Case Title: BUDDY C. BUENO v. CF & I STEEL CORPORATION, A Colorado Corporation

Citation: 

Docket Number: 88-321

State: wyoming

Court: Wyoming Supreme Court

Date: 1989-05-15T00:00:00Z

Document:
BUDDY C. BUENO v. CF & I STEEL CORPORATION, A Colorado Corporation1989 WY 111773 P.2d 937Case Number: 88-321Decided: 05/15/1989Supreme Court of Wyoming
BUDDY C. BUENO, APPELLANT 
(PLAINTIFF),

v.

CF & I STEEL 
CORPORATION, A COLORADO CORPORATION, APPELLEE (DEFENDANT).

Appeal from the District 
Court, PlatteCounty, John T. Langdon, 
J.

Robert T. Moxley 
of Whitehead, Gage & Davidson, P.C., Cheyenne, for appellant.

Bruce A. 
Hellbaum of Jones, Jones, Vines & Hunkins, Wheatland, for appellee.

Before CARDINE, C.J., and THOMAS, URBIGKIT, MACY 
and GOLDEN, JJ.

URBIGKIT, 
Justice.

[¶1.]     This is an ERISA case 
which considers interest and attorney's fees following court mandated 
arbitration and subsequent award of pension benefits. We reverse and remand for 
award of prejudgment interest on the amount of excess health insurance premiums 
paid and on back pension payments from date of deemed retirement. Properly 
proved attorney's fees incurred by appellant are also 
allowed.

FACTS

[¶2.]     In 1980, appellant 
Buddy C. Bueno (Bueno) sustained a work related injury while employed by 
appellee CF & I Steel Corporation (CF & I) in its Sunrise Mine in 
northern Platte County, 
Wyoming. In February 1983, for a 
deemed date of retirement of July 10, 1982, Bueno applied for a "Permanent 
Incapacity Retirement" pension under a pension agreement which was a defined 
benefit plan under the Federal Employee Retirement Income Security Act, 29 
U.S.C. § 1132 (ERISA).

[¶3.]     The pension application 
was rejected by CF & I by statement dated April 7, 
1983.

This letter is 
notification that your application for a Permanent Incapacity Type Pension, 
effective February 28, 1983, has been DISAPPROVED by the General Pension 
Board.

The basis for the 
DISAPPROVAL has been determined by the medical reports and findings of the 
physician who has examined you. It has been determined that you are not 
permanently incapacitated as defined in the Pension Plan of CF & I Steel 
Corporation.

[¶4.]     No notice was included 
in the denial or otherwise of what right to appeal, if any, Bueno might have.1 Employer sparring was continued by 
the assertion of various procedural defenses during the application process, and 
suit was finally instituted in early 1986 in state court to pursue benefit 
entitlement after direct efforts and administrative intervention through the 
Commissioner of Labor for the State of Wyoming remained 
unavailing.

[¶5.]     On a motion for partial 
summary judgment, the district court determined that the litigation must wait 
for conclusion of the arbitration process provided in the ERISA plan. Complex 
negotiations followed resulting in the designation of the third or impartial 
doctor2 who made a favorable decision to 
the pension claimant, Bueno, concluding:

Finally, based upon this 
evaluation, the past history data, and the review of the material provided on 
Mr. Buddy Bueno, it is my opinion that he was not capable of returning to work 
as a miner following his January, 1980 accident to his back, and is now not 
capable of returning to work as a miner.

[¶6.]     With this favorable 
arbitration decision, the case becomes complicated. In a stipulation and joint 
statement of position filed September 26, 1988, it was agreed between the 
litigants that the basic liability had been established by arbitration to be 
retroactive to "his deemed date of retirement, July 10, 1982," but leaving two 
unresolved issues of interest and attorney's fees as stated in 
stipulation:

3. There remains in 
dispute, for adjudication via the Summary Judgment procedure, the issue of 
whether or not the Plaintiff is entitled to prejudgment interest on the 
liquidated amount on his back pension, to-wit: Fifty-One Thousand Two Hundred 
Fifty-One Dollars and Eighty-Four Cents ($51,251.84) as of August 10, 1988, and 
Seven Hundred Two Dollars and Eight Cents ($702.08) per month thereafter. The 
parties regard the issue of the right to interest, at the statutory rate of 
seven percent (7%), to be an issue of law.

4. The remaining disputed 
issues involve the right to attorneys fees or the appropriateness of an award of 
attorneys fees, under 29 U.S.C. § 1132(g). The parties would hereby submit these 
issues as issues of law to the court, in the context of summary judgment 
procedure and have agreed that they will make factual showings in the summary 
judgment procedure toward the end that these issues may be adjudicated without 
an evidentiary hearing.

