The opinion
STATE OF LOUISIANA
COURT OF APPEAL, THIRD CIRCUIT
06-1487
SHIRLEY DUFOUR
VERSUS
RIVER CITY MANAGEMENT, INC.
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APPEAL FROM THE
OFFICE OF WORKERS’ COMPENSATION - DISTRICT 2
PARISH OF RAPIDES, NO. 05-07862
JAMES BRADDOCK, WORKERS’ COMPENSATION JUDGE
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BILLY HOWARD EZELL
JUDGE
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Court composed of Ulysses Gene Thibodeaux, Chief Judge, Sylvia R. Cooks, Oswald
A. Decuir, Glenn B. Gremillion, and Billy Howard Ezell, Judges.
DECUIR, J., dissents and assigns written reasons.
REVERSED.
George A. Flournoy
Flournoy & Doggett
P. O. Box 1270
Alexandria, LA 71309-1270
(318) 487-9858
Counsel for Plaintiff/Appellant:
Shirley Dufour
Debra Talbot Parker
Johnson, Stiltner & Rahman
P. O. Box 98001
Baton Rouge, LA 70898-8001
(225) 930-0437
Counsel for Defendants/Appellees:
River City Management, Inc.
Louisiana Workers’ Compensation Corporation
EZELL, Judge.
After the claimant and the insurer in this workers’ compensation case executed
a full and final settlement of the dispute, the claimant’s attorney filed several motions,
all of which were found to be without merit. Consequently, the workers’
compensation judge determined the attorney had filed frivolous pleadings and
assessed him with a $500.00 attorney fee to be paid to the Defendants. When the fee
was not paid timely, the Defendants filed a motion for penalties under La.R.S.
23:1201(G) which was granted by the workers’ compensation judge, and the attorney
was assessed with a $3,000.00 penalty and $2,000.00 in attorney fees, in addition to
the original $500.00 judgment. The attorney, George Flournoy, appeals. For the
following reasons, we reverse.
The facts of this case were set forth in a previous opinion of this court wherein
we denied the Defendants’ motion to dismiss Flournoy’s appeal. In Dufour v. River
City Management, 06-1408, pp.1-2 (La.App. 3 Cir. 1/17/07), 947 So.2d 234, we
explained:
[T]he plaintiff filed a disputed claim for workers’ compensation against
her former employer, River City Management. On August 22, 2005, the
Office of Workers’ Compensation (OWC) approved a compromise
settlement between the parties. On November 17, 2005, the plaintiff
filed another disputed claim for workers’ compensation against River
City Management, claiming that mileage expenses had not been
reimbursed. The defendants filed a Motion for Sanctions, stating that
the full and final settlement of all the plaintiff’s workers’ compensation
claims was executed by the OWC on August 22, 2005. The Motion for
Sanctions sought to have the plaintiff’s current workers’ compensation
claim dismissed with prejudice and attorney fees awarded. Following
a hearing on January 9, 2006, the OWC granted the motion, assessed
$500.00 in attorney fees, and dismissed the plaintiff’s claim with
prejudice. The OWC signed the written judgment on January 11, 2006.
On July 14, 2006, the defendants filed a Motion for Penalties and a
Motion for Expedited Hearing, claiming that they had not received the
court ordered attorney fees.
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The OWC held a hearing on August 7, 2006 and granted the
Motion for Penalties, ordering the plaintiff’s attorney to pay the
previous $500.00 assessed in attorney fees, as well as $3,000.00 [sic] in
attorney fees, and a penalty of $3,000.00 for failure to pay the previous
judgment. The workers’ compensation judge signed the written
judgment on August 18, 2006. Notice of the judgment was sent to the
plaintiff on August 18, 2006. The plaintiff filed a Motion and Order for
New Trial which was denied by OWC on August 25, 2006.
In the present appeal, Flournoy argues that the provisions of La.R.S.
