08-12WC. David Yustin v. State of VT, Dept. of Public Safety.

• Court: Vermont

Vermont Workers Compensation 2012. 08-12WC. David Yustin v. State of VT, Dept. of Public Safety David Yustin v. State of VT, Dept. of Public Safety(March 20, 2012)STATE OF VERMONT DEPARTMENT OF LABORDavid Yustin v. State of Vermont, Department of Public SafetyOpinion No. 08-12WCBy: Jane Woodruff, Esq. Hearing OfficerFor: Anne M. Noonan CommissionerState File No. Y-03486RULING ON CROSS MOTIONS FOR SUMMARY JUDGMENT APPEARANCES: Christopher McVeigh, Esq., for Claimant Keith Kasper, Esq., for Defendant ISSUES PRESENTED:

1. Is Claimant entitled to an award of costs and attorney fees for legal representation provided in securing the Department's March 2008 interim order?

2. Was Claimant's request for an award of costs and attorney fees timely filed?

FINDINGS OF FACT: For the purposes of these cross motions, the following facts are not disputed: 1. Claimant was an employee and Defendant was his employer within the meaning of Vermont's Workers' Compensation Act. 2. On June 12, 2006 Claimant, a Vermont State trooper, injured his left shoulder. The injury occurred while he was working out at the Rutland County Sheriff's Department gym in preparation for a physical fitness exam. Claimant was off duty at the time. 3. Initially Defendant denied that Claimant's injury was compensable, on the grounds that it did not arise out of and in the course of his employment with Defendant. 4. While Claimant contested Defendant's denial, he used accumulated sick leave to pay for his time out of work, and employer-provided health care benefits to cover his medical costs. 5. On March 24, 2008 the Department issued an interim order requiring Defendant to pay both temporary total disability and medical benefits causally related to Claimant's shoulder injury. 6. Defendant did not challenge the Department's March 2008 interim order. However, rather than paying temporary disability benefits outright, instead it reinstated the sick leave Claimant had used to cover his time out of work. 7. Claimant objected to this reimbursement procedure. He argued that Defendant should have paid him the temporary disability benefits it owed in a lump sum rather than reimbursing his sick leave bank. If it had done so, then Claimant would have had funds available from the benefit award with which to pay his attorney fees. 8. Claimant pursued this issue to formal hearing. On July 17, 2009 the Commissioner ruled in Defendant's favor, thus denying Claimant's challenge to its sick leave reimbursement process. Claimant then appealed to the Vermont Supreme Court. On February 23, 2011 the Court issued its decision upholding the Commissioner's determination. Yustin v. Department of Public Safety, 2011 VT 20. 9. In affirming Defendant's right to offset Claimant's sick leave wages against the temporary disability benefits the Department had ordered it to pay, the majority opinion in Yustin addressed the question whether the process was in fact "cost-neutral" to Claimant. Id., ¶14. Responding to the argument raised in the dissenting opinion - that the process was not cost-neutral because it deprived Claimant of a lump-sum award from which to pay his attorney fees - the majority stated:

Claimant's argument overlooks his clear statutory right to seek from the Commissioner a reimbursement of reasonable attorney fees incurred in pursuing his claim, a right that applies even where - as here - the attorney fees are incurred prior to final hearing. See 21 V.S.A. §678(d) (authorizing an award of attorney fees incurred to secure payment of benefits in settlement after denial but before formal hearing).

Id. 10. In a footnote, the majority addressed in greater detail the dissent's charge that Claimant's right to seek attorney fees was "illusory," because it was restricted by certain workers' compensation rules limiting the circumstances under which fees could be awarded at the informal dispute resolution level. With specific reference to what is now Workers' Compensation Rule 10.1320 - where a claim is denied "without reasonable basis" - the majority noted that there had been ample evidence in the record to support a request for attorney fees on those grounds. It concluded:

Thus, Claimant was

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