IN THE SUPREME COURT OF NORTH CAROLINA

No. 399PA16

Filed 1 February 2019

In re Appeal of the Fee Award of the North Carolina Industrial Commission in 

N.C.I.C. Nos. W82780 & W98474

KEITH SAUNDERS

v.

ADP TOTALSOURCE FI XI, INC.,

Employer,

LIBERTY MUTUAL/HELMSMAN MANAGEMENT SERVICES, 

Carrier 

 

On discretionary review pursuant to N.C.G.S. § 7A-31 of a unanimous decision 

of the Court of Appeals, 249 N.C. App. 361, 791 S.E.2d 466 (2016), vacating and 

remanding an order entered on 4 September 2015 by Judge Alan Z. Thornburg in 

Superior Court, Buncombe County that reversed in part an opinion and award filed 

on 23 February 2015 by the North Carolina Industrial Commission. Heard in the 

Supreme Court on 27 August 2018.

The Sumwalt Law Firm, by Mark T. Sumwalt, Vernon Sumwalt, and Lauren 

H. Walker; and Grimes Teich Anderson, LLP, by Henry E. Teich, for plaintiffappellant.

Hedrick Gardner Kincheloe & Garofalo LLP, by M. Duane Jones, Kari L. 

Schultz, and Linda Stephens, for defendant-appellees.

HUDSON, Justice.

Plaintiff Keith Saunders appealed the Opinion and Award of the North 

Carolina Industrial Commission (the Commission), which declined to award certain 
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attorney’s fees to plaintiff’s attorneys, to the Superior Court in Buncombe County 

pursuant to N.C.G.S. § 97-90(c). The superior court reversed the Commission’s 

decision and ordered attorney’s fees to be paid to plaintiff’s attorneys from the 

reimbursement for retroactive attendant care medical compensation that the 

Commission had awarded to plaintiff. Both plaintiff and defendants ADP 

TotalSource Fi Xi, Inc. and Liberty Mutual/Helmsman Management Services, 

appealed from the superior court’s order. On appeal, the Court of Appeals vacated 

the superior court’s order and remanded the matter to the court for further remand 

to the Commission, holding that the superior court exceeded the “narrow scope” of its 

statutory authority to review the reasonableness of a Commission’s fee award under 

N.C.G.S. § 97-90(c) by taking and considering new evidence that was not presented 

before the Commission. Saunders v. ADP TotalSource Fi Xi, Inc., 248 N.C. App. 361, 

376, 791 S.E.2d 466, 477-78 (2016). Because we conclude that N.C.G.S. § 97-90(c) 

authorizes the superior court to consider additional evidence and exercise its

“discretion” in reviewing the reasonableness or setting the amount of attorney’s fees, 

we reverse. 

Background

Plaintiff was employed as a bartender for defendant-employer when on 6 

March 2010 and 7 July 2010 he sustained two work-related injuries by accident to 

his lower back. On 15 October 2010, defendants filed a Form 60 with the North 

Carolina Industrial Commission, in which they accepted plaintiff’s claim as 
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compensable under the Workers’ Compensation Act (the Act) and described the injury 

as “extruded disk herniation left side L4-5.” On 21 October 2010, plaintiff underwent 

back surgery performed by Stephen David, M.D. “involving L4 and L5-S1 

laminectomies, bilateral partial medial facetectomies, and bilateral foraminotomies 

with discectomy.” In spite of his surgery, as well as extended physical therapy, 

plaintiff continued to experience “severe disabling pain” and he developed left foot

drop and “reflex sympathetic dystrophy (RSD), or complex regional pain syndrome 

(CRPS).”

On 3 November 2010, plaintiff retained Henry E. Teich to represent him before 

the Commission. Plaintiff and Mr. Teich entered into a fee agreement that provided 

Mr. Teich’s law firm a contingency fee of “25% of any recovery as Ordered by the 

North Carolina Industrial Commission.” At the time of this agreement, there were 

no issues involving attendant care or home modification. Plaintiff and Mr. Teich later 

supplemented this agreement to provide for an attorney’s fee of 25% of ongoing 

temporary total disability payments. On 23 April 2012, the Commission filed an 

order approving this arrangement through which Mr. Teich’s firm received every 

fourth temporary total disability check due plaintiff.

Plaintiff’s deteriorating medical condition resulted in his “suffer[ing] several 

falls or near-falls, . . . which place him at a significant[ly] increased risk of suffering 

a fall,” and plaintiff was ultimately rendered incapable of “perform[ing] activities of 

daily living or otherwise liv[ing] independently.” Multiple medical providers 
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recommended that plaintiff install safety equipment and assistance devices in his 

home and that he receive attendant care medical services. Defendants received notice 

of plaintiff’s attendant care needs at least as of January 2012, and they agreed to 

provide attendant care to plaintiff starting on 4 February 2012, but they conditioned 

continued payments for attendant care upon being allowed to take depositions of two 

of plaintiff’s doctors without an evidentiary hearing. Following a dispute about the 

depositions, defendants ceased providing attendant care payments to plaintiff on 8 

May 2012. In the absence of continued attendant care provided by a home health 

agency, plaintiff’s then-partner and now-husband, Glenn Holappa, began providing 

the necessary attendant care services to plaintiff on a daily basis. 

