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Buckingham v. Health South Rehabilitation Hospital11/18/1997
ating attorneys' fees to the appropriate adjudicative authority, first to the district court, later to a hearing officer, and then to a WCJ, according to a broad discretionary standard of reasonableness. See 1929 N.M. Laws, ch. 113, § 22; 1955 N.M. Laws, ch. 274, § 1. Starting in 1959, the legislature began to narrow judicial discretion to award attorneys' fees by stipulating that the court must consider: (1) prior attempts at settlement and the amount, if any, the attorney improved the worker's case by litigation, and (2) "the present value of the award made in the work[er's] favor." 1959 N.M. Laws, ch. 67, § 28. Because attorneys' fees were only awarded for collecting "compensation through court proceedings," this Court initially held that attorneys were entitled to no award of fees for securing medical benefits, whether retroactive or prospective. See . We were in error. The Supreme Court subsequently reversed this Court and adopted a broader view of that same language in the Act, concluding that "medical expenses are compensation for the purpose of allowing attorney fees under [the Act]." .
{37} Subsequently, our Supreme Court in , codified a series of supplemental factors that went beyond the language of the Act. The so-called Fryar factors are used still today to calculate the true value of the attorney's effort to the worker in light of a public policy concerned about balancing the need to curb the expense of unnecessary litigation against the chilling effect of miserly attorneys' fees on Justice to the worker. See . Following Fryar I, this Court again tried unsuccessfully to narrow the discretion of the Judge in calculating a fair attorneys' fee award by prohibiting the use of a percentage contingency fee even as a guide to determine a fair fee. See ) (Fryar II). We concluded erroneously that "a fee based on a percentage of the award is not authorized either by § 54-1-54(D), . . . or by the additional factors listed in Fryar v. Johnsen." . The Supreme Court eventually overturned the Fryar II decision and made clear that there was nothing in the Act or in Fryar I that prohibited a court from utilizing a percentage of total recovery as one of several methods of arriving at a fair fee. See . Indeed, in Quintana, the Supreme Court noted that the Act continued to require the trial Judge to take into consideration "'the present value of the award made in the work[er's] favor.'" (quoting Section 52-1-54(D)(2)). We think our Supreme Court made clear in Quintana that, along with all the other Fryar factors, a court must consider, as a rule of reasonableness or proportionality, how a percentage of total recovery (excluding the value of future medical benefits) compares with other methods of determining a reasonable fee.
{38} In its first wholesale modification of the Workers' Compensation Act in 1986, the legislature stipulated that a fair attorneys' fee could not exceed a sliding scale based on a percentage of recovery which was "twenty percent of the first five thousand dollars ($5000) of the benefits secured, fifteen percent of the next five thousand dollars ($5000) of the benefits secured and ten percent of the remaining benefits secured." 1986 N.M. Laws, ch. 22, § 18. In the next subsection, the Act stipulated, for the first time and in language identical to the present Act, that "the value of future medical benefits awarded shall not be considered in determining attorneys' fees." Id. The clear legislative intent was: (1) to establish a cap based on a percentage, and (2) to ensure that the value of future medical benefits was not included in that calculation. The net effect was to keep attorneys' fees lower. Except for the notion of a cap on fees, this was nothing new. Fees could still be calcula
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