# Petition — Lerner v. Haas

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition
- **Published:** January 1, 1979
- **Citation:** 444 U.S. 841

## Text

78-18 gah Freee |

MAR 30 1979

Unjted States

No. A-548, October Term, 1978.

Sidney S. Lerner, M.D., Administrator
Estate of Samuel Lerner, Deceased

Petitioner

V.

Gerald J. Haas, Esquire, and
Philadelphia Psychiatric Center, and
Pennsylvania Manufacturers’ Association
Insurance Company

Respondents

PETITION FOR WRIT OF CERTIORARI TO
THE SUPREME COURT GF PENNSYLVANIA

Sidney S. Lerner, M.D.
1101 Stratford Avenue

Philadelphia;-Pa..19126
(215) CA4 - 0808 i

Fro se For Petitioner

/ Migs | ae

eal

L RODAM JR. SLERK

ttt te a 5 len 5 TARE. 8

INDEX
Petition ]
Orders, Opinions and Decision Below 2
Jurisdiction 3
Question Presented For Review 3
Constitutional Provision Involved 3
Statement Of The Case 4
Reasons For Granting The Writ 5
Conclusion 12

INDEX TO APPENDIX

Orders by Supreme Court of Pennsylvania deny-
ing allowance of appeal, September 14, 1978 Al

Denial of Reconsideration November 2, 1978 Al

Precedential Opinion in Richman denying counsel
fee even if earned because barred by failure to
satisfy requirements of controlling statutes of
workmen's compensation law A2

Squarely conflicting Opinion in Lerner awarding
counsel fee where Court can point to no feature
distinguishing the cases with regard to applic-
ation of controlling statutes A6

Board's Opinion at A69972 documenting absence
of approval of Agreement For Legal Services af-
ter tolling of timely appeal period AlO, Al4

Board's one sentence Order at C.F. 2384 a-
warding counsel fee sans findings of fact, con-
clusions of law or supporting memorandum Al5

ii
TABLE OF AUT

Sherred v. Pittsburgh, 7 Pa Cmwith 401,
299 A.2d 381 (1973)

Richman v. W.C.A,.B. et al, 16 Pa Cmwith 594,
329 A.2d 920 (1975)

Lerner v. Haas et al, 35 Pa Cmwlth 300,
386 A.2d 1038 (1978)

stitut r s

United States Constitution
Amendment XIV

Pennsylvania Statutes:

Pa. Workmen's Compensation Act, Sections
318, 407, 423, 442,501

Authorities

Barbieri, Pa. Work. Comp., Chapter 5,
Section 5.45 at page 157

IN THE
SUPREME COURT OF THE UNITED STATES
OCTOBER TERM, 1978
No. A-548

Sidney S. Lerner, M.D., Administrator
Estate of Samuel Lerner, Deceased
Petitioner

Ws

Gerald J. Haas, Esquire, and
Philadelphia Psychiatric Center, and
Pennsylvania Manufacturers'
Association Insurance Company
Respondents

PETITION FORA WRIT OF CERTIORARI TO
THE SUPREME COURT OF PENNSYLVANIA

The petitioner Sidney S. Lerner, M.D.,
administrator of the estate of Samuel
Lerner, deceased, respectfully requests
that a Writ of Certiorari issue to review
the judgment of the Supreme Court of
Pennsylvania entered in this proceeding
on September 14, 1978; together with a
summary vacation of the Order below.

2
ORDERS, OPINIONS and DECISION BELOW

Supreme Court of Pennsylvania:

An Order denying Pettition for Allowance
of Appeal from this Commonwealth Court
and an Order denying on the merits an
amended petition were both entered by the
Supreme Court of Pennsylvania on Septem-
ber 14, 1978; see Al.

Denial of reconsideration was entered on
November 2, 1978; see Al

Commonwealth Court of Pennsylvania

Richman v. W.C.A.B. et al., 16 Pa.Cmwlth
, ; ; see A2

Sherred Ye Pittsburgh, 7 Pa. Cmwlth 401,

Lerner v. Haas et al., 35 Pa. Cmwlth 300,
A. ; see A6

Pa. Workmen's Compensation Appeal Board:

Lerner v. Phila. Psychiatric Center at
A69972 entered on October 2, 1975; see Al4.

Opinion in Lerner v. Phila. Psychatric
Center at (Counsel Fee)c.f.2304 entered
officially but as an unpublished document on
September 1, 1976.

Order in Lerner v. Phila. Psychiatric
Center at (Counsel Fee)C.F.2364 entered on
November 5, 1976; unpublished copy appended at
Als.

Referee Wallace J. Stevenson:

Decision in Lermer v. Phila. Psychatric Center
and Pennsylvania Manufacturers’ Association

Insurance Company at No. 197-158-4933 issued on
Marc : ‘

<li

3
[URISDICTION

An Order denying Petition for Allowance of Ap-
peal from the Commonwealth Court and an Order de- _
nying on the merits an amended petition were both
entered by the Supreme Court of Pennsylvania on
September 14, 1978. A final Denial of Reconsidera-
tion was entered on November 2, 1978. On February
8, 1979 Mr. Justice Brennan issued an Order extend:
ing the time for filing a Petition for Writ of Certio-
rari in this case to and including April 2, 1979, for
good cause but without prejudice to the Court's con:
sideration of whether the petition is timely filed.
The jurisdiction of this Court is invoked under 28
U.S.C. Section 1257 (3).

