Volk v. America West Airlines

• Decision Date: 26 July 1995
• Docket Number: No. 92-06678,92-06678
• Citation: 899 P.2d 746,135 Or.App. 565
• Parties: In the Matter of the Compensation of Jane A. Volk, Claimant. Jane A. VOLK, Petitioner, v. AMERICA WEST AIRLINES and Travelers Insurance Co., Respondents. WCB; CA A84509.
• Court: Oregon Court of Appeals

Page 746

899 P.2d 746

135 Or.App. 565

In the Matter of the Compensation of Jane A. Volk, Claimant Jane A. VOLK, Petitioner, v. AMERICA WEST AIRLINES and Travelers Insurance Co., Respondents.

WCB No. 92-06678; CA A84509.

Court of Appeals of Oregon.

Argued and Submitted June 15, 1995.

Decided July 26, 1995.

Donald M. Hooton, Portland, argued the cause and filed the brief for petitioner.

Craig A. Staples, Tigard, argued the cause for respondents. With him on the brief was Roberts, Reinisch, MacKenzie, Healey & Wilson, P.C.

Before DEITS, P.J., and De MUNIZ and HASELTON, JJ.

DEITS, Presiding Judge.

Claimant seeks review of an order of the Worker's Compensation Board (Board) holding that claimant's counsel is entitled to an attorney fee, but refusing to order insurer to pay the fees directly to the attorney. We affirm.

Claimant was awarded 20 percent unscheduled permanent disability by an October 23, 1991, determination order. Insurer paid the full amount of the award to claimant. Claimant subsequently requested reconsideration of the award. On June 9, 1992, an order on reconsideration was issued and claimant's award was reduced to 11 percent. Claimant then requested a hearing on the reconsideration order. Insurer sought to offset the overpaid compensation. Before a hearing was held on the matter, the parties entered into a stipulation that reinstated the award of 20 percent unscheduled disability. The parties also agreed to submit to the referee the question of claimant's counsel's entitlement to an attorney fee.

The referee concluded that because increased compensation was not awarded by the stipulation, claimant was not entitled to an out-of-compensation attorney fee. The Board disagreed with the referee's holding and concluded that claimant's attorney was instrumental in obtaining a "substantive increase" in her compensation and that her counsel was entitled to an out-of-compensation attorney fee pursuant to ORS 656.386(2).

The Board went on to conclude, relying on our decisions in Johnson v. Capitol Car Wash, 127 Or.App. 49, 871 P.2d 473 (1994), and Lebanon Plywood v. Seiber, 113 Or.App. 651, 833 P.2d 1367 (1992), that it was without statutory authority to order the insurer to pay claimant's attorney a fee in addition to the amounts that it had already paid to claimant. The Board reasoned that requiring insurer to pay the attorney fee to claimant's attorney, when the full amount of compensation due had already been paid to claimant, would essentially be ordering the insurer to pay additional compensation to which the claimant was not entitled. The Board then outlined a procedure for a claimant's attorney to recover a fee award in circumstances such as this. Under the Board's procedure, the attorney must first seek recovery of the fee directly from the claimant. In the event that the attorney's efforts to recover the fee directly from claimant are unsuccessful, the Board concluded that the fee is a lien upon claimant's compensation under ORS 656.388(2) and OAR 438-15-010(3) and may be recovered from any future permanent disability awards granted on the claim. On May 24, 1994, the Board issued an order on reconsideration affirming its earlier decision.

Claimant assigns error to the Board's conclusion that it lacked authority to issue an order directing insurer to pay the approved attorney fees directly to claimant's counsel. Claimant argues that the Board's reliance on Lebanon Plywood v. Seiber and Johnson v. Capitol Car Wash was misplaced and that the Board abused its discretion in failing to apply the provisions of OAR 438-15-085(2).

Before turning to the merits, we must first consider the effect on this case of the adoption of Senate Bill 369 in the 1995 legislative session. ORS 656.386(2), which governs the award of attorney fees in this case, was amended to provide:

"In all other cases, attorney fees shall be paid from the increase in the claimant's compensation, if any, except as otherwise expressly provided in this chapter." Or.Laws 1995, ch. 332, § 43 (S.B. 369, § 43) (emphasis supplied). ¹

The first question that we must address is whether the above change in the law applies retroactively to this case. We conclude that it does. Section 66 of SB 369 provides, in part:

"(1) Notwithstanding any other provision of law, this Act applies to all claims or causes of action existing or arising on or after the effective date of this Act, regardless of the date of injury or the date a claim is presented, and this Act is intended to be fully retroactive unless a specific exception is stated in this Act."

