*1 PAULSEN, Aрpellant, JANICE BONANZA and v. Claimant HOUSE, Employer, Company, STEAK and Crawford Respondent. Defendant No. 86-324.
Submitted on Briefs Oct.
Decided Jan.
Court. Kelleher, Jr., attorney, appeals L. Workers’
Robert claimant’s $3,318.50. Compensation attorney him fees awarding order of appeal attorney properly The issue on is fee was calcu- whether the lated Court.
We affirm. June, 1983, Bo- employed at the injured
The claimant was while car- Billings, nanza Steak House in Montana. Bonanza’s insurance (hereinafter rier, Company, company) ac- Crawford & insurance cepted liability, expenses temporary total paying both medical June, October, disability through 1983. The benefits from temporary total extended 1984, $3,434.65, disability status for award of to October a total awarding proposed for her order and ordered claimant submit attorney attorney 54.55 of documented fees and costs. Claimant’s $125, fee to bringing the total hours of work at an rate of $6,818.75. $1,080.55. men- of It should be Claimant submitted costs attorney her into a fee tioned that claimant and entered agreement whereby attorney 33% May, would receive any insur- Court. The award made attorney awarding fees company proposed order objected ance 23, 1986, May the Workers’ Com- parties filed briefs. and both On pensation company pay claimant Court ordered the insurance $70, $3,318.50 hourly rate of and costs based on $1,080.55. petition for reconsideration Claimant’s fee award denied. 39-71-614, MCA, in workers’ explains how
Section compensation cases are determined:
“(1) еmployer against an The of an fee assessed exclusively be based or insurer under must 39-71-611 or 39-71-612 on representing claimant spent by the time judge. The workers’ brought the issues before the costs. He attorney fee and assess determine judge shall to him. not bound attor- spent must be based on the fee hourly fee for ney’s customary this state. attorney from
“(2) and an not restrict a claimant This section does arrangement under which the attor- entering contingency fee into a compensation payments percentage of the amount of receives a attorney. How- of the efforts of the received the claimant because ever, against an em- equal an amount fee and costs assessed ployer must under or 39-71-612 and this section insurer 39-71-611 attorney is entitled to from the claim- be deducted from the fee an arrangement.” ant under a Attorney the bill that subse- Norman Grosfield of Helena authored quently primarily prac- became Section MCA. Grosfield tices the workers’ field and was chief counsel and then administrator of the Workers’ Division administrator, directly During 1975-79. his tenure as Grosfield was involved in the carri- assessment of insurance ers. Assessments at that time were made on an basis and thought were in line with what the Division was the charged by legal profession in the state of Montana. Grosfield *3 addressing testified that the bill was aimed at this Court’s decision Wight Hughes Co., v. (Mont. 1983), Livestock Inc. in Mont. [204 Wight, attorney St.Rep. 664 P.2d 40 fees were as- 98.] against sessed an insurance carrier based on the time incurred attorney hourly proper claimant’s and a amount as determined procedure Court. We found that the used improper and held attorney the court should base the assessment of fees on the attorney. his contract between the claimant and prior proсedure employed Grosfield’s intent was to reinstate the Wight an effort to hold down the costs of workers’ prevent legislature. and to a severe backlash (1) hourly applied, As to the 39- fee to be Subsection of Section 71-614, MCA, says that “The attorney’s customary
time must be based on the fee fоr in this state.” Grosfield testified granted oppor that the statute the workers’ tunity appropriate calculate the amount based on judge’s knowledge charging of in the state of Mon tana. Grosfield’s remark is not accurate reflection of the final ver sion of the statute. The fee is tо be based on what the individual attorney fee, has established as his recognized by lawyers not on what is as a reasonable adopted Stanley Gullett v. the state of Montana. We this view in (Mont. 1986), 365,] St.Rep. Structures Mont. 722 P.2d [222 expected, questions As Grosfield encountered several about the depоsition testimony. bill’s effect. We refer to Grosfield’s “Q. question prevent The third raised was whether the bill would a obtaining involving from a windfall fee cases large money. prompted you amounts of What to raise and address question? can, My any-
“A. concern was that Workers’ cases more, money; largеr involve and with substantial amounts of awards, larger Wight it decision continued effect would larger larger against amount to in- assessments carriers, surance effect of substan- which would have the ultimate Montana, tially increasing employer in the costs to the the State of pri- rising my opinion, inordinаtely. which costs are That was mary prevent intent of the the substantial assessments of against larger cases. insurance carriers
“Q. prevent Does the bill a claimant’s such cases collecting contingency fee?
“A. No.
“Q. Why is that? may specifically provides
“A. The that a claimant’s bill contract, charge a fee based оn the but carrier shall be deducted awarded or assessed an insurance attorney. is received from the total fee that you is whether “Q. question The fourth raised and addressed disputed involving amounts of the bill would assist claimants small question? Why, again, you raise and address that monies. did relatively minor “A. There are situations which there are involved; particular case money amounts of before fact involving a rela- Court, particular case I would consider that insur- tively money. But are situations where small amount there *4 costs, etc.; pay amount in medical ance carriers rеfuse to the small case, have the strictly apply Wight it would if were to one receiving proper representa- assisting reverse effect claimants see the award of appropriate where can tion. There are situations larger company even be could аn insurance was, like that. recovery I’ve had situations than what the actual hourly amount, it en- granting fee on an So based they courages Court attorneys to take those issues before if something going get than the they know that to other contin- are added.)” (Emphasis gency they amount are fee successful. Kelleher, attorney, Jr., case, In this Robert failed to customary establish was $125. that his fee Kelle response her he set the fee in $125 testified that direct 39-71-614, enactment In of a of Section MCA. the absence standard statute, which to set Kelleher’s fee under the the Workers’ Com рensation Judge appropriate: $70 concluded that a fee was per figure yields
“The $70 hour this case of $3,318.50 ($70 hours). roughly times 54.55 This three greater times expected than what claimant’s counsel have could earn agreement. under a Under award, per claimant’s counsel $20.78 would havе earned hour. Clearly, adequately this compensate amount would not him for the energy expended However, in pursuing this matter. it is an indica figure one, tion that per $70 is a reasonable and that the $125 requested by hour fee justified claimant’s counsel not be would under the facts this case.” prеsented did the best he with could the situation
him. In future fee the Workers’ Judge to the time should be based individual customary current and fee as established particular attorney.