In June 2012, with the consent of plaintiff and Mr. Holappa, Mr. Teich 

associated Mark T. Sumwalt and The Sumwalt Law Firm to assist in litigating the 

attendant care issues in plaintiff’s claim. Mr. Teich had associated Mr. Sumwalt in 

previous workers’ compensation cases involving attendant care issues because of Mr. 

Sumwalt’s significant experience and expertise in attendant care litigation. On 7 

January 2013, plaintiff filed a Form 33 requesting a hearing before the Commission 

because “defendants are refusing to pay compensation for attendant care services.” 

Plaintiff’s counsel extensively litigated the attendant care issues, as well as issues

“pertaining to home modifications, equipment needs, prescription medications, and 

psychological treatment.” Plaintiff sought, inter alia, ongoing future attendant care

through a home health care agency and retroactive compensation for the attendant 
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care services provided by Mr. Holappa following defendants’ refusal to provide 

attendant care beyond 8 May 2012. Defendants denied any compensation for past 

attendant care, future attendant care, and psychological treatment. 

Deputy Commissioner J. Brad Donovan heard the matter on 19 March 2013. 

On 23 December 2013, Deputy Commissioner Donovan entered an “Opinion and 

Award in which he awarded retroactive attendant care compensation to Plaintiff’s 

family for eight hours per day, seven days per week, at a rate of $18.00 per hour, and 

ongoing attendant care compensation for eight hours per day, seven days per week at 

a rate of $18.00 per hour.” Moreover, Deputy Commissioner Donovan “approved a 

reasonable attorneys’ fees [sic] of 25% of the value of the retroactive attendant care 

services provided by Plaintiff’s family from May 8, 2012 to December 23, 2013, which 

were payable to plaintiff and/or his family.” Defendants appealed to the Full 

Commission, which heard the case on 15 May 2014.

On 23 February 2015, the Full Commission issued an “Opinion and Award in 

which it awarded retroactive attendant care compensation to Mr. Holappa, for six 

hours per day, seven days per week, at a rate of $10.00 per hour, and ongoing 

attendant care compensation through a home health agency for eight hours per day, 

seven days per week.” The Commission found that because plaintiff had not paid Mr. 

Holappa for the attendant care services he provided, “any payment for retroactive 

attendant care services should be paid to the provider in the first instance, i.e., Mr. 

Holappa, as opposed to plaintiff as reimbursement for what he paid out of pocket.” 
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Furthermore, the Commission found that “[t]he only attorney fee agreement of record 

at the Industrial Commission is the one entered into between Grimes & Teich, L.L.P. 

and plaintiff.” With regard to the attorney’s fee of twenty-five percent of the 

reimbursement for retroactive attendant care compensation, the Commission 

concluded:

In the case at bar, the Full Commission finds and concludes 

that the fee agreement between plaintiff and plaintiff’s 

counsel is reasonable, as is the attorney fee plaintiff’s 

counsel has received and will continue to receive from 

plaintiff’s ongoing indemnity compensation. However, 

“[m]edical and hospital expenses which employers must 

provide pursuant to N.C.G.S. § 97-25 are not a part of 

‘compensation’ as it always has been defined in the 

Workers’ Compensation Act.” Hyler v. GTE Products Co., 

333 N.C. 258, 264, 425 S.E.2d 698, 702 (1993) (citation 

omitted). “[T]he relief obtainable as general ‘compensation’

is different and is separate and apart from the medical 

expenses recoverable under the Act’s definition of ‘medical 

compensation.” Id. at 265, 425 S.E.2d at 703. There is no 

evidence of a fee agreement between plaintiff’s counsel and 

any of plaintiffs medical providers, including Mr. Holappa. 

The Full Commission concludes that to the extent 

plaintiff’s counsel’s fee agreement with plaintiff, and 

specifically the phrase “any recovery,” could be interpreted 

to include medical compensation, it is unreasonable under 

the facts of this case. The Full Commission therefore 

declines to approve an attorney fee for plaintiff’s counsel 

out of the medical compensation which defendants have 

been ordered to pay to Mr. Holappa.

Plaintiff appealed the Commission’s denial of attorney’s fees to the Superior 

Court in Buncombe County pursuant to N.C.G.S. § 97-90(c), which authorizes the 

senior resident superior court judge to “consider the matter and determine in his 
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discretion the reasonableness of said agreement or fix the fee” in situations in which

there is an agreement and “[i]n all other cases where there is no agreement for fee or 

compensation . . . [to] consider the matter of such fee and determine in his discretion

the attorneys’ fees to be allowed in the cause.” On 27 April 2015, defendants filed a 

motion to intervene, which was allowed by the superior court.