23:1201(G) do not apply to a sanction against an attorney. He contends that the
penalties and attorney fees under the Workers’ Compensation Act apply only to
unpaid judgments of compensation benefits. By contrast, the Defendants contend
that the provisions apply to any unpaid judgment in a workers’ compensation case.
The pertinent judgment in this case is the $500.00 assessment made against the
Appellant under the authority of La.Code Civ.P. art. 863(D). A workers’
compensation judge is authorized to impose sanctions under Article 863. See
Clophus v. Taco Bell Corp./Hot ‘N Now, Inc., 98-1794 (La.App. 3 Cir. 3/31/99), 732
So.2d 692. There is nothing in the jurisprudence to indicate, and indeed the
Appellant does not suggest, that an Article 863 sanction imposed by a workers’
compensation judge is somehow unenforceable or entitled to less weight than any
other judgment of a workers’ compensation judge. In this case, the judgment
imposing the sanction was not appealed, and it is now final. The validity of that
judgment is not before us.
To the contrary, what is before us is the sanction imposed on the Appellant for
failing to pay the original sanction. The workers’ compensation judge relied on the
provisions of the Workers’ Compensation Act to penalize the failure to pay a
judgment of his court. Louisiana Revised Statutes 23:1201(G) provides as follows:
If any award payable under the terms of a final, nonappealable
judgment is not paid within thirty days after it becomes due, there shall
be added to such award an amount equal to twenty-four percent thereof
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or one hundred dollars per day together with reasonable attorney fees,
for each calendar day after thirty days it remains unpaid, whichever is
greater, which shall be paid at the same time as, and in addition to, such
award, unless such nonpayment results from conditions over which the
employer had no control. No amount paid as a penalty under this
Subsection shall be included in any formula utilized to establish
premium rates for workers’ compensation insurance. The total one
hundred dollar per calendar day penalty provided for in this Subsection
shall not exceed three thousand dollars in the aggregate.
“Awards of attorney fees in workers’ compensation cases are essentially penal
in nature, and are intended to deter indifference and undesirable conduct by
employers and insurers toward injured employees.” Smith v. Quarles Drilling Co.,
04-179, p. 6 (La. 10/29/04), 885 So.2d 562, 566. Penal statutes are to be strictly
construed even though the benefits provisions of the Workers’ Compensation Act is
to be liberally construed. Id. Louisiana Revised Statutes 23:1201(G) is a penal
statute which must be strictly construed. Id.
While La.R.S. 23:1201(G) does apply to “any award,” it further provides that
an “employer” is not responsible for the penalties when nonpayment was due to
something the employer had no control over. Clearly, the statute, when read as a
whole, was intended to apply to nonpayment of a judgment by employers and their
insurers. Further evidence is found in the fact that La.R.S. 23:1201(G) also provides
that amounts paid as penalties and attorney fees pursuant to the statute cannot be used
to determine workers’ compensation premiums. This is because the scheme of
penalties and attorney fees in the workers’ compensation arena are directed at
employers and their insurers. Other means were available to enforce the judgment.
For these reasons, the judgment of the workers’ compensation court is reversed.
Costs of this appeal are assessed to River City Management, Inc. and the Louisiana
Workers’ Compensation Corporation.
REVERSED.
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STATE OF LOUISIANA
COURT OF APPEAL, THIRD CIRCUIT
06-1487
SHIRLEY DUFOUR
VERSUS
RIVER CITY MANAGEMENT, INC.
DECUIR, J., dissenting.
The trial court assessed the Claimant’s attorney with penalties and attorney
fees for failing to pay a judgment timely. Acknowledging that La.R.S. 23:1201(G)
provides for the assessment of such a penalty, the majority holds that only the
employer and/or insurer can be subject to this penalty. I disagree.
