§ 52-3-47 — Fee restrictions; appointment of attorneys by the director

or workers' compensation judge; discovery costs; offer of judgment; penalty for violations. A. It is unlawful for any person to receive or agree to receive any fees or payment directly or indirectly in connection with any claim for compensation under the New Mexico Occupational Disease Disablement Law except as provided in this section. B. In all cases where the jurisdiction of the workers' compensation administration is invoked to approve a settlement of a compensation claim under the New Mexico Occupational Disease Disablement Law, the director or workers' compensation judge, unless the claimant is represented by an attorney, may in the director's or judge's discretion appoint an attorney to aid the workers' compensation judge in determining whether the settlement should be approved. In the event of such an appointment, a reasonable fee for the services of the attorney shall be fixed by the workers' compensation judge, subject to the limitation of Subsection I of this section. C. In all cases where the jurisdiction of the workers' compensation administration is invoked to approve a settlement of a compensation claim under the New Mexico Occupational Disease Disablement Law and the claimant is represented by an attorney, the total amount paid or to be paid by the employer in settlement of the claim shall be stated in the settlement papers, and the workers' compensation judge shall determine and fix a reasonable fee for the claimant's attorney, taking into account any sum previously paid. The fee fixed by the workers' compensation judge shall be the limit of the fee received or to be received by the attorney in connection with the claim, subject to the limitation of Subsection I of this section. D. The cost of discovery shall be borne by the party who requests it. If, however, the claimant requests any discovery, the employer shall advance the cost of paying for discovery up to a limit of three thousand five hundred dollars ($3,500). Beginning January 1, 2027, the limit shall be four thousand dollars ($4,000), and beginning January 1, 2029, the limit shall increase to four thousand five hundred dollars ($4,500). If the claimant substantially prevails on the claim, as determined by a workers' compensation judge, any discovery cost advanced by the employer shall be paid by that employer. If the claimant does not substantially prevail on the claim, as determined by a workers' compensation judge, the employer shall be reimbursed for discovery costs advanced according to a schedule for reimbursement approved by a workers' compensation judge. E. In all cases where compensation to which any person is entitled under the provisions of the New Mexico Occupational Disease Disablement Law is refused and the claimant thereafter collects compensation through proceedings before the workers' compensation administration or courts in an amount in excess of the amount offered in writing by an employer five business days or more prior to the informal hearing before the administration, the compensation to be paid the attorney for the claimant shall be fixed by the workers' compensation judge hearing the claim or the courts upon appeal in the amount the workers' compensation judge or courts deem reasonable and proper, subject to the limitation of Subsection I of this section. In determining and fixing a reasonable fee, the workers' compensation judge or courts shall take into consideration: (1) the sum, if any, offered by the employer: (a) before the employee's attorney was employed; (b) after the attorney's employment but before proceedings were commenced; and (c) in writing five business days or more prior to the informal hearing; (2) the present value of the award made in the employee's favor; and (3) the failure of a party to participate in a good-faith manner in informal claim resolution methods adopted by the director. F. After a recommended resolution has been issued and rejected, but more than ten days before a trial begins, the employer or claimant may serve upon the opposing party an offer to allow a compensation order to be taken against the employer or claimant for the money or property or to the effect specified in the offer, with costs then accrued, subject to the following: (1) if, within ten days after the service of the offer, the opposing party serves written notice that the offer is accepted, either party may then file the offer and notice of acceptance together with proof of service thereof, and thereupon that compensation order may be entered as the workers' compensation judge may direct. An offer not accepted shall be deemed withdrawn, and evidence thereof is not admissible except in a proceeding to determine costs. If the compensation order finally obtained by the party is not more favorable than the offer, that party shall pay the costs incurred by the opposing party after the making of the offer. The fact that an offer has been made but not accepted does not preclude a subsequent offer; (2) when the liability of one party to another has been determined by a compensation order, but the amount or extent of the liability remains to be determined by further proceedings, the party adjudged liable may make an offer, which shall have the same effect as an offer made before trial if it is served within a reasonable time not less than ten days prior to the commencement of hearings to determine the amount or extent of liability; (3) if the employer's offer was greater than