After a hearing, the superior court entered an order on 25 August 2015, 

followed by an amended order on 4 September 2015 in order to cure an ambiguity in 

the final paragraph of the initial order. The superior court reversed the Commission’s 

denial of attorney’s fees from the reimbursement for retroactive attendant care 

medical compensation. In its order, the superior court found, in pertinent part:

7. With the knowledge and approval of Plaintiff 

and Mr. Holappa, attorney Mark T. Sumwalt and his firm 

The Sumwalt Law Firm were subsequently associated to 

assist in litigating the attendant care issues that had 

arisen in Plaintiff’s claim as a result of Defendants’ refusal 

to voluntarily provide the recommended attendant care to 

Plaintiff and compensate Mr. Holappa for the attendant 

care services he provided to Plaintiff.

8. Mr, Holappa, through Plaintiff’s counsel, 

submitted an affidavit to this Court in which he stated that 

he consented and agreed to Plaintiff’s counsel’s pursuit of 

such recovery on his behalf with the understanding and 

desire that any recovery made on his behalf through 

Plaintiff’s workers’ compensation claim would be subject to 

the 25% fee previously agreed to in the retainer agreement.

9. Mr. Sumwalt was associated in 

approximately June 2012, and litigation commenced with 

the clear understanding of all parties involved that any 
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compensation recovered on behalf of Mr. Holappa for 

providing attendant care services to Plaintiff would be 

subject to the previously agreed upon amount of 25% of any 

benefits ordered by the Industrial Commission, in 

accordance with the parties’ retainer agreement contract.

. . . .

13. Plaintiff’s counsel did not request fees from 

the home modifications, equipment needs, prescription 

medications, or compensation for psychological treatment 

that Plaintiff’s counsel obtained on Plaintiff’s behalf 

through litigation, despite the significant monetary value 

of these awards. Plaintiff’s counsel requested an attorneys’ 

fee only from the attendant care compensation obtained for 

Mr. Holappa in accordance with the retainer agreement.

. . . .

20. At the hearing in this matter, Mr. Sumwalt 

represented to this Court that his firm has invested over 

500 hours of attorney time in this case and over $13,000.00 

in litigation costs.

21. As a result of Mr. Sumwalt’s and Mr. Teich’s 

representation, Mr. Holappa recovered over $61,000.00 in 

retroactive attendant care compensation.

. . . .

26. Neither Plaintiff nor Defendants were able to 

cite any case where the Industrial Commission failed to 

award an attorneys’ fee from retroactive family memberprovided attendant care compensation.

From its findings of fact, the court made the following conclusions of law:

3. In reaching its decision, this Court 

considered, with regard to the efforts of Mr. Teich and Mr. 

Sumwalt to achieve an award for retroactive attendant 

care services, the following: the significant time 
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investment of the attorneys, the amount involved, the 

favorable results achieved, the contingent nature of the fee 

retainer agreement, the customary nature of the 25% fee 

for similar services, the specialized skill level and 

significant experience of Mr. Sumwalt in the area of 

attendant care service recovery, and the appropriate and 

necessary nature of the attorneys’ services given the 

Defendant[s’] denial of the claim. N.C. Gen. Stat. § 97-

90(c).

4. After consideration of these factors, this 

Court determined that Mr. Sumwalt performed significant 

legal services and expended substantial sums in litigation 

costs in this matter, which services and costs were 

necessary and essential to the prosecution of Plaintiff’s 

case and the achievement of the award for retroactive 

attendant care services.

5. This Court therefore concludes that Plaintiff’s 

counsel’s fee agreement of “25% of any recovery as Ordered 

by the North Carolina Industrial Commission” is 

reasonable.

. . . .

7. This Court does not find Defendants’ 

argument that [Palmer v. Jackson] prohibits an award of 

attorneys’ fees from retroactive family member-provided 

attendant care compensation to be persuasive. In Palmer, 

the plaintiff’s attorneys did not have a fee agreement with, 

or the consent of, the medical provider in that case (a 

hospital) to pursue the recovery of its fees, and the hospital 

objected to having to pay an attorneys’ fee from the fees 

that the plaintiff’s attorneys recovered on the hospital’s 

behalf outside of an attorney-client relationship. Those are 

not the facts of the instant case. Plaintiff’s counsel had the 

consent of and a fee agreement with both Plaintiff and Mr. 

Holappa. 

. . . .
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9. Awards of the value of retroactive attendant 

care services are not prohibited, and neither are reasonable 

attorneys’ fees based on such awards.

Accordingly, the court “in its discretion, determine[d] that a reasonable attorney’s fee 

for the retroactive attendant care compensation recovered [on] Mr. Holappa’s behalf 

for services he provided to Plaintiff is 25% and shall therefore be allowed.” Both 

parties appealed to the Court of Appeals.1

At the Court of Appeals, defendants argued that the superior court did not 

have subject-matter jurisdiction to review the Commission’s denial of attorney’s fees

because N.C.G.S. § 97-90(c) limits the superior court solely to reviewing the 

reasonableness of an attorney’s fee under an explicit or implied fee agreement 

between an attorney and a claimant that was presented to the Commission for 

approval. Defendants asserted that the only fee agreement presented to the 

Commission here was between plaintiff and his counsel and that the superior court 

therefore lacked the authority to consider new affidavits and to review the 

reasonableness of a purported implied agreement between plaintiff’s counsel and Mr. 