QUESTION PRESENTED FOR REVIEW

If a State appellate court makes the grave pro-
cedural error of reviewing an Order that is devoid
of findings of fact or conclusions of law, and com-
pounds that lapse by entering an Opinion that is in
square conflict with its very own precedential .De-
cision, does this not speak against a fair hearing
and deny the due process and equal protection of
the laws guaranteed by our Constitution ?

CONSTITUTIONAL PROVISION INVOLVED

"... nor shall any State deprive any person of

. property, without due process of law; nor deny
any person within its jurisdiction of the equal pro-
tection of the laws."

4
STATEMENT OF SE

Petitioner seeks review of a cause where-
in the Pennsylvania Workmen's Compensation Ap-
peal Board (Board) has entered an Order devoid of
findings of fact or conclusions of law that directs
payment (from a compensation award) of counsel
fee plus interest. The pervasive pattern of errors
to be specified below involves the failure to apply
relevant statutes as’ well as square conflict in the
Opinions of its Appellate Courts that has negated
a fair hearing and thereby resulted in a denial of
due process and equal protection of the laws that
are so repugnant to our Constitution.

This cause is not narrowly limited to the
needs of petitioner. For the public interest is serv-
ed when workers' compensation litigation, of vital
importance to all working people, is conducted in
a judicial atmosphere where the laws are impartial-
ly administered and a fair hearing is assured. In
1976, the most recent year for which figures are a-
vailable in Pennsylviaia, more than fifteen hun-
dred compensation awards were mace with an aver-
age award of sixteen hundred dollars ($1600). A
mere handful of claimants could afford to avail
themselves of legal counsel. A less-than-fair
hearing in such circumstances creates a crisis of
confidence in our judicial system and deepens the
perception of our courts as favoring the rich and
powerful.

4a

This is such a cause. A petitioner, unre-
presented by counsel, prays for an equitable re-
view of an Order devoid of findings of fact or con-
clusions of law which an appellate body erroneous-
ly undertook to scrutinize, substituting its own
judgments as a fact-finder, and then entered an
Opinion that conflicts squarely with its own pre-
cedential Decision on the issue of counsel fee in
workers' compensation cases. Such a course and
result preclude a fair hearing and deny the workers
of our land of the hard-won rights of the Fourteenth
Amendment. Can the Supreme Court disdain to lend
a helping hand to the under-dog and riglit this
wrong against the American worker ?

5

This Court's jurisdiction is invoked, sua
sponte if need be, to resolve the egregious con-
flict and in the words of John Rutledge of South
Carolina, "to secure the national rights and
uniformity of Judgmts."

REASONS FOR GRANTING THE WRIT

A pervasive pattern of improprieties and
squarely conflicting decisions has deprived peti-
tioner of a fair and impartial hearing. The arbitrary
and capricious result flies in the face of document-
ary evidence of record and bespeaks a denial of
due process and equal protection of the laws which
is repugnant to our Constitution. The Court's re-
view is sought in a matter of vital importance to
all working people in order to resolve egregious
conflicts and to secure the uniformity of precepts
appropriate to a society governed by laws not men.
These conflicts are:

1. Exemption of compensation benefits from
claims. Section 318 of the Pennsylvania Workmen's
Compensation Act (Act) exempts compensation pay-
ments from claims. In Barbieri, an authority on
workers’ compensation in Pennsylvar..a, it is said:
"Section 318 ... includes the exemption clause
which frees compensation payments from claims of
creditors and makes assignments of such payments
illegal. The exemption may not be waived." The
Board's Order in Lerner is written without regard to
that statute. See:

Pennsylvania Workmen's Compensation Act, Sec-
tion 318.

Barbieri, Pa. work. comp., Chapter 5, Section 5.45
at page 157.

Order by Board here appended at page AlS.

cr
Uv

2. Exception For Counsel Fee. Section 501 of

the Act provides an exception whereby attorneys
after having fulfilled specific requirements may ob-
tain a lien against prospective compensation pay-
ments by employer/insurer to the employee. The
record shows that the respondent lawyer in Lerner
did not fulfill said requirements and further , that
the Board ordered payment from already expended
funds by the employee's estate to the attorney.
Section 501 authorizes only a lien against prospect
ive payments by employer to employee. See:
Section 501 of the Act.

Order by Board here appended at page AlS.

3. Findings of fact, Conclusions of law in

Sherred. In Sherred the Court protected the interest
of Mary Alice Sherred ., -emanding the case to the
Board to supply the specific findings of fact and

- conclusions of law that might enable the appellate
_ Court to give “fair judicial scrutiny" to the matter.

In Lerner, however, the Court denied the equal pro-
tection of the laws by proceeding to hear this case
even though the Board had issued its Order sans
findings of fact and conclusions of law. Due pro-
cess was also denied in Lerner since, by its own
words in Sherred, the appellate Court could not
give "fair judicial scrutiny" in such circumstances.
Sherred v. Pittsburgh, 7 Pa Cmwlth 401, 299 A2d 381,
(1973) Lerner v. Haas et al, 35 Pa Cmwith 300,
386 A2d 1038, (1978)

See the unpublished one-sentence Order entered by

the Board in Lerner v. Phila. Psychiatric Ctr., at
C.F. 2384, here appended at page Al5S.

