JAMES LAFORE, Employee/Appellant, v. WCI/FRIGIDAIRE FREEZER PRODS. and RELIANCE INS. GROUP/GALLAGHER BASSETT SERVS., Employer-Insurer, and HEALTHPARTNERS, INC. and CENTER FOR DIAGNOSTIC IMAGING, Intervenors.

 

WORKERS= COMPENSATION COURT OF APPEALS

AUGUST 20, 2003

 

ATTORNEY FEES.  The compensation judge did not abuse his discretion in finding that the employee=s former attorney was entitled to a fee of $13,000.00 under Minn. Stat. ' 176.081, subd. 1.

 

Affirmed.

 

Determined by Stofferahn, J., Wilson, J., and Pederson, J.

Compensation Judge: William R. Johnson

 

OPINION

 

DAVID A. STOFFERAHN, Judge

 

The employee appeals from a decision of the compensation judge awarding his previous attorney continuing fees.  We affirm.

 

BACKGROUND

 

On May 23, 2000, the employee, James LaFore, retained attorney James Roberts to represent him in connection with a claim for certain wage loss benefits and medical expenses due to a July 1, 1994 work injury to the employee=s thoracic spine.   The employee signed a retainer agreement authorizing Roberts to receive contingency fees up to $13,000.00, pursuant to the provisions of Minn. Stat. ' 176.081, subd. 1 (a), from any benefits obtained.  Roberts prepared and filed a claim petition on behalf of the employee.  The employer and insurer filed an answer which denied liability for the benefits claimed, alleging that the employee=s July 1, 1994 injury, though admitted, had been temporary in nature and had fully resolved.  In addition, they alleged that the employee had reached maximum medical improvement (MMI) from his injury on August 5, 1997, thereby precluding further temporary total disability compensation 90 days after service of MMI even if the injury were not merely temporary in nature. 

 

The employer and insurer subsequently changed their position and dropped these defenses.  They paid the benefits claimed by the employee, including initiating payment of ongoing temporary total disability compensation.  The employer and insurer withheld  attorney fees from those benefits based on the statutory contingency formula but did not pay the withheld amounts to the employee=s attorney, Roberts. 

 

On October 25, 2000 the employer and insurer filed a notice of intention to discontinue compensation, alleging that the employee had reached maximum medical improvement on October 5, 2000, and that temporary total disability compensation would end ninety days after that date.  On behalf of the employee, Roberts requested an administrative conference on the discontinuance.  Following a conference held on December 11, 2000, the employer and insurer=s request for discontinuance was denied.

 

The employer and insurer subsequently filed a new notice of intention to discontinue benefits on April 17, 2001, claiming that the employee had sustained a non work-related cervical injury which constituted a superseding cause of his disability.  Roberts objected to the discontinuance and, after an administrative conference, the discontinuance was denied.  Temporary total disability benefits were ordered to be continued to the employee.

 

On September 4, 2001, Roberts filed a statement of attorney fees.  The statement requested fees pursuant to Minn. Stat. ' 176.081, subd. 1, and Edquist v. Browning-Ferris, 380 N.W.2d 787, 38 W.C.D. 411 (Minn. 1986).^[1]  In the statement, Roberts stated that he had obtained $26,179.87 in temporary total disability benefits for the employee.  He requested $5,435.97 in fees, the amount he alleged had been withheld.  After the employer and insurer objected to the statement and argued that the amount of fees withheld and owing through September 21, 2001, was $5,038.38, Roberts agreed to that amount.  An order determining attorney fees was served and filed on October 16, 2001, which awarded to Attorney Roberts Athe sum of $5,038.38 as and for attorney fees and nontaxable costs for representation of the employee to date.@  The employee was also awarded $1,152.56 pursuant to Minn. Stat. ' 176.081, subd. 7.  Those amounts were paid by the employer and insurer.  Subsequently, the employer and insurer continued to withhold attorney fees from wage loss benefits paid to the employee, but did not pay any of the further amounts withheld to Roberts. 

 

On April 3, 2002, the employer and insurer filed another notice of intention to discontinue benefits, alleging that the employee had been released to light duty work which was available with the employer.  Roberts requested an administrative conference but dismissed the request when he learned the employee had in fact returned to work with the employer and that the employer and insurer had initiated payment of temporary partial disability benefits. 