Holappa that had not been presented to the Commission. In the alternative, 

 

1 On appeal, plaintiff argued that the superior court erred in granting defendants’

motion to intervene and that defendants lacked standing to challenge a contract to which 

they were not a party. The Court of Appeals determined that the superior court did not err 

in allowing defendants’ motion to intervene and that defendants did have standing to 

challenge the superior court’s order on appeal. Saunders, 249 N.C. App. at 364-69, 791 S.E.2d 

at 471-74. Plaintiff raised these issues in his petition for discretionary review, but this Court 

did not allow review of these issues and they are therefore not before this Court. 
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defendants argued that the Act does not allow attorney’s fees to be paid out of medical 

compensation. 

The Court of Appeals examined the language and legislative history of 

N.C.G.S. § 97-90(c), noting that subsection (c) was added in response to the decision 

in Brice v. Robertson House Moving, Wrecking & Salvage Co., 249 N.C. 74, 105 S.E.2d 

439 (1958), in order “to rectify the specific problem of the trial court not having 

jurisdiction over attorneys’ fees in [ ] workers’ compensation cases.” Saunders, 249

N.C. App. at 371, 791 S.E.2d at 475 (quoting Palmer v. Jackson, 157 N.C. App. 625,

632, 579 S.E.2d 901, 906 (2003), disc. rev. improvidently allowed, 358 N.C. 373, 595 

S.E.2d 145 (2004)). The court determined that “the statute solely applies to an 

appellate reasonableness review of a fee award on a contract between the claimantemployee and his attorney previously reviewed by the Full Commission, and not a de 

novo hearing.” Id. at 371, 791 S.E.2d at 474. According to the Court of Appeals,

subsection (c)’s “narrow scope” authorizes the superior court “to consider the factors 

set forth in the statute in reviewing the Commission’s determination of the 

‘reasonableness’ of a fee agreement” but does not authorize the superior court “to look 

beyond the evidence presented before the Commission or to take new evidence.” Id. 

at 374, 791 S.E.2d at 476 (citing Blevins v. Steel Dynamics, Inc., 202 N.C. App. 584, 

691 S.E.2d 133, 2010 WL 521029 (2010) (unpublished)). 

The Court of Appeals determined that the superior court here, in contravention 

of this statutory authority,
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considered evidence, the purported “fee agreement” 

between Plaintiff’s attorney and Mr. Holappa, which was 

not considered before the Industrial Commission. 

Plaintiff’s counsel took the indemnity and disability fee 

contract between Plaintiff and Mr. Teich, added an 

affidavit, which had never been considered by or ruled 

upon by the Industrial Commission, and argued for the 

first time before the superior court that these documents 

“created” an implied third party contract between 

Plaintiff’s counsel and Mr. Holappa.

Plaintiff’s counsel did not petition the superior court 

for appellate review of the “reasonableness” of the 

Industrial Commission’s decision related to the “agreement 

for fee or compensation” between Plaintiff and his 

attorneys referenced in the Full Commission’s Opinion and 

Award, but instead presented a theory and a purported “fee 

contract,” which was never presented to or reviewed by the 

Industrial Commission. See N.C. Gen. Stat. § 97-90(c).

Id. at 373-74, 791 S.E.2d at 476. Accordingly, the Court of Appeals concluded that 

the superior court had “acted beyond the scope of its statutory and limited appellate 

review of the reasonableness of the Commission’s fee award by taking and 

considering new evidence, which was not presented to the Commission.” Id. at 375,

791 S.E.2d at 477. The court also questioned whether, given that the enactment of 

subsection (c) predated the establishment of the Court of Appeals, to which appeals 

from the Commission under the Act typically lie, “the reasonableness review by the 

superior court under subsection (c) may have become an obsolete relic.” Id. at 375, 

791 S.E.2d at 477. Nonetheless, the court “refer[red] this issue to the General 

Assembly and request[ed] its review of . . . the continuing need for this limited 
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appellate review by the superior court of the reasonableness of the Commission’s 

attorney’s fee awards.” Id. at 376, 791 S.E.2d at 477.

The Court of Appeals further determined that the superior court “ruled far 

beyond an appellate review of the ‘reasonableness’ of the attorney’s fee” in that “[t]he 

superior court purported to adjudicate a question of workers’ compensation law, i.e., 

whether the Commission may order an attorney’s fee to be paid from the award of 

medical compensation.” Id. at 374, 791 S.E.2d at 476. According to the Court of 

Appeals:

This determination is outside the scope [of] the superior 

court’s appellate jurisdiction under N.C. Gen. Stat. § 97-

90(c), and rests within the statutes governing the 

Industrial Commission, subject to appeal to this Court. 

N.C. Gen. Stat. § 97-91 (2015). Our Court has determined 

“medical compensation is solely in the realm of the 

Industrial Commission, and § 97-90(c) gives no authority 

to the superior court to adjust such an award under the 

guise of attorneys’ fees. Doing so constitutes an improper 

invasion of the province of the Industrial Commission, and 

constitutes an abuse of discretion.” 

