Director, Office of Workers' Compensation Programs, U.S. Dept. of Labor v. South East Coal Co., 78-3507

• Decision Date: 29 May 1979
• Docket Number: No. 78-3507,78-3507
• Parties: DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED STATES DEPARTMENT OF LABOR, Petitioner, v. SOUTH EAST COAL COMPANY, Employer, and Old Republic Insurance Company, Carrier, and Obie Spicer, Claimant, Respondents.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 1046

598 F.2d 1046

DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED STATES DEPARTMENT OF LABOR, Petitioner, v. SOUTH EAST COAL COMPANY, Employer and Old Republic Insurance Company, Carrier and Obie Spicer, Claimant, Respondents.

No. 78-3507.

United States Court of Appeals Sixth Circuit.

Argued Feb. 21, 1979.

Decided May 29, 1979.

Laurie M. Streeter, Kenneth F. Noto, Gary P. Brady, U. S. Dept. of Labor, Washington, D. C., for petitioner.

John L. Kilcullen, Washington, D. C., for South East Coal Co.

J. W. Craft, Jr., Craft, Barrett, Haynes & Ward, Hazard, Ky., for Old Republic Insurance Co.

Richard D. Cooper, Hazard, Ky., for Obie Spicer.

Before EDWARDS, Chief Judge, and WEICK and LIVELY, Circuit Judges.

LIVELY, Circuit Judge.

The narrow issue in this case is whether the Black Lung Disability Trust Fund (the Trust Fund) may be held liable for attorney's fees awarded to a black lung claimant whose work as a coal miner ended before January 1, 1970. The Benefits Review Board (BRB) held that the Trust Fund is liable for the payment of such an award of attorney's fees. We agree and affirm.

The Director, Office of Workers' Compensation Programs (the Director) concedes that the Trust Fund is liable for payment of the benefits awarded to the claimant, but contends that the BRB was without authority to direct payment of attorney's fees by the Trust Fund. If this position is correct, the respondents South East Coal Company and its insurance carrier Old Republic Insurance Company would be liable for the payment of the fees under an award of the administrative law judge who found that the claimant was entitled to black lung benefits.

The claimant Obie Spicer worked in underground mines from 1928 to 1962. He filed a claim for black lung benefits in 1974. Under existing law his last coal mine employer was held liable for the payment of benefits and legal fees upon a finding that Spicer was totally disabled from pneumoconiosis which arose out of his employment in the mines. South East Coal Company was his last employer. While the employer's appeal was pending before the BRB, in 1977 Congress enacted two statutes which made significant changes in the existing scheme of black lung compensation.

One of the 1977 amendments changed the previous requirement that the last coal mine employer pay black lung benefits of miners whose employment ended before January 1, 1970 to provide that payment of these claims be shifted to the newly created Trust Fund. This amendment is entitled the Black Lung Benefits Reform Act of 1977, Pub.L. No. 95-239, 92 Stat. 99 (to be codified at 30 U.S.C. § 932(j)) (hereafter Reform Act). The Trust Fund was provided for in § 3(a)-(c) of the Black Lung Benefits Revenue Act of 1977, Pub.L. No. 95-227, 92 Stat. 13 (to be codified at 30 U.S.C. § 934a) (hereafter the Revenue Act). Section 3(d) of the Revenue Act, (to be codified at 30 U.S.C. § 934) determines what payments may be made from the Trust Fund, as follows:

§ 934

(a) Amounts in the Black Lung Disability Trust Fund (referred to in this section as the "fund") established under section 934a of this title shall be available, as provided by appropriation Acts, for

(1) the payment of benefits under section 932 of this title in any case in which the Secretary determines that

(A) the operator liable for the payment of such benefits

(i) has not commenced payment of such benefits within 30 days after the date of an initial determination of eligibility by the Secretary, or

(ii) has not made a payment within 30 days after that payment is due.

