NY Court Affirms Board’s Reduction of Attorney Fee to 45 Percent of Amount Requested

Yesterday, a New York appellate court affirmed a decision by a panel of the state’s Workers’ Compensation Board that set counsel fees for the claimant’s attorney at $8,000, instead of the $18,000 the attorney had originally requested [Matter of Oshier v. New York State Dept. of Corr. & Community Supervision, 2020 N.Y. App. Div. LEXIS 955 (Feb. 6, 2020)]. Finding, inter alia, that the claimant’s endorsement of counsel’s request was not pertinent and indicating that counsel had provided no support for his claim that 15 percent of the amount awarded to a claimant was a customary fee in a workers’ compensation case, the appellate court found the Board’s decision was not arbitrary, capricious or an abuse of discretion.

Background

In April 2015, claimant injured her left shoulder in a work-related accident. She filed a claim for workers’ compensation benefits and appeared without counsel at a hearing before a WCLJ. At the hearing’s conclusion, the WCLJ ruled that claimant sustained a compensable injury and set the average weekly wage at $1,022.01. In December 2016, claimant retained counsel to represent her in further proceedings involving her claim.

Conflicting medical evidence was presented on the issue of the permanency of claimant’s condition. Ultimately, the WCLJ concluded that claimant had a 55 percent schedule loss of use of the left arm and awarded her benefits totaling $116,917.94. Although claimant’s counsel requested counsel fees in the amount of $18,000 — roughly 15 percent of the amount recovered — the WCLJ awarded $9,225. Claimant and her counsel sought Board review of that part of the WCLJ’s decision awarding counsel fees. A panel of the Board, in turn, modified the WCLJ’s decision by reducing the award and granting counsel fees to claimant’s counsel in the amount of $8,000. Claimant and her counsel appealed.

Board Has Broad Discretion in Setting Fees

The court initially noted that the Board had broad discretion in setting counsel fees and and that such approval would be disturbed only if it was arbitrary, capricious, unreasonable or otherwise constituted an abuse of the Board’s discretion.

Counsel Fees May Not Be Based Upon Amount of Recovery

The court noted that claimant’s counsel had represented that a total of 17.9 hours were expended performing legal services in connection with the case. The court stressed that here, the claim had already been established by the time counsel was retained so the services rendered were confined to the SLU award. The court added that while counsel maintained that it was through his vigorous advocacy that he was able to obtain a favorable result, the desirability of the result was not a relevant consideration in determining the amount of the counsel fees to be awarded. Indeed, stressed the court, the regulations specifically prohibited an award of counsel fees based upon the amount of the recovery [see 12 NYCRR 300.17[f]].

Claimant’s Endorsement of Fee Amount Not Pertinent

The court noted claimant’s endorsement of counsel’s fee request, but indicated it was not pertinent to the court’s consideration. Moreover, counsel had provided no support for his claim that 15 percent of the amount awarded to a claimant was the customary fee in a workers' compensation case. Under all these circumstances,, the court found that the Board’s counsel fee award of $8,000 was not arbitrary, capricious or an abuse of discretion.