 

On May 30, 2002, Roberts filed a medical request seeking payment of a number of medical bills allegedly due to the employee=s thoracic injury.  At a pre-trial in August of 2002 the parties discussed payment of the bills, but no agreement was reached and the matter was set for hearing.  Shortly thereafter, the employee discharged Roberts as his attorney. 

 

On December 4, 2002, Roberts filed a motion for an order to release attorney fees.  In the motion, Roberts requested that the employer and insurer be required to disclose the amount of fees being withheld and also requested an order releasing that amount to him.  The motion resulted in a hearing on attorney fees which was held on December 19, 2002. 

 

At the hearing, Roberts contended that fees which had been withheld from temporary total disability compensation and temporary partial disability compensation after October 16, 2001 should be paid to him.  He also claimed that fees were due from permanent partial disability benefits paid to the employee but from which no fees had been withheld.  The employer and insurer responded that the amount of $1,997.53 had been withheld from continuing benefits and asserted  that there had been no payment of permanent partial disability compensation.  The employer and insurer objected to any payment to Roberts of the withheld fees.  The employee appeared through his current attorney, William Getts, and objected to Roberts=s fee request.  The employee and the employer and insurer argued that Roberts had requested a specific fee in 2001, that he had not requested ongoing fees at that time, and that he had not provided additional services after October 16, 2001 which would justify a fee under Minn. Stat. ' 176.081, subd. 1.  The employee also requested an award pursuant to Minn. Stat. ' 176.081, subd. 7, in the event of an award of fees to Roberts.

 

In his findings and order, served and filed as amended on February 21, 2003, the compensation judge ordered that Roberts should be paid the amounts that had been withheld from temporary total and temporary partial disability benefits to the date of hearing, and that Roberts should thereafter continue to receive contingency fees from ongoing benefits as warranted pursuant to Minn. Stat. ' 176.081, subd. 1(a).  The compensation judge also ordered payment to the employee pursuant to Minn. Stat. ' 176.081, subd. 7.  The employee appeals from the award of ongoing fees to Roberts.

 

DECISION

 

Minn. Stat. ' 176.081, subd. 1 provides for an attorney fee of 25 percent of the first $4,000.00 in benefits received by the employee and 20 percent of the next $60,000.00 in benefits and further provides that no approval for the fee is required.

 

The employee argues on appeal that Roberts= initial fee request sought fees in an exact dollar amount and did not specifically include a request for Acontinuing@ contingency fees, and that the October 16, 2001 order awarded the requested specific dollar amount in fees to Roberts Afor representation of the employee to date.@  Accordingly, the employee argues, the October 16, 2001 order precludes any further award of attorney fees to Roberts to the extent based on work performed prior to its date.  Since the stream of wage loss benefits from which contingency fees were awarded below resulted solely from Roberts= efforts on behalf of the employee prior to October 16, 2001, the employee contends that the compensation judge therefore erred as a matter of law in granting any further attorney fees to Roberts.

 

The compensation judge held that the prior order did not clearly limit the attorney fee payable to Roberts to the amount previously awarded and that Roberts Adid not waive his right to claim attorney fees merely because he did not specifically indicate that he was claiming continuing fees at the time of the prior Award.@  (Finding 2).   Noting that under Minn. Stat. '176.081, subd. 1(a), an attorney fee pursuant to that statute=s contingency formula A. . . does not require approval by the commissioner, compensation judge, or any other party,@ the judge further reasoned that the compensation judge who issued the prior fee order could not have intended it as disapproval of Roberts= right to contingency fees.  The compensation judge concluded that Roberts remained entitled to additional contingency fees as warranted up to the limitations of the statutory  formula.

 

We note that the specific amount of the fee award in the October 16, 2001 order was exactly that amount which the parties understood to have been withheld through the date of the initial request.  This factor supports an inference that the sole reason that Roberts sought the order was to obtain the release of the amount withheld to date, which lends support to an inference that the Ato date@ language in the fee request and order was intended in this context, and not as a waiver of any further fees based on Roberts= representation of the employee through that date.  We note, also, that Roberts= fee statement accompanying the initial fee request prior to October 16, 2001 did indicate that he claimed contingency fees pursuant to Minn. Stat. '176.081, subd. 1. 

 

Under the circumstances, we cannot conclude that the compensation judge abused his discretion in awarding  further attorney fees to Roberts within the limits of the statutory formula, and affirm.