Allums v. Workmen's Compensation Appeal Board
Allums v. Workmen's Compensation Appeal Board
Opinion of the Court
Opinion by
This is an appeal by John T. Allums (Claimant) from an order of the Workmens Compensation Appeal Board (Board) that denied his petition for reconsideration which petition sought additional counsel fees pursuant to Section 440 of The Pennsylvania Workmens Compensation Act (Act),
Claimant suffered a compensable injury on January 14, 1977.
Employer appealed this order to the Board. Claimant cross-appealed on the basis that the referee erred in inadvertently omitting from his award an eighteen dollar fee for the cost of transcribing the testimony from the hearing. On his appeal form, Claimant also requested that additional legal fees be assessed against Employer for the work Claimants attorney was performing in defending Claimants case against the Employers “meritless appeal” from the award of counsel fees. The Board ordered a remand for purposes of correcting the eighteen dollar transcript bill omission (later paid upon stipulation without hearing) but denied Claimants request for additional legal fees, although it did uphold the $1,000.00 fee assessment granted by the referee for the work done by Claimants attorney in first preparing to defend the withdrawn modification petition.
Claimant, of course, asserts that the additional counsel fees are proper and should have been imposed. Employer disagrees and cites Weidner v. Workmen's Compensation Appeal Board, 497 Pa. 516, 442 A.2d 242 (1982) in support of its position.
The Supreme Court reversed this Courts Weidner II decision and held that counsel fees were proper, but only for the work the attorney did in securing the initial award, i.e., the $3,750 award for the work the attorney performed in representing the Claimant, not for the efforts the attorney expended in his attempt to obtain counsel fees. Thus, Weidner (Pa.) establishes that an attorney is only entitled to fees where the work he does is on behalf of the client’s interests, not his own.
Finally, Claimant asks that we direct the Board to grant him attorneys fees for appeal to this Court. This would entail an examination of the underlying factual arrangement and agreement as to counsel fees on appeal before this Court. Therefore, it should be addressed by the Board and the referee on remand in the same manner and to the same extent as is warranted in establishing attorneys fees for counsels work in defending the appeal before the Board.
Based upon the foregoing discussion, the order of the Board is reversed and the case is remanded for computation of attorneys fees due Claimant.
Order
Now, October 27, 1987, the order of the Workmens Compensation Appeal Board in the above captioned matter is hereby reversed and the case is remanded for computation of attorney fees due Claimant. Should additional evidence with respect to the amount of attorneys fees due be necessary the Board is authorized to conduct further hearings.
Jurisdiction relinquished.
Act of June 2, 1915, P.L. 736, as amended. Section 440 was added by Section 3 of the Act of February 8, 1972, P.L. 25.
The parties entered into a supplemental agreement on April 2, 1979.
Section 440 states:
In any contested case where the insurer has contested liability . . . the employe ... in whose favor the matter at issue has been finally determined shall be awarded, in addition to the award for compensation, a reasonable sum for costs incurred for attorneys fee, . . . Provided, That cost for attorney fees may be excluded when a reasonable basis for the contest has been established. . . .
In contested cases involving petitions to terminate, reinstate, increase, reduce or otherwise modify compensation awards, agreements or other payment arrangements or to set aside final receipts, where the contested issue, in whole or part, is resolved in favor of the claimant, the claimant shall be. entitled to an award of reasonable costs as hereinabove set forth.
77 P.S. §996 (emphasis added).
The Board held that “there is no medical evidence in this record to indicate that the filing of the modification petition was reasonably based.”
Employer also argues that imposition of additional attorneys fees is prohibited by Section 442 (added by Section 3 of the Act of February 8, 1972, P.L. 25), 77 P.S. §998, and 77 PS. §1021, and by Bureau of Workmen's Compensation Regulation 121.24. 34 Pa. Code §121.24. We agree, however, with claimant that these issues were not raised before the Board and, accordingly, are waived on appeal, Pa. R. A.P 1551(a).
