COURT OF APPEALS OF VIRGINIA 

Present: Judges Elder, Humphreys and Kelsey 

Argued at Richmond, Virginia 

DANIEL S. ROMAN 

 OPINION BY 

v. Record No. 1690-05-2 JUDGE LARRY G. ELDER 

 MARCH 28, 2006 

ONDEO DEGREMONT, INC. AND 

 AMERICAN AND FOREIGN INSURANCE COMPANY 

 FROM THE VIRGINIA WORKERS’ COMPENSATION COMMISSION 

 Christopher C. Booberg for appellant. 

 Lisa Frisina Clement (Tracey Alice Berry; Penn, Stuart & Eskridge, 

on brief), for appellees. 

 Daniel S. Roman (claimant) appeals a decision of the Workers’ Compensation 

Commission denying his request for a penalty award against Ondeo Degremont, Inc., and its 

insurer, American and Foreign Insurance Company, (collectively employer) for the late payment 

of attorney’s fees. On appeal, he contends the Workers’ Compensation Act’s provision requiring 

assessment of a penalty on late paid compensation--compensation not paid within a certain time 

period unless certain conditions are met--applies to the late payment of attorney’s fees.1 We hold 

that where the commission orders the attorney’s fee to be paid out of the claimant’s accrued 

compensation, the fee remains compensation within the meaning of the penalty statute. Thus, we 

 1

 Claimant contended before the deputy commissioner that he was entitled to “a penalty 

assessment against the carrier for interest and attorney’s fees not paid in a timely manner.” The 

deputy disagreed. Appellant failed to obtain a ruling from the commission on the issue of his 

entitlement to a penalty on late paid interest. Thus, he may not raise that issue on appeal to this 

Court. See Overhead Door Co. v. Lewis, 29 Va. App. 52, 62, 509 S.E.2d 535, 539-40 (1999). 
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reverse the decision of the commission denying the request for imposition of a penalty under the 

facts of this case and remand for further proceedings consistent with this opinion. 

I. 

BACKGROUND 

 Claimant suffered an occupational disease for which the commission concluded he was 

entitled to temporary total disability benefits in the amount of $645 per week from August 6, 

2001, and continuing. By opinion of July 23, 2003, the deputy entered an award for those 

benefits and directed that attorney’s fees of $12,000 be paid to claimant’s counsel from accrued 

compensation. Employer filed a request for review, and the commission affirmed the award by 

opinion of May 4, 2004. Employer noted an appeal to this Court, which summarily affirmed the 

commission’s decision dated October 26, 2004. The carrier took no action to obtain additional 

review of the ruling, and by check dated November 10, 2004, it paid claimant the accrued 

temporary total disability compensation due less the $12,000 the commission had ordered to be 

paid directly to claimant’s attorney as attorney’s fees. 

 As of December 15, 2004, neither the attorney’s fees nor the interest on accrued 

compensation had been paid, and claimant asked the commission to award a 20% penalty for 

their late payment.2

 The deputy denied the request, citing several recent commission decisions 

concluding that Code § 65.2-524’s provisions regarding penalties for the late payment of 

compensation apply only to “actual disability benefits due a claimant” and do not apply to the 

late payment of attorney’s fees or interest. He reasoned that “valid policy reasons . . . support 

providing a 20% penalty for late payments to an injured worker who depends upon such 

payments for week to week sustenance, but denying such a penalty to doctors and lawyers with 

respect to the late payment of their charges.” Finally, he noted that “[o]utside the realm of 

 2

 The attorney’s fee payment was not made until after January 21, 2005. 
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injured workers, the law generally disfavors and disallows penalties, and provides other remedies 

such as interest and attorney’s fees,” but that claimant “ha[d] not sought any such alternative 

remedies” here. 

Claimant filed a request for review by the commission, which affirmed the deputy’s 

decision by a vote of two to one. The majority noted the legal principle requiring the narrow 

construction of penalty provisions and the reasoning of the deputy, and it relied on a prior 

decision in which it concluded Code § 65.2-524 provides for a penalty on unpaid compensation 

and that an attorney’s fee does not constitute compensation. 

 Claimant noted his appeal to this Court. 

II. 

ANALYSIS 

 Subject to certain tolling provisions, Code § 65.2-524 provides in relevant part as 

follows: 

If any payment is not paid within two weeks after it becomes due, 

there shall be added to such unpaid compensation an amount equal 

to twenty percent thereof, unless the Commission finds that any 

required payment has been made as promptly as practicable and (i) 

there is good cause outside the control of the employer for the 

delay or (ii) in the case of a self-insured employer, the employer 

has issued the required payment to the employee as a part of the 

next regular payroll after the payment becomes due. 

