CLAIM NOS. E807734 E807735
Before the Arkansas Workers’ Compensation Commission
ORDER FILED AUGUST 13, 1999
Upon review before the FULL COMMISSION in Little Rock, Pulaski County, Arkansas.
Claimant represented by the HONORABLE FREDERICK S. “RICK” SPENCER, Attorney at Law, Mountain Home, Arkansas.
Respondent represented by the HONORABLE JOSEPH H. PURVIS, Attorney at Law, Little Rock, Arkansas.
Decision of the Administrative Law Judge: Reversed.
[1] OPINION AND ORDER[2] The claimant appeals a decision by the administrative law judge ordering the claimant’s attorney to reimburse the respondents expenses in the amount of $335.00 that were incurred in preparation for a hearing. For the reasons discussed below, we find that the decision of the administrative law judge must be reversed. [3] On July 8, 1998, the claimant’s attorney filed a claim for compensation and a request for a hearing on behalf of the claimant. The claim was assigned to an administrative law judge. A prehearing information sheet filed by the claimant indicated that the claimant’s attorney was prepared to litigate the claim. On September 15, 1998, a prehearing conference was conducted and a prehearing order was filed on September 17, 1998. During the prehearing conference, the claimant’s attorney advised the administrative law judge that he was prepared to litigate the claim and a hearing was scheduled for December 9, 1998. The status of discovery was discussed during that conference and the claimant’s attorney failed to indicate at that time that he was seeking additional medical information or records. On November 25, 1998, Attorney Spencer filed a Motion for Continuance stating that he had been unable to obtain additional medical evidence from the claimant’s family physician, Dr. Ahrens. The motion was granted and the hearing was rescheduled for February 17, 1999. On February 15, 1999, the claimant’s attorney faxed a “Voluntary Dismissal of Claim Without Prejudice” and asked that the claim be removed from the hearing docket. February 15, 1999, was a state holiday and the Commission’s offices were closed. Therefore, the request was not actually received until February 16, 1999, the day before the scheduled hearing. The claimant’s attorney’s written request for dismissal did not provide any reason to justify the request or attempt to show good cause to remove the matter from the docket. [4] By order dated February 16, 1999, the administrative law judge granted the claimant’s motion and dismissed the claimant’s claim without prejudice. On his own motion, the administrative law judge also directed the claimant to pay the court reporter’s appearance fee and to pay any expenses reasonably incurred by the respondents in preparation for the canceled hearing. The administrative law judge directed the respondents to submit a statement of expenses within 10 days. [5] After receiving the respondents’ statement of expenses for $335.00, the administrative law judge entered an order on March 16, 1999, directing the claimant’s attorney to reimburse the respondent’s expenses of $335.00 within 30 days. The administrative law judge denied a motion for reconsideration by order dated April 15, 1999. The claimant’s attorney has reimbursed the respondents and filed this appeal. [6] In his March 16, 1999 order, the administrative law judge concluded that the claimant’s attorney violated both Ark. Code Ann. § 11-9-717 and the administrative law judge’s own Prehearing Procedure Standing Order provided to the claimant’s attorney when a hearing was requested. [7] Arkansas Code Annotated § 11-9-717 provides:
[8] (B) A party who is not represented by an attorney shall sign his claim, request for benefits, request for additional benefits, controversions of benefits, request for a hearing, pleading, motion, or other paper, and state his address. [9] (2) The signature of an attorney or party constitutes a certificate by him that: [10] (A) He has read the claim, request for benefits, request for additional benefits, controversion of benefits, request for a hearing, pleading, motion, or other paper; [11] (B) To the best of his knowledge, information, and belief formed after reasonable inquiry, it is well grounded in fact and is warranted by existing law or a good faith argument for the extension, modification, or reversal of existing law; and [12] (C) It is not interposed for any improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation. [13] (3) If a claim, request for benefits, request for additional benefits, controversion of benefits, request for a hearing, pleading, motion, or other paper is not signed, it shall be stricken unless it is signed promptly after the omission is called to the attention of the pleader or movant. [14] (4) If a claim, request for benefits, request for additional benefits, controversion of benefits, request for a hearing, pleading, motion, or other paper is signed in violation of this rule, the Workers’ Compensation Commission, including Administrative Law Judges, upon motion or upon their own initiative, shall impose upon the person who signed it, a represented party, or both, an appropriate sanction, which may include an order to pay to the other party or parties the amount of reasonable expenses incurred because of the filing of a claim, request for benefits, request for additional benefits, controversion of benefits, request for a hearing, pleading, motion, or other paper, including a reasonable attorney’s fee. [15] (b) Appropriate sanctions, including the amount of reasonable expenses and attorney’s fees, may also be imposed against a party or its attorney which, without good cause shown, fails to appear for a hearing, deposition, or any other matter scheduled by the commission or Administrative Law Judge, or frivolously joins another party. [16] In addition, the Prehearing Order filed in this matter on [17] September 17, 1998, contained the following:(a)(1)(A) Every claim, request for benefits, request for additional benefits, controversion of benefits, request for a hearing, pleading, motion, and other paper of a party represented by an attorney shall be signed by at least one (1) attorney of record in his or her individual name, whose address shall be stated.
