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                                    BRB No. 00-795

DALE ROBINSON                           )
                                        )
          Claimant-Respondent           )
                                        )
       v.                               )
                                        )
TRANSOCEAN TERMINAL                     )    DATE ISSUED:   05/03/2001

OPERATORS                               )
                                        )
     and                                )
                                        )
SIGNAL MUTUAL INDEMNITY                 )
ASSOCIATION, LIMITED                    )
                                        )
          Employer/Carrier-             )
          Petitioners                   )    DECISION and ORDER


     Appeal of the Compensation Order Award of Attorney's Fees of Charles
     Lee, District Director, United States Department of Labor.

     William S. Vincent, Jr., New Orleans, Louisiana, for claimant.

     Douglas P. Matthews (Frilot, Partridge, Kohnke & Clements), New Orleans,
     Louisiana, for self-insured employer.

     Before: HALL, Chief Administrative Appeals Judge, SMITH and McGRANERY,
     Administrative Appeals Judges.

     HALL, Chief Administrative Appeals Judge:

     Employer appeals the Compensation Order Award of Attorney's Fees (OWCP No. 07-145716) of District Director Charles Lee rendered on a claim filed pursuant to the
provisions of the Longshore and Harbor Workers' Compensation Act, as amended, 33
U.S.C. §901 et seq. (the Act).  The amount of an attorney's fee
award is discretionary and will not be set aside unless shown by the challenging
party to be arbitrary, capricious, an abuse of discretion or not in accordance with
the law. See Roach v. New York Protective Covering Co., 16 BRBS 114 (1984).

     Claimant was injured during the course of his employment on May 24, 1997. 
Employer voluntarily paid temporary total disability benefits from the date of
injury through June 12, 1998.  From June 13 through July 16, 1998, employer paid
temporary partial disability benefits.  Temporary total disability benefits were
reinstated on July 17, 1998, and continued through March 19, 1999.[1]   Because it supplied evidence of suitable
alternate employment, employer paid temporary partial disability benefits from
March 20, 1999 forward.  On September 21, 1999, claimant hired an attorney to
represent him in his claim to reinstate temporary total disability benefits.  In
a memorandum issued on December 7, 1999, following an informal conference, the
claims examiner recommended claimant be paid temporary total disability benefits
from June 3, 1999, and continuing, pursuant to Dr. Steiner's opinion regarding
claimant's medical condition.  By letter dated December 16, 1999, employer voiced
its disagreement with the claims examiner's opinion.  It stated  it would not
reinstate temporary total disability benefits until after claimant underwent
surgery and his condition changed.  Claimant underwent surgery on January 3, 2000,
and, on January 11, 2000, employer reinstated temporary total disability benefits,
including back payments to June 3, 1999.  Claimant completed an LS-18 Pre-Hearing
Statement on January 18, 2000.  By letter dated January 28, 2000, employer informed
claimant's counsel of the amended payments.

     On March 6, 2000, claimant's counsel filed a fee petition for an attorney's
fee in the amount of $2,253.12, representing 12.875 hours at an hourly rate of $175
for work performed between September 21, 1999, and February 15, 2000.  Employer
disputed the fee request, arguing that it paid the amount recommended by the claims
examiner and filed the appropriate documentation; therefore, citing FMC Corp.
v. Perez, 128 F.3d 908, 31 BRBS 162(CRT) (5th Cir. 1997), it asserted it was
not liable for a fee.  The district director rejected employer's argument,
distinguished Perez, and awarded the fee as requested.  Employer appeals the
fee award, and claimant responds urging affirmance.

     Under Section 28(b), 33 U.S.C. §928(b), when an employer voluntarily pays
or tenders benefits and thereafter a controversy arises over additional
compensation due, the employer will be liable for an attorney's fee if  the
claimant succeeds in obtaining  greater compensation than that paid or tendered by the employer.[2] See James J. Flanagan Stevedores, Inc. v. Gallagher, 219
F.3d 426, 34 BRBS 35(CRT) (5th Cir. 2000); Hawkins v. Harbert Int'l, Inc.,
33 BRBS 198 (1999); Ahmed v. Washington Metropolitan Area Transit Authority,
27 BRBS 24 (1993); Tait v. Ingalls Shipbuilding, Inc., 24 BRBS 59 (1990). 
An employer may avoid paying an attorney's fee under Section 28(b) if, within 14
days after the claims examiner's recommendation, it accepts that recommendation or
if it refuses the recommendation but tenders a payment which is accepted as full
payment by the claimant.  33 U.S.C. §928(b); Perez, 128 F.3d at 910,
31 BRBS at 163(CRT); Savannah Machine & Shipyard Co. v. Director, OWCP, 642
F.2d 887, 13 BRBS 294 (5th Cir. 1981).

