Warren v. Amstead Industries, Inc. ( 2019 )

SUPERIOR COURT
OF THE
STATE OF DELAWAREI1
CRAIG A. KARSNITZ 1 The Circle, Suite 2
JUDGE GEORGETOWN, DE 19947
June 3, 2019
Adam F. Wasserman, Esquire Linda L. Wilson, Esquire
Ciconte Serba LLC Marshall Dennehey Warner
1300 King Street Coleman & Goggin
P.O. Box 1126 1007 N. Orange Street
Wilmington, DE 19899 Suite 600
Wilmington, DE 19899
RE: Ida Warren y. Amstead Industries, Inc.,
C. A. No. S18A-08-002 CAK
Submitted: May 28, 2019
Decided: June 4, 2019
Dear Counsel:
By Opinion dated April 23, 2019 I reversed the decision of the
Industrial Accident Board. I did so because I found the Board process to be in
violation of Board Rules and principles of due process. In short I determined that
the Board decided the case by addressing and resolving an issue that was not fairly
raised in the pleadings. Because claimant succeeded on appeal I am required by
Delaware Workers’ Compensation Law to consider claimant’s application for
attorney’s fees for work on the appeal.'
I asked counsel to submit letter memoranda addressing the attorney’s
fee issue, and they have done so. The matter is ripe for resolution.
Section 2350 (f) gives me substantial discretion to award attorney’s
fees to a successful claimant on appeal from the Board. I have discretion to allow
a reasonable fee where the claimant’s position in the hearing before the Board is
affirmed on appeal. I “affirmed” the position taken by claimant concerning the
lack of proper pleading on the primary issue upon which the Board decided the
case. The only limit to the fee award is that it be reasonable.
As it has seemed with all issues in this case the parties are in
substantial and unfortunately, liverish disagreement. Claimant asks that I award
almost $62,000 in fees, and supports the request with an affidavit testifying to a
time expenditure of 225 hours,’and an hourly rate of $275.00. Employer asserts
emphatically that I should exercise my discretion and award nothing. In addition
in a footnote in its letter addressing attorney’s fees, Employer seems to reargue my
decision.
' 19 Del. C. §2350 (f)
° This includes 20 hours spent in pursuing the claim for attorney’s fees.
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Claimant’s position was accepted by me, and my decision will result
in another hearing before the Board. It is exactly this circumstance which to me
justifies an award of attorney’s fees to a Claimant. The rub is what is reasonable.
The seminal case in awarding fees to a workers’ compensation
Claimant is General Motors Corp. v. Cox.’ In Cox the Delaware Supreme Court
articulated the following factors to consider, most of which come from the
Delaware Rules of Professional Conduct:
(1) the time and labor required, the novelty and difficulty of the
questions involved, and the skill requisite to perform the legal
service properly.
(2) the likelihood that acceptance of the case would preclude other
employment opportunities for the attorney.
(3) fees customarily charged in the community for similar legal
services.
(4) the amount involved and the results obtained.
(5) time limitations imposed by the client or by the circumstances.
(6) the nature and length of the professional relationship.
(7) the experience, reputation, and ability of the lawyer or lawyers
performing the services.
(8) whether the fee was fixed or contingent.
3304 A.2d 55 (Del. 1973) (“Cox”)
(9) the employer’s ability to pay.
(10) whether Claimant’s counsel has or expects to receive
compensation from any other source.
As I believe I am required I will address each factor. Before doing so
I comment as to the overall approach. To me an award of attorney’s fees has a
substantial subjective element. The question I address is what is fair to all. I view
the issue holistically and not the individual parts, or in any formulaic way.
I consider one other issue raised by the parties. Claimant raised three
issues in her appeal. She prevailed on the pleadings issue, I declined to rule on
one issue finding it unnecessary to do so, and in dicta I opined that Claimant was
wrong and the Board was correct on a third issue. The batting average was one for
three, but the result was a reversal of the Board decision.
The subsidiary question is whether fees should be awarded for work
on all issues or only the one on which Claimant was successful. Two cases bear
upon this question. In Digiacomo v. Board of Public Education‘ our Supreme
Court reversed a decision which reduced the fee because Claimant “lost” one of
the issues. Digiacomo involved an Employer appeal in which, of course, the
Employer framed the issues. The Claimant necessarily had to respond to the
issues and succeeded in obtaining an affirmance of the Board award. The
“507 A.2d 542 (Del. 1986)
Supreme Court under the above-described circumstances felt the reduction of the
fee to reflect the “loss” of an issue was error.
By contrast in Pollard v. The Placers, Inc.’ the Claimant appealed,
controlled the issues and the Court affirmed an award of fees based upon an issue
analysis. The Court also approved viewing the result achieved in the context of
the issues won.
I am of the opinion that the Placers solution is the applicable one.
