GERALD GRACE, Employee/Respondent, v. SMITH FOUNDRY CO., and TRIFAC WORKERS’ COMP. FUND/MACKINAW ADM’RS, LLC (F/K/A MEADOWBROOK), Self-Insured Employer/Appellants.

The self-insured employer appeals from the compensation judge’s award of Roraff and Irwin^[1] fees.  We affirm.

In 2015, the employee, Gerald Grace, suffered a personal injury to his left upper extremity while working for the employer, Smith Foundry Company.  The employee later claimed that the 2015 work incident caused injury to his cervical spine for which he sought workers’ compensation benefits.  That claim was denied by a compensation judge, whose findings were affirmed by this court.^[2]  With the assistance of attorney James Hansing, the employee then claimed further injury in the nature of thoracic outlet syndrome as a result of the 2015 work incident.  In a Findings and Order served and filed on February 19, 2020, a compensation judge found that injury compensable and awarded various benefits, including wage loss benefits, causally related medical benefits, a rehabilitation consultation, and a change in physician.  The employee’s claim for permanent partial disability benefits was denied.

The employee’s attorney then filed a statement of attorney fees seeking payment of contingent fees in the amount of $8,786.11, excess fees in the amount of $26,000.00, taxable costs and disbursements, and partial fee reimbursement to his client under Minn. Stat. § 176.081, subd. 7.  The compensation judge awarded a combined total fee of $26,000.00, a portion of the claimed taxable costs and disbursements, and a portion of the subdivision 7 reimbursement claim.  The self-insured employer appealed the award of the Roraff/Irwin portion of this fee, and the employee cross-appealed the partial denial of his claim for taxable costs and disbursements.  In a decision dated January 12, 2021, this court affirmed part of the compensation judge’s award, but vacated the excess fee award and remanded the issue for determination without consideration of potential future benefits.^[3]

On remand, the compensation judge concluded that no additional evidentiary hearing was needed but accepted written arguments from the parties.  She issued her Findings and Order on Remand on March 26, 2021.  The compensation judge found that the $8,786.11, which had been withheld as contingent fees, was inadequate to compensate Mr. Hansing for his representation of the employee.  The judge found that by application of the Irwin factors, Mr. Hansing is entitled to an excess fee of $10,213.89, for a total attorney fee award of $19,000.00.  The self-insured employer appeals.

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.”^[4]  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.”^[5]  Where evidence conflicts or more than one inference may reasonably be drawn from the evidence, the findings are to be affirmed.^[6]  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.”^[7]

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.^[8]

On appeal, the self-insured employer asserts that the compensation judge erred in concluding that the contingent fees were insufficient and that awarding more than $10,000.00 in Roraff/Irwin fees to the employee’s attorney was an abuse of discretion.

Minnesota Statutes section 176.081 provides for a contingent fee to an employee’s attorney based upon the compensation awarded to the employee.  The amount of the fee is presumed to be adequate.^[9]  However, where the contingent fee is found by a compensation judge to be inadequate to reasonably compensate the attorney, the attorney may petition for an award of additional fees.  In circumstances where there is a potential for both contingent fees, paid out of the employee’s benefits, and Roraff or Heaton fees, paid by the employer and insurer, any fee beyond the contingent fee “shall be assessed against the employer and insurer only if the [employee’s] attorney establishes that the contingent fee is inadequate to reasonably compensate the attorney for representing the employee in the medical or rehabilitation dispute.”^[10]  In determining whether a contingent fee is inadequate, a compensation judge must consider the statutory guidelines together with seven Irwin factors, which are: “the amount involved, the time and expense necessary to prepare for trial, the responsibility assumed by counsel, the expertise of counsel, the difficulties of the issues, the nature of proof involved, and the results obtained.”^[11]

In its arguments before the compensation judge and on appeal, the self-insured employer suggests that the amount of the attorney fee award should be dictated wholly by the results obtained.  It asserts that the fee awarded here is excessive because the employee did not prevail on all claims, because the award is disproportionate to the wage loss and medical benefits recovered, and because the rehabilitation consultation and change of physician that were approved have yet to be “recovered.”  According to the self-insured employer, the Roraff/Irwin fee should not exceed the amount of medical benefits recovered.

It is clear from the compensation judge’s decision that she considered the self-insured employer’s arguments and gave significant attention to the extent of the results obtained.  As was required, the compensation judge considered all factors set forth in Irwin in determining whether the contingent fee reasonably compensated Mr. Hansing, and in determining the amount of the Roraff/Irwin fee to award.^[12]  The compensation judge was uniquely situated to determine what weight to give each factor.^[13]  The compensation judge gave the most weight among the factors to the difficulty of the issues.  She noted that considerable time, effort, and expense had been required in developing a new theory of the case that established liability for the thoracic outlet syndrome and in proving a causal link between that condition and the employee’s work injury.  Absent these efforts, the employee would not have recovered any of the benefits awarded to him.

The compensation judge weighed all of the Irwin factors and determined that the contingent fee was inadequate, and that Mr. Hansing was entitled to a Roraff/Irwin fee in the amount of $10,213.89.  This court will not reverse an award or denial of attorney fees absent an abuse of discretion.^[14]  As we have previously noted, “[t]he compensation judge abuses his or her discretion only when the award of fees is based upon a clearly erroneous conclusion given the record.”^[15]  Her excess fee determination was reasonable given the facts of this case, and absent an abuse of discretion, we affirm.