JOHN D. RODRIGUEZ, Employee, v. CONAGRA PEAVEY, SELF-INSURED, Employer/Appellant, and KENNY REHAB ASSOCS., ABBOTT NORTHWESTERN HOSP., and FAIRVIEW CEDAR RIDGE CLINIC, Intervenors.
WORKERS= COMPENSATION COURT OF APPEALS
JULY 13, 2000
ATTORNEY FEES - SUBD. 7 FEES; STATUTES CONSTRUED - MINN. STAT. ' 176.081, SUBD. 7. Under the law in effect on the employee=s 1990 date of injury, Roraff fees may not form the basis for an award pursuant to Minn. Stat. ' 176.081, subd. 7, and the judge=s decision to the contrary is reversed.
Determined by Wilson, J., Wheeler, C.J., and Rykken, J.
Compensation Judge: Jennifer Patterson
DEBRA A. WILSON, Judge
The self-insured employer appeals from the compensation judge=s award pursuant to Minn. Stat. ' 176.081, subd. 7. We reverse.
On September 11, 1990, the employee sustained work injuries in the course of his employment with ConAgra Peavey [the employer] when a platform on which he was standing collapsed. The employer, which was self-insured for workers= compensation purposes, apparently admitted liability for a left leg injury and paid the employee various benefits. Two years later, in September of 1992, the parties agreed to settle the employee=s claims relating to the September 11, 1990, accident on a full, final, and complete basis, with the exception of future medical expense claims relating to the employee=s left leg and low back. In a provision immediately following a description of the employee=s contingent fee agreement with his attorney, the stipulation provided as follows:
IT IS FURTHER STIPULATED BY THE EMPLOYEE that he has been advised of and understands any claim which he may have to reimbursement of attorney=s fees under Minn. Stat. '176.081, subd. 7 & 8, and Minn. Stat. '176.191, and that he knowingly waives said claims.
With regard to future medical expense claims and related attorney fees, the agreement provided,
[r]easonable or necessary expenses pursuant to Minn. Stat. sec. 176.135 for treatment of the Employee=s left leg and low back injuries of September 11, 1990, will remain open. Nonetheless, it is expressly understood the Employer and Insurer are not waiving their primary denial of causation with regard to the back, and expressly reserve all defenses they have with regard to causal relation to the back. It is further expressly understood that future attorney=s fees pursuant to Minn. Stat. sec. 176.135 or Roraff fees are not intended to be closed out to the extent future disputes on medical issues may arise.
All other benefits and attorney fee claims were expressly closed out by the agreement. An award on stipulation was issued on September 11, 1992.
In late 1998, the employee filed a medical request, seeking payment for treatment related to left knee, low back, and leg symptoms. The matter eventually went to hearing, and, in an order issued on October 19, 1999, the compensation judge awarded most of the disputed expenses. With the agreement of the parties and without further hearing, the judge also awarded the employee=s attorney $5,750.00, in Roraff fees, for work performed in connection with the medical expense dispute, indicating that the employee=s claim for an award under Minn. Stat. ' 176.081, subd. 7, would be addressed by separate decision. In that separate decision, issued on February 16, 2000, the compensation judge determined that the employee=s claim under Minn. Stat. ' 176.081, subd. 7, was not barred by the 1992 stipulation for settlement and that an award under subdivision 7 was appropriate pursuant to the Minnesota Supreme Court=s decision in Irwin v. Surdyk=s Liquor, 599 N.W.2d 132, 59 W.C.D. 319 (Minn. 1999). The employer appeals.
STANDARD OF REVIEW
A[A] decision which rests upon the application of a statute or rule to essentially undisputed facts generally involves a question of law which [the Workers= Compensation Court of Appeals] may consider de novo.@ Krovchuk v. Koch Oil Refinery, 48 W.C.D. 607, 608 (W.C.C.A. 1993).
The employee=s attorney was successful in obtaining disputed medical expenses on the employee=s behalf and was consequently awarded Roraff fees in the amount of $5,750.00 for this work. This award is undisputed on appeal. The employee also claimed entitlement to an award, calculated as a percentage of the Roraff fees, pursuant to Minn. Stat. ' 176.081, subd. 7, which, on the employee=s date of injury, provided as follows:
Subd. 7. If the employer or insurer files a denial of liability, notice of discontinuance, or fails to make payment of compensation or medical expenses within the statutory period after notice of injury or occupational disease, or otherwise unsuccessfully resists the payment of compensation or medical expenses, or unsuccessfully disputes the payment of rehabilitation benefits or other aspects of a rehabilitation plan, and the injured person has employed an attorney at law, who successfully procures payment on behalf of the employee or who enables the resolution of a dispute with respect to a rehabilitation plan, the compensation judge, commissioner, or the workers= compensation court of appeals upon appeal, upon application, shall award to the employee against the insurer or self-insured employer or uninsured employer, in addition to the compensation benefits paid or awarded to the employee, an amount equal to 25 percent of that portion of the attorney=s fee which has been awarded pursuant to this section that is in excess of $250.
