Rhodes v. Industrial Com'n
| Citation | 125 Idaho 139,868 P.2d 467 |
| Parties | Kathryn Marie RHODES, Mike Jacobson, and Cheryl Jacobson, husband and wife, individually and on behalf of all claimants with industrial injuries; Idaho Migrant Council, Inc., and Humberto Fuentes, its Executive Director; United Food and Commercial Workers Union Local 369-A; David C. Ackley; G. Rich Andrus; James Arnold; Robert K. Beck; Clyel Berry; Cheri L. Bush; Andrew Chasen; James Combo; George Conrad; Roger Cox; Bradford Eidam; Dalon Esplin; Mark Freeman; Lori Freund; Jerry Goicoechea; Charles L. Graham; James Green; Jim C. Harris; William J. Hines; Keith Hutchinson; Joseph Jarabeck; Clark Jordan; Rick D. Kallas; Lawrence Kirkendall; Richard E. Kriger; Stratton Lammers; Lynn M. Luker; R. Brad Masingill; Albert Matsuura; Michael McBride; Byron Meredith; Jerry R. Meyers; John Mitchell; Thomas Mitchell; Hugh Mossman; David D. Peck; Raymundo G. Pena; Emil F. Pike; Delwin W. Roberts; Breck Seiniger; Bruce D. Skaug; Dale Smith; Stephen K. Stark; John E. Sutton; David K. Swanson; Michael J. Verbillis; Steve Verby; Timothy C. Walton; James L. Westberg; and Kenneth White, Petitioners, v. INDUSTRIAL COMMISSION of the State of Idaho, Gerald A. Geddes, Logan E. Lanham, and Betty L. Richardson, Commissioners, in their official capacity, Respondents. Boise, February 1993 Term |
| Decision Date | 03 December 1993 |
| Court | United States State Supreme Court of Idaho |
Givens, Pursley, Webb & Huntley, Boise, for petitioners. Robert E. Huntley, Jr., argued.
Larry EchoHawk, Atty. Gen., and John W. Barrett, Asst. Atty. Gen., Boise, for respondents. John W. Barrett, argued.
Respondent, the Industrial Commission of the State of Idaho ("Commission"), has authority to adopt rules and regulations pursuant to I.C. § 72-508. The Commission must comply with the administrative procedures governing the enactment of administrative regulations codified as I.C. § 67-5203. In August 1992, based on extensive research 1 prompted by a major concern that fees charged by claimants' attorneys in workers' compensation cases were unduly high, the Commission published a draft of formal regulations which proposed mandatory attorney fee guidelines, and set dates for public hearings on the matter. At the hearings, the Commission received testimony from several persons representing the interest of workers, attorneys, labor unions, state agencies, and others. The testifiers were virtually unanimous in their opposition to the proposed regulations. The public expressed concern over the fate of small cases as well as difficult cases. The ultimate loser, the public concurred, is the injured worker whose access to unlimited, uninhibited legal representation is abridged.
At the administrative hearing on the matter on October 21, 1992, the Commission's staff counsel recommended against adoption of the proposed regulations because they were too broad. Nonetheless, the Commission, on a split vote of 2-1, adopted the regulations restricting the amount of legal fees recoverable by an attorney representing injured workers, citing I.C. § 72-803 as its source of authority. The Commission issued a "Statement of the Principle Reasons For and Against the Adoption of a Regulation Governing Attorney Fees in Workers' Compensation Cases," pursuant to I.C. § 67-5203(3). Commissioner Richardson wrote a dissenting statement. The regulations were to take effect December 1, 1992.
On November 13, 1992, petitioner Kathryn Marie Rhodes ("Rhodes"), along with the Idaho Migrant Council, the United Food and Commercial Workers' Union, and several Idaho attorneys, filed a petition in this Court on behalf of all claimants with industrial injuries for ex parte temporary stay, for stay pending hearing, for alternative writ of prohibition, and for peremptory writ of prohibition to prevent the Commission from implementing the disputed regulations until the dispute was settled by this Court. In support of the petition, Rhodes claimed that the regulations prejudiced the ability of injured employees to obtain legal counsel, appendicing communications in which attorneys declined to represent injured workers due to the fee cap. This Court granted the petition for ex parte temporary stay on November 25, 1992, with the Court ordering respondents to answer the other petitions within fourteen (14) days. Both the petitioner and respondent have filed briefs in this Court in support of and in response to, respectively, the petition for writ of prohibition.
