Heritage Healthcare v. Ayers

BRANCH, Judge,

dissenting.

The Appellate Division of the State Board of Workers’ Compensation determined that the claimant’s attorney was entitled to “quantum meruit” fees of 25 percent of the amount of temporary total disability (“TTD”) benefits from the date of injury through the date the employer paid the late fees just prior to the final hearing. The record supports the Appellate Division’s award, and the superior court therefore was not authorized to substitute its own findings for the findings of the Appellate Division and thereby increase the attorney fee award to include 2 5 percent of TTD benefits payable after the employer paid the late fee. Accordingly, I respectfully dissent.

1. “On appeal to this Court, our duty is not to review whether the record supports the superior court’s decision but whether the record supports the initial decision of the local governing body or administrative agency.” (Citations and punctuation omitted.) Jamal v. Thurmond, 263 Ga. App. 320 (587 SE2d 809) (2003).

On appeal from an award of the Appellate Division of the State Board of Workers’ Compensation, this Court examines the record to see if there is competent evidence to support the award and construes the evidence in a light most favorable to the prevailing party. Further, it is axiomatic that the findings of the State Board of Workers’ Compensation, when supported by any evidence, are conclusive and binding, and that neither the superior court nor this court has any authority to substitute itself as a fact finding body in lieu of the board.

(Citation and punctuation omitted.) Harris v. Peach County Bd. of Commrs., 296 Ga. App. 225 (674 SE2d 36) (2009).

This case turns on the wording of the Appellate Division’s award, which shows that the Appellate Division awarded fees in quantum meruit under OCGA § 34-9-108 (b).

Subsection (b) of OCGA § 34-9-108 provides for recovery of attorney fees from a party to the proceedings or the employer in two circumstances. Subsection (b) (1) provides that the “adverse attorney’s fee” may be assessed against the “offending party” when that party “brought, prosecuted, or defended [the proceedings] in whole or *179in part without reasonable grounds”; subsection (b) (2) provides that “the reasonable quantum meruit[11] fee of the attorney, as determined by the board” may be assessed against “the employer” if the employer fails to comply with OCGA § 34-9-22112 “without reasonable grounds.” (Emphasis supplied.) Attorney fees may be assessed under either or both provisions. See, e.g., C. Brown Trucking v. Rushing, 265 Ga. App. 676, 678-679 (2) (595 SE2d346) (2004). And the decision to assess fees under either subsection falls within the discretion of the court, although the determination of the amount of fees must be based upon the evidence presented. See Copelan v. Burrell, 174 Ga. App. 63, 64 (2) (329 SE2d 174) (1985).

The Appellate Division ruled that Ayers was entitled to attorney fees under both subsections (b) (1) and (2) of OCGA § 34-9-108, but it announced that it was determining the amount of the award in the quantum meruit language of subsection (b) (2) as follows:

[I]t is the determination of the Board that the reasonable quantum meruit fee to be assessed against the Employer/ Insurer is 25% of the amount of [TTD] benefits plus late fees paid from October 26, 2010, (the date of injury) through September 27,2011, (the issuance of the late fee payment on the eve of hearing below).

(Emphasis supplied.) Thus, it is clear from the Appellate Division’s order that it used its discretion to assess fees under subsection (b) (2) rather than (b) (1).13

The amount of fees to be assessed under subsection (b) (2) is “the reasonable quantum meruit fee of the attorney, as determined by the board.” Although proof of an express attorney fee agreement may afford “prima facie proof of the value of the services rendered... even when recovery is sought upon quantum meruit,” G. Carbonara & Co. v. Helms, 205 Ga. App. 547, 548 (423 SE2d 36) (1992) (citations and punctuation omitted), “the hearing director and full board are vested *180with exclusive authority to weigh the evidence.” Zurich Ins. Co. v. McDuffie, 117 Ga. App. 90, 91 (2) (159 SE2d 423) (1968). The question of the amount and reasonableness of the quantum meruit attorney fees under OCGA § 34-9-108 (b) (2) is thus a factual question for the State Board. Here, the State Board awarded attorney fees for the period of time that the employer stood delinquent in its obligations to the employee, i.e., from the time of injury through the date the employer paid the late fees. There was competent evidence in the record to support the agency decision to limit the assessed fees to the specified period of time.14 Thus the record supports the initial decision of the Appellate Division, and the superior court was therefore not authorized to substitute its own findings for the findings of the Appellate Division.