     In this case, employer contends it is not liable for an attorney's fee because
it voluntarily reinstated total disability benefits prior to any formal
proceedings.  Specifically, it cites Todd Shipyards Corp. v. Director, OWCP
[Watts], 950 F.2d 607, 25 BRBS 65(CRT) (9th Cir. 1991), and National Steel
& Shipbuilding Co. v. United States Department of Labor, 606 F.2d 875, 11 BRBS
68 (9th Cir. 1979), in support of this proposition, alleging that the United States
Court of Appeals for the Ninth Circuit requires an award of additional benefits
after formal proceedings before employers can be held liable for attorney's
fees.  We reject employer's contention and its reliance on those Ninth Circuit
decisions, as neither Watts  nor National Steel requires formal
proceedings as a prerequisite  to employer's liability.  In Watts, the court
affirmed the denial of a fee payable by the employer under Section 28(b) because
there was no controversy remaining after the informal conference, other than a
dispute over counsel's entitlement to a fee. Watts, 950 F.2d 607, 25 BRBS
65(CRT).  In National Steel, disputed issues remained and the case was
transferred to an administrative law judge who awarded the claimant additional
benefits; thus, the employer was held liable for a fee. National Steel, 606
F.2d 875, 11 BRBS 68.  The facts in the case at bar differ in that a controversy
existed after the informal conference, as demonstrated by employer's December 16,
1999, letter specifically refusing to pay the recommended benefits.

     Contrary to employer's assertions, neither the Ninth Circuit cases nor, more
importantly, the language of the Act itself mandate that the claim proceed to a
formal hearing before an administrative law judge in order for the employer to be
held liable for a fee.  The decisions in Watts and National Steel
emphasize that Section 28(b) authorizes a fee in situations involving additional
compensation where a dispute remains following informal attempts to resolve a
claim.  Similarly, employer's reliance on Perez, 128 F.3d 908, 31 BRBS
162(CRT), is misplaced.  As the district director stated, the facts of Perez
are distinguishable: the dispute therein was resolved prior to commencement of
informal proceedings because the employer voluntarily and continuously paid the
equivalent of the amount due for permanent total disability from the date of injury
through the date of settlement.  Thus, the employer was not held liable for an
attorney's fee because the requirements of Section 28(b) were not satisfied.
Id.; see also Boe v. Dep't of the Navy/MWR, 34 BRBS 108 (2000).

     Section 28(b) sets out steps involving informal proceedings which determine
whether employer is liable for claimant's attorney's fee.  Section 28(b), however, 
makes no mention of referral to an administrative law judge for a formal hearing. 
The section states that where employer pays benefits and a  controversy arises over
additional compensation, the district director must schedule a conference and issue
a written recommendation.  If employer refuses to accept the recommendation within
14 days, it can tender the compensation it believes is due; if claimant refuses to
accept this amount, utilizes the services of an attorney, and then obtains
additional benefits, employer is liable for a fee.  Liability thus turns on whether
employer accepts the district director's recommendation within the specified time
and claimant thereafter obtains additional benefits over those employer was willing
to pay.

     The requirements set forth in Section 28(b) were met here, notwithstanding
that referral to the Office of the Administrative Law Judges became unnecessary. 
Employer changed claimant's temporary total disability to temporary partial
disability in March 1999.  Claimant then obtained counsel and following an informal
conference, it was recommended in December 1999 that employer pay temporary total
disability back to June 3, 1999.  Employer, however, specifically refused this
recommendation and continued paying partial disability benefits, refusing to
reinstate total disability benefits until claimant had surgery.  Following
claimant's January 3, 2000, surgery, on January 11, 2000, 35 days after the
informal conference took place, employer paid the benefits claimant sought. 
Although formal adjudication was avoided, it is clear that employer did not accept
the claims examiner's recommendation in a timely manner and that reinstatement of
total disability benefits occurred only after employer's own conditions had been
met. See Staftex Staffing v. Director, OWCP [Loredo], 237 F.3d 409, 34 BRBS
105(CRT) (5th Cir. 2000); Hadel v. I.T.O. Corp. of Baltimore, 6 BRBS 519
(1977) ("pay or tender" must be unrestricted admission of liability). Thus, the
district director did not err in holding employer liable for a fee for counsel's
services performed before his office. See generally Gallagher, 219 F.3d 426,
34 BRBS 35(CRT).  Consequently, we reject employer's arguments, and we affirm the
district director's fee award.[3] 

     Accordingly, the district director's fee award is affirmed.

     SO ORDERED.



                                                                   
                         BETTY JEAN HALL, Chief
                         Administrative Appeals Judge



     I concur:                                                     
                         ROY P. SMITH
                         Administrative Appeals Judge


     McGRANERY, Administrative Appeals Judge, concurring:

     I concur in my colleagues' decision, holding employer liable for claimant's
attorney's fee under 33 U.S.C. §928(b).  I write separately to point out the
sophistry of employer's argument, that claimant is not entitled to an attorney's
fee because the increased compensation claimant received following employer's
failure to accept the district director's recommendation was not "awarded."  33
U.S.C. §928(b).  That section provides in relevant part:

     If the employee refuses to accept such payment or tender of
     compensation, and thereafter utilizes the services of an attorney at
     law, and if the compensation thereafter awarded is greater than
     the amount paid or tendered by the employer or carrier, a reasonable
     attorney's fee based solely upon the difference between the amount
     awarded and the amount tendered or paid shall be awarded in
     addition to the amount of compensation. 

