On August 5, 2014, the North Carolina Court of Appeals issued an important decision in Purcell v. Friday Staffing, 2014 N.C. App. LEXIS 817. The case, which was handled by MGC attorney Sally Moran, is the first appellate decision interpreting the application of N.C.G.S. § 97- 12.1. N.C.G.S. § 97-12.1, which was enacted as part of the June 24, 2011, reforms to the North Carolina Worker’s Compensation Act, provides as follows:
No compensation shall be allowed under this Article for injury by accident or occupational disease if the employer proves that (i) at the time of hire or in the course of entering into employment, (ii) at the time of receiving notice of the removal of conditions form a conditional offer of employment, or (iii) during the course of a post-offer medical examination:
(1) The employee knowingly and willfully made a false representation as to the employee’s physical condition;
(2) The employer relied upon one or more false representations by the employee, and the reliance was a substantial factor in the employer’s decision to hire the employee; and
(3) There was a causal connection between false representation by the employee and the injury or occupational disease.
In Purcell, the plaintiff had a worker’s compensation claim for a back injury in 1999. The plaintiff underwent surgery and was ultimately assigned permanent work restrictions of no lifting greater than 20 pounds as a result of this injury. On May 28, 2010, the plaintiff applied for employment with the employer-defendant, Friday Staffing. As part of the job application process, the plaintiff completed two pre-employment questionnaires. In one of the questionnaires, the plaintiff specifically indicated that she could engage in work requiring lifting greater than 50 pounds. In responding to the second questionnaire, the plaintiff indicated that she had never filed a workers’ compensation claim, had never suffered any injury or undergone surgery and had never received treatment or consultation about back pain or possible back injuries.
Before the Court of Appeals, the plaintiff did not dispute that the first two prongs of N.C.G.S. § 97-12.1 were satisfied. Rather, the plaintiff argued that the Industrial Commission erred in finding a causal connection between her false representation and her back injury. In its decision, the Court held that when requiring a “causal connection” to satisfy the third prong of N.C.G.S. § 97-12.1, the legislature intended that a defendant show that a plaintiff’s undisclosed or misrepresented injury, condition or occupational disease increased the risk of the subsequent injury or disease. The Court found that the plaintiff’s treating physician provided unchallenged testimony that the plaintiff was at an increased risk of injury if she exceeded her work restrictions of no lifting greater than 20 pounds. The Court held that this finding, in conjunction with the Industrial Commission’s finding that the plaintiff exceeded her work restrictions as part of her employment with Friday Staffing, supported the Industrial Commission’s finding of a causal connection under the third prong of N.C.G.S. § 97-12.1. As a result, the Court upheld the Industrial Commission’s denial of benefits.
Submitted by Sally Moran and John Barringer, McAngus Goudelock & Courie
