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N.C. appeals court vacates order eliminating comp lien - Business Insurance Skip to content Register for free Search Search Log In Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2025 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers N.C. appeals court vacates order eliminating comp lien by Louise Esola Workers Comp Coverage Aug 6, 2026 A North Carolina appeals court on Wednesday vacated orders eliminating an employer and insurer’s workers compensation lien on an injured worker’s $450,000 third-party settlement, ruling the lower court lacked jurisdiction because the agreement was not final. In Saunders v. Woolard , the North Carolina Court of Appeals ruled that a Pasquotank County Superior Court judge improperly reduced to zero the subrogation lien held by Orano USA and its workers compensation insurer, Liberty Mutual Insurance. Richard Saunders was injured while working at an Orano job site and filed a workers compensation claim that the company accepted. Liberty Mutual paid temporary total disability and medical benefits for the injury. Mr. Saunders later sued Phillip E. Woolard, doing business as Woolard’s Welding Service, alleging the welding contractor’s negligence caused his injuries. Discovery produced evidence indicating Orano may also have been negligent. Mr. Saunders and the contractor agreed to settle the negligence claim for $450,000. Orano and Liberty Mutual, which had paid more than $400,000 in workers compensation benefits, refused to consent to the settlement. Mr. Saunders then asked the trial court under North Carolina law to determine the amount of the employer and insurer’s subrogation lien. The court reduced the lien to zero. The appeals court said it was bound by its 2004 ruling in Ales v. T.A. Loving Co. , which held that a court lacks jurisdiction under state law unless the employee and third party have reached a final settlement requiring only performance to bind the parties. Emails between the attorneys showed that the parties had agreed on the $450,000 amount but were awaiting the employer’s consent. Mr. Saunders’ motion also stated that the proposed settlement would require court approval and a determination of the lien. Because resolution of the workers compensation lien was a condition precedent to the settlement, the agreement was not final and the trial court lacked jurisdiction to extinguish the lien, the appeals court said. The panel acknowledged that the Ales ruling has been criticized for hindering settlements and potentially conflicting with North Carolina’s policy favoring negotiated resolutions. It said, however, that only the state Supreme Court, the General Assembly or the Court of Appeals sitting en banc could overturn the precedent. The court vacated the trial court’s orders and remanded the case, stating that the lower court could consider the lien under state law if the parties present evidence of an agreement without a condition precedent. 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