Cannon v. Catalytic, Inc.

617 N.E.2d 693, 84 Ohio App. 3d 488, 1992 Ohio App. LEXIS 6537

• Court: Ohio Court of Appeals
• Decided: December 22, 1992
• Docket: No. 91 CA 2023.
• Status: Published

Opinions

Peter B. Abele, Judge.

This is an appeal from a Scioto County Common Pleas Court judgment ordering Catalytic, Inc, defendant below and appellant herein, to pay $2,500 for attorney fees incurred by James Cannon, plaintiff below and appellee herein.

Appellant assigns the following error:

“The trial court erred in granting plaintiffs request for an attorney’s fee.”

Although the record transmitted on appeal does not include the record of proceedings before the Ohio Industrial Commission, we glean the following facts from appellee’s complaint. On June 2, 1989, the Bureau of Workers’ Compensation district hearing officer mailed an order rejecting appellee’s workers’ compen sation claim on statute-of-limitations grounds. The officer noted that although a doctor diagnosed appellee as having asbestosis in November 1976, appellee did not file his application for workers’ compensation benefits until November 13, 1987.

On November 17, 1989, the Columbus Regional Board mailed an order reversing the hearing officer’s order. The board noted appellee became disabled on November 16, 1985 and filed his application for benefits on November 13, 1987, within the two-year statute of limitations of R.C. 4123.85. In an order mailed June 21, 1990, the commission affirmed the board’s decision and remanded the case to a district hearing officer for a decision on the merits.

On August 22, 1990, appellant filed a notice of appeal in the Scioto County Common Pleas Court from the Industrial Commission’s June 21,1990 order. 1 On December 27, 1990, the court granted appellee leave to file his complaint instanter.

On August 14, 1991, appellee moved for summary judgment with an affidavit stating his disability began on November 16, 1985 and he filed an application for workers’ compensation benefits on November 13, 1987, within the two-year statute of limitations. On September 19, 1991, appellant filed a memorandum and cross-motion for summary judgment arguing the critical date is the November 1976 date of diagnosis, not the November 16, 1985 date of disability. On September 23, 1991, the court granted appellee’s motion for summary judgment. No one filed an appeal from the September 23, 1991 judgment.

The instant appeal involves appellee’s November 5, 1991 motion for a $2,500 attorney fee award pursuant to R.C. 4123.519(E). On November 6, 1991, the court notified the parties the motion would be heard at 8:00 a.m. on November 19, 1991. On November 21, 1991, the court entered judgment granting the motion and assessing appellant $2,500 for attorney fees incurred by appellee.

In a December 5, 1991 memorandum, appellant opposed appellee’s motion for attorney fees. Appellant argued R.C. 4123.519(E) does not permit courts to award attorney fees until after the claimant’s right to participate in the Workers’ Compensation Fund has been established. Appellant argued appellee’s right to participate has not yet been fully established in the case sub judice. Appellant further argued appellee should not receive the maximum $2,500 award.

Appellant filed a timely notice of appeal from the November 21, 1991 judgment entry.

I

Appellant raises two arguments in support of its sole assignment of error. First, appellant argues the court erred by awarding appellee attorney fees. Second, in the alternative, appellant argues the attorney fee award must not exceed $1,500, the statutory maximum in effect at the time appellee became disabled.

Appellant asserts R.C. 4123.519(E) permits attorney fee awards only after a claimant’s right to participate in the Workers’ Compensation Fund has been established. Appellant argues appellee has not yet received an order finally adjudicating his right to participate. Both parties cite R.C. 4123.519(E). The statute provides:

“(E) The cost of any legal proceedings authorized by this section, including an attorney’s fee to the claimant’s attorney to be fixed by the trial judge, based upon the effort expended, in the event the claimant’s right to participate or to continue to participate in the fund is established upon the final determination of an appeal, shall be taxed against the employer or the commission if the commission or the administrator rather than the employer contested the right of the claimant to participate in the fund. The attorney’s fee shall not exceed twenty-five hundred dollars.” (Emphasis added.)

The critical question in the case sub judice involves the meaning of the words italicized in the statute above. Under what circumstances is a claimant’s “right to participate” in the fund “established” upon the final determination of an appeal?

Appellant argues claimants may not recover attorney fees until they have been awarded workers’ compensation benefits. In the case sub judice, the Scioto County Common Pleas Court did not award appellee benefits, but merely held the statute of limitations does not bar appellee from participating in the fund. Appellee must now go back to the Industrial Commission to prove his right to recover benefits for asbestosis, appellant argues.

Appellee argues the appeal to the Scioto County Common Pleas Court established his right to participate in the Workers’ Compensation Fund. As a result of the appeal, appellee may return to the Industrial Commission to prove his right to recover for asbestosis. Appellee argues his right to return to the Industrial Commission is a “right to participate” in the Workers’ Compensation Fund.