4. Denial of award of counsel fee in Richman.
In Richman the Court held:

7

",.. that appellant did not comply with the
statutory provisions that would enable him to col-
lect the fees they are claiming either from the
claimant, from the subrogees or as a lien on the
fund." (underlining supplied)

The Opinion concluded:

"Surely equity, and perhaps the law, would
allow appellant to be paid a reasonable attorney
fee in a case such as presented here, absent a
controlling statute. However, when, as in this
case, there are attorney fees claimed for protec-
tion of subrogation interests, such claims must be
presented in accordance with Section 501 or Secr
tion 442 of the Workmen's Compensation Act for
approval by the referee or the Board. Since neither
procedure was followed in the instant case, we,
therefore, must affirm the Board's decision and
deny appellant's petition and appeal." See:
Richman v. WCAB et al, 16 Pa. Cmwlth 594,

329 A2d 920 (1975) here appended at page A2

In Lerner, however, the Court affirmed award
of counsel fee although the attorney “did not com-
ply with the statutory provisions that would enable
him to collect the fees" nor can the Court point to
any feature that distinguishes the cases with re-
spect to the applicability of the controlling stat-
utes. The statutory requirements are:

(a) Prior Board approval of Agreement for Legal
Services conforming to Section 442.

(b) Petition For Counsel Fee Under 50] is in
the nature of an appeal from Referee's award and
by statute must be filed within twenty days. See:
Lerner v. Haas etal, 35 Pa Cmwith 300, 386 A2d
1038 (1978)

Attorney Haas has made no showing nor is there
evidence of record that prior approval of Agreement

8

For Legal Services was granted or even applied for.
Contrariwise, the absence of such approval is doc
umented in an appeal filed by claimant before the
Board at A69972 in which the award of counsel fee
was one of the issues raised. In the Opinion, the
Board concluded:

"Purther, section 501 of the Pennsylvania
Workmen's Compensation Act... negates the val-
idity of any counsel fee arrangement unless such
an arrangement is approved by this board. Since
there is no such approval in this case, the peti-
tion for allowance of attorney fees and disburse-
ments must be dismissed." (underlining supplied)
See: Pennsylvania Workmen's Compensation Appeal
Bcard in Lerner v. Phila. tr tr at Appeal
A69972 unpublished Opinion here appended at page
Al0, and its conclusion at page Al4. That decision
not only documents the absence of approval neces-
sary to validate a claim for counsel fee but by its
date of October 2, 1975 clearly indicates that the
timely filing of an appeal within twenty days of
the award by Referee on March 5, 1975, had long
since tolled.

5. Quantum meruit award in Sundheim.
The Respondent, Attorney Haas, entered a Petition

For Counsel Fee Under Section 501 with the Board
and sought by a back-door approach to insinuatean
alternative quantum meruit claim. There is no pro-
vision for such claim in Section 501. The Court
cluded its Opinion in Sundheim hy stating:

"The plaintiff, in our judgment, was not enti-
tled to recover on his contract, the basis of this
suit, but he may have an action on quantum meruit
for damages as a result of a breach of contract."
The Petitioner here holds while an award under

9

Section 501 was clearly improper, that might not
preclude "an action on quantum meruit for damages
as a result of a breach of contract." To sustain
such an action, however, the attorney must demor-
state that he seeks the amount deserved coinciding
with the amount by which the estate benefitted as
a result of the attorney's efforts. The record shows
clearly, however, that the eState gained no bene-
fit at all through Mr. Haas. The award by the Re-
feree states:

" Based on a careful consideration of this tes-
timony (totalling 397 pages) and the exhibits, the
Referee hereby makes the following Findings of
Fact, Conclusions of Law and Order, applicableto
all three petitions:- "

Attorney Haas had withdrawn himself from the case
long before the hearings at which that testimony
and the exhibits were presented and he did not par
ticipate or contribute to them in any way. The at-
torney did himself state in a letter to petitioner
dated April 25,1974:

",.. my forbearance to insist on payment at
this time should not be in any way construed as my
considering the fee to be a contingent upon the
successful conclusion of the case."

It is thus clear that Mr. Haas considered himself
entitled to a counsel fee based on $5000 without
regard to any beneficial award, based solely on
petitioner's telephoned assent to a figure of $4800
as a basis for negotiation. Mr. Haas did not ex-
amine or prepare any witnesses. He appeared at
no evidentiary hearings. Nor did he ever once meet
to talk with the claimant. With no supporting docu-
ments, we are asked to believe that that this ex-
pert spent 20 hours negotiating with the insurer at
the implausible rate of $73 per hour. Mr. Haas

ee er

16

seeks the best of both worlds but he has no equi-
table claim either under Section 501 or by a quan*
tum meruit award. As to which was the basis for
the award, the Court can only speculate since the
Board entered its Order sans findings of fact or
conclusions of law. See:

Sundheim v r unty Bu & L Ass
140 Pa. Super 529, 14 A2d 349 (1940)

See the unpublished one-sentence Order entered by

the Board in Lerner v. Phila. Psychiatric Ctr., at
C.F. 2384, here appended at page AlS.

