MELVIN W. STANLEY v. BILLY RAY BROWN and LONNIE C. JONES, JR., 261 N.C. 243

Rodman, J. Plaintiff’s appeal is directed to the action of the court in setting aside, because of error of law arising during the trial, that portion of the verdict fixing damages for personal injuries. The conclusion we reach with respect to the errors assigned by Brown makes it unnecessary to answer the question propounded by plaintiff. Brown’s appeal presents two questions:

(1) Is he liable for personal injuries sustained by plaintiff?

(2) Did the court commit error in the charge with respect to the asserted negligence of Brown? Our Workmen’s Compensation Act, c. 97 of the General Statutes, was enacted in 1929. Sec. 9 of that

chapter relieves an employee from liability for negligence resulting in injury to a fellow employee when the employees and employer are subject to the Compensation Act and the injury arises out of and in the course of the employment. Warner v. Leder, 234 N.C. 727, 69 S.E. 2d 6; Bass v. Ingold, 232 N.C. 295, 60 S.E. 2d 114; Essick v. Lexington, 232 N.C. 200, 60 S.E. 2d 106. Municipalities and their employees are bound by the Act, G.S. 97-7. The Act does not purport to deal with an employee’s common law right of action against his fellow employee for damage to property.

Brown, as a defense to plaintiff’s right to damages for personal injuries, pleaded an award made by the Industrial Commission. In support of his defense he put in evidence I.C. Form 21 entitled “AGREEMENT FOR COMPENSATION FOR DISABILITY MELVIN WILLARD STANLEY (Employee) v. CITY OF BURLINGTON (Employer) IOWA NATIONAL MUTUAL INS. CO. (Carrier).” The named parties stipulated the following facts: (1) “(A) 11 parties hereto are subject to and bound by the provisions of the North Carolina Workmen’s Compensation Act, and that the Iowa National Mutual Insurance Company, is the insurance carrier for said employer.”

(2) Employee sustained an injury by accident arising out of and in the course of his employment on 1 March 1960.

(3) The accident resulted in a sprained back and neck.

(4) The average weekly wage of the employee at the time of the accident, including overtime, was $323 per month.

(5) Disability resulting from the accident began on 2 March 1960.

(6) The employer and the insurance carrier were bound to pay to the employee compensation at the rate of $35 per week for 2 and 5/7 weeks.

(7) The employee returned to work for the City of Burlington on 28 March 1960 at an average wage of $323 per month. Compensation was paid pursuant to the stipulations on 8 June 1960. The Industrial Commission, based on the facts stipulated and the compensation paid, approved the agreement on 13 June 1960. The Commission’s approval of the stipulated facts and payment was as conclusive as if made upon a determination of facts in an adversary proceeding. G.S. 97-82 and 83; Smith v. Red Cross, 245 N.C. 116, 95 S.E. 2d 559; Neal v. Clary, 259 N.C. 163, 130 S.E. 2d 39.

Plaintiff, to, avoid the bar created by the Commission’s approval, alleged the order of 13 June had been vacated because his injuries were not sustained in the course and scope of his employment. The order on which plaintiff relies to vacate the award of 13 June 1960 was made by a deputy commissioner on 8 March 1962. It is based on facts stipulated by plaintiff, Burlington, and Iowa Mutual. The stipulation is dated 18 January 1962.

Summarized or quoted, these are the facts stipulated: The parties were, on 1 March 1960, bound by the Compensation Act; plaintiff's monthly wage was $323; employer, on 2 March 1960, filed a report of the accident and injury with the Industrial Commission; “the defendant-insurance carrier thereafter investigated the matter and on the basis of the investigation, the defendant-insurance carrier concluded that the plaintiff-employee was injured by accident within the course and scope of his employment”; defendants then entered into an agreement to pay compensation to plaintiff; the agreement was submitted to and approved by the Commission; pursuant to the agreement the insurance carrier paid plaintiff $95 as compensation and $1,259.15 as medical expenses; that Brown was acting in the course and scope of his employment when he collided with the vehicle occupied by plaintiff; but “because of the mistaken belief that a police officer is always on duty and acting within the course and scope of his employment, and the fact that the plaintiff-employee had gone to the point where there was a cave-in in the street, a captain of the police department filed an employer’s report of accident in which he stated that the plaintiff-employee was returning to the police station after assisting a fellow patrolman on an assignment, and the plaintiff-employee advised the defendant-insurance carrier that he was still on duty at the time of the accident and was assisting Police Officer Brown who had arrested a driver of a vehicle for being under the influence of intoxicants and that the accident occurred as they were on the way back to the police station and that the plaintiff-employee was using his own personal vehicle since there were no other such vehicles available”; compensation and medical payments had been made; “The defendant-insurance carrier was notified by the plaintiff-employee that he was not actually on duty at the time of the accident and that his injury was probably not one covered by the Workmen’s Compensation Act; that the defendant-insurance carrier and the defendant-employer then conducted separate investigations and on the basis of the investigations conducted they concluded that the plaintiff did not sustain an injury by accident arising out of and in the course of the plaintiff’s employment.” (Emphasis supplied).

