Allegheny County cannot recover nearly $15,000 in attorney fees it paid in a workers’ compensation case, even though the Workers’ Compensation Appeal Board’s decision against the county was ultimately reversed, the Pennsylvania Supreme Court has ruled.
In a unanimous Jan. 18 opinion, the justices acknowledged that a lawyer for the employee, Harold Parker, should not have been awarded attorney fees in the first place. But Parker’s lawyer, David Landay, cannot be ordered to disgorge those fees, the ruling said.
“The General Assembly, in enacting the Workers’ Compensation Act, did not provide any mechanism by which employers can recoup erroneously awarded counsel fees, once paid,” Justice Max Baer wrote for the unanimous court. “Rather, the General Assembly contemplated that when a merits appeal is undertaken, a court may grant supersedeas of an order awarding attorney’s fees.”
But Allegheny County did request supersedeas in the Parker case, Baer noted, and it was denied, so the county’s reimbursement petition must be denied as well.
Landay said in many instances where the amount of money in dispute is relatively low, he can only take a workers’ compensation case if he has a chance at recovering unreasonable contest fees.
“If this decision had stood, I would never be able to spend that fee,” Landay said. “I’d have to hold onto it for years.”
The case dates back to a shoulder injury that Parker suffered in 1993, when he was working as chief supervisor of the Allegheny County Shuman Detention Center. It was in 2007 that Allegheny County was successful in a suspension petition that eventually led to the attorney fee award.
“The instant appeal involves a prolix factual and procedural history spanning several decades and involving numerous decisions related to the county’s repeated attempts to suspend Harold Parker’s workers’ compensation benefits,” the opinion noted.
In 2002, the county filed a suspension petition that was denied. It filed another in 2007, arguing that Parker voluntarily removed himself from the workforce and declined a job offer within his abilities. A workers’ compensation judge granted the 2007 petition.
Parker then appealed to the WCAB, saying that under collateral estoppel, Allegheny County could not pursue the 2007 petition because the 2002 petition was denied on the same basis. The WCAB agreed with Parker, reversed the 2007 petition decision and awarded attorney fees to Parker’s lawyer. The board awarded $14,750 in attorney fees for unreasonable contest.
But the county filed an appeal to the Commonwealth Court, arguing that the 2007 petition was based on different grounds than the 2002 petition. The Commonwealth Court agreed, and said Parker’s lawyer would have to disgorge the awarded fees.
The county also filed a request for supersedeas along with its Commonwealth Court appeal on the merits of the case, but the Commonwealth Court denied it. The WCAB had done the same.
But with regard to disgorgement, the Supreme Court said the Commonwealth Court committed an error of law.
“Requiring a claimant’s attorney to disgorge unreasonable contest fees previously paid in the litigation would chill claimants’ attorneys from bringing such claims and would, therefore, make employers more apt to bring unreasonable challenges to their liability,” Baer wrote. The court should not add missing language to the Workers’ Compensation Law, he said.
“There is no right for reimbursement for unreasonable contest attorney fees. If there was, the legislature would have made it part of the supersedeas procedures,” Landay said. “Here it was important and unusual that the court was a unanimous decision.”
Bradley Andreen of O’Brien, Rulis & Bochicchio, who represented Allegheny County, did not respond to a call seeking comment.