[18] 1. Sanctions Pursuant To Purported Ark. Code Ann. §11-9-717 Violation [19] The administrative law judge found in relevant part in his March 16, 1999 order:Since the parties agreed to the hearing date during the prehearing conference, no changes will be made without showing good cause. Docket changes made five days or less before the scheduled hearing may result in the assessment of hearing costs, court reporter expenses, witness fees, attorney fees, or other costs resulting from the change.
Likewise, the Prehearing Procedure Standing Order which was provided to the claimant’s attorney when the hearing was requested in this matter provides the following:
(g) If discovery is complete, a hearing will be scheduled during the prehearing conference. Except in unusual and unavoidable circumstances, which will be determined at the discretion of the Commission, there will be no continuances of the scheduled hearing. Thus, the parties are advised to have their calendars available at the time of the prehearing conference so that an acceptable hearing date can be determined. If discovery is incomplete, the case will be returned to general files.
[20] [Emphasis added].In his written request for a dismissal of the claim, counsel for the claimant did not provide any reason to justify the request to remove the matter from the docket or otherwise attempt to show good cause, as directed in the Prehearing Order. However, he subsequently indicated that he and the claimant simply decided that she did not have a justiciable claim.
[21] However, in the present case, no evidentiary hearing was held, and this issue was not submitted to the administrative law judge on stipulated facts. The Commission file does not contain any correspondence from the claimant’s attorney indicating that the motion to dismiss was filed because the claimant’s attorney determined that there is no justiciable claim in the case. To the contrary, the only correspondence from the claimant’s attorney indicates that the claimant’s attorney sought the voluntary dismissal because he was unable to obtain the medical reports he sought prior to the scheduled hearing, and that he sought a dismissal without prejudice in this case because the administrative law judge has previously denied the attorney’s untimely continuance requests in other cases. We do not perceive the claimant’s motion for a voluntary dismissal without prejudice under these circumstances as an admission that the claimant’s claim is not well grounded in fact or that there is no justiciable claim. There is simply no evidence or stipulated admission before the Commission that the claimant’s claim is or is not well grounded in fact. Consequently, we reverse the administrative law judge’s finding that the claimant’s attorney dismissed the claimant’s claim because the attorney determined that the claimant did not have a justiciable claim. [22] 2. Sanction Pursuant To Prehearing Orders [23] We agree with the administrative law judge that the claimant’s attorney has not shown good cause, as required by the administrative law judge’s Prehearing Order, in filing his motion to dismiss without prejudice two days before the scheduled hearing. As discussed, the claimant’s attorney has explained on appeal that he proposed a voluntary dismissal in this case because the administrative law judge has denied his requests for untimely continuances in similar cases in the past. The claimant’s attorney explained that the reason he files untimely motions for a continuance is because of his inability to obtain medical reports in a timely manner. [24] The claimant’s attorney and his high volume Workers’ Compensation practice are well known to this Commission. This Commission is not unsympathetic to the problem that attorneys face in obtaining medical reports in a timely manner to present as hearing evidence. We, likewise, recognize that oversights will occur from time to time in a high volume practice. [25] Nevertheless, for the following reasons, we do not find persuasive the arguments presented by the claimant’s attorney for failing to comply with the administrative law judge’s prehearing orders. The claimant’s attorney asserts that his last-minute requests for continuances and, in this case, a voluntary dismissal occur because he cannot obtain relevant medical reports. However, in order to be admissible as evidence, any medical reports the claimant’s attorney intends to submit into evidence at a hearing must be furnished to the opposing party at