Based on these stipulations the deputy commissioner, on 8 March 1962, found as a fact and concluded as a matter of law that plaintiff did not sustain an injury by accident arising out of and in the course of his employment. Brown, by motion to nonsuit, challenges the validity of the order of 8 March 1962. That order was made without notice to him.

If valid it deprives him of the protection accorded by the statute and does so simply because the employer- and its insurance carrier, at the suggestion of the injured employee, have “concluded that the plaintiff did not sustain an injury by accident arising out of and in the course of the plaintiff’s employment,” a fact theretofore solemnly asserted by plaintiff and admitted after an investigation by the insurance carrier.

Plaintiff’s right to compensation, under the admissions made in 1960 and not now controverted, depended upon a resolution of this simple question of fact: Did plaintiff go to the Jones car for the purpose of assisting Brown in the performance of his duty? If so, the rights of plaintiff and Brown inter se were fixed by the express language of the Compensation Act. The Commission, with plenary power to decide that factual question, answered in the affirmative. Its answer was based upon the admissions made by the injured party, his employer, and by the insurance carrier after it had made its own investigation.

The Industrial Commission has the inherent power, upon application made in due time, to relieve a party from a judicial determination of his rights when the decision is a product of mistake, fraud, or excusable neglect. Neal v. Clary, supra; Butts v. Montague Brothers, 208 N.C. 186, 179 S.E. 799; Ruth v. Carolina Cleaners, 206 N.C. 540, 174 S.E. 445: Harris v. Diamond Const. Co. (Va.), 36 S.E. 2d 573; Annotations 73 A.L.R. 2d 939 et seq.; 2 Am. Jur. 2d 336.

But this power to prevent injustice by fraud, mistake, or excusable neglect does not extend so far as to permit a nullification of the Act, by an agreement between a party entitled to receive and a party obligated to pay compensation that they will disregard its provisions. G.S. 97-6, 17. When it has been judicially determined upon solemn admissions made by the party entitled to receive and the party obligated to pay that the employee has sustained a compensable injury, rights accrue to others which cannot be disturbed without notice and an opportunity .to be heard. Neal v. Clary, supra.

It follows from what we have said that the order of the deputy commissioner, based as it is solely upon the agreement of the employee, employer and insurance carrier, without notice to and an opportunity for Brown to be heard is, as to him, void. Universal Oil Products Co. v. Root Ref. Co., 328 U.S. 575, 90 L. ed. 1447; 30A Am. Jur. 672. The record does not disclose when the parties sought to have the Commission vacate its original award.

It must not be inferred from what is here said with respect to the power of the Commission in a proper case to vacate an award that the Commission can or should act upon the petition which the parties filed with it. Certainly the Commission has no greater authority than courts of general jurisdiction in similar situations. In re Crawford, (S.C.), 30 S.E. 2d 841. The least that is required of an applicant is that he shall have exercised due diligence. Henderson v. Henderson, 232 N.C. 1, 59 S.E. 2d 227; 30A Am. Jur. 625.

Whether G.S. 1-220 is applicable to cases before the Industrial Commission where relief is sought on the ground of fraud, mistake, or excusable neglect, need not now be determined. The court erred in declining to allow Brown’s motion to nonsuit plaintiff’s cause of action for personal injuries. The evidence with respect to Brown’s negligence was sufficient to carry the case to the jury; hence the court properly overruled the motion as it relates to plaintiff’s claim for property damage. Plaintiff alleged the collision was caused by the negligence of Brown in that he (

a) exceeded the speed limit, (

b) failed to keep his vehicle under control, and (

c) failed to look out for other traffic. Plaintiff’s evidence was sufficient to support a finding of negligence based on any of these allegations. Brown’s evidence was sufficient to repel the asserted negligence. To explain his failure to stop before colliding with plaintiff’s vehicle, he offered evidence that there was a sudden and unexplained failure of the brakes on his car caused by loss of brake fluid.

The court in its charge summarized the evidence and stated Brown’s contention with respect to the failure of the brakes, but it failed to state what the law would be if the jury concluded the collision was caused by an unforeseeable brake failure. Brown’s exception directed to the failure of the court to declare the law entitles him to a new trial on the issue of negligence. Reversed on the claim for personal injuries. New trial on the claim for property damage.