Id. at 374, 791 S.E.2d at 476-77 (quoting Palmer, 157 N.C. App. at 635, 579 S.E.2d at 

908 (citation omitted)). The court concluded that because the superior court “was 

without jurisdiction under N.C. Gen. Stat. § 90-97(c) to re-weigh the Commission’s 

factual determinations under these facts, or to award, de novo, attorney’s fees from 

attendant care medical compensation to be paid to a third party medical provider,” 

the superior court’s order “is a nullity and is vacated.” Id. at 376, 791 S.E.2d at 477. 
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Accordingly, the court remanded the case to the superior court for further remand to 

the Commission. Id. at 376, 791 S.E.2d at 477-78. 

On 25 October 2016, plaintiff filed a petition seeking discretionary review of 

the following issues:

I. Whether the Court of Appeals’ opinion in Saunders

is inconsistent with the Supreme Court’s previous 

decisions in Schofield and Virmani.

II. Whether the Court of Appeals’ opinion in Saunders

is inconsistent with its own prior decisions, 

including Kanipe, Boylan II, Koenig, Davis, Boylan

I, Creel, and Priddy.

III. Whether the Court of Appeals’ opinion in Saunders

is consistent with N.C. Gen. Stat. § 97-90(c) and case 

law construing the statute.

On 1 November 2017, this Court entered a special order granting discretionary 

review solely of Issue III.

Analysis

We conclude that the decision of the Court of Appeals is not consistent with 

N.C.G.S. § 97-90(c) and therefore, reverse the Court of Appeals. The issue we agreed 

to hear on discretionary review is one of statutory interpretation, meaning it is a 

“question[ ] of law and [ ] reviewed de novo.” In re D.S., 364 N.C. 184, 187, 694 S.E.2d 

758, 760 (2010) (citing Brown v. Flowe, 349 N.C. 520, 523, 507 S.E.2d 894, 896 (1998)); 

see also Irving v. Charlotte-Mecklenburg Bd. of Educ., 368 N.C. 609, 611, 781 S.E.2d 

282, 284 (2016) (“When considering a case on discretionary review from the Court of

Appeals, we review the decision for errors of law.” (citing N.C. R. App. P. 16(a))). “We 
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have held in decision after decision that our Workmen’s Compensation Act should be 

liberally construed to effectuate its purpose to provide compensation for injured 

employees or their dependants, and its benefits should not be denied by a technical, 

narrow, and strict construction.” Hollman v. City of Raleigh, 273 N.C. 240, 252, 159 

S.E.2d 874, 882 (1968) (citing 3 Strong’s North Carolina Index: Master and Servant § 

45 (1960)); see also Deese v. Se. Lawn & Tree Expert Co., 306 N.C. 275, 278, 293 S.E.2d 

140, 143 (1982) (“[I]n all cases of doubt, the intent of the legislature regarding the 

operation or application of a particular provision is to be discerned from a 

consideration of the Act as a whole—its language, purposes and spirit.”).

Attorney’s fees are regulated under the Act by N.C.G.S. § 97-90, which states

that “[f]ees for attorneys . . . shall be subject to the approval of the Commission.” 

N.C.G.S. § 97-90(a) (2017). In addition, the Act mandates that any attorney who 

accepts a fee not approved by the Commission or the superior court is guilty of a Class 

1 misdemeanor. Id. § 97-90(b) (2017). The superior court’s role in approving 

attorney’s fees is defined in subsection (c), which provides:

If an attorney has an agreement for fee or 

compensation under this Article, he shall file a copy or 

memorandum thereof with the hearing officer or 

Commission prior to the conclusion of the hearing. If the 

agreement is not considered unreasonable, the hearing 

officer or Commission shall approve it at the time of 

rendering decision. If the agreement is found to be 

unreasonable by the hearing officer or Commission, the 

reasons therefor shall be given and what is considered to 

be reasonable fee allowed. If within five days after receipt 

of notice of such fee allowance, the attorney shall file notice 
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of appeal to the full Commission, the full Commission shall 

hear the matter and determine whether or not the 

attorney’s agreement as to a fee or the fee allowed is 

unreasonable. If the full Commission is of the opinion that 

such agreement or fee allowance is unreasonable and so 

finds, then the attorney may, by filing written notice of 

appeal within 10 days after receipt of such action by the 

full Commission, appeal to the senior resident judge of the 

superior court in the county in which the cause of action 

arose or in which the claimant resides; and upon such 

appeal said judge shall consider the matter and determine 

in his discretion the reasonableness of said agreement or fix 

the fee and direct an order to the Commission following his 

determination therein. The Commission shall, within 20 

days after receipt of notice of appeal from its action

concerning said agreement or allowance, transmit its 

findings and reasons as to its action concerning such 

agreement or allowance to the judge of the superior court 

designated in the notice of appeal. In all other cases where 

there is no agreement for fee or compensation, the attorney 

or claimant may, by filing written notice of appeal within 

five days after receipt of notice of action of the full 

Commission with respect to attorneys’ fees, appeal to the 

senior resident judge of the superior court of the district of 

the county in which the cause arose or in which the 

claimant resides; and upon such appeal said judge shall 

consider the matter of such fee and determine in his 

discretion the attorneys’ fees to be allowed in the cause. The 

Commission shall, within 20 days after notice of appeal has 

been filed, transmit its findings and reasons as to its action 

concerning such fee or compensation to the judge of the 

superior court designated in the notice of appeal; provided 

that the Commission shall in no event have any 

jurisdiction over any attorneys’ fees in any third-party 

action. In any case in which an attorney appeals to the 

superior court on the question of attorneys’ fees, the 

appealing attorney shall notify the Commission and the 

employee of any and all proceedings before the superior 

court on the appeal, and either or both may appear and be 

represented at such proceedings.
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The Commission, in determining an allowance of 