Minn. Stat. ' 176.081, subd. 7 (1990). There were two primary issues before the compensation judge: (1) whether the employee=s claim pursuant to Minn. Stat. ' 176.081, subd. 7, was barred by the parties= 1992 stipulation for settlement; and (2) whether the supreme court=s holding in Irwin, allowing subdivision 7 fees on Roraff fees, was controlling given this employee=s 1990 date of injury. With regard to the first issue, the compensation judge found the settlement agreement ambiguous and, resolving the ambiguity against the drafter of the agreement, which was the employer, she concluded that the employee=s subdivision 7 claim was not barred by the stipulation. With regard to the second issue, the compensation judge noted that judicial construction of a statute is as much a part of the statute as the original language, and she concluded that, because the language of subdivision 7 was essentially the same on the employee=s date of injury as it was on Irwin=s, the supreme court=s holding on the issue in Irwin was equally applicable to the employee=s claim. The employer argues that the compensation judge erred in her resolution of both issues. Because we conclude that Irwin is inapplicable and that the law in effect on the date of the employee=s injury does not allow for an award under subdivision 7 to be based on Roraff fees, we need not consider whether the compensation judge erred in construing the stipulation for settlement.
The employee in Irwin sustained a work-related injury in 1996 and claimed entitlement to an award, under subdivision 7, calculated on Roraff fees. Discussing the Workers= Compensation Court of Appeals= prior treatment of such claims, the supreme court wrote as follows:
The WCCA has treated subdivision 7 awards as reimbursement to the employee for attorney fees deducted from his compensation award pursuant to the contingent fee formula. . . . More recently, the WCCA refused to award subdivision 7 fees for a different reason[, concluding] that because traditional Roraff fees were paid pursuant to Minn.Stat. ' 176.135, rather than ' 176.081, which previously made no provision for an award based on medical expenses, Roraff fees were not paid Apursuant to [section 176.081]@ and thus subdivision 7 fees were not appropriate..
However, the court rejected the Workers= Compensation Court of Appeals= denial of Irwin=s subdivision 7 claim, explaining,
 [T]he 1995 changes to Minn.Stat. ' 176.081 added a provision for attorney fees based on medical expenses. See Minn.Stat. ' 176.081, subd. 1(a) (1998). Subdivision 7 allows an award to the employee on an Aattorney=s fee which has been awarded pursuant to this section.@ Id.' 176.081, subd. 7 (1998) (emphasis added). In Mack [v. City of Minneapolis], 33 N.W.2d at 747, we followed the plain language of the statute, which provided, as does the current statute, for an award of subdivision 7 fees based on attorney fees awarded Apursuant to this section.@ Id. (citing Minn.Stat. ' 176.081, subd. 7 (1982)) (emphasis added). We there held that subdivision 7 awards should be made on all attorney fees awarded under section 176.081, even those fees paid by the employer. Id. Thus, under the plain language of the statute, a subdivision 7 award should be based on all attorney fees paid pursuant to Minn.Stat. ' 176.081, including attorney fees based on medical expenses pursuant to Minn.Stat. ' 176.081, subd. 1(a). We therefore reverse the holding of the WCCA.
Irwin, 599 N.W.2d at 144, 59 W.C.D. at 339 (underscoring added). From this discussion, it is evident that the Irwin court based its decision on the fact that Roraff fees are, under the 1995 amendments, specifically awardable pursuant to section 176.081. However, in 1990, on this employee=s date of injury, Minn. Stat. ' 176.081 contained no provision or authority for an award of Roraff-type fees. As such, Roraff fees were not at that time payable Apursuant to this section,@ as expressly required by Minn. Stat. ' 176.081, subd. 7. Contrary to the compensation judge=s reasoning, it is not dispositive that subdivision 7 itself remained largely unchanged between 1990 and 1996.
AThe workers= compensation statutes in effect on the date an employee sustains a disabling injury govern both his rights to compensation and the extent of his employer=s liability.@ Broos v. Portec, Inc., 376 N.W.2d 688, 691, 38 W.C.D. 224, 228 (Minn. 1985). To allow an award under subdivision 7 here would impose a new burden on the employer not contemplated by the statute in effect on the date of the employee=s injury, and we see no evidence that the legislature intended retroactive application of the pertinent post-1990 statutory amendments. Therefore, because Roraff fees were not payable under Minn. Stat. ' 176.081 on the date of this employee=s injury, Roraff fees may not form the basis for an award under Minn. Stat. ' 176.081, subd. 7, and we reverse the judge=s decision to the contrary.
 See Roraff v. State, Dep't of Transp., 288 N.W.2d 15, 32 W.C.D. 297 (Minn. 1980); Minn. Stat. ' 176.135, subd. 1.
 The employee disputes this conclusion by arguing that Minn. Stat. ' 176.081, subd. 1, Aincluded language relating to recovery of medical benefits or services@A[p]rior to the 1995 amendments.@ However, while some language to this effect was added in 1992, no such language existed in Minn. Stat. ' 176.081, subd. 1, in 1990, the pertinent date here. Moreover, while it may be true, as the employee points out, that Minn. Stat. ' 176.081, subd. 5(d) (repealed 1995), contained criteria that were used for evaluating Roraff fee claims in 1990, subdivision 5(d) did not provide any underlying authority for Roraff fee awards. In the Roraff case itself, the supreme court noted that Minn. Stat. ' 176.081 was intended to apply to Adisability compensation@ cases Abut was not intended to apply to awards of attorneys= fees in proceedings brought solely to recover medical expenses.@ Roraff, 288 N.W.2d 15, 16, 32 W.C.D. 297, 298. The availability of fees in medical expense cases was instead Areasonably to be inferred from the language used in section 176.135, subdivision 1,@ the provision governing medical expense claims. Id.