Rose v. Falcon Communications

• Citation: 6 S.W.3d 429
• Parties: (Mo.App. S.D. 1999) Johnny Rose, Claimant-Appellant, v. Falcon Communications, Inc., Respondent-Respondent. 23064
• Decision Date: 14 December 1999
• Court: Court of Appeal of Missouri (US)

6 S.W.3d 429 (Mo.App. S.D. 1999)

Johnny Rose, Claimant-Appellant, v. Falcon Communications, Inc., Respondent-Respondent.

23064

Missouri Court of Appeals Southern District

12/14/99

Appeal From: Labor and Industrial Relations Commission

Counsel for Appellant: Michael Moroni

Counsel for Respondent: Dale E. Gerecke

Opinion Summary: None

Crow, P.J., and Parrish, J., concur.

Kenneth W. Shrum, Judge

In this workers' compensation case, Johnny Rose (Claimant)--acting without an attorney--settled a third-party claim that arose out of the same occurrence that led to his workers' compensation claim. Claimant then sought to recover a "reasonable attorney fee" from his employer under section 287.150,¹ as an expense incurred in settling the third-party claim. The Labor and Industrial Relations Commission (Commission) concluded that Claimant could not recover an attorney fee under such circumstances. The issue we must decide is whether a workers' compensation claimant who settles a third-party claim without an attorney is entitled to have an attorney fee imputed when calculating the employer's subrogation lien amount. We conclude that a claimant is not so entitled. We affirm the award of the Commission.

Claimant was injured during his lunch hour when a co-worker struck him with a pickup truck. Claimant's employer, Falcon Communications, Inc., (Falcon) refused to voluntarily provide workers' compensation benefits on the theory that the accident did not arise out of and in the course of Claimant's employment. While his workers' compensation claim was pending, Claimant entered into a settlement with his co-worker's automobile liability insurance carrier for $50,000, the policy limit. Claimant settled this claim without a lawyer.

Ultimately, an Administrative Law Judge (ALJ) entered an award favorable to Claimant for $45,379.13 on his workers' compensation claim. However, the ALJ also gave Falcon full credit for the third-party settlement amount, i.e., $50,000. Consequently, the ALJ found that Falcon did not owe Claimant any compensation. The ALJ also rejected Claimant's argument that Falcon should be credited with only $33,333.33 of the third-party settlement. Claimant argued that Falcon's credit for the third-party recovery should have been reduced by one-third, or $16,666.67, because Claimant was entitled to impute a one-third attorney fee as an expense of settling the third-party claim. Claimant insisted this was true even though he had not actually incurred any such fee. Had Falcon's third-party recovery credit been reduced as urged by Claimant, Falcon would have owed Claimant $12,045.80 in compensation.

After the ALJ rendered its decision, Claimant appealed to the Commission. The Commission rejected Claimant's arguments for an imputed attorney fee and affirmed the ALJ's decision. This appeal followed.

Claimant argues that the Commission erred as a matter of law in refusing to impute a one-third attorney fee as described above. He insists that imputation of the fee was authorized by the "plain language of the subrogation statute (RSMo 287.150)."

In pertinent part, section 287.150 provides:

"3. Whenever recovery against the third person is effected by the employee . . . , the employer shall pay from his share of the recovery a proportionate share of the expenses of the recovery, including a reasonable attorney fee. After the expenses and attorney fee have been paid, the balance of the recovery shall be apportioned between the employer and the employee . . . ." (Emphasis added.)

Claimant characterizes this statute as meaning that an employer always must pay an attorney fee out of the third-party recovery. His argument proceeds as follows:

"Because a comma was used before 'include' [sic] the phrase attorney fee refers to the entire sentence and not just expenses of the recovery. Application of Graham, 199 S.W.2d 68, 74-5 (Mo.App. 1946)[.] It follows that the statute directs that the employer pay an attorney fee irrespective of other expenses. Since the statute says that an employer is to pay an attorney fee from the recovery it is proper to impute a one third fee because that was the fee in Ruediger v. Kallmeyer Brothers Service, 501 S.W.2d 56 (Mo.[banc] 1973) (the seminal case on the subrogation issue). For example, if the claimant had been an attorney, he could have legitimately apportioned the usual contingent fee against the third party settlement for his efforts in obtaining the settlement. The attorney fee would have to have been offset under the statute. The attorney would have earned the fee. Since a person has a constitutional right to act as his own lawyer, [citations omitted], it follows that he is entitled to the fee the same as a lawyer because he earned it. That is the situation in this case, and the fee must be imputed."

We disagree. Appellate courts must give effect to statutes as they are written. McDermott v. Carnahan, 934 S.W.2d 285, 287[4] (Mo.banc 1996). Statutes are to be given a common-sense and practical interpretation. Concord Publ'g House, Inc. v. Director of Revenue, 916 S.W.2d 186, 194[15] (Mo.banc 1996). In construing a statute, a court must endeavor to suppress the mischief sought to be cured thereby, repress subtle inventions and evasions for the continuance of that mischief, and advance the remedy intended by the legislature. Vining v. Probst, 186 S.W.2d 611, 615[6] (Mo.App. 1945).

The "evil" or "mischief" the legislature sought to cure by enacting section 287.150 was "double recovery" by an injured employee, i.e., recovery from both a third-party tortfeasor and from an employer. Akers v. Warson Garden Apartments, 961 S.W.2d 50, 56 (Mo.banc 1998); Schumacher v. Leslie, 360 Mo. 1238, 232 S.W.2d 913, 919 (banc 1950). "It is elementary that a claimant should not be allowed to...