6. The levy of interest in Palmgreen
By the 1972 amendments to the Workmen's Compen-

sation Act, the General Assembly of Pennsylvania
sought to assure "the prompt payment of compensa-
tion when due." To discourage the endemic delay,
an interest rate of 10% was instituted on payments
due. That provision applies to compensation pay-
ments from employer/insurer to employee. A levy
of interest on counsel fee to be paid by a disabled
employee is nowhere specified or contemplated.
The Commonwealth Court's Opinion in Lerner rely-
inc on Palmgreen states:

"In all cases of contract interest is allowable
at the legal rate from the time payment was with-
held after it became the duty of the debtor to make
payment. Palmgreen v. Palmer's Garage, Inc.,
383 Pa. 105, 117 A2d 721 (1955)." In relying on
Palmgreen the Court has chosen a case in the gen-
eral domain of law without any reference at all to
workers' disability compensation. It is inconceiv-
able that the Legislature which strictly regulates
the counsel fee that may be assessed against a
disabled worker would countenance a leyy of in-
terest on that fee. The levy assessed here is with-

8}

out precedent and has no basis in law or equity.
Palmgreen, however, does serve to raise the issue
of when it “became the duty of the debtor to make
payment.’ In its Opinion in Lerner, the Common-
wealth Court stated on the first page:

"On November 14, 1972 respondent (Haas)
and the employer's insurance company agreed to
a stipulation of facts and a proposed payment of
$4800. The petitioner (Lerner) orally agreed to acr
cept the agreement that same day and the following
day the agreement was presented to the referee."
Section 407 of the Act requires that all agreements
for compensation be in writing and signed by all
parties in interest. The "document" variously call-
ed above a “Stipulation of facts" and an “agree-
ment" supposedly executed by Haas and the insur-
er and to which Lerner orally agreed (by telephone)
and said to have been presented to the referee on
the following day was presumably a bona fide docu-
ment (in writing). Such, however, is not the case.
No Agreement bearing either.a $4800 or a $5000
figure was ever presented to the referee. No such
document has been offered in evidence nor does it
appear of record.The Board's Order levies interest
from January 1, 1973 when, presumably it "became
the duty of the debtor to make payment." Unfortun-
ately for this concocted version, the insurer wrote
Mr. Haas on March 1, 1973, saying:

"Re: Samuel Lerner v Phila. Psychiatric Hosp.

Termination Petition #197-18-4933
Dear Mr. Haas:

"With reference to the above-captioned
case, youwill recall I previously wrote to you
by letter of January 5, 1973 requesting copies
of medical bills and your contention as to the
disability time involved in this case so that

12

the Stipulation can be worked out and drawn up.
"The Referee's office is awaiting the Stip-
ulation, can you please advise me of these
matters so that the Stipulation can be prepared.
Very truly yours,
( signed )
John F. McElvenny
JFM:chy
c.c. - Referee Wallace J. Stevenson"
To this Mr. Haas appended a hand-written note:

" 3-2-73
“Dear Sid -
For your information & action. May I hear
from you soon?
(signed) Jerry"

It is incredible that despite the inchoate state of
any agreement or stipulation of facts let alone an
award or payment as of March 1, 1973 yet the levy
of interest dates from January 1, 1973 when it pur-
portedly “became the duty of the debtor to make
payment." This strange set of circumstances took
place when the Board chose to make an award while
abstaining from submission of findings of fact or
conclusions of law that might reasonably reflect
the evidence of record. This lapse was compound-
ed by the appellate Court's proceeding contrary to
Sherred and assuming the role of advocate in a vain
effort to justify the capricious result.

CONCLUSION

The essence of civil liberty requires a legal
remedy for a legal wrong. Since our government is
one of laws not men, the rights and safeguards
established by the workmen's compensation laws

13

should be impartially administered for the protec-
tion of all disabled workers.

WHEREFORE, petitioner respectfully requests
that a Writ of Certiorari issue to review the judg-
ment of the Supreme Court of Pennsylvania, and a
summary vacation of the Order below.

CERTIFICATE OF SERVICE

I certify that three copies of this document
have been mailed to each of the below-named and
that all who should be served have been served.

Gerald J. Haas, Esq., 225 S. 15th Street,
Philadelphia, Pa. 19102

Larry Pitt, Esquire, 925 Chestnut Street
Philadelphia, Pa. 19107

Sidnef¥S. Lerner, M.D.
Pro se for Petitioner
1101 Stratford Avenue
Philadelphia, Pa. 19126

Al
IN THE SUPREME COURT OF .PENNSYLVANIA
Eastern District
September 18, 1978
In re: Lerner v. Haas etal, No. 3636A.D. 1978
Dear Dr. Lerner:

Please be advised that the Court has entered
the following Orders in the above captioned matter:
On the Petition for Allowance of Appeal from the
Commonwealth Court:

"September 14, 1978 Denied By the Court"

On the Amended Petition for Allowance of Appeal:

"September 14, 1978 Denied on the merits

By the Court"
Very truly yours,
Sally Mrvos, Prothonotary

November 2, 1978
RE: Lerner v Haas et al, No. 3636A.D. 1978
Dear Dr. Lerner:

The Court has decided not to reconsider its
denial of allocatur in the above case. This ends
the matter.

If further advice is needed, please seek it
from legal counsel of your choice.

