ROBERT MORAN, Employee/Appellant, v. UNITED PARCEL SERV. and LIBERTY MUT. INS. CO., Employer-Insurer.

 

WORKERS= COMPENSATION COURT OF APPEALS

APRIL 1, 2003

 

 

HEADNOTES

 

ATTORNEY FEES.  Where the employee was receiving wage loss benefits and the employee=s attorney was entitled to contingent fees based on those benefits, the compensation judge did not err by dismissing the employee=s petition for Roraff fees as premature.

 

Affirmed.

 

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

Compensation Judge: Jennifer Patterson

 

OPINION

 

MIRIAM P. RYKKEN, Judge

 

The employee appeals the compensation judge=s Order Dismissing Petition for Attorney Fees without prejudice.  We affirm.

 

BACKGROUND

 

On February 7, 2001, Robert Moran, the employee, sustained a work-related injury while working for United Parcel Service, the employer, which was insured for workers= compensation liability by Liberty Mutual Insurance Company, the insurer.  The insurer paid various workers= compensation benefits.  On September 12, 2001, the employer and insurer filed a notice of intention to discontinue the employee=s temporary total disability benefits based upon the employee=s failure to follow through with the treating physician=s recommendations and his unauthorized change of physicians.  Following an administrative conference held on October 30, 2001, the compensation judge allowed discontinuance of the employee=s temporary total disability benefits.  The employee filed an objection alleging entitlement to temporary total disability benefits from October 30, 2001, and continuing. 

 

On October 18, 2001, the employee filed a medical request for a functional capacities evaluation (FCE).  On November 7, 2001, the employer and insurer denied payment for the FCE.  The employee=s claims were consolidated and scheduled for a hearing on March 26, 2002.  However, in March 2002, before the hearing was held, the parties entered into a stipulation for settlement.  The stipulation covered wage loss benefits from October 21, 2001, through February 1, 2002, and any claims for attorney fees through February 1, 2002.  The remaining issues were addressed at hearing on March 26, 2002, following which the compensation judge awarded temporary total disability benefits from February 2, 2002, through February 18, 2002, temporary partial disability benefits from and after February 19, 2002, a functional capacities evaluation, and reimbursement of intervention interests. 

 

On July 3, 2002, the employee=s attorney filed a statement of attorney=s fees requesting contingent fees under Minn. Stat. ' 176.081, subd. 1, which the compensation judge awarded by order served and filed July 29, 2002.  On August 9, 2002, the employee filed another statement requesting Roraff fees of $2,555.00 for 14.6 hours incurred in obtaining the FCE.  The employer and insurer objected, and a hearing was scheduled for October 7, 2002.  When the parties appeared for the hearing before the compensation judge, but prior to going on the record, the employer and insurer indicated that there was an ongoing stream of benefits from which attorney=s fees could be withheld and argued that the employee could not show that the contingent fee was inadequate.  The compensation judge did not proceed with the hearing, as she concluded that a determination of the attorney fee claim would be premature at that point.

 

In an order served and filed October 11, 2002, the compensation judge dismissed the petition for attorney fees without prejudice, stating that Awhere contingent attorney fees are being paid from a flow of benefits, determination of whether those contingent fees will be adequate to compensate an employee=s attorney for legal services provided, and a Petition for Roraff Fees, are premature,@ citing Borgan v. Bob Hegland, Inc., 62 W.C.D. 452 (W.C.C.A. 2002).  The compensation judge advised that the employee=s attorney could re-file a fee petition once attorney fees from the ongoing benefits ceased.  The employee appeals.

 

STANDARD OF REVIEW

 

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), summarily aff=d (Minn. June 3, 1993).

 

DECISION

 

The employee states that contingent fees had not been paid as of the hearing scheduled for October 7, 2002, but does not dispute that ongoing benefits were being paid to the employee and that the employee=s attorney was entitled to contingent attorney fees from those benefits.  Nevertheless, the employee argues that the compensation judge erred by issuing an order without a hearing on the adequacy of the contingency fee. 

 

A contingent attorney fee for recovery of monetary benefits is presumed adequate to cover recovery of medical and rehabilitation benefits or services concurrently in dispute.  The employer or insurer are liable for additional fees only if Athe contingent fee is inadequate to reasonably compensate the attorney for representing the employee in the medical or rehabilitation dispute.@  Minn. Stat. ' 176.081, subd. 1(a)(1).  Where wage loss benefits are being paid which are producing contingency fees, the determination of whether contingency fees are adequate to compensate the employee=s attorney is premature.  Borgan v. Bob Hegland, Inc., 62 W.C.D. 452, 462-63 (W.C.C.A. 2002).

 

In this case, at the time the parties appeared before the compensation judge on October 7, 2002, the employee was receiving wage loss benefits and the employee=s attorney was entitled to contingent fees based on those benefits.  The compensation judge dismissed the petition for attorney fees without prejudice, stating that Awhere contingent attorney fees are being paid from a flow of benefits, determination of whether those contingent fees will be adequate to compensate an employee=s attorney for legal services provided, and a Petition for Roraff Fees, are premature.@  Because this was a claim presented to the compensation judge for her review, we would have preferred that she had made findings of fact which then would have been available for review on appeal.  Nevertheless, the parties do not dispute that at the time of the scheduled hearing, ongoing benefits were being paid to the employee and the employee=s attorney was entitled to contingent attorney fees from those benefits.  Under the circumstances of this case, we affirm the compensation judge=s conclusion that it is premature to determine whether the contingent fees will be adequate to compensate the employee=s attorney for legal services provided and affirm the judge on that basis.