Ragon v. Great American Indemnity Co.

273 S.W.2d 524, 224 Ark. 387, 1954 Ark. LEXIS 596
CourtSupreme Court of Arkansas
DecidedDecember 20, 1954
Docket5-527
StatusPublished
Cited by22 cases

This text of 273 S.W.2d 524 (Ragon v. Great American Indemnity Co.) is published on Counsel Stack Legal Research, covering Supreme Court of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ragon v. Great American Indemnity Co., 273 S.W.2d 524, 224 Ark. 387, 1954 Ark. LEXIS 596 (Ark. 1954).

Opinion

Ed. F. McFaddin, Justice.

This appeal presents two questions: (a) the authority of the Workmen’s Compensation Commission to award an attorney, as a portion of his fee, a percentage based on the amount paid by the employer for medical services and hospital bills of the client; and (b) the.appropriateness of a declaratory judgment proceeding in a matter such as is here presented.

In the case of Great American Indemnity Co., et al., v. Bailey, 221 Ark. 469, 254 S. W. 2d 322, this Court affirmed the award of the Workmen’s Compensation Commission allowing Bailey compensation against his employer (Day & Night Cleaners, Inc.) and the employer’s insurance carrier (Great American Ind. Co.) The Commission’s award, which we affirmed, stated:

“The respondents will pay to the claimant compensation at the rate of $22.75 per week based on the average weekly wage of $35.00, from July 10, 1952, to continue subject to the provisions and limitations of the Act and further direction of this Commission, and that the .respondents further furnish to the claimant such medical treatment as has been recommended by Dr. Worth M. Gross.

“The question of the termination of the' healing period and the extent of his permanent partial disability, if any, is to be determined at a later date.

■ “The claimant’s attorney, Heartsill Ragon, is hereby allowed the maximum attorney’s fee permitted by the Act, said fee to be paid in addition to the compensation awarded herein. ’ ’

The present litigation was commenced by Heartsill Ragon (the attorney named in the above award) filing action in the Sebastian Circuit Court against Great American Indemnity Co. and Day & Night Cleaners, Inc. The complaint alleged:

“This is an action for a declaratory judgment pursuant to the provisions of Act 274 of the Acts of the General Assembly of the State of Arkansas for the year 1953, Ark. Stats., 1947, § 34-2501 to 34-2512. . . .”

The complaint then alleged the award, as above quoted; and stated that the attorney had received his fee based only on a percentage of the cash award allowed Bailey and not on the amounts that the defendants had expended and were expending for medical treatment and hospitalization for Bailey. The complaint said:

“. . . the Great American Indemnity Company, has paid out as compensation a large and substantial sum, now unknown to this plaintiff but within the peculiar knowledge and information of the defendants, for medical and hospital servicés and supplies as set out in § 11 of said Initiated Act No. 4 of 1948, Ark. Stats., 1947, § 81-1311.

“. . . the defendant should pay to the plaintiff a sum .equal to 10% of all compensation hereafter paid under the terms of the award of the Arkansas Workmen’s Compensation Commission, and in particular, 10% of all compensation paid in accordance with § 11 of the Arkansas Workmen’s Compensation Act.”

The prayer of the complaint was for a declaratory judgment declaring Ragon entitled to judgment against the defendants for a fee based not only on a percentage of the cash award, but also on a percentage of the amount expended for medical services and hospitalization. To the complaint the defendants interposed a demurrer on two grounds: (i) that the Court has no jurisdiction of the subject-matter of the action; and (2) that the complaint does not state facts sufficient to constitute .a cause of action. The Circuit Court sustained the demurrer and dismissed Ragon’s complaint when he refused to plead further, and Ragon brings this appeal.

I. Attorney’s Fees on Medical Expenditures. That the Commission has the power and duty to award this attorney a fee based not only on the cash award to his client, but also on the amount expended by either or both of the defendants for the medical services and hospitalization of Bailey, is a matter of which we have no doubt. The "Workmen’s Compensation Act 1 provides in § 2(i), 2 as regards compensation:

<£ ‘Compensation’ means the money allowance payable to the employee or to his dependents, and includes the allowances provided for in § 11, and funeral expense.”

Then in § 11 3 the Act provides:

“The employer shall promptly provide for an injured employee such medical, surgical, hospital and nursing service, and medicine ... as may be necessary during the period of six months after the injury, or for such time in excess thereof as the Commission, in its discretion, may require. . . .”

So we conclude that medical, surgical and hospital service, and medicine (and we mean all of these when we use the words “medical services”) are a part of “compensation.”

As regards fees for legal services, the Compensation Act provides in § 32: 4

“Fees for legal services rendered in respect of a claim shall not be valid unless approved by the Commission, and such fees shall not exceed twenty-five per centum (25%) on the first one thousand dollars ($1,000.00) of compensation, or part thereof, and ten per centum (10%) on all sums in excess of one thousand dollars ($1,-000.00) of compensation. Whenever the Commission finds that a claim has been controverted, in whole or in part, the Commission shall direct that fees for legal services be paid by the employer or carrier in addition to compensation awarded, and such fees shall be allowed only on the amount of compensation controverted and awarded. . . . ”

In the case at bar, the insurance carrier denied all liability including medical services; and it was not until the decision by this Court that the insurance carrier made such payments. Certainly, therefore, in this case, the attorney obtained medical services for his client; and, in the discretion of the Commission, was entitled to fees based on the percentage expended by the insurance carrier and/or the employer for such controverted medical services. The Commission could direct the defendants to inform the Commission as to all amounts expended for medical and hospital services and supplies, and to pay Ragon a percentage on such amounts.

II. Declaratory Judgment. But the point that gives us most serious concern is whether appellant, Ragon, in the present state of the record, may use the Declaratory Judgment Statute 5 in lieu of exhausting his administrative remedies.

Appellant says that the Workmen’s Compensation Law makes the award of the Commission a final judgment that may be enforced under the provisions of § 25(c) of the Workmen’s Compensation Law, 6 which reads as follows:

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Bluebook (online)
273 S.W.2d 524, 224 Ark. 387, 1954 Ark. LEXIS 596, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ragon-v-great-american-indemnity-co-ark-1954.