Sincerely,
Michael J. Eagen
Chief Justice

A2
In The COMMONWEALTH COURT of PENNSYLVANIA
Richman et al v WCAB et alat No. 182 C.D. 1974
Opinion by Judge Wilkinson, January 7, 1975

The facts of this case are essentially undis-
puted. The appellant is the law partnership of
Greenlee, Richman, Derrico & Posa. This firm had
been retained by Lloyd E. Myers, claimant , to re-
present him in a workmen's compensation claim
against appellee United States Steel Corporation.

Claimant had been injured on April 2, 1971..
Appellee corporation denied that a compensable
accident had taken place, but in lieu of workmen's
compensation, had paid claimant sickness and ac-
cident benefits during the period of his disability.
Also during this period, the claimant received un-
employment compensation benefits from the other
appellee, the Pennsylvania Bureau of Employment
Security.

On October 19, 1972, the parties were notified
by the referee that claimant had proven a compens-
able accident did occur and claimant, therefore,
was entitled to workmen's compensation benefits
from appellee corpcration, a self-insurer, in the
amount of $3437.15. The referee's order further
established that subrogation rights were granted to
both appellee corporation and appellee bureau for
all payments of social insurance benefits ($2340)
and unemployment compensation benefits ($900)
that had been paid to claimant. There was no ap-
peal from any part of this order.

On November 20, 1972, appellee corporation
mailed appellant a check for $197.15 as the balance
due to claimant after deduction of the two subroga-
tion claims of the appellees. Appellant then, on
March 16, 1973, submitted invoices to both appel-
lees for their respective pro-rata share of appel-
lant's charges for legal services and costs advan-

Te eee eae

A3
ced in prosecuting claimant's case. Both appellees
refused to honor appellant's bill and on April 12,
1973, almost six months after the referee's award,
appellant filed a "Petition for Award of Counsel
Fees" with the Workmen's Compensation Board, re-
questing that the Board order payment of appellant's
expenses and legal fees properly due from each
subrogee.
The Board denied appellant's petition, holding

that the request for counsel fees is in the nature of

an appeal from the referee's award and under Sec-
tion 423 of the Pennsylvania Workmen's Compensa-
tion Act, Act of June 2, 1915, P.L. 736, as amend-
ed, 77 P.S. Sections 853, 854 (Supp. 1974-1975),
the appeal was too late, having been filed beyond
20 days of the notice of the referee's award. The
Board also held that because the provisions of
Section 501 of the Act, 77 P.S. Section 1021, were
not met, "this Board has no authority to direct the
parties to make payments to counsel for claimant".

| The instant appeal followed.

| The appellant now argues, based on the equit-
able principles of subrogation as laid down in Furia
v. Philadelphia, 180 Pa. Superior Ct. 50,118 A. 2d
236 (1955), and the intent evidenced in the legis-
lative history of Section 319 of the Act, 77 P.S.
Section 671, that they are entitled to receive attor-
ney fees from the fund they created which benefit-
ted the subrogees. We find it unnecessary to reach
this issue for we hold that appellant did not comply
with the statutory provisions that would enable him
to collect the fees they are claiming, either from
the claimant, from the subrogee or as a lien on the
fund.

Appellant's right to receive his attorney fees

from the subrogees of a workmen's compensation a-
ward must be controlled by the Workmen's Compen-

A4
sation Act. Section 501 of the Act, 77 P.S. Section
1021, provides that, inter alia:

“No claim or agreement for legal services or
disbursements in support of any claim for compen-
sation, or in preparing any agreement for compen-
sation ... shall be an enforceable lien against the
amount to be paid as compensation, or be valid or
binding in any other respect, unless the same be
approved by the board...." (Emphasis supplied.) |
The section goes on to require that such claim or
agreement be filed with the department for approv-
al, and then provides for creation of a lien by giv-
ing notice to the employer. Appellant, who has
the burden of proof, has made no showing that the
approval of attorney's fees contemplated in Section
501 was ever granted or even sought.

* section 442 of the Act, 77 P.S. Section 998, was
added on February 8, 1972, long after the injury on
April 2, 1971, but before the referee's determination
on October 19, 1972. This Section provides:

"All counsel fees, agreed upon by claimant
and his attorneys, for services performed in mat-
ters before any referee or the board, whether or not
allowed as part of a judgment, shall be approved
by the referee or board as the case may be, provid-
ing the counsel fees do not exceed twenty per cent
of the amount awarded. The official conducting any
hearing, upon cause shown, may allow a reason-
able attorney fee exceeding twenty per centum of
the amount awarded at the discretion of the hear-
ing official.

"In cases where the efforts of claimants'
counsel to produce a result favorable to the claim-
ant but where no immediate award of compensation
is made such as in cases of termination or suspen-

AS

Surely equity, and perhaps the law, would al-
low appellant to be paid a reasonable attorney fee
in a case such as presented here, absent a control-
ling statute. However, when as in this case, there
are attorney fees claimed for protection of subroga-
tion interests, such claims must be presented in
accordance with Section 501 or Section 442 of the
Workmen's Compensation Act for approval by the
referee or the Board. Stnce neither procedure was
followed in the instant case, we, therefore, must
affirm the Board‘s decision and deny appellant's
petition and appeal.