attorneys’ fees, shall examine the record to determine the 

services rendered. The factors which may be considered by 

the Commission in allowing a reasonable fee include, but 

are not limited to, the time invested, the amount involved, 

the results achieved, whether the fee is fixed or contingent, 

the customary fee for similar services, the experience and 

skill level of the attorney, and the nature of the attorney’s 

services.

In making the allowance of attorneys’ fees, the 

Commission shall, upon its own motion or that of an 

interested party, set forth findings sufficient to support the 

amount approved.

The Commission may deny or reduce an attorney’s 

fees upon proof of solicitation of employment in violation of 

the Rules of Professional Conduct of the North Carolina 

State Bar.

Id. § 97-90(c) (2017) (emphases added). 

Subsection (c) contains no language that limits the superior court solely to “the

[same] factors set forth in the statute” that are to be considered by the Commission 

or that prohibits the superior court from “look[ing] beyond the evidence presented 

before the Commission or [ ] tak[ing] new evidence.” Saunders, 249 N.C. App. at 374, 

791 S.E.2d at 476. On the contrary, the statute vests the superior court judge with 

the authority to “consider the matter and determine in his discretion the 

reasonableness of said agreement or fix the fee” when there is an agreement, and “[i]n 

all other cases where there is no agreement for fee or compensation . . . [to] consider 

the matter of such fee and determine in his discretion the attorneys’ fees to be allowed 

in the cause.” N.C.G.S. § 97-90(c) (emphases added). We find that the plain language
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of the statute—committing the matter of attorney’s fees to the superior court judge

to “consider the matter” of a fee and “determine [it] in his discretion”—sets forth a 

broad, de novo fact-finding role to be played by the superior court. See, e.g., White v. 

White, 312 N.C. 770, 777-78, 324 S.E.2d 829, 833 (1985) (explaining that “[i]t is well 

established that where matters are left to the discretion of the trial court, appellate 

review is limited to a determination of whether there was a clear abuse of discretion,” 

and “[a] ruling committed to a trial court’s discretion is to be accorded great 

deference” and discussing how “[t]he findings of fact show that the trial court 

admitted and considered evidence relating to several of the twelve factors contained 

in” the statute at issue (emphasis added) (citations omitted)); see also Little v. Penn 

Ventilator Co., 317 N.C. 206, 218, 345 S.E.2d 204, 212 (1986) (“The abuse of discretion 

standard of review is applied to those decisions which necessarily require the exercise 

of judgment. . . . [T]he reviewing court sits only to insure that the decision could, in 

light of the factual context in which it is made, be the product of reason.” (emphasis 

added)). Accordingly, we conclude that the Court of Appeals erred by reading strict 

limits into the statutory review to be conducted by the superior court. Instead, we 

hold that, in accord with the authority given in N.C.G.S. § 97-90(c) to “consider the 

matter” of attorney’s fees and “in his discretion” fix the attorney’s fees to be allowed,

the superior court judge may take and consider additional evidence not presented to 

the Commission in order to properly consider the matter and exercise the court’s

discretion. 
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Opinion of the Court

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Here, the Commission found that “[t]he only fee agreement of record at the 

Industrial Commission is the one entered into between [Teich’s firm] and plaintiff” 

and concluded that “[t]here is no evidence of a fee agreement between plaintiff’s 

counsel and any of plaintiff’s medical providers, including Mr. Holappa.” The 

superior court, under its authority to “consider the matter” of attorney’s fees and “in 

[its] discretion” fix the attorney’s fees to be allowed, considered the evidence, 

including an affidavit from Mr. Holappa, and determined that there actually was 

such an agreement. In fact, the very same agreement between plaintiff’s counsel and 

plaintiff that was before the Commission was the one submitted to the superior court 

for review; Mr. Holappa’s affidavit made clear that he was also a party to that 

agreement. The superior court thereupon found the following facts:

7. With the knowledge and approval of Plaintiff 

and Mr. Holappa, attorney Mark T. Sumwalt and his firm 

The Sumwalt Law Firm were subsequently associated to 

assist in litigating the attendant care issues that had 

arisen in Plaintiff’s claim as a result of Defendants’ refusal 

to voluntarily provide the recommended attendant care to 

Plaintiff and compensate Mr. Holappa for the attendant 

care services he provided to Plaintiff.

8. Mr. Holappa, through Plaintiff’s counsel, 

submitted an affidavit to this Court in which he stated that 

he consented and agreed to Plaintiff’s counsel’s pursuit of 

such recovery on his behalf with the understanding and 

desire that any recovery made on his behalf through 

Plaintiff’s workers’ compensation claim would be subject to 

the 25% fee previously agreed to in the retainer agreement.