(B) there is no operator who is required to secure the payment of such benefits,

(2) the payment of obligations incurred by the Secretary with respect to all claims of miners or their survivors in which the miner's last coal mine employment was before January 1, 1970,

(3) the repayment into the Treasury of the United States of an amount equal to the sum of the amounts expended by the Secretary for claims under this part which were paid before April 1, 1978, except that the fund shall not be obligated to pay or reimburse for benefits paid attributable to periods of eligibility before January 1, 1974,

(4) the repayment of, and the payment of interest on, advances to the fund under subsection (b)(2) of section 934a of this title,

(5) the payment of all expenses of operation and administration on and after the effective date of the Black Lung Benefits Reform Act of 1977 (or any other Act determined by the Secretary to contain substantially the same provisions) under this part (other than under section 937(a) or 943 of this title) including the administrative expenses incurred by the Department of Labor under this part, the administrative expenses incurred by the Department of the Treasury in administering subchapter B of chapter 32 of Title 26 and in carrying out its responsibilities with respect to the fund, and any expenses incurred by the Department of Health, Education, and Welfare in connection with the administration of this part, and

(6) the reimbursement of operators for amounts paid by such operators (other than as penalties or interest) before April 1, 1978, in satisfaction (in whole or in part) of claims of miners whose last employment in coal mines was terminated before January 1, 1970.

Following initial funding from general revenues of the government, the Trust Fund will be financed exclusively by the proceeds of a new excise tax on all coal mined in the United States and sold by the producer. The effect of this change is to shift liability from the last employer (or the government where no "responsible" employer exists) to the coal industry as a whole for benefits to those who file claims after December 31, 1973 but who were not employed miners on the effective date of the first black lung legislation (January 1, 1970).

One of the difficulties in this case arises from the incorporation of another federal compensation law to carry out the congressional scheme of providing government compensation for old black lung claims while requiring employer responsibility for current claims. Under the original legislation, black lung claims filed on or before December 31, 1972, if allowed, were to be paid by the government through the Department of Health, Education and Welfare. These claims were processed under Part B, Subchapter IV of the Federal Coal Mine Health and Safety Act of 1969, 30 U.S.C. §§ 921-924 (1970) (the 1969 Act). Claims filed after December 31, 1972 were to be processed under Part C, Subchapter IV of the same Act, 30 U.S.C. §§ 931-936 (1970). The last coal mine employer, if available, was to be liable for payments. The original statutory scheme called for Part C claims to be filed with the applicable state workmen's compensation board beginning on January 1, 1973 (later extended to January 1, 1974). However, the right to claim benefits pursuant to the Longshoremen's and Harbor Workers' Compensation Act, 33 U.S.C. § 901 Et seq. (1970) (hereafter LHWCA) was provided where state workmen's compensation laws did not make adequate provision for black lung benefits. In the 1969 Act the LHWCA was made applicable to black lung claims by a "crossover" statement that its provisions "shall (except as otherwise provided in this subsection and except as the Secretary shall by regulation otherwise provide) be applicable to each operator of an underground coal mine in such State with respect to death or total disability due to pneumoconiosis arising out of employment in such mine." 30 U.S.C. § 932(a) (1970). Section 7(a)(3) of the Reform Act changed § 932(a) to read in part as follows:

. . . the provisions of (the LHWCA) shall (except as otherwise provided in this subsection or by regulations of the Secretary And except that references in (the LHWCA) to the employer shall be considered to refer to the trustees of the fund, as the Secretary considers appropriate and as is consistent with the provisions of section 424 (30 U.S.C. § 934)) be applicable . . . . (emphasis added).

There is no explicit reference to attorney's fees in Part C of the 1969 Act or in either of the 1977 acts. However, one of the provisions of the LHWCA adopted in Part C of the 1969 Act provides for the award of "a reasonable attorney's fee against the employer or carrier . . . which shall be paid directly by the employer or carrier to the attorney for the claimant in a lump sum after the compensation order becomes final." 33 U.S.C. § 928(a) (1976). The BRB held that the language of the 1977 Reform Act which states that references in the LHWCA to the...