IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Lavery Law

, :

: No. 594 C

. D

. 2016

Petitioner : Submitted: September 23, 2016

:

v. :

:

Workers ’ Compensation Appeal : Board (Two Brothers Italian Grill :

and Bar and George Drivas), :

: Respondents :

BEFORE: HONORABLE ROBERT SIMPSON, Judge

HONORABLE PATRICIA A. McCULLOUGH, Judge

HONORABLE ROCHELLE S. FRIEDMAN, Senior Judge

OPINION NOT REPORTED

MEMORANDUM OPINION

BY SENIOR JUDGE FRIEDMAN FI LED: November 29, 2016

Lavery Law petitions for review of the April 1, 2016, order of the

Workers’ Compensation Appeal Board (WCAB) affirming the decision of a workers’

compensation judge (WCJ) to grant the Faherty Law Firm all attorney fee s payable

on and after March 28, 2015 , the date that George Drivas (Claimant) discharged

Lavery Law and retained the Faherty Law Firm

. 1 We affirm

.

1 The WCJ’s decision also disposed of: (1) NorGuard Insurance Company’s ( NorGuard)

petitions for modification, suspension, and review ; (2) NorGuard’s physical examination petition ;

(3) Claimant’s penalty petition ; and (4) Claimant’s reinstatement petition.2

On October 1, 2006, Claimant sustained a left lower leg fracture while in

the course and scope of his employment at Two Brothers Italian Grill and Bar

(Employer)

. (WCJ’s Findings of Fact, No. 1.) Claimant began receiving workers’

compensation (WC) benefits on April 2, 2007 . ( Id. , No. 2.)

On October 3, 2008, Claimant and Lavery Law executed a 20 percent

contingent fee agreement ( First Fee Agreement ) , which provided that Lavery Law

would receive the following payment for its services: (1) 20 percent of any moneys

recovered by Lavery Law as result of Claimant’s claim , including awards for past and

future WC benefits ; (2) 20 percent of any settlement; and (3) costs advanced by

Lavery Law in connection with the claim

. (N.T., 4/10/15, at 17 ; Ex. J

- 3.)

T he WCJ approved the First Fee Agreement on January 23, 2012,

(WCJ’s Findings of Fact, No. 33) in an order denying modification and review

petitions filed by Employer’s insurance carrier, NorGuard Insurance Company

(NorGuard). ( Id. , No. 5 .) The WCJ ’s order directed NorGuard to “deduct 20% from

the payment of wage

- loss benefits and pay the 20% to Claimant’s attorney

. ” (N.T.,

4/10/15, at 18, Ex. J

- 6.)

On March 6, 2013

, NorGuard filed modification, suspension, and review

petitions, alleging that Claimant ’s WC benefits were incorrectly calculated

. (WCJ’s

Findings of Fact, No. 7.) Subsequently , Claimant filed a rein statement petition and a

penalty petition . ( Id. , No s . 1 7 , 18 .) NorGuard later filed a petition for physical

examination. ( Id. , No. 21 .)3

On March 28, 2015, Claimant discharged Lavery Law and signed a 20

percent contingent fee agreement (Second Fee Agreement) with Michael F. Faherty

,

Esquire, of the Faherty Law Firm . ( Id. , No s

. 25, 26 .) Faherty had left his

employment at Lavery Law ( id. , No. 25), where he had worked on Claimant’s WC

case file . ( N.T., 4/10/15, at 8

. )

O n April 10, 2015, the WCJ held a hearing to discuss a fee dispute

between Lavery Law and t he Faherty Law Firm . ( WCJ’s Findings of Fact, No. 25. )

Lavery Law and the Faherty Law Firm agreed that, as of the date of the hearing

,

Lavery Law was still rece iving 20 percent attorney fees in relation to Claimant’s WC

matter . (N.T., 4/10/15, at 9.) Lavery Law argued that it had billed 228.7 hours, equal

to $21,346. 50 in time, to Claimant’s file b ut received only $14, 321.96 in attorney

fees. 2 ( Id. at 8.) Lavery Law argued that it was owed $7,025.04 in quantum meruit 3

for the difference between the amount billed and the amount received. ( Id. ) Lavery

Law requested half of any attorney fees received by the Faherty Law Firm unti l

Lavery Law recoup ed $7,025.04. ( Id. ; WCJ’s Findings of Fact, No. 2 5

. ) Lavery Law

also requested that the Faherty Law Firm pay Lavery Law’s litigation costs. (WCJ’s

Findings of Fact, No. 25.)

On July 6, 2015, the WCJ filed an interlocutory order approving the

Second Fee Agreement and directing Lavery Law to pay the Faherty Law Firm any

2 Lavery Law submitted an itemized list of billed services. (N.T., 4/10 /15, at 17, Ex. J

- 17.)

3 “ Quantum meruit ” means “as much as he has deserved” and refers to “[a] claim or right of

action for the reasonable value of services rendered.” Black’s Law Dictionary 1361

- 62 ( 9 th ed.

2009 ).4

attorney fees that Lavery Law received from March 28, 2015, through and including

July 6, 2015. ( Id. , No. 26.) The WCJ also directed NorGu ard to pay t he Faherty Law

Firm 20 percent of Claimant’s wage

- loss benefits. ( Id. )

On December 10, 2015, the WCJ issued a decision denying NorGuard ’ s

petitions for modification, suspension, and review, dismissing NorGuard ’s physical

examination petition as moot , and denying Claimant’s penalty petition

. (WCJ’s

Conclusions of Law, Nos. 2

- 3.) The WCJ granted in part Claimant’s reinstatement

petition and awarded Claimant two closed periods of temporary total disability

benefits

. ( Id. , No. 4.)

