Aetna Casualty & Surety Co. v. Rodriguez

399 A.2d 1289, 1979 Del. LEXIS 385
CourtSupreme Court of Delaware
DecidedMarch 12, 1979
StatusPublished
Cited by3 cases

This text of 399 A.2d 1289 (Aetna Casualty & Surety Co. v. Rodriguez) is published on Counsel Stack Legal Research, covering Supreme Court of Delaware primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Aetna Casualty & Surety Co. v. Rodriguez, 399 A.2d 1289, 1979 Del. LEXIS 385 (Del. 1979).

Opinion

HORSEY, Justice:

This is an appeal from a decision and order of the Superior Court allowing attorney’s fees to claimants’ attorney for services on appeal from the Industrial Accident Board to be taxed as costs against certain employers and carriers under 19 Del.C. § 2350(f). The issues on appeal1 are (1) whether under the facts a fee is allowable under 19 Del.C. § 2350(f) and (2) reasonableness of the fee award of $45,000. The employers and insurers appeal as to both questions. The claimants appeal as to the [1290]*1290second question, contending the fee award was insufficient. We find the statutory prerequisites for the allowance of attorneys’ fees under 19 Del.C. § 2350(f) not to have been met under the facts of this case, and therefore we reverse.

I

The pertinent history of this case is set forth in several prior reported opinions. All American Engineering Company v. Price, et. al., Del.Super., No. 5222 C.A.1972 (unreported), reversed and remanded, Del.Supr., 320 A.2d 336 (1974); All American Engineering Company v. Price, Del.Super., 348 A.2d 333 (1975); Hope’s Suburban Garage v. Hope, Del.Super., 348 A.2d 336 (1975); and Price v. All American Engineering Company, Del.Super., No. 5222 C.A.1971 (unreported-1978).

However, some history of this case is necessary for an understanding of the disposition of this appeal. The legal services rendered by claimants’ attorney related to 1971 legislation increasing workmen’s compensation benefits for employees who were totally disabled before the law’s effective date. (58 Laws of Delaware, Ch. 96, as amended by 58 Laws of Delaware, Ch. 311, codified in 19 Del.C. § 2334, hereafter sometimes referred to as the “Act”.) A disabled person, David E. Price, then made application to the Industrial Accident Board for benefits under the Act; and the Board, after hearing and over the employer-insurer’s objection, granted Price the benefits provided by the Act.

The Price decision was appealed to the Superior Court on the sole ground that the Act’s retroactive benefits were unconstitutional. While the appeal was pending and before decision, 42 other claimants filed motions with the Board for supplemental benefits under the Act; and the Board, over objections of the employer-insurers affected, claiming lack of due notice and opportunity for a full hearing, entered orders on the motions granting supplemental benefits to each of the claimants, some 35 of whom were represented by the attorney whose fee for appellate services is in question.2 The employers-insurers in each of the 42 cases filed appeals with the Superior Court on multiple grounds of (1) lack of procedural due process; (2) the constitutionality of the Act; and (3) the reasonableness of the fee allowances for services before the Board. The cases were then consolidated with the Price appeal.

The Superior Court held the Act to be unconstitutional. All American Engineering Company v. Price, et. al., Del.Super., No. 5222 C.A.1972 (unreported). On appeal, this Court held the Act to be constitutional but held, “. . .it was reversible error for the Board to act under [19 Del.C. § 2334] without due notice and opportunity [of the employers-insurers] to be heard. . ” Price v. All American Engineering Company, supra, 320 A.2d at 342. The effect of this Court’s decision was to nullify the Board’s proceedings as to the award of supplemental disability benefits in all of the 43 cases but the one involving Price. However, following remand of the cases to the Board, no further hearings were held by the Board concerning the 42 applicants for supplemental disability benefits under the Act. Rather, all of said claims for supplemental disability benefits were resolved by settlement agreements reached between the parties. See All American Engineering Company v. Price, supra, 348 A.2d at 335.

II

Following settlement of these claims, counsel for claimants in the 43 cases consolidated on appeal petitioned the Superior Court for allowance of attorneys’ fees under 19 Del.C. § 2350(f) for their services on appeal from the Board. Counsel also con[1291]*1291currently filed with the Board applications for attorneys’ fees for services before the Board under 19 Del.C. § 2127(a). They did so as a result of this Court’s advice in Price that the prior fee allowances by the Board in its 1971 orders of up to $2,250 per case should be reconsidered in light of the reversal and remand for lack of procedural due process.3 (320 A.2d at 342).

The revised counsel fee award under § 2127(a) for services before the Board was appealed to the Superior Court and decided at the same time that the Court decided the question of the allowance of attorney’s fees under § 2350(f) for services on appeal. As to the former, the Court reversed the Board’s award, stating that the “. right of a claimant to assess his employer with his attorney’s fee is statutory . that the statute predicates a fee award on an employee having been “awarded compensation”; and that no award had been made by the Board inasmuch as the cases had been settled by the parties. The Court also referred to Board Rule No. 24(A), stating that § 2127 had no application where a case is settled without formal hearing. Hence, the Court concluded that the claimants were ineligible for the awarding of attorney’s fees under § 2127(a). Hope’s Suburban Garage v. Hope, supra, 348 A.2d 336.

Ill

However, on the question of the allowance of counsel fees for services on appeal under § 2350(f), the Court ruled that counsel fees were allowed. All American Engineering Company v. Price, supra, 348 A.2d 333. The Court reasoned that since this Court had held the Act to be constitutional, the claimants had, in essence, “prevailed” before the Board, even though the Board’s proceedings had been held to be in violation of procedural due process. While the Court acknowledged that a “literal reading” of § 2350(f) might result in denial of a fee allowance, such denial would defeat the purpose of the statute, namely, “. to prevent the depletion of awards granted by the Board by fees generated by the appeal of such awards by employers where the award granted is ultimately upheld on appeal”. (348 A.2d at 335). The Court concluded that by reason of this Court’s finding of the Act to be constitutional, this Court thereby “. . . endorsed the action of the Board . . .” and thus, in effect, “affirmed on appeal” within the meaning of § 2350(f).

IV

The Superior Court has misconstrued our 1974 ruling in Price; for this Court expressly disapproved the Board’s actions in granting supplemental benefits without complying with the notice and hearing requirements of 19 Del.C. § 2345 and § 2347. For that reason, the Board’s compensation awards were reversed as to all claimants but Price and the cases remanded for new hearings.

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399 A.2d 1289, 1979 Del. LEXIS 385, Counsel Stack Legal Research, https://law.counselstack.com/opinion/aetna-casualty-surety-co-v-rodriguez-del-1979.