Hendricks v. Workers' Compensation Appeal Board

909 A.2d 445, 2006 Pa. Commw. LEXIS 542, 2006 WL 2933946
CourtCommonwealth Court of Pennsylvania
DecidedOctober 16, 2006
Docket237 C.D. 2006
StatusPublished
Cited by13 cases

This text of 909 A.2d 445 (Hendricks v. Workers' Compensation Appeal Board) is published on Counsel Stack Legal Research, covering Commonwealth Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hendricks v. Workers' Compensation Appeal Board, 909 A.2d 445, 2006 Pa. Commw. LEXIS 542, 2006 WL 2933946 (Pa. Ct. App. 2006).

Opinions

OPINION BY

Judge COHN JUBELIRER.

At issue in this case is whether a Workers’ Compensation Judge (WCJ) and the Workers’ Compensation Appeal Board (Board) have the authority to determine attorney’s fees for successive counsel in a workers’ compensation proceeding under [447]*447Section 442 of the Workers’ Compensation Act (Act).1

Kevin Hendricks (Claimant) sustained an injury on April 21, 1992, in the course and scope of his employment with Phoenix Pipe & Tube (Employer). Employer accepted liability for Claimant’s injury pursuant to a Notice of Compensation Payable issued on June 8, 1992. In September, 1995, Employer’s workers’ compensation insurance carrier filed a petition to terminate Claimant’s compensation benefits alleging that he was fully recovered.

Claimant then retained Adam Sager, Esquire, from the firm of Sager & Sager Associates (Sager) to represent him in defense of the termination petition. At that time, Claimant signed a fee agreement entitling Sager to 20% of Claimant’s ongoing workers’ compensation benefits. The WCJ provisionally approved this fee agreement. Employer apparently made ongoing payments to Sager for 20% of Claimant’s compensation benefits and to Claimant for 80% of his compensation. Sager successfully defended against Employer’s termination petition when, on December 24, 1997, the WCJ issued an opinion and order denying Employer’s termination petition. Sager continued to receive the 20% fee in accordance with the approved fee agreement.

Subsequently, by letter dated April 12, 2001, Claimant terminated his employment of Sager as counsel and expressed his intent to hire Paul Silver, Esquire, from the firm of Reger and Rizzo (Silver), as his new counsel.

In 2002, Silver filed a Petition for Approval of Counsel Fees, asking the Board to approve his 15% fee agreement with Claimant. In June, 2003, the Board rejected Silver’s request because Sager had been receiving an approved 20% counsel fee for past services rendered in connection with the successful defense of a termination petition. The Board stated that it had no authority to discontinue this fee. Moreover, the approval of any additional fees for Silver, when added to Sager’s fee, would exceed the 20% maximum deemed per se reasonable. Additionally, the Board noted that “[n]o additional petitions or litigation have ensued since [Sager’s] discharge.” (Board Order 6/12/03 at 1.) The Board found it was without authority to discharge “previously approved counsel fees and approve fees for a subsequent counsel, particularly where the need for new counsel has not been established.” (Board Order 6/12/03 at 2.)

In November, 2004, Claimant, through Silver, filed a petition for penalties (Silver Petition) alleging that Employer failed to pay Claimant’s medical bills. The parties scheduled several hearings before the WCJ, but no record was made. The WCJ continued the hearings at the request of the parties so they could continue with settlement negotiations. On March 9, 2005, Silver requested approval of his attorney fee agreement in the amount of 15% pending resolution of the matter. By interlocutory order dated March 31, 2005, the WCJ approved Silver’s fee.

In April, 2005, Employer ceased making payments to Sager, apparently pursuant to the interlocutory order of March 31, 2005, which approved Silver’s fees.2

Subsequently, Sager filed a penalty petition (Sager Petition) with the WCJ against [448]*448Employer for failing to pay him his 20% counsel fee as of April, 2005. Sager requested the WCJ to vacate the approval of Silver’s counsel fee and reinstate Sager’s fee agreement. Silver responded by indicating that, because Sager had been discharged in 2001, Sager had no authority to file his penalty petition. Silver requested the WCJ to dismiss the Sager Petition.

On June 25, 2005, the WCJ conducted a final hearing on the Silver Petition based on Employer’s failure to pay Claimant’s medical bills. Counsel for Employer informed the WCJ that Employer and Silver, on Claimant’s behalf, had resolved the matter and asked that the WCJ allow the withdrawal of the Silver Petition. '

By decision and order dated June 29, 2005, the WCJ allowed counsel to withdraw the Silver Petition and approved Silver’s counsel fee. The WCJ also dismissed the Sager Petition, noting that, under Pitt v. Workmen’s Compensation Appeal Board (McEachin), 161 Pa. Cmwlth.60, 636 A.2d 235 (1993), petition for allowance of appeal denied, 538 Pa. 661, 648 A.2d 792 (1994), jurisdiction to resolve counsels’ fee disputes rests with the appropriate court of common pleas, not before a WCJ.

On July 6, 2005, Sager filed a “Petition for Appeal Nunc Pro Tunc for Reinstatement of Counsel Fees” with the Board. The Board treated this petition as an appeal of the WCJ’s June 29, 2005 decision and order. Silver filed a motion with the Board to quash the appeal.

By Order and Opinion dated January 26, 2006, the Board denied Silver’s motion and addressed the merits of Sager’s appeal. As to the merits, the Board reversed the award of counsel fees to Silver and directed Employer to pay 20% of Claimant’s compensation to his original counsel, Sager. The Board indicated that an earlier WCJ had approved Sager’s 20% counsel fees in 1996, which were memorialized in a fee agreement signed by Claimant. The Board indicated that this fee agreement had not been extinguished simply by Claimant’s retention of new counsel. The Board reasoned that:

Section [442], 77 P.S. § 998, provides that all counsel fees agreed on by a claimant and an attorney for services performed in matters before a WCJ shall be approved by the WCJ. In Gingerich v. Workers’ Compensation Appeal Board, 825 A.2d 788 (Pa.Cmwlth. 2003), the Court held that a claimant may not simply repudiate previously-approved attorney fees. In Gingerich, the Court held that a WCJ’s approval of a compromise and release agreement involving a settlement of a subrogation lien could not extinguish claimant’s original attorney’s right to 20% fees for future benefits.

(Board Op. at 4-5.) The fee agreement between Claimant and Sager is not in the record before this Court.

Thereafter, Silver filed a petition for review with this Court. In February, 2006, Sager filed an application for intervention. About the same time, Silver filed a request for a stay, supersedeas or escrow of counsel fees pending appeal. By an order dated March 30, 2006, this Court granted Sager’s application for intervention, denied Silver’s request for a stay or supersedeas, but granted Silver’s request with regard to the escrow, directing Sager to place all counsel fees received after the date of this order in escrow.

Before this Court, Silver raises three issues: (1) whether the Board exceeded its authority by deciding a fee dispute;3 (2) [449]*449whether the Board improperly considered evidence in the appeal that was never made part of the record before the WCJ; and, (3) whether Silver’s fee agreement superceded Sager’s fee agreement.4

I.

The first issue before this Court is whether the Board exceeded its authority.

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Hendricks v. Workers' Compensation Appeal Board
909 A.2d 445 (Commonwealth Court of Pennsylvania, 2006)

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Bluebook (online)
909 A.2d 445, 2006 Pa. Commw. LEXIS 542, 2006 WL 2933946, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hendricks-v-workers-compensation-appeal-board-pacommwct-2006.