CLAIM NO. D902929
JERRY SEWARD, EMPLOYEE, CLAIMANT v. THE BUD AVANTS COMPANY, EMPLOYER, RESPONDENT and ROCKWOOD INSURANCE/ARKANSAS PROPERTY CASUALTY GUARANTY FUND, CARRIER, RESPONDENT
Before the Arkansas Workers’ Compensation Commission
OPINION FILED MARCH 13, 1997
Upon review before the FULL COMMISSION, Little Rock, Pulaski County, Arkansas.
Claimant represented by DAVID H. McCORMICK, Attorney at Law, Russellville, Arkansas.
Respondent represented by WILLIAM H. TRICE, Attorney at Law, Russellville, Arkansas and RICHARD L. PEEL, Attorney at Law, Russellville, Arkansas.
Decision of Administrative Law Judge: Affirmed as modified.
[1] OPINION AND ORDER
[2] Claimant appeals from a decision of the Administrative Law Judge filed September 26, 1995 finding that claimant’s attorney is entitled to a lump sum attorney’s fee based upon claimant’s award of permanent and total disability benefits. The Administrative Law Judge specifically awarded claimant’s counsel an attorney’s fee in the amount of $7,873.00. On appeal claimant contends that the wrong figures were used to calculate the lump sum attorney’s fee and that the Administrative Law Judge erred in requiring claimant to pay his one-half share of the attorney’s fee out of the claimant’s weekly benefits. We agree, in part, with claimant and affirm the decision as modified.
[3] On November 25, 1995, an Administrative Law Judge entered an order awarding a lump sum attorney’s fee based upon figures used by Steve Williams, Fiscal Officer for the Workers’ Compensation Commission. Mr. Williams used the wrong age in calculating lump sum. On December 30, 1992, an Administrative Law Judge entered an order setting aside the November 25, 1995 order. On January 7, 1995, a new order was entered calculating and awarding a lump sum fee.
[4] However, the Administrative Law Judge used both the wrong age and the wrong disability rate in the January 7, 1995 order. Although the claimant raises several issues on appeal regarding the Administrative Law Judge’s authority to enter his order, we find that the only issue which we need address is the correct lump sum attorney’s fee. Both parties agree that the Full Commission should address this issue.
[5] We find that claimant’s age on the date of the award, and not the date of the injury, is the appropriate age to use in calculating claimant’s average remaining life time expectancy. At the time of the permanent and total disability award, claimant was 42 years old with a life expectancy of 37.31 years which computes to 1940.12 weeks. Claimant’s average remaining lifetime expectancy discounted at the rate of 10%, compounded annually equals 482.8785. When the discounted weeks are multiplied times claimant’s correct disability rate of $174.20, it amounts to a discounted payout to claimant of $84,117.43. In addition to the discounted benefits, claimant is entitled to, and was awarded, undiscounted benefits in the amount of $2,727.00 which represents the difference between the permanent partial disability benefits paid on the 30% impairment rating and the correct rate of permanent and total disability benefits. When Ark. Code Ann. §
11-9-715 is applied to the total benefits awarded, claimant’s counsel is entitled to an attorney’s fee in the amount of $9,084.44.
[6] Ark. Code Ann. §
11-9-715 applies to all cases other than cases involving the State Treasurer as custodian of the Second Injury Fund, therefore, we find that it does apply to lump sums. Consequently, respondent and claimant are each responsible for their one-half share of claimant’s attorney’s fee. Ideally claimant’s one-half portion of attorney’s fee should have been taken out of any benefits-accrued but not paid. Therefore, we find that if there are any accrued benefits to date, claimant’s one-half portion of the attorney’s fee is to be deducted from the accrued benefits. However, if there are not any accrued benefits, we find that respondent shall withhold 10% from claimant’s bi-weekly checks and forward a check to claimant’s attorney every two weeks until claimant’s one-half portion of the fee is paid in full.
[7] Accordingly, we find that the decision of the Administrative Law Judge should be affirmed as modified.
[8] IT IS SO ORDERED.
ELDON F. COFFMAN, Chairman MIKE WILSON, Commissioner
[9] Commissioner Humphrey concurs in part and dissents in part.
[10] CONCURRING AND DISSENTING OPINION
[11] I concur with the opinion of the majority finding that claimant’s attorney is entitled to a lump sum attorney’s fee in the amount of $9,084.44. However, I dissent from the majority’s finding concerning how claimant’s portion of the attorney’s fees is to be paid.
[12] I agree with the majority that any accrued benefits owed claimant should be used to satisfy claimant’s obligation for controverted attorney’s fees. However, in order to further the purpose behind allowing lump sum attorney’s fees, respondent should be required to pay claimant’s attorney the entire fee in a lump sum and withhold a percentage of claimant’s bi-weekly benefits until respondent has recouped claimant’s proportionate share of attorney’s fees.
[13] Additionally, I would point out that the actual effect of today’s opinion is to lump sum only respondent’s obligation for controverted attorney’s fees. Since claimant’s obligation for attorney’s fees is withheld from his bi-weekly benefit check, (just as if there had been no lump sum award of attorney’s fees), claimant’s portion of any fee should not be discounted but paid out bi-weekly until claimant dies or is no longer permanently and totally disabled.
[14] For the foregoing reasons, I concur in part and dissent in part.
[15] PAT WEST HUMPHREY, Commissioner