(Emphasis added). 

Here, the commission awarded claimant the disputed compensation benefits and directed 

that attorney’s fees of $12,000 be paid directly to claimant’s counsel from accrued temporary 

total disability compensation. See Va. Workers’ Comp. Comm’n Rule 9.2 (“When an award 

provides for an attorney fee, the employer shall pay the fee directly to the attorney unless there is 

alternative provision in the award.”). It is undisputed that employer paid to the claimant, in a 

timely fashion, his past due compensation less the $12,000 in attorney’s fees that the commission 
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ordered withheld and paid directly to counsel. However, employer did not pay the attorney’s 

fees within that same time frame. This appeal requires us to determine whether attorney’s fees 

ordered to be paid directly to counsel from accrued compensation are “payment[s]” of 

“compensation” within the meaning of Code § 65.2-524.3

 We hold that they are. 

The Workers’ Compensation Act is remedial in nature; its purpose is “the prompt 

payment of compensation to injured workers. The purpose of the penalty provision of Code 

§ [65.2-524] is to compel prompt payment . . . . [The statute’s] time limit is designed to 

discourage ‘slow and circuitous’ payment of benefits due and to discourage inaction or 

inattention to a claim.” Weston v. B.J. Church Constr. Co., 9 Va. App. 283, 286-87, 387 S.E.2d 

96, 97-98 (1989). Although penalty statutes must be “‘strictly construed in favor of the party on 

whom the penalty is sought to be imposed,’” this requirement of “[n]arrow construction . . . does 

not empower a court to relieve a party from the operation of a statute, absent fraud or other 

legally compelling circumstances. Likewise, the mandate of strict construction does not 

authorize courts to amend or modify clearly drafted statutes absent constitutional defect.” Id. at 

286, 387 S.E.2d at 97 (quoting Audobon Tree Serv. v. Childress, 2 Va. App. 35, 41, 341 S.E.2d 

211, 215 (1986)). 

We hold that the terms “payment” and “compensation” as used in the first sentence of 

Code § 65.2-524 are synonymous for purposes of our analysis. In the sentence’s main clause, 

the word “such” in the phrase “such unpaid compensation” indicates that the term “any payment” 

 3

 This appeal does not require us to consider whether medical benefits, cf. Uninsured 

Employer’s Fund v. Wilson, 46 Va. App. 500, 619 S.E.2d 476 (2005) (holding term 

“compensation,” as used in Code § 65.2-520, which “allows unapproved settlement payments to 

‘be deducted from the amount to be paid as compensation,’” is limited to Chapter 5 indemnity 

payments made directly to claimant), or attorney’s fees other than those ordered to be paid from 

accrued compensation, see, e.g., Code § 65.2-713 (permitting assessment of attorney’s fees 

against employer under certain circumstances), are “payment[s]” of “compensation” for purposes 

of Code § 65.2-524’s penalty provisions. We expressly decline to reach such questions. 
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in the introductory dependent clause is co-extensive with the term “unpaid compensation.” See

Strawberry Hill Land Corp. v. Starbuck, 124 Va. 71, 86, 97 S.E. 362, 367 (1918) (“‘Such’ is a 

descriptive and relative word, and refers to the last antecedent, unless the meaning of the 

sentence would thereby be impaired. The word refers to what has been specified, and means the 

same as has been theretofore mentioned.” (citation omitted)), quoted with approval in Sharlin v. 

Neighborhood Theatre, Inc., 209 Va. 718, 721, 167 S.E.2d 334, 337 (1969). We hold further that 

the plain meaning of the terms “payment” and “compensation” as used in Code § 65.2-524 

includes, at the very least, accrued temporary disability compensation due pursuant to Chapter 5 

of the Act. See Uninsured Employer’s Fund v. Wilson, 46 Va. App. 500, 503, 619 S.E.2d 476, 

478 (2005) (holding that “the ‘conventional meaning’ of compensation includes only ‘wage loss 

compensation,’ also commonly known as ‘indemnity payments’”). 

Finally, contrary to the opinion of a majority of the commission in this case, we hold that 

such funds do not lose their character as “payment[s]” of “compensation” for purposes of Code 

§ 65.2-524 simply because the commission, pursuant to its authority to approve and award 

attorney’s fees under Code § 65.2-714,4 orders that the employer pay a particular portion of those 

 4

 Code § 65.2-714 provides that 

Fees of attorneys . . . under this title . . . shall be subject to the 

approval and award of the Commission. . . . [T]he Commission 

shall have exclusive jurisdiction over all disputes concerning such 

fees or charges and may order the repayment of the amount of any 

fee which has already been paid that it determines to be excessive 

. . . . 