Appellant relies upon Taylor v. Chrysler Corp. (Feb. 24, 1988), Summit App.No. 13171, unreported, 1988 WL 24336, and Salmond v. Owens-Illinois, Inc. (Apr. 26, 1985), Lucas App.No. L-84-229, unreported, 1985 WL 7106, in support of its position. After the Taylor claimant won a workers’ compensation award, his employer appealed to the common pleas court. The appeal ended when the parties entered into a stipulated judgment entry remanding the case to the Industrial Commission for further proceedings. Thereafter, the claimant filed a motion for attorney fees. The common pleas court denied the motion. The Ninth District affirmed the denial, noting:

“Taylor argues that, as attorney’s fees and costs are recoverable even where the appeal is dismissed for lack of jurisdiction or where the employer withdraws the appeal after discovery, he should prevail. Hospitality Motor Inns [Inc. v. Gillespie], supra [ (1981), 66 Ohio St.2d 206, 20 O.O.3d 209, 421 N.E.2d 134]; Moore v. General Motors Corp. (1985), 18 Ohio St.3d 259 [18 OBR 314, 480 N.E.2d 1101]; Wickline v. Ohio Bell Tel. Co. (1983), 9 Ohio App.3d 32 [9 OBR 34, 457 N.E.2d 1192]. However, in each of those cases cited the orders of the Industrial Commission finally remained in effect. The stipulated judgment entry herein specifically granted the employer’s appeal, reversed the orders of the Industrial Commission, and remanded the cause for further determination. Accordingly, there was no final determination of the appeal and the prior ruling of the Industrial Commission no longer remained in effect; Chrysler’s appeal was granted. Although Taylor’s claim finally was allowed, apparently for a different diagnosis, that allowance was not upon the final determination on appeal but rather as a result of administrative rulings. Therefore, Taylor’s motion for an order taxing costs and attorney’s fees was properly denied by the trial court.” (Emphasis added.)

Although appellant claims Taylor is directly on point with the case sub judice, appellee notes a major difference between the two cases. In Taylor, the claimant lost on appeal to the common pleas court; in the case sub judice, the claimant won on appeal to the common pleas court.

The Salmond claimant also lost on appeal to the common pleas court. The Sixth District held R.C. 4123.519(E) permits court costs and attorney fee awards only to successful claimants. The Sixth District quoted the syllabus from Hospitality Motor Inns, Inc. v. Gillespie (1981), 66 Ohio St.2d 206, 20 O.O.3d 209, 421 N.E.2d 134, as follows:

“ ‘The “legal proceedings” contemplated by R.C. 4123.519 is the act of appeal, itself, and once such appeal is perfected, the Court of Common Pleas has authority to award attorney’s fees to the successful claimant, notwithstanding the fact that the appeal is subsequently dismissed for lack of jurisdiction.’ ” (Emphasis added.)

The Sixth District then commented:

“The critical portion of the quotation is the Ohio Supreme Court’s emphasis on awarding attorney fees only to successful claimants. In our opinion, the emphasis on a successful claimant should be applied not only to attorney’s fees, but to court costs. Cf. Jones v. Pierson (1981), 2 Ohio App.3d 447 [2 OBR 542, 442 N.E.2d 791]; Civ.R. 54(D).” (Emphasis added.)

Salmond thus stands for the proposition that attorney fees may not be awarded to claimants who lose on appeal. See, also, Gomez v. Owens-Illinois, Inc. (Sept. 27, 1985), Lucas App. No. L-85-031, unreported, 1985 WL 7608. As we have noted above, the claimant in the case sub judice won on appeal.

Taylor and Salmond do little to answer the critical question in our case — when is a claimant’s “right to participate” in the Workers’ Compensation Fund “established”?

Appellee relies upon Hospitality Motor Inns, supra, and Moellendick v. United Dairy, Inc. (Aug. 22, 1991), Belmont App. No. 90-B-32, unreported, 1991 WL 161341. In Hospitality Motor Inns, the employer did not appeal when the claimant won six months of temporary total disability benefits in a February 1, 1974 order. The employer did appeal, however, when the claimant won an additional sixteen months of benefits for the same disability. The claimant moved to dismiss the appeal for the reason that the Industrial Commission’s decision addressed the extent of the claimant’s disability and hence was not appealable. See R.C. 4123.519(A). The common pleas court dismissed the appeal for lack of subject matter jurisdiction and granted the claimant’s request for attorney fees. The First District Court of Appeals affirmed. The Ohio Supreme Court also affirmed, permitting the claimant to recover attorney fees notwithstanding the fact the common pleas court dismissed the employer’s appeal for lack of jurisdiction. The court commented that although the dismissal did not determine the claimant’s right to participate in the Workers’ Compensation Fund, the claimant’s right to participate had been established earlier, in the original February 1, 1974 order:

“ * * * It is clear that the decision as to claimant’s right to participate was made, not in the commission’s order granting further compensation, but in the original order of February 1,1974 — an order which the employer did not appeal.” Hospitality Motor Inns, 66 Ohio St.2d at 210, 20 O.O.3d at 211, 421 N.E.2d at 137.