Affirmed.
MR. CHIEF JUSTICE TURNAGE and MR. JUSTICES HARRI- SON and WEBER concur. SHEEHY, specially JUSTICE concurring:
I concur majority following: with the and add this accepted, Court or at on, heаvily testimony Grosfield, least relied of Norman that the customary usual and lawyers Montana assessed Montana yardstick was the which the in fixing
bound this case. In leading use the usual lawyers, misinterpreted misap- fees of Grosfield prehended adopting what intended 1985 revi- sions to Section MCA. *5 deposition in before the Workers’
Grosfield testified Cоurt: expressed by my- drafting and the intent as
“The intent the bill exactly oppo- primary was the legislature self to the as the author Wight site, perceived problem in the decision correct what as a pro- system previously. That would and to reinstate the that existed attorneys customary feеs based on attor- vide for an assessment by lawyers.” neys charged Montana in Montana Deposition, at 21. Grosfield drafting the his intention Whatever Grosfield intended legislature eliminated Instead, by legislature. not followed the the hourly by legal recognized from the bill consideration of profession. MCA, are contained
The 1985 amendments to Section (1985). originated in Ch. Laws of Montana The amendments Grosfield, 778, authored, told, by who was intent H.B. as we are of attor- contingent attorney fees contracts should not be the basis compensation especially large awards. fees awards in- рroposed paragraph as first and The central of Grosfield’s bill Legislature Session said: during House the 1985 troduced (1) em- attorney’s assessed “. . . The amount of an exclusively ployer based on or insurer under 39-71-612 must be on the is- representing the claimant spent time judge. The brought sues before the workers’ spent give the documentation must document the time as- fee and judge. judge The shall determine a reasonable him. costs. He is not bound the documentation sess must be based spent fee the to the time The legal profes- recognized by the customary performed in this work sion as a reasonable fee for added.)” state. (Emphasis session). (1985 Bill H.B. 778 Introduced proposed was not bill language above Grosfield’s The underlined concept applying accepted by legislature. It refused the attorneys. Instead, legislature customary fees of usual read as follows: revised the offered bill to (1) against an em- attorney’s fee assessed “. . . of an The amount exclu- must be based ployer or 39-71-612 or insurer under 39-71-611 representing the claim- sively spent on the time judge. workers’ brought the issues before the ant on give the documen- the time The must document judge. judge The shall determine tatiоn to the submit- costs. He is not bound fee and assess spent must ted to him. The be based on the fee for this state.” Reference H.B. 778. inserted in language above is what underlined proffered. It is clear that
place language had that Grosfield charged attorney fees legislature recognized the matter of vary such fees attorneys largely subjective; individual lawyer, determining fees include lawyer that factors in those *6 availability per- age, experience, ability, of the to and the legal form the kind of work involved. statutes, legislative construing give effect to the the court must State ex re. School District
will,
possible,
if
and not defeat that will.
(1939),
118,
No. 8 v. Lensman
ambiguity
If
108 Mont.
The evidence on fees should be related to the or handling firm the worker’s claim. Pertinent factors to be considered experience field, should include the in the and the complexity of the claim. The should document for the supplying Court the claimed figures represent to the court would his annual overhеad business; handling legal justifiably expected his annual income from business; and the number of annual billable hours that attorney normally apply Using would business. such figures, determine, could its discretion, proper hourly fee to be awarded. Other methods of evi- may suggest dence themselves to the Workers’ аttorneys, or to but all re- methods evidence should “attorney’s customary late to the or current fee” for his ser- vices. lawyers charge Evidence of what other to the in- irrelevant quiry. Norm’s norm is not the norm the case. JUSTICE MORRISON concurs with MR. JUSTICE
SHEEHY. HUNT, concurring:
MR. JUSTICE *7 by majority concur in the result Justice reached Sheehy special perplexed in his concurrence. But I am what objection considering testimony seems to Gros- be of Norman field, law, experienced practitioner of Workers’ Montana Workers’ who was counsel and later administrator of the Division, agency entire the state that oversees the Compensation program in Montana. In addition to that experience, private practice, entering the witness testified that since primarily 80% of his work was and is Workers’ law representing claimants. by deposition subject to cross-examina-
Grosfield testified and was testimony tion. His was considered who,
judge analysis in his said: opinion testimony answered “Since Mr. Grosfield’s was not deposition testimony, counsel has countervailing prepondered on proof and has not carry failed to his burden originally requested. hourly rate heightened reasonableness “Further, judge said: opinion toas by Mr. Grosfield’s is not bound
“While this court any given for rate what would be one.” figure to be a valid the $70 this the Court finds Section in line with This seems to me to be conclusion MCA, says, judge is not bound which “The judge him. The hourly fee attorney’s customary and current must be based on the for this state.” opinion of my considering opinion was correct expert. this