I.C. NO. 944502, JAMES GOODSON, Employee, Plaintiff, and NORTH CAROLINA DEPARTMENT OF INSURANCE EX. REL. JAMES LONG, COMMISSIONER OF INSURANCE, Intervenor v. RFS ECUSTA, INC., Assuming Employer, and PH GLATFELTER COMPANY, Original Self-Insured Employer, and NORTH CAROLINA SELF-INSURANCE GUARANTY ASSOCIATION, Defendants. ORDER by STEPHEN T. GHEEN, Chief Deputy Commissioner, N.C. Industrial Commission. Filed 3 December 2002. 

            This workers’ compensation action comes on for hearing ex mero motu based upon the failure of the Defendants to pay continuing disability benefits to the Plaintiff.

A P P E A R A N C E S

            Plaintiff:          Neill Fuleihan, Attorney at Law, Brevard, North Carolina; appearing.

                                  The Honorable Roy Cooper, Attorney General for the State of North
Carolina, North Carolina Department of Justice, Raleigh, North
Carolina; E. Clementine Peterson, appearing.

            Defendants:    Allan R. Tarlton, Attorney at Law, Asheville, North Carolina; notice only. 

                                  Young Moore and Henderson, P.A., Raleigh, North Carolina; J. D. Prather
                                          appearing for PH Glatfelter Company.

                                  Stuart Law Firm, PLLC, Raleigh, North Carolina; Catherine R. Stuart appearing for
                                          North Carolina Self-Insurance Guaranty Association.

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FINDINGS OF FACT

1.                  PH Glatfelter (hereinafter “Glatfelter”) was a certified self-insured employer in the State of North Carolina at the time of the industrial accident giving rise to this workers’ compensation action. The North Carolina Department of Insurance (hereinafter “NCDOI”) certified Glatfelter as an approved self-insured employer.

2.                  Glatfelter posted a 1.6 Million Dollar security deposit with the NCDOI for the protection of its covered employees.

3.                  As an approved self-insured employer, Glatfelter was a member of the North Carolina Self-Insurance Guaranty Association.

4.                  RSF Ecusta, Inc. (hereinafter “Ecusta”) assumed the North Carolina operations of Glatfelter by contract. It appears the contract provided that Ecusta assume and pay workers’ compensation benefits of the Plaintiff (hereinafter “Goodson”).

5.                  The NCDOI permitted Ecusta to substitute a 1.6 Million Dollar security deposit for that of Glatfelter.

6.                  Ecusta was not required to be approved as a self-insured employer in the State of North Carolina for the workers’ compensation claims assumed from Glatfelter.

7.                  Ecusta has filed a petition in bankruptcy and has ceased paying continuing disability benefits to Goodson.

8.                  Glatfelter and the North Carolina Self-Insurance Guaranty Fund deny liability for payments on any of these claims.

9.                  By letter dated November 25, 2002, the North Carolina Department of Insurance has requested that it be permitted to intervene these cases.

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CONCLUSIONS OF LAW

1.                  The Industrial Commission, in its discretion, may add necessary or proper parties. Glatfelter and the North Carolina Self-Insurance Guaranty Association appear to be both necessary and proper parties. N.C. Gen. Stat. §97-79. It appears that the NCDOI is a proper party given its involvement in the assumption of Glatfelter’s claims by Ecusta and substitution of the statutory security deposit.

2.                  The Industrial Commission may, in its discretion, determine issues for determination. It appears that two essential issues arise; first, is Glatfelter or the North Carolina Self-Insurance Guaranty Association responsible for payment of workers’ compensation insurance benefits upon the default of Ecusta, and is the statutory security deposit being held by the NCDOI available for the payment of claims. N.C. Gen. Stat. §97-79.

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            The foregoing FINDINGS OF FACT and CONCLUSIONS OF LAW engender the following:

O R D E R

1.                  That Glatfelter and the North Carolina Self-Insurance Guaranty Association are added as parties to this matter and aligned as party defendants.

2.                  That the NCDOI’s request to intervene is granted and the NCDOI is aligned for the purposes of this action as a party plaintiff.

3.                  That this matter shall be heard on December 19, 2002 at 9:30 am at the North Carolina Industrial Commission, Sixth Floor, Room 6155, 430 North Salisbury Street, Raleigh, North Carolina.

4.                  That Deputy Commissioner George Hall is designated to hear the issues in this matter. Deputy Commissioner Hall shall retain jurisdiction over this matter until final determination in the Deputy Commission Section of the Industrial Commission. That the parties should direct all further communications and filings in this case to Deputy Commissioner Hall.

5.                  That the issues initially identified for determination are as follows: Does Glatfelter and/or the North Carolina Self-Insurance Guaranty Association is liable for the payment of workers’ compensation claims upon the default of Ecusta to pay claims, and a determination of the availability of Ecusta’s statutory security deposit for payment of claims. The Deputy Commissioner designated may modify or add such additional issues as may be necessary and proper with proper notice to the parties.

6.                  The parties, as indicated below, shall produce to the Deputy Commissioner assigned the following documents within ten days of the date of this Order:

a)                  Glatfelter shall produce a copy of all agreements and correspondence related to those agreements between Glatfelter, Ecusta and/or the NCDOI related to the assumption of Glatfelter’s workers’ compensation claims in North Carolina by Ecusta.

b)                  The NCDOI shall produce all documents and correspondence between Glatfelter, Ecusta and/or the NCDOI related to the assumption of Glatfelter’s workers’ compensation claims in North Carolina by Ecusta.

7.                  Nothing in this Order is effective as imposing any demand upon Ecusta as it is under the protection of the Federal Bankruptcy Court.

                                    S/                                
STEPHEN T. GHEEN
CHIEF DEPUTY COMMISSIONER