LISA A . CURRY, ET AL . V TOYOTA MOTOR MANUFACTURING KY, INC . ; WORKERS' COMPENSATION FUNDS, SUCCESSOR TO SPECIAL FUND ; HON . JAMES L . KERR, ADMINISTRATIVE LAW JUDGE ; AND WORKERS' COMPENSATION BOARD
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RENDERED : November 21,,2002
TO BE PUBLISH D
_' .
2002-SC-0288-WC
LISA A. CURRY, ET AL .
V
APPEAL FROM COURT OF APPEALS
2001-CA-2759-WC
WORKERS' COMPENSATION BOARD NO. 95-34095
TOYOTA MOTOR MANUFACTURING KY, INC . ;
WORKERS' COMPENSATION FUNDS,
SUCCESSOR TO SPECIAL FUND;
HON . JAMES L . KERR, ADMINISTRATIVE LAW JUDGE;
AND WORKERS' COMPENSATION BOARD
APPELLEES
OPINION OF THE COURT
AFFIRMING
An injured worker's attorney appeals decisions that limited his fee to $15,000 for
both effecting a settlement with the employer and successfully litigating the claim for a
1995 injury against the Special Fund. Although he maintains that KRS 342 .320(1)
authorized a separate $15,000 fee for obtaining a recovery from each defendant, we
have concluded that the statute authorized only one attorney fee for the entire recovery .
Hence, we affirm .
On July 19, 1995, the claimant sustained a work-related injury to her head and
spine when a station wagon hatch door hit her on the head . She later filed an
application for benefits wherein she named both the employer and Special Fund as
defendants . The matter was held in abeyance for a period of time pending settlement
negotiations with the employer but was assigned to an Arbitrator early in 2000, when an
agreement failed to materialize . Proof-taking began, and the matter was later
transferred to an Administrative Law Judge (ALJ) . In December, 2000, after the parties
finished taking proof and after the pre-hearing conference was conducted, the claimant
and her employer agreed to settle the matter for a substantial lump sum and periodic
payments for life . The claimant's attorney then submitted the agreement for approval
and requested a fee of $15,000 from the recovery, detailing the services that he had
provided from November 8, 1995, through December 27, 2000 . Noting that the claim
was practiced with a high degree of skill and that an excellent result was achieved, the
ALJ approved the requested fee. Consistent with the claimant's Form 109 election, it
was deducted from the lump sum payment .
In May, 2001, the remainder of the claim was heard, and the ALJ rendered an
opinion that awarded the claimant a total disability, half of which was apportioned to the
Special Fund . The claimant's attorney then requested a fee of $15,000 from the
recovery against the Special Fund, accompanying his motion with a detailed list of the
services that he had provided from November 8, 1995, through July 2, 2001, and a
Form 109 in which the claimant indicated that she wished to pay the fee out of past-due
benefits . Denying both the motion and the attorney's subsequent petition for
reconsideration, the ALJ noted that the attorney had already received the maximum fee
that was permitted under KRS 342.320(1) and was not entitled to a second fee . Having
failed to convince either the Workers' Compensation Board (Board) or the Court of
Appeals that the decision was erroneous as a matter of law, the attorney appeals .
As effective April 4, 1994, KRS 342 .320 provided, in pertinent part, as follows:
(1) All fees of attorneys . . . shall be subject to the approval
of the administrative law judge . . . . In an original claim, no
attorney's fees shall be allowed or approved against any
party not represented by an attorney, nor shall any
attorney's fee be allowed or approved exceeding an amount
equal to twenty percent (20%) of the first twenty-five
thousand dollars ($25,000), fifteen percent (15%) of the next
ten thousand dollars ($10,000), and five percent (5%) of the
remainder of the amount recovered . . . . However, in no
event shall the attorney's fee exceed fifteen thousand dollars
($15,000) . . . .
(2) No attorney's fee in any case involving benefits under
this chapter shall be paid until the fee is approved by the
administrative law judge, and any contract for the payment
of attorney's fees otherwise than as provided in this section
shall be void . The motion for approval of an attorney's fee
shall be submitted within thirty (30) days following finality of
the last appealable order of the administrative law judge . . . .
