Wall v. Conn Welding & Machine Co.

179 A.2d 235, 197 Pa. Super. 360, 1962 Pa. Super. LEXIS 832
CourtSuperior Court of Pennsylvania
DecidedMarch 21, 1962
DocketAppeal, No. 163
StatusPublished
Cited by26 cases

This text of 179 A.2d 235 (Wall v. Conn Welding & Machine Co.) is published on Counsel Stack Legal Research, covering Superior Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wall v. Conn Welding & Machine Co., 179 A.2d 235, 197 Pa. Super. 360, 1962 Pa. Super. LEXIS 832 (Pa. Ct. App. 1962).

Opinions

Opinion by

Watkins, J.,

This is a workmen’s compensation case where the injury was caused by the negligence of a third party. The question before us is whether the employer is liable for the pro rata share of counsel fees based, not only on the amount of compensation already paid but also on the amount of future compensation the employer is relieved from paying as the result of a settlement obtained by the claimant against a third party tortfeasor.

There is no dispute about the facts in this case. On July 26, 1956, Kenneth O. Paden was an employe of the defendant-appellant, Conn Welding & Machine Company, and on that date was fatally injured by an accident in the course of his employment. He was survived by his widow and three minor children.

On August 27, 1956, an agreement was entered into with the defendant’s insurance carrier providing for compensation for the widow and her three minor children in an amount payable as provided by the Workmen’s Compensation Law. Since that date, the sum of $7,532.50 was paid or accrued to the claimant by way of legal instalments on April 6, 1960, leaving a balance due in future payments under the agreement, of $10,297.01.

A civil action for the wrongful death of the decedent employe was instituted by Milton E. Wall, administrator of his estate, the appellee herein, and was settled on April 6, 1960, for the sum of $77,500. The agreement also included a full settlement of the subrogation interest of the defendant company and its insurance carrier.

[363]*363The question to be decided by this appeal is whether claimant should be reimbursed for counsel fees on the basis of the proportionate share of the total amount of the compensation awarded, which would include the future compensation payments which the defendant was relieved of paying due to the settlement, or based only on the amount actually paid by the defendant’s carrier up to the time of the settlement. The Workmen’s Compensation Board held that the claimant was entitled to counsel fees proportionate to benefits received in the settlement of the action which included payment of future compensation in the sum of $10,297.04. The action of the board was affirmed by the County Court of Allegheny County and this appeal followed.

The original Workmen’s Compensation Act of 1915, P. L. 736, provided in §319 that the insurance carrier was entitled to recover by way of subrogation all monies paid by it to the claimant without deduction of any counsel fees paid by claimant in effecting such recovery. This section was amended by the Act of June 4, 1937, P. L. 1552, to provide for the payment of the proportionate share of the claimant’s counsel fees. Conrad v. Aero-Mayflower Transit Co., 152 Pa. Superior Ct. 477, 33 A. 2d 91 (1943). This was amended by the Act of May 18, 1945, P. L. 671, which required no payment of counsel fees by the employer where the third party settlement was sufficient to pay reasonable fees in addition to the compensation paid by the employer. Kratsas v. Guest, 166 Pa. Superior Ct. 233, 70 A. 2d 672 (1950).

Section 319 was again amended by the Act of May 29, 1951, P. L. 507, 77 PS §671, which reads as follows: “Where the compensable injury is caused in whole or in part by the act or omission of a third party, the employer shall be subrogated to the right of the employe, his personal representative, his estate or his dependents, against such third party to the .extent of the [364]*364compensation payable under this article by the employer; reasonable attorney’s fees and other proper disbursements incurred in obtaining a recovery or in effecting a compromise settlement shall be prorated between the employer and employe, his personal representative, his estate or his dependents. Any recovery against such third person in excess of the compensation theretofore paid by the employer shall be paid forthwith to the employe, his personal representative, his estate or his dependents, and shall be treated as an advance payment by the employer on account of any future instalments of compensation.”

This Court interpreted this amendment and held: “Upon close examination of all the amendments and the interpretation of the legislative intent, the logical conclusion is inescapable that the legislature intended that the employer be required to share the burden of attorney’s fees on the basis of its total benefit from the third party recovery, that is, the total amount which the carrier would have been called upon to pay. The argument that it is impossible to determine just what the total savings will be where future payments are concerned is answered by the Act which allows for modification in payments or suspension if certain contingencies arise.” Soliday v. Hires Turner Glass Co., 187 Pa. Superior Ct. 44, 51, 142 A. 2d 425 (1958). So that the law was clear that an insurance carrier must pay to the claimant a proportionate share of the attorney’s fees based upon the entire amount of compensation awarded or provided for in a compensation agreement.

Section 319 was again amended by the Act of December 28, 1959, P. L. 2034, §4, effective January 30, 1960, 77 PS §671, the pertinent part of which provides : “. . . reasonable attorney’s fees and other proper disbursements incurred in obtaining a recovery or in effecting a compromise settlement shall be prorated be[365]*365tween the employer and employe, his personal representative, his estate or his dependents. The employer shall pay that proportion of the attorney’s fees and other proper disbursements that the amount of compensation paid or payable at the time of recovery or settlement bears to the total recovery or settlement.”

It is without question that the employer received a direct benefit when relieved of future payments of workmen’s compensation benefits in the amount of $10,-297.04. It is also without question that justice and equity should require the employer to pay a fee based upon the direct benefits received by being relieved of payment of future compensation benefits and the burden of counsel fees should not be borne entirely by the claimant. However, this involves the construction of a legislative enactment and the determination of the legislative intent is controlling.

The appellant contends that the amendment changed the law as enunciated in the case of Soliday v. Hires Turner Glass Co. supra, and that the language “compensation paid or payable at the time of recovery or settlement” means that the proration of the attorney’s fees by the claimant and carrier must be based on the amount of compensation which the claimant had actually received or is due to be paid to him at the date of the recovery bears to the total amount of settlement.

We do not agree with this interpretation of the language of the amendment. Believing as we do that equity and justice are on the side of the claimant we are loathe to read into this legislative action an intent to create an unjust and inequitable result. When the legislature intended to relieve the employer for payment of counsel fees for the collection of hospital, medical or dental expenses, it explicitly so stated in the same amendment of Section 319, by saying: “Without deduction for attorney’s fees.” The legislature, if it intended to bring about the result contended for by the [366]*366appellant, could have been just as explicit. If it intended to considei* only compensation already paid to the defendant and instalments due at the time of settlement, the word accrued could well have been used.

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Bluebook (online)
179 A.2d 235, 197 Pa. Super. 360, 1962 Pa. Super. LEXIS 832, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wall-v-conn-welding-machine-co-pasuperct-1962.