This Court must resolve the following issues:
I. Whether the Commission has exceeded its statutory authority by enacting a comprehensive regulation governing attorney fees for claimants' attorneys.
II. Whether the regulation enacted violates the United States Constitution or the Idaho Constitution.
The adoption of the Administrative Procedure Act ("APA") in 1965, served as a general statutory grant of rule-making authority to administrative agencies to promulgate rules and regulations to effect the purposes of the specific acts they are required to administer. See Mead v. Arnell, 117 Idaho 660, 666, 791 P.2d 410, 416 (1990). In addition, the state legislature has, by statute, empowered the Commission to issue rules and regulations necessary to accomplish the purposes of the Workers' Compensation Act. I.C. § 72-508. The purpose of the Workers' Compensation Act, enacted under the broad canopy of the police power, is stated in I.C. § 72-201 to provide "sure and certain relief for injured workmen and their families...." Finally, I.C. § 72-803 grants the Commission the authority to "approve" claims for attorney fees. 2 Thus, it is apparent that the Commission has the authority to administer I.C. § 72-803, and to issue regulations necessary to bring about secure relief for injured workers and their families. 3
The Commission asserts that the regulation, issued pursuant to I.C. §§ 72-508 and 72-803, is reasonable in its design to protect the public welfare. Rhodes challenges the reasonableness of the Commission's interpretation of the scope of power conferred by § 72-803, complaining that the regulation exceeds any reasonable extension of the power to "approve" attorney fees, and unreasonably transgresses separation of powers. This Court has ruled that the Commission has original and exclusive jurisdiction over issues concerning attorney fees in workers' compensation cases. Brannon v. Pike, 112 Idaho 938, 939, 737 P.2d 459, 460 (1987). However, this ruling must be balanced against the principle that the judicial department of the government is uniquely imbued with the power to regulate the practice of law. Idaho State Bar Assoc. v. Idaho Pub. Util., 102 Idaho 672, 675, 637 P.2d 1168, 1171 (1981). Where the practice of law intersects with a social system such as the workers' compensation system, the judicial power does not merge, but remains plenary. Any authority exercised by the other departments of government that affects the practice of law must not conflict with judicial resolution.
The authority granted to the Commission under § 72-803, to "approve" attorney fees, does not conflict with the judicial penumbra. The regulation under challenge, promulgated to foster ease, utility, and predictability in the application of I.C. § 72-803, in turn does not overstep the legislative bounds of I.C. § 72-803, read in pari materia with the entire Workers' Compensation Act. See Heese v. A & T Trucking, 102 Idaho 598, 600, 635 P.2d 962, 964 (1981) (). The regulation is not a fee schedule. It is a framework establishing uniform grounds for fee approval. The language of I.C. § 72-803 contemplates that the Commission will monitor the appropriateness of fees on behalf of claimants, and therefore the regulation provides a reasonable interpretation of the power vested by I.C. § 72-803.
Rhodes argues that the disputed regulation infringes injured claimants' right to competent counsel to seek redress for their industrial injuries, in violation of the due process clause of the constitution, and interferes with attorneys' right to pursue their profession, in violation of the equal protection clause of the constitution. Administrative regulations are subject to the same principles of construction as are statutes. Bingham Mem. Hosp. v. Idaho Dep't of Health & Welfare, 112 Idaho 1094, 1096, 739 P.2d 393, 395 (1987); Higginson v. Westergard, 100 Idaho 687, 691, 604 P.2d 51, 55 (1979). Accordingly, when faced with a constitutional challenge, this Court makes every presumption in favor of the constitutionality of the challenged regulation, and the burden of establishing unconstitutionality rests upon the challengers. See Olsen v. J.A. Freeman Co., 117 Idaho 706, 709, 791 P.2d 1285, 1288 (1990).
Rhodes has failed to show how the regulation violates the equal protection clause of the constitution of the...
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