The Court of Appeals determined that the claimant "had only one injury and one
claim" and concluded, therefore, that the attorney was entitled to only one maximum
fee. Emphasizing that he provided approximately 307 .74 hours to achieve the two
separate awards, the attorney asserts that what this appeal truly concerns is "the
reasonable amount of an attorney fee for a second proceeding and second amount
recovered ." Relying on Lamb v. Fuller , Ky.App ., 32 S.W.3d 518 (2000), he maintains
that although only one claim was filed, the permissible fee under KRS 342.320(1) is the
stated percentage of each recovery, up to a maximum of $15,000 per recovery .
We are not persuaded that Lamb v. Fuller, supra, controls these facts. There,
the worker was injured in four discrete incidents over a period of more than four years
but filed a single Form 101 application wherein she alleged an injury from each of the
incidents and also from cumulative trauma . She later reached an agreement with the
employer and the Special Fund by which she would receive a lump sum for total
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disability resulting from the last two incidents . The agreement indicated that the claim
for each of the two incidents had been compromised for half of the sum and, therefore,
the worker's attorney requested two separate fees, one for the recovery from each
incident. Concluding that the outcome should not be affected by the fact that the
worker had filed only one Form 101, the Court determined that because the agreement
resolved two separate claims, the attorney was entitled to a fee for the recovery on
each claim. Even if we were to agree with Lamb v. Fuller , supra , which is a Court of
Appeals decision, it implied no more than that KRS 342.320(1) authorized an attorney
fee based upon the recovery for each incident, without regard to whether a separate
.
Form 101 was filed for each .
Although the claimant's Form 101 named both the employer and the Special
Fund as parties-defendant, it alleged that she was injured as a result of only one
incident . Attempting to justify two fees, the attorney maintains that he expended many
hours "in two separate litigations at different times for the two separate recoveries ." It is
apparent from the record, however, that the agreement with the employer was not
reached until after the pre-hearing conference, at which point the proof had closed with
the exception of the hearing . To bolster his argument, the attorney maintains that he
expended approximately 307.74 hours on the entire matter . Yet, the itemized
statements that appear in the two attorney fee motions are identical up until December
27, 2000, and the vast majority of those 307 .74 hours were used to justify the fee that
he requested from the recovery against the employer. Of the total, only 38.51 hours
were expended after that point, and several of the notations related to actions taken
with regard to wrapping up the settlement. More important, however, is the fact that
Chapter 342 clearly considers the claims against an employer and the Special Fund to
be parts of a whole rather than separate claims that may be prosecuted separately.
This is evidenced by KRS 342 .120(4) which, at the time of the claimant's accident,
provided that the Special Fund must be named as a party to the proceedings against
the employer as soon as practicable or any recovery against it was barred .
Finally, the attorney maintains that there would be no incentive for an attorney to
prosecute a claim against a second defendant after effecting a settlement with the first
if no additional fee were permitted . We note, however, that aside from possible ethical
and legal consequences to the attorney for failing to do so, an attorney fee motion is
premature under KRS 342.320(2) until finality of the ALJ's last appealable order. Thus,
where there are multiple defendants, an attorney fee award is premature until after the
extent of all defendants' liability has been resolved . In any event, this attorney did
prosecute the claim against the Special Fund after being awarded a fee from the
settlement proceeds, so we will address the matter no further .
Just as KRS 342.730 limited a worker's recovery from all defendants to the
maximum benefit for permanent, total disability, KRS 342.320 limited the worker's
attorney fee in an original claim to a maximum of $15,000 . Although the claimant
named two defendants, she had only one claim for the effects of the work-related
accident, and her attorney has already been awarded the maximum fee out of the
settlement proceeds. Under those circumstances, we are persuaded that the ALJ
properly denied his motion for another $15,000 fee.
The decision of the Court of Appeals is affirmed.
All concur.
COUNSEL FOR APPELLANT:
Michael C. Arnold
328 Thomas More Parkway
Crestview Hills, KY 41017
COUNSEL FOR APPELLEE,
TOYOTA MOTOR MANUFACTURING, KY, INC. :
H . Douglas Jones
H. Douglas Jones & Associates, PLLC
51 Cavalier Blvd ., Ste. 260
P .O . Box 0095
Florence, KY 41022-0095
COUNSEL FOR APPELLEE,
SPECIAL FUND :
John William Burrell
David W. Barr
Kentucky Labor Cabinet
1047 US Highway 127 South
Suite 4
Frankfort, KY 40601
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