Judge Rogers stated that counsel fees are not dependent upon the claimants success in defending the petition to terminate, but upon whether there was a reasonable contest. Specifically, Judge Rogers wrote:
The appellant seems to contend that the second paragraph of Section 440 relating, inter alia, to petitions for termination require [sic] that attorneys fees be awarded in all cases where the contested issue, in whole or in part, has been resolved in fovor of the claimant. We do not agree with this construction. We believe, rather, that the preposition as in the final phrase, ‘as hereinabove set forth,’ expresses the Legislature’s intention that costs in such cases shall be awarded in the circumstances described in the first paragraph of Section 440. Hence, attorney’s fees shall be awarded unless a reasonable basis for the employer’s contest has been established; or otherwise expressed, the award of attorney’s fees is the rule and their exclusion is the exception to be applied in cases where the record establishes that the employer’s or carrier’s contest is reasonably based.
Weidner I, 16 Pa. Commonwealth Ct. at 565, 332 A.2d at 887 (emphasis in original).
Our reasoning in Weidner II was specifically rejected by the Supreme Court when it stated:
The Commonwealth Court erred in limiting Section 440 of the Act solely to recoupment as provided in Section 442. Our examination of these two separate statutory sections leads us to believe they serve different purposes. Section 442 evidences a legislative intent of protecting claimants against unreasonable fees charged and imposed on them by their attorneys under their own improvident fee agreements. As such, it is properly limited to recoupment. Section 440, on the other hand, shows a legislative intent of protecting claimants against unreasonable contests of a claimants initial or continuing right to the bene*450 fits of the act, including the benefit of a suspension, where a monetary award is not possible. To limit Section 440 to the same policy of recoupment as Section 442 would frustrate the legislative purpose of protecting claimants against unreasonable contests of their right to suspension since claimants dependent upon compensation for themselves and their families are not often in a position to incur a fixed obligation to their attorneys where there is no hope of that attorneys creating a fund out of which it can be paid.
Weidner v. Workmen's Compensation Appeal Board, 497 Pa. 516, 521, 442 A.2d 242, 244 (1982).
This case was assigned to the opinion writer on June 9, 1987.
Concurring Opinion
Concurring Opinion by
I concur in the result only.
Section 440 of The Pennsylvania Workmens Compensation Act (Act), Act of June 2, 1915, PL. 736, as amended, 77 PS. §996, provides two methods of computation of costs, including attorneys fees: (1) where liability is unreasonably contested and decided favorably for the claimant, and (2) in contested cases involving petitions to modify compensation awards where the
In Weidner v. Workmen's Compensation Appeal Board, 497 Pa. 516, 442 A.2d 242 (1982), the referee had foiled to award counsel fees in his initial decision, and the claimant specifically appealed this issue. Our court on appeal remanded, holding that the contest was unreasonable and counsel fees were proper. Upon remand, the referee awarded counsel fees, and it was the employers insurance carrier which appealed. Upon reaching our Supreme Court, it was held that where there has been an unreasonable contest advanced by the employer, an award of attorneys fees is proper for the work the attorney did in securing the initial award, i.e., where the attorney was acting on the claimants behalf. Weidner at 522, 442 A.2d at 245.
In Weidner, the court said that section 440 of the Act, 77 P.S. §996, shows a “legislative intent of protecting claimant against unreasonable contests of a claimants initial or continuing right to the benefits of the act” (emphasis added). Weidner at 521, 442 A.2d at 244. Thus, payment is not barred for all costs by those who incurred them on behalf of a claimant, including reasonable fees to claimants counsel. To reach a different result would be to discourage lawyers from engaging in the modification proceedings in which the only benefit to the claimant may be a nonmonetary award.
Petitioner had a right to engage counsel to pursue the modification issue on his behalf, even though such representation extended beyond the initial referees hearing. As the Supreme Court indicated in Weidner, the intent of section 440 of the Act, 77 P. S. §996, was to
Once the contested right of liability is sought to be modified and is resolved in favor of a claimant, the claimant is entitled to an award of costs and attorneys fees. When respondent withdrew its petition to modify, that issue was terminated and since there was no change in the original award, the resolution was favorable to petitioner. Petitioner is therefore entitled to reasonable costs as set forth in section 440 of the Act, 77 PS. §996.
Reference
- Full Case Name
- John T. Allums, Petitioner v. Workmen's Compensation Appeal Board (Westinghouse Electric Corp.), Respondents
- Cited By
- 7 cases
- Status
- Published