Interest on 
excess payments of health insurance also remained in 
question.

[¶7.]     Bueno supported the 
motion for award of attorney's fees pursuant to 29 U.S.C. § 1132(g) by 
affidavits of both attorney and client, which listed hours, hourly rates and a 
one-third contingent fee payment contract including reference to the federal 
lodestar doctrine. In resistance, CF & I claimed that Bueno's "delay in 
availing himself of the procedures outlined in the pension plan, in a timely 
manner, was a major cause in these parties not being able to reach agreement 
prior to the instigation of litigation."

[¶8.]     Following hearing on 
Bueno's reasserted motion for summary judgment, the district court recognized a 
right to entitlement of back pension payments of $52,429.52 and a right to 
reimbursement for excess health insurance premiums.3 The requests for interest and 
attorney's fees were taken under advisement and the district court, in a later 
decision letter, found first that the amount incurred was unliquidated so 
prejudgment interest could not be awarded, and:

This Court is without 
authority to award attorneys fees. It is true that defendant did not dispute the 
reasonableness of same - on the obligation of defendant to pay 
same.

There is no provision in 
the arbitration requirements for attorneys fees. I find no culpability or bad 
faith on the part of defendant, nor do I find that defendant, in any way, 
impeded or attempted to derogate plaintiff's rights under the pension plan. As 
noted previously, the delay herein, which obviously was caused by plaintiff or 
his union, necessarily entailed legal efforts which arose solely from the delay 
itself - a spoilation of evidence, so to speak. In addition, there was no 
evidentiary material furnished to the Court upon which to determine that the 
attorneys fees were reasonable[.] Jones Land & Livestock Co. v. Federal Land 
Bank of Omaha, 733 P.2d 258, 265 (Wyo. 1987) states that there must be an 
evidentiary hearing in order to make a determination that the attorneys fees are 
reasonable. See also Albrecht et ux. v. Zwaanshoek Holding et al., [762 P.2d 1174 (Wyo. 
1988)] (case #87-136, decided 9-20-88).

A motion for new 
trial or reconsideration of the denial of prejudgment interest, attorney's fees 
and for an evidentiary hearing was made pursuant to W.R.C.P. 59(a)(1), (6), and 
(8). That motion was denied and this appeal followed.

INTEREST

[¶9.]     When no contractual 
rate is otherwise provided and the judgment amount constitutes a liquidated sum, 
the statutory rate of interest should be imposed. Miles v. CEC Homes, Inc., 753 P.2d 1021, 1028 (Wyo. 1988). Consequently, we reverse and 
remand for computation of interest at the statutory rate of seven percent on 
pension benefits included within the total amount of $52,429.52 and excess 
insurance premiums from the date payment was due until paid at an uncompounded 
rate of seven percent. W.S. 40-14-106(e). See application of the statute in O's 
Gold Seed Co. v. United Agri-Products Financial Services, Inc., 761 P.2d 673, 
677 (Wyo. 1988).

[¶10.]  Determination of interest is a matter of 
mathematical computation as was the computation of the amount due itself. 
Mathematical computability is the criterium for a liquidated claim. See Frieden 
Const., Inc. v. Lower & Co., 766 P.2d 527, 530 (Wyo. 1988); Horseshoe 
Estates v. 2M Co., Inc., 713 P.2d 776, 781 (Wyo. 1986); Holst v. Guynn, 696 P.2d 632, 635 (Wyo. 1985); Mountain Fuel Supply Co. v. Central Engineering & 
Equipment Co., 611 P.2d 863, 872 (Wyo. 1980); Laramie Rivers Co. v. Pioneer 
Canal Co., 565 P.2d 1241, 1245 (Wyo. 1977); and Rissler & McMurry Co. v. 
Atlantic Richfield Co., 559 P.2d 25, 32 (Wyo. 1977). Cf. Buenger v. Pruden, 713 P.2d 771, 773 (Wyo. 1986). CF & I was put on notice of 
demand by the February 1983 pension application with the deemed retirement date 
agreed upon by all parties as July 10, 1982. See Northern Gas Co. v. Town of 
Sinclair, 592 P.2d 1138, 1143 (Wyo. 1979) and Rissler 
& McMurry Co., 559 P.2d  at 34. Cf. Holst, 696 P.2d  at 
636.

