North Carolina Lawyers Weekly
When an attorney appeals the Industrial Commission’s denial of a fee in a workers’ compensation case, G.S. § 97-90(c) allows the superior court judge to consider additional evidence not presented to the Commission. The superior court did not abuse its discretion when it awarded plaintiff’s counsel 25 percent of a retroactive award for attendant-care services that had been provided by plaintiff’s husband.
We reverse the Court of Appeals’ decision and remand to the Commission for entry of an order setting attorneys’ fees as determined by the superior court.
Facts
Plaintiff suffered a debilitating injury at work. After a discovery dispute, defendants stopped providing attendant-care services, so plaintiff’s husband began providing those services.
With the consent of plaintiff and his husband, plaintiff’s counsel associated an attorney experienced in recouping compensation for attendant care services. After many attorney hours and litigation expenses, plaintiff was awarded retroactive attendant-care compensation. However, the Commission declined to grant attorneys’ fees associated with that award.
Plaintiff’s counsel appealed the denial of fees to the superior court. The superior court considered an affidavit from plaintiff’s husband – which had not been presented to the Commission – stating that plaintiff’s husband had agreed to plaintiff’s counsel’s pursuit of retroactive attendant-care compensation on his behalf with the understanding and desire that any recovery made on his behalf through plaintiff’s workers’ compensation claim would be subject to the 25-percent fee previously agreed to in the original retainer agreement between plaintiff and counsel.
The superior court reversed the Commission’s denial of attorneys’ fees, but our Court of Appeals reversed.
Analysis
Contrary to the Court of Appeals’ ruling, the controlling statute, G.S. § 97-90(c), does not prohibit the superior court from looking beyond the evidence presented before the Commission or from taking new evidence. Rather, the statute vests the superior court judge with the authority to “consider the matter and determine in his discretion the reasonableness of said agreement or fix the fee” when there is an agreement, and “in all other cases where there is no agreement for fee or compensation … [to] consider the matter of such fee and determine in his discretion the attorneys’ fees to be allowed in the cause.” Thus, the plain language of the statute sets forth a broad, de novo fact-finding role for the superior court.
Pursuant to § 97-90(c), the superior court judge may take and consider additional evidence not presented to the Commission in order to properly consider the matter and exercise the court’s discretion.
Here, the Commission found, “The only fee agreement of record at the Industrial Commission is the one entered into between [plaintiff’s original counsel] and plaintiff” and concluded, “There is no evidence of a fee agreement between plaintiff’s counsel and any of plaintiff’s medical providers, including [plaintiff’s husband] Mr. Holappa.” The superior court, under its authority to “consider the matter” of attorney’s fees and “in [its] discretion” fix the attorney’s fees to be allowed, considered the evidence, including an affidavit from Mr. Holappa, and determined that there actually was such an agreement. In fact, the very same agreement between plaintiff’s counsel and plaintiff that was before the Commission was the one submitted to the superior court for review; Mr. Holappa’s affidavit made clear that he was also a party to that agreement.
Having determined that Mr. Holappa was a party to the agreement between plaintiff and his counsel providing for attorney’s fees of “25 percent of any recovery,” the superior court properly considered all the factors listed in subsection (c) and “in its discretion, determined that a reasonable attorney’s fee … is 25 percent and shall therefore be allowed.”
The Court of Appeals also said that “medical compensation is solely in the realm of the Industrial Commission, and § 97-90(c) gives no authority to the superior court to adjust such an award under the guise of attorneys’ fees.” We disagree and conclude that the superior court below acted exactly within the authority and discretion provided to it by the plain language of § 97-90(c).
We also disagree with the Court of Appeals that § 97-90(c) is an “obsolete relic” because it was enacted prior to the establishment of the Court of Appeals. The legislature has amended the subsection several times without removing the superior court’s discretion to review attorney’s fees.
Furthermore, the appellate jurisdiction now possessed by the Court of Appeals was the same as that possessed by the superior court before the enactment of subsection (c). A review under § 97-90(c) is a unique, fact-based avenue of review covering a limited subject matter that the legislature has chosen to vest in the superior court.
Reversed and remanded.
Saunders v. ADP TotalSource Fi Xi, Inc. (Lawyers Weekly No. 010-001-19, 25 pp.) (Robin Hudson, J.) Appealed from Buncombe County Superior Court (Alan Thornburg, J.) On discretionary review from the Court of Appeals. Mark Sumwalt, Vernon Sumwalt, Lauren Walker and Henry Teich for plaintiff; M. Duane Jones, Kari Schultz and Linda Stephens for defendants. N.C. S. Ct.
