Kentucky Cap on Claimant Attorney’s Fees Applies In Spite of Multiple Proceedings to Recover Benefits

The $12,000 cap on claimant’s attorney’s fees contained in KRS 342.320(2)(a) applies to the entire “original claim,” including any interlocutory proceedings, such as as a medical fee dispute, held a Kentucky appellate court in Watts v. Danville Housing Auth., 2014 Ky. LEXIS 345 (Aug. 21, 2014). The interlocutory proceeding cannot be considered separate from the employee’s claim for income benefits in order to support approval of additional fees.

After an employee sustained a work-related back injury, her treating physician recommended that the employee undergo a fusion surgery on her spine, but the employer denied the proposed surgery. The employee filed a medical fee dispute petition and utilized her attorney during the proceeding. After a bifucation of issues, the law judge entered an interlocutory opinion, award, and order finding that the fusion surgery was necessary for treatment of the employee’s work-related injury. The employee received more than $72,000 in TTD benefits as a result of the interlocutory order. Once the employer reached MMI, the claim was returned to the active docket, and the parties reached a settlement for a sum of $175,000, which included a waiver of future medical expense benefits.

After the settlement, the attorney filed two motions for approval of attorney fees, one of $12,000 for work performed in obtaining the lump sum payment, and a second requesting $8,369.19 for work performed in obtaining the TTD and medical benefits under the interlocutory order. The judge granted the motion regarding the $12,000 in attorney’s fees, but denied the second motion in its entirety.

On appeal, the attorney contended that the term “original claim” in KRS 342.320(2)(a) should be narrowly construed, that a motion for interlocutory relief related to a medical fee dispute should be considered a separate proceeding from the underlying workers’ compensation matter for purposes of calculating attorney’s fees. The appellate court disagreed. It indicated that while an attorney may apply for an attorney fee after the entry of an interlocutory order, the maximum fee allowed for the entire original claim is nevertheless limited to the $12,000 cap specified by the statute.

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