Appeal of Thomas Phillips
169 N.H. 177
N.H.2016Background
- Thomas Phillips, a quadriplegic from a 2006 workplace injury, sued for workers’ compensation benefits; insurer (State Farm) denied liability citing notice and intoxication defenses.
- The CAB initially found for State Farm on notice and intoxication; this Court reversed as to notice and remanded the intoxication issue.
- On remand a CAB panel member recused; Phillips obtained a de novo hearing before a new panel, which accepted the law of the case and awarded ongoing indemnity and medical benefits.
- Phillips sought attorney’s fees under RSA 281-A:44 based on a contingency fee agreement (one-third of past and future benefits), calculating about $4.14 million; State Farm argued fees should be limited to reasonable hourly fees/costs for CAB proceedings.
- The CAB rejected contingency billing that included future medical benefits as per se unreasonable and awarded $79,369.59 based on an hourly-equivalent amount; Phillips appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether contingent fees may include future medical benefits | Contingent fee may reasonably include past and future medical and indemnity benefits | Future medical benefits are speculative and statute bars lump-summing medical benefits | Court: CAB erred — no statutory bar to considering future medical benefits; contingent fees can include future medical benefits when reasonably demonstrable |
| Whether contingent-fee agreements are per se unreasonable | One-third contingent fee is permissible under Couture and fee agreement should be honored subject to reasonableness | CAB may limit fee to reasonable hourly billing; contingency not controlling | Court: Fee agreement is a factor but reasonableness standard controls; CAB must apply factors and may adjust contingency under Doucet and ethical rules |
| Whether future benefits are necessarily too speculative to value now | Phillips: future benefits can be estimated and have been allowed in prior cases | State Farm: impossible to value future benefits; therefore contingency on them is inappropriate | Court: Speculativeness is not a categorical bar; prior cases (e.g., Knapp) allow estimation and weighing of uncertainty; CAB must assess evidence rather than adopt a blanket rule |
| Whether Phillips prevailed on his prior appeal to the supreme court and is entitled to appellate fees | Phillips: prior appeal led to remand and ultimately a larger award; thus he prevailed and is entitled to fees for that appeal | State Farm: Phillips did not obtain a substantive win on appeal—only a remand/new hearing; not a prevailing party | Court: Phillips prevailed under RSA 281-A:44 because he obtained an award greater than the decision that was appealed; he is entitled to reasonable fees for the prior appeal, but amount left to CAB if it awards a contingency covering whole case |
Key Cases Cited
- Couture v. Mammoth Groceries, Inc., 117 N.H. 294 (1977) (upheld contingent fee including future benefits in a workers’ compensation case; set reasonableness factors)
- Corson v. Brown Prods., Inc., 119 N.H. 20 (1979) (attorney’s fees may be allowed for medical benefits)
- Cheshire Toyota/Volvo, Inc. v. O’Sullivan, 132 N.H. 168 (1989) (fee agreement is one factor; court reviews reasonableness of award)
- City of Manchester v. Doucet, 133 N.H. 680 (1990) (factors for adjusting contingent fees and considering attorney skill; fee agreement not dispositive)
- Knapp v. Tennessee Gas Pipeline, 149 N.H. 740 (2003) (trial court may base lump-sum allocation on estimated future benefits despite speculative possibilities)
- Appeal of Phillips, 165 N.H. 226 (2013) (prior appellate ruling in same matter addressing notice issue)
- Appeal of Brown, 143 N.H. 112 (1999) (forum allocation: CAB for administrative-level fee awards; supreme court for appellate-level fee awards)