JANET HUFNAGEL, Employee/Appellant, v. DEER RIVER HEALTH CARE CTR. and MHA INS. CO., Employer-Insurer/Respondents and ESSENTIA HEALTH and BERKLEY RISK, Employer-Insurer/Respondents.

The attorney fee award in the underlying litigation was heard before this court on a prior appeal.  After remand, the compensation judge awarded both Roraff/Irwin attorney fees and fees under Minn. Stat. § 176.191, subd. 1 (.191 fees).^[1]  The employee’s counsel appeals, claiming the amount of Roraff/Irwin fees and .191 fees awarded is inadequate and the compensation judge committed legal and procedural errors.  We affirm the attorney fee award.

The underlying facts of this matter were set out in this court’s earlier decision, Hufnagel v. Deer River Health Care Ctr., 78 W.C.D. 419 (W.C.C.A. 2017), and in that of the Minnesota Supreme Court, Hufnagel v. Deer River Health Care Ctr., 915 N.W.2d 747, 78 W.C.D. 431 (Minn. 2018).  In an unappealed October 27, 2016, Findings and Order, the compensation judge found that the employee’s work injuries of June 22, 2009, August 14, 2014, and June 10, 2015, were substantial contributing causes of the need for the claimed medical care, but that Essentia was solely responsible for payment.  Essentia Health (Essentia) had claimed that the entirety of the need for medical care arose from the employee’s 2009 work injury while employed by Deer River Health Care (Deer River).  The employee’s attorney filed a statement of attorney fees with the compensation judge requesting compensation for a total of 78.15 hours, including $31,120.47 in excess Roraff fees.  The judge found that the employee’s counsel had obtained indemnity benefits of at least $10,444.33 on behalf of his client, was entitled to contingent fees of $2,088.87, and was entitled to an additional $8,000.00 in excess Roraff/Irwin attorney fees, all from the 2014 and 2015 dates of injury.  Those amounts were awarded.  No award was made for .191 fees.

Counsel for employee appealed to this court.  The matter was remanded to the compensation judge for consideration of both Roraff/Irwin fees and .191 fees.  Respondent Essentia appealed the decision to the Minnesota Supreme Court, which affirmed by order issued July 18, 2018.  Following the affirmance, the employee’s counsel settled all outstanding attorney fee issues with Deer River by stipulation, approved on September 11, 2018.  The employee’s counsel received a payment of $7,250.00 under the stipulation.  Deer River took no further part in the proceedings.

On remand, a pretrial conference was conducted by telephone before the compensation judge.  The pretrial statement of Essentia indicated that no new evidence would be presented.  The pretrial statement of the employee’s counsel indicated that in addition to the remanded issues, additional attorney fees would be sought for litigating the attorney fee issue.  The employee would present new evidence of the amounts paid to Eric Deal, M.D., the independent medical expert for Essentia.  That information was sought by way of discovery, objected to by Essentia.

At the pretrial conference, the employee’s counsel identified the issues as: 1) appropriate Roraff/Irwin fees; 2) appropriate .191 fees; 3) possible apportionment of .191 fees; 4) attorney fees payable for litigating the attorney fee issues; and 5) discovery issues.  Essentia responded that the discovery was objected to as irrelevant to the issues of the proceeding.  Essentia requested that no evidentiary hearing be held.  The employee’s counsel subsequently requested that Essentia provide an accounting of the time spent on the case by Essentia’s counsel.  There is no indication in the appeal record that this information was provided or that the request for an accounting of counsel’s time was brought to the attention of the compensation judge.

The compensation judge did not conduct an evidentiary hearing.  By Findings and Order on Remand, served and filed on March 6, 2019, the judge awarded contingent fees ($2,088.87 and $653.37), Roraff/Irwin fees ($12,000.00, apportioned equally between Deer River and Essentia), and .191 fees ($12,000.00 to be paid jointly by Deer River and Essentia).  The employee’s counsel appeals the most recent award as insufficient under prior decisions of this court and the Minnesota Supreme Court.  The employee’s counsel maintains that the judge made a fundamental error of law by apportioning the Roraff fee award between Essentia and Deer River.  The employee’s counsel also maintains that the compensation judge committed errors of law by not allowing discovery of the amount paid to the independent medical examiner and not conducting an evidentiary hearing on remand.