9. Mr. Sumwalt was associated in 

approximately June 2012, and litigation commenced with 
SAUNDERS V. ADP TOTALSOURCE FI XI, INC.

Opinion of the Court

-20-

the clear understanding of all parties involved that any 

compensation recovered on behalf of Mr. Holappa for 

providing attendant care services to Plaintiff would be 

subject to the previously agreed upon amount of 25% of any 

benefits ordered by the Industrial Commission, in 

accordance with the parties’ retainer agreement contract.

. . . .

13. Plaintiff’s counsel did not request fees from 

the home modifications, equipment needs, prescription 

medications, or compensation for psychological treatment 

that Plaintiff’s counsel obtained on Plaintiff’s behalf 

through litigation, despite the significant monetary value 

of these awards. Plaintiff’s counsel requested an attorneys’

fee only from the attendant care compensation obtained for 

Mr. Holappa in accordance with the retainer agreement.

(Emphases added.) The court then concluded:

1. . . . Plaintiff’s counsel participated in complex 

litigation, including the defense of the case on appeal 

before the Full Commission, predominantly on the issue of 

attendant care and with a contingency fee agreement with 

Plaintiff and Mr. Holappa in place. 

. . . .

5. This Court therefore concludes that Plaintiff’s 

counsel’s fee agreement of [ ] “25% of any recovery as 

Ordered by the North Carolina Industrial Commission” is 

reasonable.

. . . .

7. This Court . . . . [finds that the facts in 

Palmer] are not the facts of the instant case. Plaintiff’s 

counsel had the consent of and a fee agreement with both 

Plaintiff and Mr. Holappa.
SAUNDERS V. ADP TOTALSOURCE FI XI, INC.

Opinion of the Court

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(Emphases added.) (Citation omitted.) Having determined that Mr. Holappa was a 

party to the agreement between plaintiff and his counsel providing for attorney’s fees 

of “25% of any recovery,” the superior court considered all the factors listed in 

subsection (c) and “in its discretion, determine[d] that a reasonable attorney’s fee . . . 

is 25% and shall therefore be allowed.”

We note first that “[a] mere recital in an order that it is entered in the exercise 

of the court’s discretion does not necessarily make the subject of the order a 

discretionary matter” and “[r]ulings of the court on matters of law are as a rule not 

discretionary.” Hollingsworth GMC Trucks, Inc. v. Smith, 249 N.C. 764, 767, 107 

S.E.2d 746, 749 (1959) (first citing Poovey v. City of Hickory, 210 N.C. 630, 631, 188 

S.E. 78, 79 (1936); then citing 2 Thomas Johnston Wilson, II & Jane Myers Wilson, 

McIntosh North Carolina Practice and Procedure (2d ed. 1956), § 1782(4) at 209). 

Here, the Court of Appeals determined that the superior court exceeded its 

discretionary authority under subsection (c) not only by taking additional evidence, 

but also by “purport[ing] to adjudicate a question of workers’ compensation law, i.e., 

whether the Commission may order an attorney’s fee to be paid from the award of 

medical compensation.” Saunders, 249 N.C. App. at 374, 791 S.E.2d at 476. 

According to the Court of Appeals, “medical compensation is solely in the realm of the 

Industrial Commission, and § 97-90(c) gives no authority to the superior court to 

adjust such an award under the guise of attorneys’ fees.” Id. at 374, 791 S.E.2d at 
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Opinion of the Court

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476 (quoting Palmer, 157 N.C. App. at 635, 579 S.E.2d at 908).2 We disagree and 

conclude that the superior court below acted exactly within the authority and 

discretion provided to it by the plain language of N.C.G.S. § 97-90(c).

Moreover, contrary to the suggestion of the Court of Appeals, we do not 

consider N.C.G.S. § 97-90(c) to be an “obsolete relic.” Id. at 375, 791 S.E.2d at 477. 

In noting that subsection (c) was added in response to the Brice decision and “prior to 

the establishment of the Court of Appeals in 1967 and the establishment of [the Court 

of Appeals’] comprehensive jurisdiction to review direct appeals from the Industrial 

Commission,” id. at 371, 791 S.E.2d at 475; see also Act of June 2, 1967, ch. 669, sec. 

1, 1967 N.C. Sess. Laws 755, 755 (vesting appeals from Commission decisions for 

errors of law in the Court of Appeals), the Court of Appeals suggested that subsection 

(c)’s review of attorney’s fees was lodged in the superior court merely because the 

Court of Appeals was not yet in existence when subsection (c) was enacted. In that 

respect, we note that the legislature, following the creation of the Court of Appeals, 

more than once has amended subsection (c) without removing the superior court’s 

discretion to review attorney’s fees. The Workers’ Compensation Reform Act of 1994, 

ch. 679, sec. 9.1, 1993 N.C. Sess. Laws (Reg. Sess. 1994) 394, 417-18; see also Act of

July 11, 2013, ch. 278, sec. 1, 2013 N.C. Sess. Laws 755, 755-56 (authorizing the 

 

2 This contention based on Palmer is misplaced, however, as neither the superior court 

nor the Commission purported to adjudicate the question of law that was at issue in Palmer. 