33 U.S.C. §928(b)(emphasis added).

     Employer asserts that although it did not accept the claims examiner's
recommendation within fourteen days, employer resumed making temporary total
disability payments in January 2000, without formal proceedings or an award by an
administrative law judge.  Employer's argument is that additional compensation was
not "awarded" in accordance with the terms of Section 28(b).  Of course, employer
overlooks its letter to claimant's counsel, dated January 28, 2000, in which
employer wrote:  "we suggest you request [DOL] withhold transmitting the case to
the Office of the Administrative Law Judges for a Formal Hearing . . . ."  Exhibit
D attached to Claimant's Brief.  Thus, the record is clear that employer sought to
delay a hearing and thereby delay an award of increased compensation.  Essentially,
employer proposes that its rejection of the district director's recommendation and
belated discharge of its obligation be rewarded by denying its liability for
claimant's attorney's fee.  Employer's contention, that it should escape liability
for the fee because claimant's increase in compensation was not made pursuant to
an administrative law judge's order awarding benefits, contravenes Congress's
intent in enacting Section 28, to encourage settlement without resort to formal
proceedings and to compensate successful claimants' attorneys after intransigent
employers reject the district director's recommendation.

     Courts have recognized that Section 28(b) must be interpreted in such a way
as to vindicate its purposes.  Recently, the Fifth Circuit rejected employer's
argument, that it was not liable for an attorney's fee because it had not rejected
the district director's recommendation to reinstate temporary total disability
benefits. James J. Flanagan Stevedores, Inc. v. Gallagher, 219 F.3d 426, 34
BRBS 35(CRT) (5th Cir. 2000).  The court held that although the recommendation was
not in evidence and employer had reinstated benefits, the record was nevertheless,
clear, that after the conference claimant employed the services of an attorney to
recover an award of additional compensation.  The court concluded that
notwithstanding the statute's apparent requirement for imposition of attorney's fee
liability on employer, that employer refuse the district director's written
recommendation, "under these particular circumstances, we find that employer has
failed to 
demonstrate that the ALJ erred in finding the conditions of §928(b)
satisfied." Id., 219 F.3d at 435, 34 BRBS at 42(CRT).  Similarly , the Ninth
Circuit rejected employer's contention that it was not liable for claimant's
attorney's fee because it had agreed in advance to be bound by OWCP's
recommendation as to extent of disability.  Matulic v. Director, OWCP, 154
F.3d 1052, 32 BRBS 148(CRT) (9th Cir. 1998).  The court found that because the
amount of compensation remained in dispute after the conference and claimant was
successful in obtaining increased compensation, employer was liable for the
attorney's fee. Id., 154 F.3d at 1061, 32 BRBS at 153-154(CRT).

     In sum, employer in the case at bar is liable for claimant's attorney's fee
under Section 28(b), where the record shows that after employer rejected the
district director's recommendation and sought to delay a formal hearing, claimant
required the services of an attorney to obtain the additional compensation owed. 
As the Fifth Circuit declared in Flanagan Stevedores, Inc., "the conditions
of §928(b) [were] satisfied."  219 F.3d at 435, 34 BRBS at 42(CRT). 
Accordingly, the district director's Order, imposing liability on employer for
claimant's attorney's fee, should be upheld.




     
                                                                   
                         REGINA C. McGRANERY
                         Administrative Appeals Judge

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Footnotes.


1)Claimant and employer jointly filed a document of fact-related stipulations for the sole purpose of this appeal of the fee award. Although they stipulated that employer paid permanent partial disability benefits, it is clear from the administrative file that only temporary benefits were at issue. Back to Text
2)Section 28(b) provides, in relevant part: If the employer or carrier pays or tenders payment of compensation without an award pursuant to section 914(a) and (b) of this title, and thereafter a controversy develops over the amount of additional compensation, if any, to which the employee may be entitled, the deputy commissioner or Board shall set the matter for an informal conference and following such conference the deputy commissioner or Board shall recommend in writing a disposition of the controversy. If the employer or carrier refuse [sic] to accept such written recommendation, within fourteen days after its receipt by them, they shall pay or tender to the employee in writing the additional compensation, if any, to which they believe the employee is entitled. If the employee refuses to accept such payment or tender of compensation and thereafter utilizes the services of an attorney at law, and if the compensation thereafter awarded is greater than the amount paid or tendered by the employer or carrier, a reasonable attorney's fee based solely upon the difference between the amount awarded and the amount tendered or paid shall be awarded in addition to the amount of compensation. Back to Text
3)We need not address employer's alternate arguments regarding the amount of the fee award, as employer did not object to the amount of the fee requested before the district director. See Ross v. Ingalls Shipbuilding, Inc., 29 BRBS 42 (1995); Clophus v. Amoco Production Co., 21 BRBS 261 (1988). Further, as Section 28(a), 33 U.S.C. §928(a), is inapplicable, employer's reference to the Board's decision in Baker v. Todd Shipyards Corp., 12 BRBS 309 (1980), which involved Section 28(a), is misplaced. Back to Text

NOTE: This is an UNPUBLISHED LHCA Document.

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