The reversal here results in a new hearing, not a monetary award. More
importantly I completely rejected the third issue raised which dealt with a claim of
violation of discovery rules, of perjury, and other ethical issues. As I said in my
initial opinion the arguments on the last issue shed far more heat than light and
were not helpful.
The second issue I found unnecessary to address other than in
passing.
As a result I give full credit in my fee analysis as to the first issue,
little credit as to the second, and none as to the third.
The Cox Factors
(1) Time, labor and skill
5703 A.2d 1211 (Del. 1997)
Claimant’s counsel has submitted an affidavit telling me he spent 225
hours litigating the appeal, a gracious plenty. Most of that time (187 hours) was
spent on the briefs. I have no delineation by issue. By reviewing the briefs it
appears to me that the greater portion of time was spent on the third issue.
Tam also of the view that the issue upon which Claimant prevailed
was not particularly novel or complex. The question was a fairly standard issue of
pleading and notice. Without meaning to in any way impugn the quality of effort,
of either attorney, I find the issue was within the ken of a good law student or
young attorney.
T also find that Claimant’s attorney properly and professionally
handled the issue which led to Claimant’s success on appeal. The attorney’s fee
affidavit also told me Claimant’s hourly rate for similar matters is $275.00 per
hour. This rate is well within the bounds of reason and the norm for the legal
market.
(2) Preclusion of other employment
Preclusion of other employment played no role in this case.
(3) Fees customarily charged
Workers’ compensation cases are typically handled on a contingent
basis, as Claimant’s attorney handled this one. In assessing fees the Court
typically either awards fees or at least reviews them based upon an hourly rate.
Here without any particular explanation Employer asserts the hourly rate seems
“about” $100.00 per hour too high. While this is my only professional association
with Claimant’s counsel, before me he was prepared, professional and competent.
Based on other similar cases and my experience J am of the opinion that the hourly
rate is reasonable.
(4) Amount involved/results obtained
Claimant’s total disability payments® were at issue. Employer sought
to terminate the benefits. Undoubtedly the money received by Claimant was
critical to her financial well-being. While we know the weekly payment, the
duration is indeterminate. The result in this case does not, however, grant the
benefits to Claimant. It gives her the right to continue in her opposition to
Employer’s petition to terminate them, a significant, but unquantifiable benefit.
(5) Time Limitations imposed by the case
The parties agree this factor has no relevance.
(6) Nature and Length of the relationship with the client
Claimant has had a professional relationship with the firm requesting
the fee for eight and a half years with respect to her workers’ compensation claim.
© Pursuant to 19 Del. C. §2324
The conclusion I reach is the relationship is stable and satisfactory.
(7) Experience, reputation and ability of the lawyer
The firm with which Claimant’s current attorney works is
experienced and well-known. Claimant’s attorney has been a member of the bar
for six and a half years and tells me he is experienced in workers’ compensation
litigation. His performance before me was professional and competent. I have
had no other experience with him.
On this subject Employer takes the opportunity to disparage
Claimant’s attorney’s work citing examples of purported failings. One can only
know another’s abilities through contact and reputation. Before me Claimant’s
counsel performed professionally and skillfully. The criticisms lodged are not
helpful to resolution of the issue.
(8) Fixed or contingent fee
The fee arrangement with Claimant is based upon a contingency
percentage of the amount recovered. Contingency fee arrangements are the norm.
However, the relationship between Claimant and her attorney provides little help
in assessing fees as the responsibility of the Employer. A contingent fee
arrangement does cause risk to counsel and is a consideration.
(9) Employer’s ability to pay
I have been provided no information on this factor.
(10) Whether counsel has received compensation from another
source
Claimant’s counsel tells me he has not received compensation for the
work for which he is now seeking payment.
Analysis
A great deal of subjectivity is necessarily a part of any fee award.
Here I find that Claimant’s counsel was successful in pursuing an appeal which
gave Claimant a chance to preserve her right to total disability payments. The
appeal does not, however, garner a specific monetary benefit to Claimant. The
Board will have to determine if disability payments will continue.
In addition I have determined that much of the time and effort on
appeal was over an issue which was not relevant to the decision. To me the
“third” issue, concerning discovery disputes and alleged perjury, were more a
result of the parties’ petulance than about advancing the case. As noted in my
issue analysis Claimant controlled the issues. I give no credit for that effort.
Finally, I reject any formalistic approach, i.e. number of hours times
hourly rate. I consider the hours and rate as only a factor as Cox tells me to do. I
place emphasis on the important, but financially limited benefit achieved, and the
straight forward issue upon which that benefit was based. I also give substantial
credit for the professional effort addressing that issue.
Taking all the factors into consideration I award Claimant the sum of
$15,000.00 in attorney’s fees, and her costs of $1,109.95. To me it bears repeating
that this, as all fee assessments, has a large subjective element. I am of the view
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this assessment is fair under all the circumstances.
To the extent an order is needed to effectuate this opinion, IT IS SO
ORDERED.
Very truly yours,
CAK/|ml
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