There are a number of exceptions to the retroactive effect of SB 369. However, the only one that has potential application to this matter is subsection (5)(a) of section 66, which provides:

"The amendments to statutes by this Act and new sections added to ORS chapter 656 by this Act do not apply to any matter for which an order or decision has become final on or before the effective date of this Act." (Emphasis supplied.)

The pertinent terms in the above subsection are "an order or decision [that] has become final." In interpreting a statute, our task is to discern the intent of the legislature. The critical question here is whether the legislature intended the new law to apply in a case such as this where the Board has taken its final action, but the matter has been appealed to, but not finally resolved by, the courts.

Under PGE v. Bureau of Labor and Industries, 317 Or. 606, 610, 859 P.2d 1143 (1993), in determining what the legislature meant, we must first examine the statute's text and context. The text of the new law does not provide an answer as to when an order or decision becomes final. However, the context does provide guidance. ORS 656.295(8) provides:

"An order of the board is final unless within 30 days after the date of mailing of copies of such order to the parties, one of the parties appeals to the Court of Appeals for judicial review pursuant to ORS 656.298. The order shall contain a statement explaining the rights of the parties under this subsection and ORS 656.298."

Considered in the context of the above statute, we conclude that the legislature intended the changes in the law to apply to Board orders for which the time to appeal had not yet expired on the effective date of the Act or, if the case had been appealed, to any case that was still pending before the court on the effective date of the legislation.

Even if it could be said that the text and context of ORS 656.386(2) are not conclusive, the legislative history supports the same interpretation. See PGE, 317 Or. at 612, 859 P.2d 1143. As originally submitted, SB 369 did not include retroactivity language. However, before the Senate Committee on Labor and Government Operations, amendments making some portions of the bill retroactive were proposed as follows:

"Section 66. (1) Notwithstanding any other provision of law, this Act applies to all claims or causes of action existing or arising on or after the effective date of this Act, regardless of the date of injury or the date a claim is presented, and this Act is intended to be fully retroactive unless a specific exception is stated in this Act.

"(2) The amendments to ORS 656.126, 656.204 and 656.265 by sections 10, 13 and 29 of this Act and the amendments to ORS 656.210(2)(a) by section 15 of this Act apply only to injuries occurring on or after the effective date of this Act.

"(3) Sections 8 and 9 of this Act and the amendments to ORS 656.054, 656.232 and 656.248 by sections 7, 23 and 26 of this Act become operative January 1, 1996.

"(4) The amendments to ORS 656.268(4), (5), (6) and (9), 656.319(4) and 656.726(2)(f) by sections 30, 39 and 55 of this Act shall apply only to claims that become medically stationary on or after the effective date of this Act." Senate Bill File, Senate Committee on Labor and Government Operations, SB 369, February 21, 1995, SB 369-13 (LC 1477), pp 54-55. See also Minutes, Senate Committee on Labor and Government Operations, SB 369, February 17, 1995, p 1 and Exs F & G.

In discussing the proposed amendments before the committee, Representative Mannix, a sponsor of the legislation, stated:

"And the other section that needs to be discussed, I think, in terms of changes, is what is the effective date clause; we had an emergency clause but we weren't clear about when things were becoming effective. This is now section 66 in the LC amendments. This specifies the effective date plus operative dates for different provisions. It's been gone over pretty carefully to make sure that new things that require appeals processes as to claim closure don't go into effect except for claims that are medically stationary after July 1st. A lot of the requirements imposed on the Department are delayed until January 1st of '96 so they'll have time to promulgate the rules. [We] tried to build in some time frames for implementation, but the rest of it's fairly clear. There's only one part of the implementation dates, I think, probably needs a real flat statement on the record and that is that the retroactivity also applies to cases in which a final order has not yet issued in litigation. There's a bunch of cases in the system right now that have been decided by different factfinders under two or three different versions of the law depending on whether the Board interpretation or the Court of Appeal's interpretation or the Supreme Court interpretation was in effect at that time and this says 'this law applies to everything no matter where it is unless you have already been to court, had it decided and there's a decision been rendered and the decision is not subject to being appealed anymore.' Otherwise, except with the exceptions here, this is the law for everybody and we'll go out and apply it whether it's pro-worker or pro-employer." Tape recording, Senate Committee on Labor and Government Operations, SB 369, February 17, 1995, Tape 49, Side B at...