On appeal, the Workers’ Compensation Court of Appeals must determine whether “the findings of fact and order [are] clearly erroneous and unsupported by substantial evidence in view of the entire record as submitted.”  Minn. Stat. § 176.421, subd. 1(3).  Substantial evidence supports the findings if, in the context of the entire record, “they are supported by evidence that a reasonable mind might accept as adequate.”  Hengemuhle v. Long Prairie Jaycees, 358 N.W.2d 54, 59, 37 W.C.D. 235, 239 (Minn. 1984).  Where evidence conflicts or more than one inference may reasonably be drawn from the evidence, the findings are to be affirmed.  Id. at 60, 37 W.C.D. at 240.  Similarly, findings of fact should not be disturbed, even though the reviewing court might disagree with them, “unless they are clearly erroneous in the sense that they are manifestly contrary to the weight of evidence or not reasonably supported by the evidence as a whole.”  Northern States Power Co. v. Lyon Food Prods., Inc., 304 Minn. 196, 201, 229 N.W.2d 521, 524 (1975).

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).

On appeal, employee’s counsel contends that he was not adequately compensated by the award of Roraff fees and .191 fees.  He billed 78.15 hours, at hourly rates stipulated to be reasonable by the parties, totaling a fee claim of $33,750.00.  The compensation judge awarded a total of $26,742.24 for contingent attorney fees, Roraff/Irwin fees, and .191 fees.

What constitutes a reasonable attorney fee is a factual determination of the compensation judge.  Lucking v. EPC Loudon/Cookson Plastic Molding Corp., slip op. (W.C.C.A. Sept. 26, 2001).  Excess fee awards may be challenged where the Irwin factors are not properly applied, or where the compensation judge committed an abuse of discretion.  Johnson v. VCI Asbestos Abatement, 65 W.C.D. 547, 550 (W.C.C.A. 2005); John v. Suburban Air Conditioning, 62 W.C.D. 285 (W.C.C.A. 2002).

The employee’s counsel has not identified any Irwin factor not addressed by the compensation judge.  Rather, the employee’s arguments go to the weight given those factors by the compensation judge.  This court has examined the record and has not identified any determination that is unsupported by facts in the record.  The compensation judge properly applied the Irwin factors to arrive at the excess fees awarded.  The alternative ground to challenge an award is abuse of discretion, which occurs when a judge makes “an erroneous legal conclusion or a clearly erroneous factual conclusion.”  Ansello v. Wis. Cent., Ltd., 900 N.W.2d 167, 173, 77 W.C.D. 721, 729 (Minn. 2017).  We conclude that the compensation judge’s factual determinations and application of the Irwin factors are not clearly erroneous, and therefore, the compensation judge did not abuse his discretion in awarding excess Roraff/Irwin fees in the amount of $12,000.00.

The employee’s counsel contends that the prior appellate decisions in this case establish a separate standard of “adequate compensation” which can only be met by awarding the entire amount billed for time spent on this case.  There is no case law that removes the application of the Irwin factors from the proper determination of attorney fees.  We find no support for the assertion that the amount billed must be the amount awarded.

The compensation judge awarded excess Roraff fees in the amount of $12,000.00, apportioned equally between Deer River and Essentia.  The employee’s counsel contends that, as Deer River was not responsible for any of the medical benefits awarded, apportionment is an error of law.  Essentia responded that none of the cases cited in support of this argument actually address apportionment of fees.

This case presents an extraordinary situation regarding calculation of attorney fees.  The three work injuries suffered by the employee while working for the two employers were found to be substantial contributing causes for the employee’s medical care.  Roraff fees and .191 fees were determined to be appropriate and both were awarded.  The employee’s counsel voluntarily settled with Deer River for a larger sum than the Roraff fee apportioned to Deer River.  As argued before the compensation judge, the issues were closely intertwined, and the effort required of counsel was similarly mingled.^[2]  Under these circumstances, this court concludes that there was no error of law in apportioning the excess Roraff fee award between Deer River and Essentia.

On remand, the employee’s counsel requested an evidentiary hearing on the attorney fees to be awarded.  The compensation judge issued his award of attorney fees without a hearing.  The employee’s counsel argues that this is an independent basis for vacating the attorney fee award and remanding the matter to the compensation judge.

Where a case is remanded to the compensation judge for reconsideration of the evidence under identified principles of law, whether to accept additional testimony and argument is within the judge’s discretion.  Matykiewicz v. General Tire Co., 69 W.C.D. 272 (W.C.C.A. 2009); see also Manthei v. Layne Minn. Co., No. WC07-267 (W.C.C.A. Jun. 30, 2008) (additional argument at judge’s discretion).

Employee’s counsel identified two new issues to the compensation judge: 1) seeking attorney fees for litigating the ongoing attorney fee issues, and 2) obtaining discovery of the amounts paid to Dr. Deal for his independent medical examination.  The first issue is beyond the scope of this court’s remand.  While the issues could be expanded by agreement of the parties, Essentia did not agree.  There has been no showing how the cost of Dr. Deal’s examination is relevant to the issue of reasonable attorney fees.  We conclude the compensation judge did not abuse his discretion in declining to conduct an evidentiary hearing on these issues in this case.  The award of attorney fees is affirmed.