[¶11.]  The district court committed an error of 
law in improvidently considering that a liability controversy creates an 
unliquidated amount. A dispute as to liability does not make the claim 
unliquidated. See Northern Gas Co., 592 P.2d  at 1143; Laramie Rivers Co., 565 P.2d  at 1245; and Rissler & McMurry Co., 559 P.2d  at 33. The amount of 
benefits was determinable and established by contractual agreement and was 
liquidated in amount. Interest on each installment should be added for the time 
that the nonpayment continued at a seven percent statutory annual rate. See 
Goodwin v. Upper Crust of Wyoming, Inc., 624 P.2d 1192, 1198 (Wyo. 
1981).

ATTORNEY'S 
FEES

[¶12.]  The volume of case law on ERISA 
attorney's fees as part of the larger field of rights created by federal 
statutes for attorney's fees is almost measureless. See UNC Teton Exploration 
Drilling, Inc. v. Peyton, 774 P.2d 584, 593 n. 6 (Wyo. 1989), as 
demonstrable of the general amount of litigation in the ERISA field alone. That 
federal benefit statute, 29 U.S.C. § 1132(g), provides for the successful 
beneficiary claimant's right to attorney's fees. The conclusion of the district 
court that it was legally without authority to award attorney's fees was 
erroneous. This court considered the subject of attorney's fees in detail in UNC 
Teton Exploration Drilling, Inc., 774 P.2d 584, by recognizing that (1) the 
right to fees is definable as a matter of federal law; (2) bad faith of the 
pension program administration is not a criterion for an award; and (3) an abuse 
of discretion is invoked in the case where the beneficiary is successful in 
securing benefits unless the court by detailed findings demonstrates a reasoned 
basis for denial. Neither that finding nor supporting evidence is presented by 
this record since no basis to deny is explained. The claimant made whole concept 
and effective access to the judicial process purpose established by the statute 
are applicable and particularly so where significant benefits, as in this case, 
are obtained. UNC Teton Exploration Drilling, Inc., 774 P.2d 584; Hensley v. 
Eckerhart, 461 U.S. 424, 103 S. Ct. 1933, 76 L. Ed. 2d 40 (1983); Landro v. Glendenning Motorways, Inc., 625 F.2d 1344 (8th Cir. 1980). 
The significant success thesis clearly mandated by the United States Supreme 
Court for civil rights cases, 42 U.S.C. § 1988, is equally applicable to the 
ERISA statute applied here. TexasState Teachers v. Garland Indp. School D., 
___ U.S. ___, 109 S. Ct. 1486, 103 L. Ed. 2d 866 (1989). In UNC Teton Exploration Drilling, Inc., this court further 
determined that the amount to be awarded was established by state law with the 
basic starting point from a lodestar computation of detailed time and stated 
hourly rate with adjustments to be made where determined to be appropriate 
within the district court's exercised discretion.

[¶13.]  This case is remanded to the district 
court to award statutory interest and hold a hearing as may be desired by the 
litigants to determine an appropriate award of attorney's fees for Bueno. Bueno 
is entitled to an award of appellate attorney's fees which may be considered by 
this court if appropriate application is made before the mandate issues. NL 
Industries, Inc. v. Dill, 769 P.2d 920 (Wyo. 1989).

[¶14.]  Reversed and 
remanded.

FOOTNOTES

1 See 29 U.S.C. § 1133 and 
Labor, 29 C.F.R. § 2560.503-1(f) (1987). The mine was closed, and the union was 
no longer active in the Sunrise, Wyoming area. After a 
delay with unsophisticated counsel, the present attorney was retained to 
investigate and proceed, which occurred with the initiation of correspondence to 
CF & I in June, 1984.

2 The provisions of the 
pension program provided:

Disputes as to Permanent 
Incapacity

7.2                   
If any difference shall arise between the Company and any participant as 
to whether such participant is or continues to be permanently incapacitated 
within the meaning of paragraph 2.5, such difference shall be resolved as 
follows:

The participant shall be 
examined by a physician appointed for the purpose by the Company and by a 
physician appointed for the purpose by a duly authorized representative of the 
International Union. If they shall disagree concerning whether the participant 
is permanently incapacitated, that question shall be submitted to a third 
physician selected by such two physicians. The medical opinion of the third 
physician, after examination of the participant and consultation with the other 
two physicians, shall decide such question. The fees and expenses of the third 
physician shall be shared equally by the Company and the Union.

3 The excess health 
insurance premiums were to be calculated by subtracting the amount of premiums 
CF & I would have charged for this insurance from the amount Bueno paid for 
this service. The parties stipulated that CF & I would have charged 
$4,084.50 and Bueno paid $10,613.26 as verified by both 
parties.