The Hospitality Motor Inns decision instructs us. that a claimant’s right to participate is made upon an order allowing the claim. Is this the only way a claimant’s right to participate may be established? When is a claimant’s right to continue to participate established?

Appellee cites the following reasoning from Hospitality Motor Inns at 213, 20 O.O.3d at 213, 421 N.E.2d at 138:

“A review of the record clearly illustrates that appellant sought to invoke the jurisdiction of the Court of Common Pleas by way of appeal. The ‘legal proceedings’ contemplated by R.C. 4123.519 is the act of appeal, itself. We can see no practical difference between the instant case and a case wherein it is only after a trial de novo that the Court of Common Pleas determines that it lacks jurisdiction to decide the issue. The procedure utilized by the appellant was still an ‘appeal’ and the same was prosecuted, albeit unsuccessfully by the appellant, pursuant to R.C. 4123.519. Having sought the benefits of R.C. '4123.519, appellant can not now be heard to complain of the detriments flowing therefrom.”

The reasoning of the Ohio Supreme Court in Hospitality Motor Inns applies forcefully to the case sub judice. We see no practical difference between the case sub judice and a case where the statute-of-limitations issue might arrive in the common pleas court after a determination of the merits of the claim. Appellant brought the instant case to the common pleas court pursuant to R.C. 4123.519. Having sought the benefits of the statute, appellant must not now be heard to complain of the detriments of the statute.

At least one appellate district has applied Hospitality Motor Inns in a similar manner. In Moellendick, supra, the employer appealed an Industrial Commission decision that merely granted the claimant a right to a hearing on the merits of his claim. The court, citing Hospitality Motor Inns, permitted the claimant to recover attorney fees. It appears a claimant’s “right to participate or to continue to participate” in the Workers’ Compensation Fund is established whenever the claimant prevails in an appeal brought by the employer. See, also, Painter v. Midland Steel Prod. Co. (1989), 65 Ohio App.3d 273, 583 N.E.2d 1018, where the court rejected an employer’s argument that its voluntary dismissal of its appeal meant there was no “final determination” necessary to trigger the R.C. 4123.519(E) attorney fees provision.

II

We will now address the second argument appellant raises under its sole assignment of error. Appellant argues the new R.C. 4123.519 attorney fee limit of $2,500, effective on November 3, 1989, should not be applied retroactively to the instant case. A recent Ohio Supreme Court decision requires us to reject appellant’s argument.

In Ginnis v. Atlas Painting & Sheeting Co. (1992), 63 Ohio St.3d 754, 591 N.E.2d 694, syllabus, the court held:

“Pursuant to R.C. 4123.519, the provision of R.C. 4123.519(E), permitting the trial judge to fix an attorney fee up to $2,500 to the claimant’s attorney, applies retroactively to any workers’ compensation case pending in any court as of November 3, 1989, the effective date of the amendment allowing attorney fees in that amount.”

In the case sub judice, appellee filed his application for workers’ compensation benefits on November 13, 1987, nearly two years before the November 3, 1989 effective date of the amendment to the statute. The instant case, however, did not reach the courts until appellant filed a notice of appeal on August 22, 1990.

Implicit in the Ginnis decision is a holding that the new $2,500 maximum applies to all cases reaching the courts after November 3, 1989. We seriously doubt the Ohio Supreme Court would allow the $2,500 maximum to be applied to cases pending in any court on November 3, 1989, but would forbid the $2,500 maximum to be applied to cases pending before the Industrial Commission on that date but not filed in a court until after that date. For this reason, we find the court did not err when awarding the $2,500 maximum to appellee.

Judgment affirmed.

Stephenson, P.J., concurs separately. Harsha, J., dissents.

1 . On August 29, 1990, Catalytic, Inc. filed a second notice of appeal from the commission's June 21, 1990 order — this time in the Lawrence County Common Pleas Court. On September 26, 1991, that court transferred the case to the Scioto County Common Pleas Court and denied James Cannon’s request for attorney fees.

On October 24, 1991, James Cannon filed a notice of appeal from the Lawrence County Common Pleas Court judgment. His sole assignment of error concerned the court's denial of his request for attorney fees.

In Cannon v. Catalytic, Inc. (June 27, 1992), Lawrence App. No. 91 CA 23, unreported, 1992 WL 154173, we dismissed the appeal, holding the Lawrence County Common Pleas Court’s September 26, 1991 order did not constitute a final appealable order.