Accordingly, we enter the following

ORDER
NOW, January 7, 1975, the decisiorw of the Workmen's
Compensation Appeal Board is hereby affirmed.
(signed)

Roy Wilkinson, Jr., Judge

sion the hearing official shall allow. or award reason-
able counsel trees, as agreed upon by claimant and
his attorneys, without regard to any per centum.”
Since appellant did not comply with either provi-
sion, i.e., approval of the referee or board, wheth-
er this Section applies is immaterial.

- It should be noted that the Board's opinion states
appellant failedto comply with the notice provision
of this third paragraph of Section 50]. At argument,
appellant produced a letter he sent to U.S. Steel
on November 8, 1972, and strenuously contends
that this letter was sufficient notice to comply with
this paragraph. In addition to the letter not being
on the record, we need not decide if this.argument
is meritorious, since we hord that appeliant tailed
to comply with the other portions of the section.

A6
In The COMMONWEALTH COURT of PENNSYLVANIA
Lerner v Haas et al at No. 2109 C.D. 1976
Opinion by Judge Wilkinson, May 16, 1978

This case, an appeal of an order of the Work-
men's Compensation Appeal Board (Board) awarding
counsel fees to respondent, arises out of workmen's
compensation proceedings wherein the employer
sought to terminate benefits to Samuel Lerner’

( claimant ).

Respondent, an attorney, was hired by claim-
ant to represent him at these proceedings on Sep-
tember 26, 1971; claimant died on December 21.
1971. Respondent continued to represent the estate
(of which petitioner, the brother of the claimant,
was appointed administrator) in the workmen's
compensation action. On November 14, 1972 re-
spondent and the employer's insurance company
agreed to a stipulation of facts and a proposed
payment of $4800. The petitioner orally agreed to
accept the agreement that same day and the follow-
ing day the agreement was presented to the referee.
However, when the written agreement (with the a-
mount of payment increased to $5,000) was pre-
sented to petitioner for his signature he delayed
signing it for a period of five months. Finally on
April 19, 1973 petitioner: informed respondent that
he would not sign the agreement and instead re-
quested the respondent to secure an agreement
from the insurance company to pay an additional
$160 for certain medical bills. Respondent refused
to seek this additional sum and withdrew from the
case. Hearings were held with the petitioner ap-
pearing pro se and following a series of appeals an
award was made of $6,271.10 representing compen-
sation of $4911.43 and the balance in interest. Re-
spondent filed a petition with the Department of
Labor and Industry asking for payment for approxi-

yy

A7

mately 20 hours of legal work on the claim. This
petition was granted by the Board in the amount of
$1,460 plus interest at the rate of 6 per cent per
annum from January 1, 1973 until the date of pay-
ment. From this award petitioner appeals.

Petitioner throughout has regrettably misread
The Workmen's Compensation Act} which makes it
difficult for us to sift the wheat from the chaff in
determining and properly disposing of the issues
he has raised. As we apprehend the matter, the
only real issue in this case is whether the Board
had the authority under Section 501 of the Act,
77 P.S. Section 1021, to approve the fee.

Petitioner first argues that this award was im’
proper because there was no prior approval of the
agreement between claimant and counsel by the
Board or referee. He relies on a decision of the
Board dated October 2, 1975 which dismissed the
respondent's petition on the ground there had been
no prior approval of counsel fees. However, that
decision did nothing more than state the proper
procedure under Section 501 required respondent
to file his claim with the Department of Labor and
Industry (which was subsequently done). See
Richman v. Workmen's Compensation Appeal Board
16 Pa. Commonwealth Ct. 594; 329 A2d 920(1973).

Alternatively, Petitioner argues that the re-
spondent, having breached his contract by with-
drawing from the case, should not be permitted to
share in the award of compensation made after his
withdrawal. This argument, however, misstates
allegations in respondent's petition which were
not denied by petitioner, and the legal basis to
Support respondent's award of counsel fees. These
factual allegations show that respondent had nego-
tiated and petitioner had agreed to a settlement on
November 14, 1972 and that respondent's petition

A8

for counsel fee was based on the amount of work
actually performed by respondent on behalf of his
client up to January 1, 1973. While petitioner
could and in fact did repudiate his initial agree-
ment to the settlement, he could not by so doina
deprive counsel of a reasonable fee for the a-
mount of services he did perform. See Sundheim
v. Beaver County Building & Loan Association,
140 Pa. Superior Ct. 529, 14 A2d 349(1940) (al-
locatur refused). For this reason we also find peti-
tioner's assertioner that Section 442 of the Act,ad-
ded by the Act of February 8,,1972, P.L. 25, as a-
mended, 77 P.S. Section 998", precludes this a-
ward to be without merit since that section gives
the Board the authority to award counsel fees ex-
ceeding the statutory amount "upon cause shown’.