In regard to the fee dispute, t he WCJ found that Lavery Law was not

entitled to any additional attorney fees because it “already received over $14,000 .00

in fees between the January 23, 2012 decision approving the 20% fee agreement

through March 27, 2015,” th e last day that Lavery Law represented Claimant.

( WCJ’s Findings of Fact , No. 33 ) Therefore, the WCJ : (1) awarded t he Faherty Law

Firm all attorney fee s payable on or after March 28, 2015 ; (2) directed Lavery Law to

reimburse t he Faherty Law Firm for an y attorney fees payable on or after March 28,

2015; (3) directed t he Faherty Law Firm to reimburse Lavery Law for any litigation

costs not reimbursed by NorGuard ; and (4) approved the Second Fee Agreement.

(WCJ’s Conclusions of Law, Nos. 5, 7.) Lavery La w appealed to the WCAB, which5

affirmed the WCJ’s allocation of attorney fees. Lavery Law now petitions f or review

of that decision. 4

Lavery Law argues that the WCJ erred in not awarding Lavery Law

$7,025.04 in quantum meruit for uncompensated legal services that Lavery Law

provided Claimant from October 3, 2008, through February 27, 2015 , and directing

that this award be deducted from any future attorney fees received by the Faherty

Law Firm

. We disagree

.

A WCJ has the authority to resolve attorney fee disputes between

successive counsel when the former counsel filed a fee agreement before he or she

was discharged

. Bierman v. Workers’ Compensation Appeal Board (Philadelphia

National Bank) , 113 A.3d 38, 42 ( Pa. Cmwlth. 2015). “[T] he WCJ is granted the

authority to determine what constitutes a reasonable attorney fee. ” Mayo v. Workers’

Compensation Appeal Board (Goodman Distribution, Inc.) , 109 A.3d 286, 289 (Pa.

Cmwlth . 2015)

. In resolving a fee dispute be tween successive counsel, the WCJ

“must balance the attorney ’ s legitimate expectations of a reasonable legal fee with the

right of a claimant ‘to be represented by counsel of his or her choice.’” Bierman , 113

A.3d at 42 (citation omitted). Once the claim ant se vers the contractual relationship

with counsel , the former counsel may only recover fees b ased on the work he or she

performed pursuant to the fee agreement up to that point. Mayo , 109 A.3d at 290

.

4 This c ourt’s review is limited to de termining whether the WCJ's findings of fact were

supported by substantial evidence, whether an error of law was committed

, or whether

constitutional rights were violated. 2 Pa. C.S. §704.6

Here, the First Fee Agreement limited Lavery Law’s attorney fees to 20

percent of WC benefits, settlements, or other sums recovered by Lavery Law in

relation to Claimant’s WC claim. As noted by the WCJ, Lavery Law received over

$14,000 in attorney fees pursuant to the First Fee Agreement before Cla imant

discharged Lavery Law on March 28, 2015 . Thus, although Lavery Law argues that

it is also entitled to $7,025.04 in quantum meruit for services billed at an hourly rate

,

Lavery Law already received such attorney fees that it is due under the agreed

- t o

terms of the First Fee Agreement. 5

Moreover, Lavery Law provides no explanation as to why an award of

quantum meruit should be recovered from the Faherty Law Firm’s attorney fees.

Quantum meruit is an “equitable remedy of restitution where one perso n has been

unjustly enriched by the services of another.” Meyer, Darragh, Buckler, Bebenek &

Eck, P.L.L.C. v. Law Firm of Malone Middleman, P.C. , 137 A.3d 1247, 1250 n.4 (Pa.

2016) . Here, Lavery Law states that its quantum meruit claim is primarily based on

services that it provided Claimant prior to the approval of the First Fee Agreement. 6

However, Lavery Law does not argue that the Faherty Law Firm benefited from these

services. Under these circumstances

, the WCJ did not abus e his discretion when he

5 Lavery Law does not argue that it failed to receive any sums owed to it under the terms of

the First Fee Agreement.

6 In its brief, Lavery Law states that “[t]he primary reason why [it] was never completely

‘made whole’ and the reason why it has a quantum meruit claim is because it performed work for

Clai mant for a period of four (4) y ears (2008

- 2012) during which time it received no remuneration

for its services because the fee agreement entered into by the parties in 2008 was not approved by

the WCJ until 2012.” (Lavery Law’s Br. at 10.)7

declined to award Lavery Law any portion of future attorney fees received by the

Faherty Law Firm

. 7

Accordingly, we affirm.

___________________________________ _ __ ROCHELLE S. FRIEDMAN, Senior Judge

7 Lavery Law ar gues that the WCJ “ failed to address , in any regard” Lavery Law’s quantum

meruit argument. (Lavery Law’s Br. at 5.) However, the WCJ addressed Lavery Law’s quantum

meruit argument by finding that Lavery Law was not entitled to any of the Faherty Law Firm ’s

attorney fees, from which Lavery Law sought to recover $7,025.04 in quantum meruit , because

Lavery Law had already received the attorney fees it was owed pursuant to the First Fee Agreement.IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Lavery Law

, :

: No. 594 C

. D

. 2016

Petitioner :

:

v. :

:

Workers ’ Compensation Appeal : Board (Two Brothers Italian Grill : and Bar and George Drivas), :

: Respondents :

O R D E R

AND NOW, this 29 th day of November , 201 6

, we hereby affirm the

April 1, 2016, order of the Workers’ Compensation Appeal Board

.

___________________________________ ROCHELLE S. FRIEDMAN, Senior Judge