Opinion
CLAIM NO. F100768
OPINION FILED MARCH 5, 2008
Upon review before the FULL COMMISSION in Little Rock, Pulaski County, Arkansas.
Claimant represented by the Honorable Gary Davis, Attorney at Law, Little Rock, Arkansas.
Respondents No. 1 represented by the Honorable Michael E. Ryburn, Attorney at Law, Little Rock, Arkansas.
Respondent No. 2 represented by the Honorable Judy W. Rudd, Attorney at Law, Little Rock, Arkansas.
Decision of Administrative Law Judge: Affirmed in part, reversed in part.
OPINION AND ORDER
Respondent No. 1 appeals an administrative law judge's opinion filed August 20, 2007. The administrative law judge ordered Respondent No. 1 to pay both Respondent No. 1's portion and the claimant's portion of lump-sum attorney's fees. After reviewing the entire record de novo, the Full Commission affirms in part and reverses in part. The Full Commission affirms the administrative law judge's finding that Respondent No. 1 shall pay its portion of the attorney's fee in lump sum. We reverse the administrative law judge's finding that Respondent No. 1 shall also pay the claimant's portion of the attorney's fee in lump sum.
The parties stipulated that the claimant sustained a compensable injury on May 30, 2000. The parties stipulated that the weekly compensation rate for permanent total disability was $394.00. In an opinion filed August 25, 2005, the administrative law judge found that the claimant was permanently totally disabled. The Full Commission affirmed and adopted the administrative law judge's decision.
Ark. Code Ann. § 11-9-715(Repl. 1996) provides:
(a)(1)(A) Fees for legal services rendered in respect of a claim shall not be valid unless approved by the Workers' Compensation Commission. . . .
(2)(B)(i) In all other cases whenever the commission finds that a claim has been controverted, in whole or in part, the commission shall direct that fees for legal services be paid to the attorney for the claimant as follows: One-half (½) by the employer or carrier in addition to compensation awarded; and one-half (½) by the injured employee or dependents of a deceased employee out of compensation payable to them. . . .
Ark. Code Ann. § 11-9-716 provides:
(a) The Workers' Compensation Commission is authorized to approve lump-sum attorney's fees for legal services rendered in respect of a claim before the commission.
(b) The lump-sum attorney's fees are allowable notwithstanding that the award of compensation to the injured employee is to be paid on an installment basis.
(c) Lump-sum attorney's fees, if approved by the commission, shall be discounted at the rate provided in § 11-9-804, as that provision may be amended from time to time.
The administrative law judge found, in pertinent part:
2. On May 30, 2000, the claimant sustained a compensable injury in his employment with respondents #1 which rendered his (sic) permanently and totally disabled and correspondingly entitled to permanent total disability at the weekly compensation benefit rate of $394.00.
3. The petition of claimant's attorney for the payment of lump-sum attorney fees pursuant to Ark. Code Ann. § 11-9-716 is reasonable and appropriate. Respondent #1 shall pay to the claimant's attorney the sum of $9,300.09, representing its portion of the discounted attorney fees.
4. Respondent #1 shall pay to the claimant's attorney the sum of $9,300.05, representing the claimant's portion of the lump-sum attorney fees at the discounted rate, pursuant to Ark. Code Ann. § 11-9-716. Respondent #2 shall reimburse
Respondent #1 from the claimant's installments at the rate of $5.93, per week, until such time as Respondent #1 has been fully reimbursed.
Respondent No 1 appeals to the Full Commission. Respondent No. 1 states on appeal that it has complied with the administrative law judge's finding that Respondent No. 1 should pay its portion of the discounted attorney's fees. Respondent No. 1 contends that the administrative law judge erred in ordering Respondent No. 1 to also pay the claimant's portion of attorney's fees in lump sum. We agree. Respondent No. 1 is not required to pay the claimant's portion of fees for legal services in a lump sum. See, Ark. Code Ann. § 11-9-715(a)(2)(B)(i), supra. See also Seward v. Bud Avants Co., 65 Ark. App. 88, 985 S.W.2d 332 (1999). The Death and Permanent Total Disability Trust Fund informs the Commission that it began paying benefits after Respondent No. 1 payed its statutory limit of permanent total disability benefits. The Fund further states, "The Claimant's portion of the attorney fee is currently being withheld from the Claimant's bi-weekly benefits which are paid by the Death and Permanent Total Disability Trust Fund (hereinafter referred to as the Trust Fund) and remitted to the Claimant's attorney." There is nothing in Ark. Code Ann. § 11-9-716 that requires the Commission to approve a lump-sum payment of the entire amount of an attorney's fee or that prohibits the Commission from approving a plan by which an attorney's fee is paid partly by lump sum and partly in installments. See, Seward, supra.