Similarly we are not persuaded by petitioner's
assertion that the Board is without authority under
Section 501 to award counsel fee plus interest in
the proper case. Moreover, we believe, sufficient
facts are in the record, undisputed by petitioner to
conclude the award of interest in this case was
"reasonable" and thus, properly made by the Board.
See Workmen's Compensation Appeal Board v.
Leuchen, 21 Pa. Commonwealth Ct. 39, 042 A.2d
810 (1975). The record showed the agreement had
been prepared and agreed to by petitioner consist-
ing of a $4,800 settlement and attorney's fees of
$1,393 which was subsequently increased to
$1,460 based on the increase in the settlement to
$5,000. In all cases of contract interest is allow-
able at the legal rate from the time payment was
withheld after it became the duty of the debtor to
make payment. Palmgreen v. Palmer's Garage, Inc.
383 Pa. 105, 117 A.2d 721 (1955). There was ample
evidence for the Board to have concluded the repu-
diation of the agreed settlement was unreasonable

A9
and unwarranted. Petitionerhas advanced no reason
for rejecting the stipulation other than his desire
to have additional compensation for $160 for medi-
cal bills. This assertion, however, must be view-
ed in light of the fact that petitioner had originally
agreed to a $4,800 settlement and later rejected a
stipulation incorporating a $5,000 settlement. Also
germane to this issue is the fact that the $5,000
settlement which would have been paid on or before
January 1, 1973 was above the sum ultimately a-
warded in compensation after protracted hearings
and appeals encompassing a two year period.
Accordingly, we will enter the following
ORDER
AND NOW, May 16, 1978 the order of the

Workmen's Compensation Appeal Board, dated No-
vember 5, 1976 at Docket No. C.F. 2384, is af-
firmed and it is directed that judgment be entered
in favor of Gerald J. Haas, Esquire and against the
Estate of Samuel Lerner, Deceased and/or Sidney
S. Lerner, M.D., in the sum of $1,460 plus inter-
est at the rate of six per cent per year from January
1, 1973 until the date of payment.

(signed)

Roy Wilkinson, Jr., Judge

]

Act of June 2, 1915, P.L. 736. as amended, 77
P.S. Section 1 et seq. ( Hereinafter referred to as
Act.)

Respondent has not argued, nor do we find it ne-
cessary to decide, the issue of the retroactivity of
Section 442 to injuries occurring prior to the ef-
fective date of the 1972 amendments.

Al0

PA. WORKMEN "S COMPENSATION APPEAL BOARD
Lerner v. Philadelphia Psychiatric Center, A69972
Opinion by Commissioner McCullough, Oct 2, 1975

Claimant was injured on January 9, 1970, which
accidental injury was the subject of a compensa-
tion agreement entered into on Pebruary 20, 1970.
The agreement recites that "while helping to sub-
due patient, Claimant was knocked down, striking
head. Resulting in fracture right occipital skull,
cerebral contusion wit» subarachnoid hemorrhage,
lacerations of left eyebrow and left upper lip, and
contusions of left side of face." Compensation at
$60 a week was begun January 16, 1970. On July.
29, 1970 the employer petitioned to terminate com-
pensation on the basis claimant had recovered from
his said injuries and could return to work on March
il, 1970. Claimant died on December 21, 1971. His
brother, a medical doctor, was appointed adminis-
trator of his estate, and petitioned for the statuto-
ry burial expense on May 19, 1972. The said ad*
ministrator petitioned to review the compensation
agreement on December ll, 1973, asking for the
_ payment of two medical bills, one for $90 and one
for $20, for services to his late brother for the
period January 9, 1970 to February 20, 1970. The
referee consolidated the said three petitions, and
after extensive hearing, did not grant the prayer of
the petition to terminate, but continued compensa-
tion under the said agreement to October 7, 1971,
as of which date he granted the termination peti-
tion. The referee also directed payment of the
said two medical bills requested under the petition
to review. The fatal claim petition was dismissed.
The action of the referee was dated February 24,
1975. The carrier appealed, asserting that the re-
feree should have granted its termination petition
as of March ll, 1970. However, counsel for the

All
carrier has submitted a one-sentence brief which
recites, "The findings of fact, conclusions of law,
and award of Referee Stevenson dated February 24,
1975, were supported by sufficient competent evi-
dence." Obviously, therefore, the carrier has with-
drawn its appeal. The administrator appealed, as-
serting that there was no termination of disability
on October 7, 1971.

On the petition to terminate, it is the burden
of the employer to show a reduction or cessation
of disability. Lackman vs. F.W.Woolworth Co.,
205 Pa. Super. 129, 208 A.2d 33(1965). The em-
ployer presented two physicians in support of its
petition. The one physician is Board certified in
neurology and psychiatry. He first saw decedent
on May 19, 1970. He received a history from de-
cedent that he had been struck by an escaping pa-
tient and was rendered unconscious and hospital-
ized from January 9 to February 20,1970, when he
voluntarily vacated the hospital. He stated deced-
ent was supposed to have a skull fracture and con-
tusion, but he knew there was a laceration of the
head and an injury to the right eye. This physician
stated decedent had had diabetes for ten years,
and that the injury aggravated the diabetes, but
thereafter the diabetes came under control. It
was his opinion that the only thing significant
from the accident was the temporary loss of con-
trol of the diabetes. This physician nowhere in
his testimony mentioned the date of October 7, 1971.

