TIMOTHY D. SPEAR, Employee, v. S. M. HENTGES & SONS, and AMERICAN HOME ASSURANCE/AIG DOMESTIC CLAIMS, INC., Employer-Insurer/Petitioners, and OPERATING ENGINEERS LOCAL 49, FAIRVIEW HEALTH SERVS., TWIN CITIES ORTHOPEDICS, METROPOLITAN HAND SURGEONS, MN DEP=T OF EMPLOYMENT AND ECON. DEV., and PAR, INC., Intervenors.

 

WORKERS= COMPENSATION COURT OF APPEALS

JANUARY 31, 2008

 

No. WC07-230

 

HEADNOTES

 

VACATION OF AWARD - MISTAKE.  The parties= differences of opinion concerning the terms of their purported agreement regarding attorney fees did not qualify as a mutual mistake of fact for purposes of vacating the order on attorney fees.

 

Petition to vacate order denied.

 

Determined by: Wilson, J., Pederson, J., and Rykken, J.

 

Attorneys: Bernard J. Robichaud, Jr., Robichaud & Anderson, Minneapolis, MN, for the Respondentr.  Inger Hansen-Corona, Erstad & Riemer, Minneapolis, MN, for the Petitioners.

 

 

OPINION

 

DEBRA A. WILSON, Judge

 

The employer and insurer petition to vacate an order determining attorney fees based on mutual mistake of fact.  Finding no basis to vacate the order, we deny the petition.

 

BACKGROUND

 

On January 11, 2006, the employee filed a claim petition seeking temporary total disability benefits, medical expenses, and the services of a QRC, as a result of an alleged work injury to his left hand and elbow in March of 2005.  The employer and insurer answered that claim petition denying primary liability for the alleged injury.

 

The claim petition came on for hearing before Judge Cheryl LeClair-Sommer.  In her findings and order filed on May 21, 2007, the judge noted that the parties had stipulated that the employee had sustained an injury, bilateral carpal tunnel syndrome, arising out of and in the course of his employment with the employer on March 1, 2005.  The judge went on to find that the employee had also sustained a Gillette-type injury[1] on April 27, 2005, in the nature of a left ulnar nerve/cubital tunnel injury, and she awarded temporary total disability benefits, medical expenses, and rehabilitation services.  No appeal was taken from that decision.

 

A notice of benefit payment was filed on June 1, 2007, stating that a final payment of $5,066.21 had been made on May 29, 2007, pursuant to the findings and order dated May 21, 2007.  On page two of that document, the employer and insurer indicated that $3,172.82 had been paid in attorney fees pursuant to Minn. Stat. ' 176.081, subds. 1 and 3.  According to that document, the total compensation paid was $23,666.21, together with medical expenses of $29,986.83.

 

On June 26, 2007, Bernard J. Robichaud, Jr., the attorney for the employee, filed a statement of attorney fees, indicating that he was claiming attorney fees under Astraight contingency,@ AM.S. 176.135 or 176.136- Roraff (hourly),@ and AM.S. 176.102- Heaton (hourly).@  Mr. Robichaud claimed that he had recovered benefits for temporary total disability, temporary partial disability, medical expenses, and rehabilitation expenses, all in unknown amounts.  The total fee claim was $16,500.00, which he asserted Adoes not exceed the limitations of M.S. 176.081, subd. 1 (a).  I have utilized the 25/20% formula in calculating these fees.@

 

The employer and insurer objected to the claimed fees as excessive, exceeding the maximum statutory limit, and containing no itemization of time spent, noting, A[f]urther, the Employee=s attorney was paid over $3,000.00 in contingent attorney fees in this particular dispute.@

 

The attorney fee issue was scheduled to be heard on August 6, 2007, before Judge LeClair-Sommer, but there is no indication that the hearing ever went forward.  On August 21, 2007, attorney William M. Topka, representing the employer and insurer, sent the compensation judge a letter stating, A[e]nclosed for filing please find the proposed Order Determining Attorneys= Fees in this matter.@  The employee=s attorney was served with that same proposed order.  That order stated, in relevant part:

 

Attorney Bernard J. Robichaud performed legal services resulting in the payment of workers= compensation benefits to the Employee, from which the Insurer withheld the sum of $3,172.82.  This amount consisted of $1,516.57 in contingent attorneys= fees and Edquist fees in the amount of $1,656.25.

 

NOW THEREFORE IT IS ORDERED that the Insurer shall pay directly to Attorney Bernard J. Robichaud the sum of $10,000.00 as and for attorneys fees and non-taxable costs for the representation of the Employee to date.

