State of Alaska, Department of Corrections v. John R. Wozniak

491 P.3d 1081
CourtAlaska Supreme Court
DecidedJuly 23, 2021
DocketS17775
StatusPublished

This text of 491 P.3d 1081 (State of Alaska, Department of Corrections v. John R. Wozniak) is published on Counsel Stack Legal Research, covering Alaska Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State of Alaska, Department of Corrections v. John R. Wozniak, 491 P.3d 1081 (Ala. 2021).

Opinion

Notice: This opinion is subject to correction before publication in the PACIFIC REPORTER. Readers are requested to bring errors to the attention of the Clerk of the Appellate Courts, 303 K Street, Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878, email corrections@akcourts.gov.

THE SUPREME COURT OF THE STATE OF ALASKA

STATE OF ALASKA, ) DEPARTMENT OF CORRECTIONS, ) Supreme Court No. S-17775 ) Appellant, ) Alaska Workers’ Compensation ) Appeals Commission No. 19-008 v. ) ) OPINION JOHN R. WOZNIAK, ) ) No. 7543 – July 23, 2021 Appellee. ) )

Appeal from the Alaska Workers’ Compensation Appeals Commission.

Appearances: Kimberly D. Rodgers, Assistant Attorney General, Anchorage, and Clyde “Ed” Sniffen, Jr., Acting Attorney General, Juneau, for Appellant. Joseph A. Kalamarides, Kalamarides & Lambert, Anchorage, for Appellee.

Before: Bolger, Chief Justice, Winfree, Maassen, and Carney, Justices. [Borghesan, Justice, not participating.]

CARNEY, Justice.

I. INTRODUCTION After initially disputing that a corrections officer was permanently and totally disabled from injuries suffered at work, the State conceded his disability status. The parties did not enter into a written settlement or stipulation because they disagreed about the amount of attorney’s fees the State should pay the officer’s attorney. After a hearing the Alaska Workers’ Compensation Board awarded attorney’s fees under AS 23.30.145(a) in two parts: it awarded a specific amount of fees for work up to the time of the hearing and statutory minimum fees of 10% of ongoing benefits as long as the officer received permanent total disability benefits. The State appealed to the Alaska Workers’ Compensation Appeals Commission, which affirmed the Board’s decision because in the Commission’s view the award was not manifestly unreasonable. The State then appealed the Commission’s decision to us. We affirm the Commission’s decision. II. FACTS AND PROCEEDINGS John Wozniak injured his right knee while working as a corrections officer and had right knee replacement surgery in 2014. He began vocational retraining but was unable to participate fully because of continuing health concerns. At times Wozniak was represented by attorney Burt Mason, although Wozniak filed at least one written workers’ compensation claim on his own. Wozniak developed a neuropathy,1 which caused continuing pain in his lower leg, as a complication of the knee replacement surgery. His treating physician suggested an out-of-state doctor who might be able to evaluate and, if possible, treat the condition after she was unable to offer further care to improve his condition. After some investigation Mason wrote to the State, proposing an agreement that Wozniak was permanently and totally disabled. The State refused the offer, so in

1 “Neuropathy” is defined as “damage, disease, or dysfunction of one or more nerves especially of the peripheral nervous system that is typically marked by burning or shooting pain, numbness, tingling, or muscle weakness or atrophy.” Neuropathy, M E R R I A M - W E B S T E R . C O M D I C T I O N A R Y , https://www.merriam-webster.com/dictionary/neuropathy (last visited May 27, 2021).

-2- 7543 April 2018 Mason filed a workers’ compensation claim on Wozniak’s behalf for permanent total disability (PTD) benefits and attorney’s fees. The State answered and denied Wozniak was permanently disabled. Ultimately, after a State-selected doctor agreed in large part with Wozniak’s treating physician and after the State’s attempt to find another doctor who would evaluate Wozniak’s condition failed, the State agreed Wozniak was entitled to PTD benefits. The parties did not enter into a written settlement about PTD benefits. The State filed a compensation report reflecting that it had “initiated” PTD benefits effective February 12, 2019. The parties were unable to agree on an amount of attorney’s fees for Mason’s work. The State mailed Mason a check for $25,000, representing what the State considered a reasonable fee. Mason did not cash the check because the Board had not awarded him attorney’s fees or costs.2 Wozniak’s claim did not specify which section of AS 23.30.145, the statute governing Board-ordered attorney’s fees, should apply to his claim. Mason filed an affidavit of his hours; an affidavit can be used when seeking fees under either AS 23.30.145(a) or (b).3 Wozniak’s hearing brief argued that the State had controverted

2 Under AS 23.30.260(a)(1) it is a misdemeanor for an attorney to “receive[] a fee, other consideration, or a gratuity on account of any services rendered for representation or advice with respect to a claim, unless the consideration or gratuity is approved by the [B]oard or the court.” There are two exceptions that are not relevant to this appeal. The State took the position at the fees hearing that it was not precluded from paying Mason attorney’s fees without a Board order because a Board regulation does not require Board approval “if the fee is paid by the employer to the employer’s attorney.” 8 Alaska Administrative Code (AAC) 45.180(h) (2011). As Mason pointed out, he was not the employer’s attorney. 3 See 8 AAC 45.180(b), (d)(1) (requiring a fee affidavit if attorney seeks (continued...)

-3- 7543 in fact4 his PTD claim and sought attorney’s fees for work done between a 2016 stipulation5 and the State’s acceptance of his PTD status, contending that Mason worked on the claim before attempting settlement with the State in 2018. The State responded that Mason had secured no benefits for Wozniak and maintained that Mason’s claimed hours and rates were unreasonable. It argued that Mason’s billing practices were not credible, attaching an unsigned draft fee affidavit from settlement discussions. The State did not ask the Board to interpret AS 23.30.145, nor did it suggest that the Board consider the value of statutory minimum fees and compare that value to reasonable fees when awarding attorney’s fees. The Board held a hearing on the fees dispute in March 2019.6 No one testified at the hearing. Mason objected to some documents the State had attached to its hearing brief and asked the Board to allow him “additional time to address . . . the comments and derisions [sic]” the State made in its brief related to his fee affidavit. The State asserted that it was “not calling Mr. Mason a liar,” “a bad person,” or “a dishonest person,” saying it was only attacking “the credibility of his billing practice.” The Board

3 (...continued) more than statutory minimum fees under subsection .145(a) or reasonable fees under subsection .145(b)). 4 See Alaska Interstate v. Houston, 586 P.2d 618, 620 (Alaska 1978) (holding that a formal controversion is not needed for the Board to award fees under AS 23.30.145(a) if claim is controverted in fact). 5 In 2016 the State and Wozniak stipulated to Wozniak’s continuing entitlement to temporary total disability and settled related issues, including attorney’s fees. 6 The Board had scheduled a hearing on the written claim before the State accepted the compensability of PTD benefits. The State indicated that one reason it agreed to PTD benefits when it did was because the case was already scheduled for a hearing.

-4- 7543 took the objection under advisement, and the parties proceeded to argue their cases. Neither party offered evidence of the potential value of Wozniak’s ongoing PTD benefits or the amount Mason might receive as statutory minimum fees on future benefits.7 In its written decision the Board made detailed findings of fact. It found that from February 17, 2016, when the State and Wozniak entered into a stipulation, until March 26, 2018, when Mason prepared a draft settlement proposal about PTD, the State had no controversion in effect and was not resisting any benefit.

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Bluebook (online)
491 P.3d 1081, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-of-alaska-department-of-corrections-v-john-r-wozniak-alaska-2021.