2. Rule 108 (a) of the State Board of Workers’ Compensation is inapplicable to the Appellate Division’s decision in this case.

Whereas subsection (b) of OCGA § 34-9-108 provides for assessing attorney fees and litigation expenses against an employer or a party and is relevant to this case, subsection (a) regulates the fee an attorney may charge a workers’ compensation claimant, which is a separate matter.15 Similarly, Rule 108 (a) of the State Board of Workers’ Compensation also addresses the claimant-attorney relationship in that it provides that contracts between an attorney and a claimant must contain certain provisions, including the following:

This contract is subject to the approval of the State Board of Workers’ Compensation, and no fee of more than $100.00 shall be paid under the contract unless approved by the Board.
No contract shall be filed with the Board which provides for a fee greater than 25 percent of the recovery of weekly *181benefits. Any contract with these terms, absent compelling evidence to the contrary, shall be deemed to represent the reasonable fee of the attorney.
Decided July 16, 2013 Swift, Currie, McGhee & Hiers, Rodney A. Ficker, for appellants. Stephen C. Carter, for appellee.

(Emphasis supplied.)

Ayers argues that by applying the highlighted language to her claim for assessed fees against her employer, the evidence of attorney fees presented by her attorney, including the fee agreement, should be deemed as a matter of law to represent the reasonable value of those fees. Nothing in the language of Rule 108 (a) shows that the provisions contained therein apply to an award of quantum meruit fees against an employer under OCGA § 34-9-108 (b). Moreover, Rule 108 (a) cannot override the express authority granted to the board by statute to determine “the reasonable quantum meruit fee of the attorney.” OCGA § 34-9-108 (b) (2). See generally MARTA v. Reid, 282 Ga. App. 877, 883 (3) (640 SE2d 300) (2006) (the board is not authorized to make rules inconsistent with the Workers’ Compensation Act, OCGA § 34-9-1 et seq.). In short, the Appellate Division was not bound by Rule 108 (a) to assess attorney fees against the employer under OCGA § 34-9-108 (b) based on the precise terms of Ayers’s attorney fee agreement with Carter.

For the above reasons, the superior court erred by reversing the decision of the Appellate Division of the State Board of Workers’ Compensation.

I am authorized to state that Presiding Judge Andrews and Judge Ray join in this dissent.

“Quantum meruit” is defined as “[t]he reasonable value of services; damages awarded in an amount considered reasonable to compensate a person who has rendered services in a quasi-contractual relationship.” Black’s Law Dictionary (9th ed. 2009).

OCGA § 34-9-221 provides for several rules for when workers’ compensation benefits must be paid.

By ignoring how the Appellate Division actually made the attorney fee award — based on the quantum meruit value of the services — the majority has reviewed the record to see whether it supports the superior court’s decision, which is exactly what this Court is not supposed to do; rather, we are required to review the record to determine whether it supports the Appellate Division’s award. The record clearly supports the Appellate Division’s quantum meruit award.

Indeed, as pointed out in James B. Hiers, Jr. et al., Ga. Workers’ Compensation Law & Practice, § 22-3, n. 14 (5th ed.), an award of something less than the full value of the attorney's services makes sense under the circumstances:

For example, assume there is some non-compliance to the extent of a late payment or non-payment. The claimant retains an attorney who contacts the insurer hy telephone or letter or both and payments are made, albeit late. Under those circumstances the board may award attorney fees commensurate with the effort expended (telephone call, letter, etc.) on a lump sum basis instead of on a continuing percentage add-on basis. It makes sense. The attorney is compensated for work performed. The insurer is made to pay for its error. The assessment may be tailored to the circumstances.

Specifically, subsection (a) provides that any fee in excess of $100 must be approved by the board and that no fee can exceed 25 percent of the claimant’s award of weekly benefits or settlement.