 

The order was signed, served, and filed on September 10, 2007.  No appeal was taken from that order.

 

On September 28, 2007, the employer and insurer filed a petition to vacate the order determining attorney fees on the basis of mutual mistake of fact.  Mr. Robichaud responded with a two paragraph letter, dated October 30, 2007,[2] stating that he strenuously objected to the motion to vacate as it was Afrivolous and inappropriate.  Defense counsel cannot conceivably object to its own order that they drafted and agreed to.@

 

On January 14, 2008, a partial stipulation for settlement on attorney fees was filed with this court.  That stipulation indicated that it was the claim and contention of Mr. Robichaud that the employer and insurer owed him $10,000.00 in fees and should release all withheld attorney fees directly to the employee.  It was the claim and contention of the employer and insurer that they were to pay Mr. Robichaud the withheld attorney fees plus additional monies up to a total of $10,000.00.  Under the terms of the stipulation, the employer and insurer agreed to pay Mr. Robichaud $10,000.00, acknowledging that he was entitled to that amount and indicating that the only dispute concerned the source of those funds.  The parties agreed A[t]hat all withheld fees in this matter will continue to be withheld pending determination of the Workers= Compensation Court of Appeals or subsequent pleading.@  An award on partial stipulation was filed on January 16, 2008.

 

DECISION

 

The Workers= Compensation Court of Appeals may vacate an award Afor cause.@  For awards filed on or after July 1, 1992, Minn. Stat. '176.461 limits Acause@ to

 

1) a mutual mistake of fact;

2) newly discovered evidence;

3) fraud; or

4) a substantial change in medical condition since the time of the award that was clearly not anticipated and could not reasonably have been anticipated at the time of the award.

 

A mutual mistake of fact occurs when opposing parties to a settlement both misapprehend some fact material to their intended settlement of a claim or claims.  Shelton v. Schwann=s Sales Enters., slip op. (W.C.C.A. May 18, 1995).  A mutual mistake requires a Aclear showing of a misunderstanding, reciprocal and common to both parties, with respect to the terms and subject matter of the contract, or some substantial part thereof.@  Carpenter v. Vreeman, 409 N.W.2d 258, 261 (Minn. App. 1987).

 

In the instant case, there is no stipulation for settlement to review, but the parties apparently thought they had reached an agreement on the attorney fees issue.  The attorney for the employer and insurer drafted an attorney fees order that both parties apparently thought represented their agreement, and the judge signed, served, and filed the order.  Only after the fact did it become apparent that the parties= views differed as to the terms of the supposed agreement.  Mr. Robichaud apparently understood that he was to be paid $10,000.00 in attorney fees (new money) and that the fees withheld to date would be released to the employee, whereas the employer and insurer apparently understood that the withheld fees would be paid to Mr. Robichaud, plus an additional sum (new money) to bring the total fee payment up to $10,000.00.  Because the compensation judge understood that she was signing an order agreed to by both parties, she did not include a memorandum or explanation.  Clearly there was a misunderstanding, but it does not meet the definition of a mutual mistake of fact.

 

In addition, this court will generally decline to vacate an award or order unless there is a practical reason to do so.  Henry v. American Bldg. Maintenance, slip op. (W.C.C.A.  Jan. 27, 1994).  In the instant case, because the employee is not precluded from bringing a claim for the withheld attorney fees, vacation of the fee order is not necessary.

 

Finally, in the January 14, 2008, partial stipulation for settlement, the parties suggested that this court make a Afinal determination on the source of fees and how to resolve the issue of the disbursal of all withheld fees.@  However, while Minn. Stat. ' 176.081, subd. 3, gives this court the authority to review attorney fees at any time, there is virtually no record here.  There is no testimony from the attorneys as to their intention in agreeing to the order for fees, and the imaged documents contain conflicting information.  For instance, the July 2, 2007, order determining attorney fees indicates that the sum of $3,172.82 in attorney fees was withheld, but the May 29, 2007, notice of benefit payment indicates that the sum of $3,172.82 in attorney fees was paid.  We therefore decline to make a determination as to disbursement of withheld attorney fees.  If the parties cannot reach agreement, an evidentiary hearing on the matter may be required.  In any event, the petition to vacate is denied.

 

 


[1] See Gillette v. Harold, Inc., 257 Minn. 313, 101 N.W.2d 200, 21 W.C.D. 105 (1960).

[2] That objection was filed with the Office of Administrative Hearings.  All filings with regard to petitions to vacate should be made with the Workers= Compensation Court of Appeals.