The purpose of this statute is to prevent attorneys from “overcharg[ing] for their services.” Bee 

Hive Mining Co. v. Ind. Comm’n, 144 Va. 240, 242, 132 S.E. 177, 177 (1926) (involving 

predecessor statute), quoted with approval in Hudock v. Va. State Bar, 233 Va. 390, 393, 355 

S.E.2d 601, 603 (1987) (involving predecessor statute). Although the statute “expressly makes 

all attorney’s fees in compensation cases subject to Commission control,” the commission’s 

practice is to “exercis[e] control only over the attorney’s fees charged to claimants” so as to 

“promote[] the [Act’s] objective of ensuring adequate relief to the claimant and his family.” 

Hudock, 233 Va. at 394, 355 S.E.2d at 604. 
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funds directly to the claimant’s attorney as a reasonable fee.5

 Cf. Rose v. Bristol Compressors, 

No. 214-98-83, 2005 VA Wrk. Comp. LEXIS 130, at *3 (Feb. 15, 2005) (noting “there is no 

provision contained in the Virginia Workers’ Compensation Act that addresses a lien for 

attorney’s fees” and that, although the commission “has accepted and considered such ‘liens,’” 

“they are not true liens in the technical, legal sense”). We also hold that neither the language of 

Code § 65.2-524 nor the statutory context in which it appears--in a chapter of the Act involving 

payments of disability compensation to claimants or their statutory dependents or trustees, see

Code §§ 65.2-500 to -531--deprives such funds of their character as “payment[s]” of 

“compensation” for purposes of the twenty percent penalty provision. We recognize that “‘the 

construction given to the Act by the . . . commission is to be accorded great weight.’ 

Nevertheless, when the Commission’s interpretation of a statute runs counter to what we 

perceive to be the clear intent of the General Assembly . . . , the former must yield.” Moore v. 

Va. Int’l Terms., Inc., 254 Va. 46, 50, 486 S.E.2d 528, 530 (1997). We hold “[t]his is such a 

case.” Id.

Although we hold that attorney’s fees to be paid from accrued compensation retain their 

character as compensation and are subject to the penalty provisions of Code § 65.2-524, we need 

not decide whether all attorney’s fees paid under the Act are necessarily so classified. See, e.g., 

Code § 65.2-713 (allowing commission, in its discretion, to sanction an employer or insurer who 

has “brought, prosecuted, or defended [a proceeding] without reasonable grounds” or who has 

 5

 Employer effectively conceded as much at oral argument, agreeing that if the 

commission made an award of attorney’s fees to be paid from accrued disability compensation 

but indicated the award was to be paid by a claimant from accrued compensation upon his 

receipt of same, the attorney’s fees would remain compensation for purposes of the penalty 

statute. Employer thus conceded the fees remained “compensation” despite the commission’s 

entry of an award for such fees and focused on to whom the benefit was to be paid--a factor not 

referenced by Code § 65.2-524 and not required by the statutory context, see discussion infra in 

the text--rather than how it was classified. 
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“delayed payment without reasonable grounds” by “assessing against the [offending] employer 

or insurer” payment of “the whole cost of the proceeding, including attorney’s fees to be fixed by 

the Commission”). We also need not address whether medical benefits are “payment[s]” of 

“compensation” to which the penalty provisions of Code § 65.2-524 apply. Cf. Wilson, 46 

Va. App. 500, 619 S.E.2d 476 (holding term “compensation,” as used in Code § 65.2-520, which 

“allows unapproved settlement payments to ‘be deducted from the amount to be paid as 

compensation,’” is limited to Chapter 5 indemnity payments made directly to claimant). Finally, 

we need not decide whether the penalty for late payment should ordinarily be paid to the 

claimant or the claimant’s attorney because claimant’s attorney in this case asks that the penalty 

be paid to the claimant. 

III. 

We hold that where the commission orders an attorney’s fee to be paid out of a claimant’s 

accrued compensation, the fee remains compensation within the meaning of the penalty statute. 

Thus, we reverse the decision of the commission denying the request for imposition of a penalty 

under the facts of this case and remand for further proceedings consistent with this opinion, 

including the assessment of a penalty to be paid to the claimant. 

Reversed and remanded.