La.R.S. 23:1201 provides for different penalties to be assessed depending on
the circumstances of the wrongdoing. Subsection F provides for penalties in the
event “compensation or medical benefits” are not paid at the time and place described
in Subsections A through E. Subsection I provides for penalties in the event an
employer or insurer arbitrarily, capriciously, or without probable cause, “discontinues
payment of claims due and arising under this Chapter.” Subsection G provides for
penalties in the event “any award payable under the terms of a final, nonappealable
judgment is not paid within thirty days.”
The term “any award” in Section 1201(G) is not restricted to awards against
certain parties, or awards for certain benefits, or awards at a certain time in the
litigation. In fact, the term “any award” is not restricted at all and, therefore, includes
an award against an attorney who filed frivolous pleadings after the compensation
matter was concluded. When Flournoy failed to pay that “award,” he opened the door
to the assessment of penalties and attorney fees under Section 1201(G).
Interestingly, prior to the amendments of 1996, by Act No. 1137, Subsection
G read as follows:
If any compensation or medical benefits payable under the terms
of a final, nonappealable judgment is not paid within thirty days after it
becomes due, there shall be added to such unpaid compensation an
amount equal to twenty-four percent thereof or one hundred dollars per
day, for each calendar day after thirty days it remains unpaid, whichever
is greater, which shall be paid at the same time as, and in addition to,
such compensation, unless the order is appealed as provided by law
or unless such nonpayment results from conditions over which the
employer had no control. No amount paid as a penalty under this
Subsection shall be included in any formula utilized to establish
premium rates for workers’ compensation insurance. The total one
hundred dollar per calendar day penalty provided for in this Subsection
shall not exceed three thousand dollars in the aggregate. [Emphasis
provided.]
The substitution by the legislature of the word “award” for the more particular
“compensation or medical benefits” and “unpaid compensation,” makes it clear to me
that the legislature intended the penalty and attorney fee provision of Subsection G
to apply to any judgment of the workers’ compensation court, even one levied against
a claimant’s attorney. By contrast, the majority cites an exception to that general rule;
it’s rationale relies on a part of the statute that specifically exempts nonpayment
which “results from conditions over which the employer had no control.” The use of
the word “employer” in this phrase is illustrative only and was not intended to limit
the provision in any way. In fact, the majority acknowledges that the term should be
expanded to include insurers. Why stop there? There is no reason why the term
should not include attorneys or anyone else who may be subject to an award of the
workers’ compensation court. Indeed, the majority wants to have it both ways,
expand the term “employer,” then use it to restrict the meaning of the statute.
The statute is, however, clear and unambiguous as written. Louisiana Civil
Code Article 9 provides “[w]hen a law is clear and unambiguous and its application
does not lead to absurd consequences, the law shall be applied as written and no
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further interpretation may be made in search of the intent of the legislature.” Further,
La.Civ.Code art. 11 requires Louisiana courts to assign to the words of a law “their
generally prevailing meaning.”
In reviewing a sanction imposed under Section 1201(G), we are bound by the
abuse of discretion standard of review. In Halker v. American Sheet Metal, 04-1407,
p. 6 (La.App. 3 Cir. 3/16/05), 898 So.2d 629, 633, this court held:
Although “penal statutes are to be strictly construed,” “[t]he WCJ
has great discretion in awarding or denying penalties and attorney fees.
The WCJ’s decision concerning whether or not to assess statutory
penalties and attorney fees will not be disturbed absent an abuse of
discretion.” Player v. Int’l Paper Co., 39,254, p. 5 (La.App. 2 Cir.
1/28/05), 892 So.2d 781.
I find no abuse of discretion in the penalty imposed in this case. The appellant
offered no justification for his failure to pay the $500.00 judgment other than his
apparent belief, albeit unfounded, that neither the court nor the defendants were
serious about enforcing the judgment. The Section 1201(G) sanction is precisely the
penalty a defendant would have to pay for ignoring a judgment of the workers’
compensation court, and I am unpersuaded by the argument that the appellant, as
attorney for the claimant, is immune from such a sanction.
Accordingly, I dissent.
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