See Palmer, 157 N.C. App. at 627-28, 579 S.E.2d at 903-04. We express no opinion on the 

decision of the Court of Appeals in Palmer, which is not binding on this Court.
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Opinion of the Court

-23-

Commission to hear disputes between an employee’s previous and current attorneys 

regarding the division of a fee and providing that “[a]n attorney who is a party to an 

action under this subsection shall have the same rights of appeal as outlined in 

subsection (c) of this section”). The superior court’s comprehensive factual review of 

an attorney’s fee as contemplated by N.C.G.S. § 97-90(c) is quite unlike the kind of 

analysis conducted by the Court of Appeals, which typically reviews for errors of law. 

See N.C.G.S. § 97-86 (2017) (“[A]ppeal from the decision of [the] Commission to the 

Court of Appeals [is] for errors of law under the same terms and conditions as govern 

appeals from the superior court to the Court of Appeals in ordinary civil actions.” 

(emphasis added)); see also id. § 7A-26 (2017) (providing that the Court of Appeals 

has “jurisdiction to review upon appeal decisions of the several courts of the General 

Court of Justice and of administrative agencies, upon matters of law or legal 

inference” (emphasis added)).

Indeed, the appellate jurisdiction now possessed by the Court of Appeals was 

the same as that possessed by the superior court before the enactment of subsection 

(c), as explained in Brice:

When the appeal comes on for hearing[,] it is heard by the 

presiding [superior court] judge who sits as an appellate 

court. His function is to review alleged errors of law made 

by the Industrial Commission, as disclosed by the record 

and as presented to him by exceptions duly entered. 

Necessarily, the scope of review is limited to the record as 

certified by the Commission and to the questions of law 

therein presented.
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Opinion of the Court

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. . . ‘In passing upon an appeal from an award of the 

Industrial Commission in a proceeding coming within the 

purview of the act, the Superior Court is limited in its 

inquiry to these two questions of law: (1) Whether or not 

there was any competent evidence before the commission 

to support its findings of fact; and (2) whether or not the 

findings of fact of the commission justify its legal 

conclusions and decision. The Superior Court cannot 

consider the evidence in the proceeding in any event for the 

purpose of finding the facts for itself.

Brice, 249 N.C. at 82, 105 S.E.2d at 445 (emphasis added) (citations omitted) (first 

quoting Penland v. Bird Coal Co., 246 N.C. 26, 33, 97 S.E.2d 432, 438 (1957); then 

quoting Thomason v. Red Bird Cab Co., 235 N.C. 602, 605, 70 S.E.2d 706, 708 (1952)). 

We conclude that subsection (c)—enacted “in response to the Brice decision,” 

Saunders, 249 N.C. App. at 371, 791 S.E.2d at 475—is separate from the appellate 

review for errors of law that was formerly vested in the superior court and is now 

vested in the Court of Appeals; instead, a review under subsection 97-90(c) is a 

unique, fact-based avenue of review covering a limited subject matter3 that the 

legislature has chosen to vest in the superior court.

 

3 Notably, the matter of attorney’s fees is not the only area under the Act that the 

legislature has committed to the discretion of the superior court. In 1983, after the creation 

of the Court of Appeals, the legislature added N.C.G.S. § 97-10.2(j), providing that when an 

employee obtains a judgment pursuant to a settlement from a third-party tortfeasor, the 

employee or the employer (or the employer’s insurance carrier) may apply to the superior 

court to have the presiding judge determine the amount of the employer’s lien. Act of June 

30, 1983, ch. 645, sec. 1, 1983 N.C. Sess. Laws 604, 604; see Act of June 26, 1991, ch. 408, sec. 

1, 1991 N.C. Sess. Laws 768, 772 (amending subsection (j) to provide that “with or without 

the consent of the employer, the [superior court] judge shall determine, in his discretion, the 

amount, if any, of the employer’s lien” (emphasis added)); see, e.g., Easter-Rozzelle v. City of 

Charlotte, 370 N.C. 286, 300, 807 S.E.2d 122, 131 (2017) (concluding that the plaintiff did not 

waive his right to compensation under the Act by settling with a third-party tortfeasor and 
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Opinion of the Court

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Conclusion

In sum, we hold that the decision of the Court of Appeals here is inconsistent 

with N.C.G.S. § 97-90(c) and that the superior court had jurisdiction to take and 

consider additional evidence not previously considered by the Commission. We 

further conclude that the superior court based its determination on factual findings 

and an exercise of discretion, as specifically authorized in N.C.G.S. § 97-90(c). 

Accordingly, we reverse the decision of the Court of Appeals and remand this case to 

that court for remand to the superior court for further remand to the Commission for

entry of an order setting attorney’s fees as determined by the superior court, and for 

additional proceedings not inconsistent with this opinion. 

REVERSED AND REMANDED.

Justice EARLS did not participate in the consideration or decision of this case.

 

receiving settlement proceeds and that “either party here may apply to the superior court 

judge to determine the amount of defendant’s lien”).