least 7 days prior to the date of the hearing. See, Ark. Code Ann. § 11-9-705(c)(2)(A). Therefore, the claimant’s attorney knew, or should have known, at least 7 days in advance of the scheduled hearing whether he did or did not have available the medical reports necessary to proceed to a hearing. In light of the 7-day rule provided for under Section 705(c)(2)(A), we find that the claimant’s attorney clearly acted without good cause in waiting until 2 days before the hearing to seek a voluntary dismissal because of his purported inability to obtain medical reports necessary to proceed to the scheduled hearing. In addition, the claimant’s attorney had adequate notice (provided by the administrative law judge’s prehearing order) that any docket changes requested within 5 days of the scheduled hearing might result in the assessment of costs, expenses and fees resulting from the change. [26] Nevertheless, we reverse the administrative law judge’s March 16, 1999 order directing the claimant’s attorney to reimburse the respondents $335.00 in expenses incurred on February 11, 1999 and February 12, 1999 in preparation for the scheduled hearing. In reaching this decision, we note that the administrative law judge’s September 17, 1998 prehearing order indicates that docket changes made within five days of a scheduled hearing may result in the assessment of costs, expenses, and fees resulting from thechange. However, the expenses proffered by the respondents were incurred five to six days before the scheduled hearing. The respondents’ own Statement of Expenses indicates that these expenses were incurred in preparation for the hearing, and there is no evidence that these expenses were incurred as a result of a change in the docket. In fact, it appears that the administrative law judge granted the claimant’s motion to dismiss in time so that apparently no expenses were incurred by the respondents as a result of the change. There is likewise no evidence that the preparation performed by the respondents’ attorney and paralegal on February 11, 1999 and February 12, 1999 would need to be duplicated if a hearing is held at a later date. [27] Therefore, for the reasons discussed herein, we reverse the administrative law judge’s March 16, 1999 order directing the claimant’s attorney to reimburse the respondents for $335 in expenses. The respondents are directed to reimburse the claimant’s attorney the $335 that he has already paid the respondents. [28] IT IS SO ORDERED. [29] _______________________________The Court of Appeals has previously affirmed the Commission’s imposition of sanctions under Ark. Code Ann. § 11-9-717 where the record indicates that an attorney filed a claim where no justiciable issue was present. See Johnson v. Triple T Foods, 55 Ark. App. 83, 929 S.W.2d 730 (1996).
ELDON F. COFFMAN, Chairman [30] Commissioner Humphrey dissents. [31] Commissioner Wilson dissents. [32] DISSENTING OPINION
[33] I respectfully dissent from the majority’s opinion finding that the claimant’s attorney does not have to reimburse the respondents expenses in the amount of $335.00. After reviewing all of the evidence in the record, I would affirm the decision of the Administrative Law Judge. However, I can agree with the majority’s admonishment to Attorney Spencer on the seven day rule for the admission of evidence. Attorney Spencer, having practiced for a number of years before this Commission, is aware of this rule and his status as a “volume practitioner” does not excuse his obvious disregard of the seven day rule. [34] When Attorney Spencer filed this claim with the Commission, he certified that the claim and hearing request was well grounded in fact. However, two days before the scheduled hearing, the claimant and the claimant’s attorney decided it was not grounded in fact. In reliance upon the attorney’s certification, the Commission and the respondents have expended valuable resources and considerable time preparing for the hearing. Attorney Spencer failed to act diligently and in a timely manner. Under the provisions of Ark. Code Ann. § 11-9-717, the attorney can be responsible to reimburse respondents for reasonable expenses. In my opinion, the amount awarded by the Administrative Law Judge is reasonable. [35] Therefore, after reviewing all the evidence, I find that the assessment of $335.00 in costs against Attorney Spencer is reasonable. Therefore, I respectfully dissent from the majority opinion. [36] __________________________ MIKE WILSON, Commissioner