
Following Cook, this Court held in Anglin that because “N.C. Gen. Stat. § 97-
10.2(j) is remedial in nature and remedial rights are determined by the law of the
forum[,] . . . the trial court did not err in applying N.C. Gen. Stat. § 97-10.2(j) to [the
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injured employee’s] UIM funds received under a South Carolina insurance policy.”
Anglin, 226 N.C. App. at 209-10, 742 S.E.2d at 209 (citation and internal quotation
marks omitted) (alteration in original); see Robinson v. Leach, 133 N.C. App. 436, 514
S.E.2d 567 (determining that subrogation rights on UIM funds are procedural in
nature and controlled by the law of North Carolina as the forum state).
This Court affirmed the trial court’s judgment that North Carolina law applied
to allow subrogation of UIM proceeds procured under an out-of-state UIM policy and
that Dunbar was entitled to the remaining proceeds from the lien on the UIM funds.
Id. at 205, 742 S.E.2d at 207.
Anglin involved a proceeding brought in the trial court pursuant to N.C. Gen.
Stat. § 97-10.2(j) of the Workers’ Compensation Act. The instant case concerns
whether the Industrial Commission possessed the authority to award a subrogation
lien to Defendants and order disbursement pursuant to N.C. Gen. Stat. § 97-10.2(f).
The reasoning this Court applied in Cook, and followed in Anglin, to N.C. Gen. Stat.
§ 97-10.2(j) is applicable here. N.C. Gen. Stat. § 97-10.2(f) is remedial in nature
because it provides for “a lien [] intended to protect the interests of those who supply
the benefit of assurance that any work-related injury will be compensated.” Cook, 209
N.C. App. at 366-67, 704 S.E.2d at 569-70.
North Carolina is the forum state in this dispute, and N.C. Gen. Stat. § 97-
10.2(f) is remedial in nature. The precedents hold our statute applies over South
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Carolina law to grant Defendants a subrogation lien on the UIM proceeds recovered
in the third-party settlement. See Anglin, 226 N.C. App. at 209-10, 742 S.E.2d at 209.
Plaintiff contends that because the UIM policies were South Carolina policies,
the Industrial Commission erred in concluding that N.C. Gen. Stat. § 97-10.2(f)
applied over South Carolina’s anti-subrogation law on UIM proceeds, S.C. Code. § 38-
77-160. Plaintiff asserts the commercial UIM policy, though purchased and issued in
North Carolina, is a South Carolina policy because of an endorsement attached
thereto, which states:
THIS ENDORSEMENT CHANGES THE POLICY.
PLEASE READ IT CAREFULLY.
SOUTH CAROLINA UNDERINSURED MOTORIST
COVERAGE
For a covered “auto” licensed or principally garaged in, or
“garage operations” conducted in, South Carolina, this
endorsement modifies insurance provided under the
following:
BUSINESS AUTO COVERAGE FORM
GARAGE COVERAGE FORM
MOTOR CARRIER COVERAGE FORM
TRUCKERS COVERAGE FORM
With respect to the coverage provided by this endorsement,
the provisions of the Coverage Form apply unless modified
by the endorsement. . . .
CONFORMITY TO STATUTE
This endorsement is intended to be in full conformity with
the South Carolina Insurance Laws. If any provision of this
endorsement conflicts with that law, it is changed to
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comply with the law.
Plaintiff also contends that her and her decedent’s personal UIM policy was
also a South Carolina policy “because it insured the Walkers as South Carolina
residents with vehicles located in that state.”
Presuming, arguendo, as Plaintiff asserts, the UIM policies are South Carolina
policies, North Carolina’s subrogation law applies over South Carolina law as the law
of the forum state, pursuant to Anglin. See Anglin, 226 N.C. App. at 209-10, 742
S.E.2d at 209. The UIM policy at issue in Anglin was a South Carolina policy, the
injured employee was a South Carolina resident, and the automobile accident
occurred in South Carolina. Id. at 204, 742 S.E.2d at 206. This Court held North
Carolina law, allowing for subrogation over the UIM policy proceeds, controlled over
South Carolina law, and affirmed the trial court’s order. Id. at 205, 742 S.E.2d at 207.
Plaintiff’s argument is overruled.
VI. Conclusion
The Full Commission correctly concluded Defendants could assert a
subrogation lien for workers’ compensation benefits paid to Plaintiff on the UIM
policy proceeds obtained by Plaintiff in the South Carolina wrongful death action.
The Industrial Commission possessed the jurisdiction to order disbursement of the
third-party settlement proceeds. The opinion and award of the Industrial
Commission is affirmed. It is so ordered.
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WALKER V. K&W CAFETERIAS
Opinion of the Court
AFFIRMED.
Judges STROUD and ZACHARY concur.
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