Based on our de novo review of the entire record, the Full Commission affirms the administrative law judge's finding that Respondent No. 1 shall pay its portion of the discounted attorney's fee in lump sum. We reverse the administrative law judge's finding that Respondent No. 1 shall also pay the claimant's portion of the attorney's fee in lump sum.
IT IS SO ORDERED.
____________________________ OLAN W. REEVES, Chairman
____________________________ KAREN H. McKINNEY, Commissioner
CONCURRING DISSENTING OPINION
I must respectfully concur in part and dissent in part from the majority's opinion. Specifically, I agree with the majority's determination that Respondent No. 1 should pay its portion of the discounted attorney fees. However, I respectfully dissent from the majority's determination that as Ark. Code Ann. § 11-9-715 and Ark. Code Ann. § 11-9-716 do not require Respondent No. 1 to pay the claimant's portion of fees for legal services in a lump sum, that Respondent No. 1 should not be ordered to pay the claimant's portion of fees for legal services in a lump sum. Based upon a de novo review of the record in its entirety, I find that Ark. Code Ann. § 11-9-715 and Ark. Code Ann. § 11-9-716 do not prohibit the Commission from approving a lump-sum payment of the entire amount of an attorney's fee by Respondent No. 1. I find that as the claimant has requested a lump-sum attorney fee payment, and as the legislature and the Courts have specifically stated that the attorney fee statutes were enacted to benefit the claimant, the majority has erred by not approving the claimant's request. Therefore, I must respectfully dissent from the majority on this issue.
The Court of Appeals stated in Seward v. Bud Avants Co. 65 Ark. App. 88, 985 S.W.2d 332 (1999) that there is nothing in Ark. Code Ann. § 11-9-716 that requires the Commission to approve a lump-sum payment of the entire amount of an attorney's fee or that prohibits the Commission from approving a plan by which an attorney's fee is paid partly by lump sum and partly in installments. Accordingly, I find that there is nothing in Ark. Code Ann. § 11-9-716 that prohibits the Commission from approving a plan by which an attorney's fee is paid wholly by lump sum.
Attorney's fees in Workers' Compensation cases are provided by statute in Arkansas as a matter of public policy to enable injured workers to obtain the services of an attorney in settlement of controverted claims.Aluminum Co. of Am. v. Neal, 4 Ark. App. 11, 626 S.W.2d 620 (1982). The Court held in Aluminum Co. of Am.v Neal, 4 Ark. App. 11, 626 S.W.2d 620 (1982) that the General Assembly enacted § 11-9-716 to remedy the problem of attorneys failing to receive full payment for their services to a workers' compensation claimant or beneficiary, where the attorney received his compensation installments on the same schedule that benefits were paid to the recipient but where the claimant or beneficiary died or remarried prior to the attorney's receipt of the total fees awarded to him. Aluminum Co. of Am. v. Neal, 4 Ark. App. 11, 626 S.W.2d 620 (1982).
Furthermore, the Court held in International Paper Co. v. McBride, 12 Ark. App. 400, 678 S.W.2d 375 (1984), that Ark. Code Ann. § 11-9-716 and Ark. Code Ann. § 11-9-715 were intended to be read together as the legislature felt strongly that the commission should be able to award lump-sum attorneys' fees. International Paper Co. v. McBride, 12 Ark. App. 400, 678 S.W.2d 375 (1984).
Here, I find that there is no statutory prohibition on the Commission approving the lump sum agreement proposed to and approved by the Administrative Law Judge. I find that as the legislative intent behind Ark. Code Ann. § 11-9-715 and § 11-9-716 is to enable the claimant to find an attorney, and to allow the claimant's attorney to get paid, not to provide the insurance carrier with a more convenient means of paying attorney fees at a discount, I find that Respondent No. 1 should pay the claimant's portion of the attorney fee, at a discount, with Respondent No. 2 paying Respondent No. 1 back over time. The only party arguably inconvenienced by the Commission's approval of such a lump sum payment arrangement is Respondent No. 1, but again, as the purpose of the attorney fee statutes is not to provide discounts and convenience to the respondent, but to enable claimants to find attorneys and for claimants' attorneys to get paid, I find that legislative intent must prevail over Respondent No. 1's "inconvenience," especially as Respondent No. 2 has not objected to the claimant's request.
For the aforementioned reasons, I must respectfully dissent.
____________________________ PHILIP A. HOOD, Commissioner