Liberty Northwest Insurance v. Watkins

198 P.3d 960, 224 Or. App. 599, 2008 Ore. App. LEXIS 1796
CourtCourt of Appeals of Oregon
DecidedDecember 24, 2008
Docket0500147H; A134305
StatusPublished
Cited by3 cases

This text of 198 P.3d 960 (Liberty Northwest Insurance v. Watkins) is published on Counsel Stack Legal Research, covering Court of Appeals of Oregon primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Liberty Northwest Insurance v. Watkins, 198 P.3d 960, 224 Or. App. 599, 2008 Ore. App. LEXIS 1796 (Or. Ct. App. 2008).

Opinion

*601 WOLLHEIM, J.

In this workers’ compensation case, insurer petitions for review of a final order by the Director of the Department of Consumer and Business Services (DCBS) upholding the awarding of attorney fees against insurer. The award of attorney fees stems from proceedings to resolve a medical services dispute following the entry of a claim disposition agreement (CDA). We review for errors of law, ORS 656.298(7) and ORS 183.482(8), and reverse and remand.

We take the facts from the final DCBS order. On June 13, 2000, claimant suffered a compensable back injury resulting in partial paralysis of his lower extremities. In February 2001, claimant and insurer entered into a CDA pursuant to ORS 656.236. In exchange for monetary compensation specified in the CDA, claimant released “all rights to workers’ compensation benefits allowed by law, including temporary disability, permanent disability, vocational rehabilitation, aggravation rights to reopen claim, attorney fees, penalties, and survivor benefits potentially arising out of this claim, and any subsequent claim for new medical conditions, except for medical services * * In addition, the CDA provided checkboxes to indicate whether, for each category of benefits, the release would be a “full” or “partial” release. For each category, including a category entitled “Penalties and Attorney Fees,” the checkbox indicating a full release was marked. The Workers’ Compensation Board (WCB) approved the CDA.

In January 2005, claimant, with the assistance of counsel, requested administrative review of insurer’s refusal to provide a wheelchair-accessible van. The medical review unit (MRU) issued an order requiring insurer to purchase the wheelchair-accessible van and requiring insurer to pay a fee to claimant’s attorney.

Insurer filed a request for a contested case hearing with DCBS. At that time, hearings were conducted by the administrative law judges (ALJs) of the WCB. The sole issue at hearing was the portion of the order awarding attorney fees. Insurer argued that the parties’ CDA disposed of claimant’s right to attorney fees. Claimant responded that an award of attorney fees was proper under ORS 656.385.

*602 ORS 656.385(1) provides, in part:

“In all cases involving a dispute over compensation benefits pursuant to ORS 656.245, 656.247, 656.260, 656.327 or 656.340, where a claimant finally prevails after a proceeding has commenced, the Director of the Department of Consumer and Business Services or the Administrative Law Judge shall require the insurer or self-insured employer to pay a reasonable attorney fee to the claimant’s attorney. In such cases, where an attorney is instrumental in obtaining a settlement of the dispute prior to a decision by the director or an Administrative Law Judge, the director or Administrative Law Judge shall require the insurer or self-insured employer to pay a reasonable attorney fee to the claimant or claimant’s attorney. The attorney fee must be based on all work the claimant’s attorney has done relative to the proceeding at all levels before the department.”

(Emphasis added.) The ALJ issued an order affirming the award of attorney fees.

Insurer submitted exceptions to DCBS, relying on Rash v. McKinstry Co., 331 Or 665, 20 P3d 197 (2001), for the proposition that, under ORS 656.236(l)(a), a CDA completely resolves all current and future matters that arise out of a claim, except medical services, unless otherwise specified in the CDA. Insurer argued that, because the CDA expressly disposed of claimant’s right to attorney fees and claimant did not reserve a right to an attorney fee, the CDA disposed of any prospective entitlement to attorney fees that claimant could claim. Claimant argued that the ALJ’s proposed order correctly affirmed the MRU order because claimant’s attorney was entitled to an award of fees under ORS 656.236(l)(a).

ORS 656.236(l)(a) provides, in part:

“The parties to a claim, by agreement, may make such disposition of any or all matters regarding a claim, except for medical services, as the parties consider reasonable, subject to such terms and conditions as the Workers’ Compensation Board may prescribe. For the purposes of this section, ‘matters regarding a claim’ includes the disposition of a beneficiary’s independent claim for compensation under this chapter. Unless otherwise specified, a disposition resolves all matters and all rights to compensation, attorney *603 fees and penalties potentially arising out of claims, except medical services, regardless of the conditions stated in the agreement.”

(Emphasis added.) DCBS concluded that, under Rash, ORS 656.236(l)(a) extinguished only those matters or rights under the jurisdiction of the WCB not otherwise reserved by a CDA. Pursuant to ORS 656.385(1), attorney fees for medical services disputes are within the sole jurisdiction of DCBS and not under the jurisdiction of the WCB. Accordingly, DCBS concluded that the CDA, which was approved by the WCB, did not resolve the attorney fees awarded in this case because the issue was medical services.

In addition, DCBS observed that the legislature had amended ORS 656.385(1) after the parties executed the CDA in 2001. At the time of execution, DCBS had discretion to award attorney fees to a prevailing claimant only in a “contested case order.” ORS 656.385(1) (2003), amended by Or Laws 2003, ch 756, § 2. The 2003 legislature amended ORS 656.385(1) to mandate an award of attorney fees to a prevailing claimant “after a proceeding has commenced before the Director of [DCBS].” Or Laws 2003, ch 756, § 2.

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Related

Liberty Northwest Ins. Corp. v. Watkins
227 P.3d 1134 (Oregon Supreme Court, 2010)
PETE'S MT. HOMEOWNERS ASS'N v. Clackamas Cty.
204 P.3d 802 (Court of Appeals of Oregon, 2009)
Pete's Mountain Homeowners Ass'n v. Clackamas County
204 P.3d 802 (Court of Appeals of Oregon, 2009)

Cite This Page — Counsel Stack

Bluebook (online)
198 P.3d 960, 224 Or. App. 599, 2008 Ore. App. LEXIS 1796, Counsel Stack Legal Research, https://law.counselstack.com/opinion/liberty-northwest-insurance-v-watkins-orctapp-2008.