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Stumvoll v. Lauridsen

Court of Workers Compensation of Montana

October 28, 1998

BARBARA STUMVOLL Appellant
v.
DAVID W. LAURIDSEN Respondent STATE COMPENSATION INSURANCE FUND, Insurer.,

          Submitted: April 20, 1998

          ORDER ON APPEAL

          MIKE McCARTER JUDGE.

         Summary: Appellant signed Attorney Retainer Agreement providing that, in cases which are settled without an order of the workers' compensation judge or Supreme Court, the attorney will receive "twenty percent (20%) of the amount of additional compensation payments the claimant receives due to the efforts of the attorney." Through the efforts of the attorney, appellant's claim for benefits was reclassified from an occupational disease to an injury, making her eligible for permanent partial disability benefits. When claimant reached MMI, the attorney demanded permanent total disability benefits on her behalf. The insurer refused and mediation ensued. During the period of negotiation, the insurer continued temporary total disability benefits. Eventually, the insurer conceded claimant was permanently totally disabled. Appellant then discharged the attorney and maintained that her PTD benefits were not subject to the fee agreement. After a Hearing Officer for the Department of Labor Hearing Officer found the attorney was entitled to twenty percent of PTD benefits and of the impairment award, claimant appealed.

         Held: While claimant is correct that her total disability benefits did not change after she reached MMI, she fails to acknowledge the whole picture. After she reached MMI, she was no longer entitled to temporary total disability benefits. Through the attorney's efforts, the insurer accepted her claim for PTD status. In Madill v. State Compensation Ins. Fund, 280 Mont. 280, 930 P.2d 665 (1997), the Supreme Court expressly held that where an insurer denies that a claimant is permanently totally disabled and the claimant's attorney thereafter obtains a concession that claimant is PTD, the attorney has obtained additional benefits for claimant. Although Madill involved an award of attorneys fees against an insurer, the conclusion regarding attorneys efforts is indistinguishable from the issue in this case. Appeal denied.

         Topics:

Attorney Fees: Fee Dispute. Under a standard fee agreement between claimant and her attorney, the attorney was entitled to receive "twenty percent (20%) of the amount of additional compensation payments the claimant receives due to the efforts of the attorney" if the matter was settled without an order of the workers' compensation judge or Supreme Court. Where the insurer had denied claimant was permanently totally disabled and the claimant's attorney thereafter obtained a concession that claimant is PTD, the attorney obtained additional benefits for claimant and was entitled to twenty-percent of PTD payments. See, Madill v. State Compensation Ins. Fund, 280 Mont. 280, 930 P.2d 665 (1997).

         ¶1 This is an appeal of a decision of the Department of Labor and Industry (Department) finding that David W. Lauridsen (Lauridsen) is due attorney fees from former client Barbara Stumvoll (Stumvoll). The facts are not in dispute.[1]

         Facts

         ¶2 Stumvoll was injured at work on September 24, 1992. She thereafter filed a claim for compensation. On February 22, 1993, the State Compensation Insurance Fund (State Fund) accepted the claim as an occupational disease and commenced paying temporary total disability benefits.

         ¶3 Stumvoll then enlisted the services of Lauridsen, signing an Attorney Retainer agreement on November 10, 1993. Lauridsen contacted the State Fund and demanded that her claim be accepted as an injury under the Workers' Compensation Act. The matter was mediated on January 27, 1994. On July 22, 1994, after Lauridsen petitioned the Workers' Compensation Court on Stumvoll's behalf, the State Fund accepted the claim as an industrial injury. It thereafter continued paying temporary total disability benefits at the same rate.[2]

         ¶4 On December 8, 1995, Lauridsen notified the State Fund that Stumvoll had reached maximum medical improvement and requested that she be determined to be permanently totally disabled. He attached a letter from Dr. John R. Dorr opining that Stumvoll was at maximum medical recovery and rating her as having a 20% impairment.

         ¶5 The State Fund declined to reclassify Stumvoll as permanently totally disabled, and Lauridsen sought another round of mediation. The mediation took place on January 31, 1996. On April 19, 1996, the State Fund reclassified Stumvoll as permanently totally disabled. The reclassification did not change Stumvoll's biweekly benefits since her rate was the same for both temporary and permanent total disability purposes. Since the State Fund apparently continued paying temporary total disability benefits between December 8, 1995 and April 19, 1996, Stumvoll suffered no interruption in her benefits.

         ¶6 Immediately after the State Fund reclassified her, Stumvoll fired Lauridsen and contested his entitlement to any attorney fees.

         ¶7 Thereafter, Lauridsen requested that the Department determine his entitlement to attorney fees. On June 21, 1996, the Department issued an initial determination finding that Lauridsen was entitled to attorney fees with respect to ...


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