The other physician presented by the defendant
was Board certified in internal medicine, who never
saw decedent, but who reviewed available medical
records. He was posed a hypothetical question
which embraced the medical history of decedent
and was asked whether any disability in deced-
ent, after April of 1970 was related to the blow on

Al2
the head suffered by the decedent on January 9,
1970. His answer was to the effect that disability
subsequent to April of 1970, was not causally re-
lated to the then-claimant's cranial trauma. He
was later asked whether the blow sustained by de-
cedent on the head had any effect on the ongoing
diabetes vascular disease of decedent, and his
answer was he found no evidence linking the blow
on the head with the vascular disease. The physic
ian then opined that disability subsequent to April
of 1970 was directly related to the diabetic vas-
cular conditions of decedent. This physician no-
where in his testimony mentioned the date of Oc- ©
tober 7, 1971.

The testimony of the aforesaid two physicians
comprises substantial competent evidence to sup-
port the termination of compensation. It is the
function of the referee to pass upon the credibility
of witnesses. Universal Cyclops Steel Corporation
vs. Workmen's Compensation Appeal Board, 305
A.2d 75(1973). It can be seen from the testimony
of these two physicians that compensation could
have been terminated in April of i970. The referee,
however did not terminate compensation until Oc-
tober 7, 1971. But this board did not pass upon
this extension by the referee of total disability
compensation, because, as recited above, the
one-sentence brief of counsel] for the employer is
tantamount to the withdraw(a)1 of the appeal.

With regard to the petition to review the com-
pensation agreement, which, in effect, was a re-
quest for the payment of services of two physic-
ians, for $90, and $20, the appeal by the defen-
dant, having been in effect withdrawn, these a-
wards stand. They should stand, having been in-
curred during the first and second months of the
disability from accident, in January of 1970.

Al3

It is the burden of the administrator in a peti-
tion for statutory burial expenses to prove that
death was a result of the injury and that the injury
was a cause of death. Hurlburt vs. Fidelity Win-
dow Clean Co., 192 Pa. Super. Ct., 152(1960).

An examination of the medical evidence of-
fered by the administrator has not met said burden.
In addition, finding of fact #7 of the referee recites
that the administrator did not establish by compet-
ent evidence that the death was causally related to
the work injury of January 9, 1970, and that the
death resulted from a prior existing pathological
disease not aggravated by the accidental injury.
Since there is substantial competent evidence in
the record to support this finding, we cannot dis-
turb the denial of the petition for statutory burial
expense.

The determination of the referee is therefore
affirmed, in toto.

In addition to the above proceedings, the ad-
ministrator, on March 25, 1975, mailed to this
board a separate appeal asking for the awarding of
costs for medical expenses, legal fees and dis-
bursements, witness fees, notes of testimony, in-
terest and penalties, etc. Since he did not present
these matters to the referee, other than the matter
concerning attorney fees, we cannot consider such
separate appeal. Further, the administrator is pro-
ceeding under the 1972 amendments to the Pennsyl-
vania Workmen's Compensation Act, and this board
has consistently held that, withregard to accidents
that occurred before said amendments, this board
will not invoke the amendments as set forth in Sec-
tion 435, and 440 under the act as amended.

On March 18, 1975, the administrator petition-
ed for a rehearing. There is no authority in the act
for such a rehearing, because this board has just

Al4
now by this decision finally disposed of the ap-
peals in the matter. The petition is therefore dis-
missed as being premature.

On April 8, 1975, the administrator petitioned
for the allowance of witness fees. This petition
cannot be considered by this board because this
matter was not considered by the referee.

On April 8, 1975, the administrator filed a
Document entitled "Claim Petition for Assessment
of Costs." Again, since this was not presented to
the referee, this board cannot consider this "Claim
Petition for Assessment of Costs."

On April 8, 1975, the administrator also filed
a Document entitled, "Petition for Allowance of At
torney Fees and Disbursements.”

We have hereinabove stated that the imposi-
tion of counsel fees on an employer under the most
recent amendments to the Pennsylvania Workmen's
Compensation Act does not apply to this pre-
amendment accident. Further, section 501 of the
Pennsylvania Workmen's Compensation Act, as it
stood at the time of the accident in this case, Jan-
uary 9, 1970, negates the validity of any counsel
fee arrangement unless such an arrangement is ap-
proved by this board. Since there is no such ap-
proval in this case, the petition for allowance of
attorney fees and disbursements must be dismissed.
Richmond, Greenlee, Richmond Derrico & Posa vs.
Workmen's Compensation Appeal Board, 16 Common.
Ct. 594 (1975). (underlining supplied)

(signed)
Commissioner
Concurred in by: Oct 2 1975
(signed)
Chairman
(signed)

Commissioner

Al5
PA. WORKMEN"S COMPENSATION APPEAL BOARD
Lermmer v Philadelphia Psychiatric Ctr. C.F. 2384
Petition for Counsel Fee By Claimant's Counsel
Order by Commissioner McCullough Nov 5, 1976

McCullough, Commissioner:

Upon consideration of the petitioner of the for-
mer counsel of the estate of Samuel Lerner, de-
ceased, under Section 501 of the Pennsylvania
Workmen's Compensation Act, said estate and/or
Sidney S. Lerner, M.D., is ordered to pay Gerald
J]. Haas, Esquire, the sum of $1,460.00 plus in-
terest at the rate of 6% per annum from January I,
1973 until the date of payment, as a counsel fee.

By the Board:

(signed)

Commissioner
(signed)

Chairman
(signed)

Commissioner

Nov 5,1976

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385006_0354%3A1. Public record. Not legal advice.