the amount awarded by the compensation order, the employer shall not be liable for the employer's fifty-percent share of the attorney fees to be paid the worker's attorney and the worker shall pay one hundred percent of the attorney fees due to the worker's attorney; and (4) if the worker's offer was less than the amount awarded by the compensation order, the employer shall pay one hundred percent of the attorney fees to be paid the worker's attorney, and the worker shall be relieved from any responsibility for paying any portion of the worker's attorney fees. G. In all actions arising under the provisions of Section 52-3-35 NMSA 1978, where the jurisdiction of the workers' compensation administration is invoked to determine the question of whether the claimant's disablement has terminated and the claimant is represented by an attorney, the workers' compensation judge or courts upon appeal shall determine and fix a reasonable fee for the services of the claimant's attorney only if the employer is unsuccessful in establishing that the claimant's disablement has terminated. The fee when fixed by the workers' compensation judge or courts upon appeal shall be taxed as part of the costs against the employer and shall be the limit of the fee received or to be received by the attorney for services in the action, subject to the limitation of Subsection I of this section. H. In determining reasonable attorney fees for a claimant, the workers' compensation judge shall consider only those benefits to the employee that the attorney is responsible for securing. The value of future medical benefits shall not be considered in determining attorney fees. I. Attorney fees, including, but not limited to, the costs of paralegal services, legal clerk services and any other related legal services costs on behalf of a claimant or an employer for a single disablement claim, including representation before the workers' compensation administration and the courts on appeal, shall not exceed thirty thousand dollars ($30,000) in calendar year 2025. Beginning January 1, 2027, the maximum allowable attorney fees shall be thirty-two thousand dollars ($32,000), and beginning January 1, 2029, the maximum allowable attorney fees shall increase to thirty-four thousand dollars ($34,000). This limitation applies whether the claimant or employer has one or more attorneys representing the claimant or employer and applies as a cumulative limitation on compensation for all legal services rendered in all proceedings and other matters directly related to a single occupational disease of a claimant. The workers' compensation judge may exceed the maximum amount stated in this subsection in awarding a reasonable attorney fee if the judge finds that a claimant, an insurer or an employer acted in bad faith with regard to handling the disabled employee's claims and the employer or disabled employee has suffered economic loss as a result thereof. However, in no case shall this additional amount exceed five thousand dollars ($5,000). As used in this subsection, "bad faith" means conduct by the claimant, insurer or employer in the handling of a claim that amounts to fraud, malice, oppression or willful, wanton or reckless disregard of the rights of the employee or employer. Any determination of bad faith shall be made by the workers' compensation judge through a separate fact-finding proceeding. Notwithstanding the provisions of Subsection J of this section, the party found to have acted in bad faith shall pay one hundred percent of the additional fees awarded for representation of the prevailing party in a bad faith action. J. Except as provided in Paragraphs (3) and (4) of Subsection F of this section, the payment of a claimant's attorney fees determined under this section shall be shared equally by the employee and the employer. K. It is unlawful for any person except a licensed attorney to receive or agree to receive any fee or payment for legal services in connection with any claim for compensation under the New Mexico Occupational Disease Disablement Law. L. Nothing in this section applies to agents, excluding attorneys, representing employers, insurance carriers or the subsequent injury fund in any matter arising from a claim under the New Mexico Occupational Disease Disablement Law. M. No attorney fees shall be paid until the claim has been settled or adjudged. N. By May 1, 2029, the advisory council on workers' compensation and occupational disease disablement shall review the maximum allowable attorney fees and the limitation on discovery costs that employers are required to advance. By November 1, 2029, the advisory council on workers' compensation and occupational disease disablement shall make recommendations to the legislature on any necessary adjustments to the maximum allowable attorney fees or the limitation on discovery costs that employers are required to advance. O. Every person violating the provisions of this section is guilty of a misdemeanor and upon conviction shall be fined not less than fifty dollars ($50.00) or more than five hundred dollars ($500), to which may be added imprisonment in the county jail for a term not exceeding ninety days. P. Nothing in this section shall restrict a claimant from being represented before the workers' compensation administration by a nonattorney as long as that nonattorney receives no compensation for representation from the claimant.

Legislative History

1978 Comp., § 52-3-47, enacted by Laws 1987, ch. 235, § 41; 1989, ch. 263, §