Court Opinion

ID: 7923109
Source: CourtListenerOpinion
Date Created: 2022-09-08 22:28:05.895994+00
Date Added: 2024-06-11T16:33:07.787441
License: Public Domain

Luckert, J.,
dissenting: I respectfully dissent from the majority’s conclusion that the common fund doctrine does not apply in this case. The majority adopts the view of the Nebraska Supreme Court in Kindred v. City of Omaha Emp. Ret. Sys., 252 Neb. 658, 564 N.W.2d 592 (1997), and the dissent in Flynn v. State Compensation Ins. Fund, 312 Mont. 410, 60 P.3d 397 (2002), both of which adhere to the early roots of the common fund doctrine and reject a less rigid equitable view that is more consistent with this court’s application of the doctrine. I would adopt the holdings and rationale of the courts in Leonard v. Southwestern Bell Corp. Disability, 341 F.3d 696 (8th Cir. 2003); Young v. Mory, 294 Ill. App. 3d 839, 690 N.E.2d 1040 (1998), and the majority in Flynn, 312 Mont. 410, which better express views consistent with this court’s past applications of the common fund doctrine.
In defining and applying the common fund doctrine, this court has looked to decisions of the United States Supreme Court. See, e.g., Gigot v. Cities Service Oil Co., 241 Kan. 304, 313-14, 737 P.2d 18 (1987). A review of those decisions reveals that the driving principle is one of equity, and formalistic rules based on the early common-law roots of the common fund doctrine, such as applied by the Nebraska Supreme Court and the dissenting justice in Flynn, have been modified to allow equitable outcomes.
For example, the limited view of what comprises a “common fund” that was adopted by the Nebraska Supreme Court has been rejected by the United States Supreme Court. The Nebraska court in Kindred, 252 Neb. 658, required the attorney’s efforts impact a common fund that is subject to the jurisdiction of the court; the Nebraska Supreme Court reasoned that the attorney’s efforts resulted in the workers compensation award and that award was not within the jurisdiction of the court. Yet, in Mills v. Electric Auto-Lite, 396 U.S. 375, 24 L. Ed. 2d 593, 90 S. Ct. 616 (1970) — which is cited in Gigot, 241 Kan. at 313 — the United States Supreme Court concluded that a “fund” need not even be created.
In Mills, the United States Supreme Court focused on whether the action that resulted in attorney fees benefited others who had *297not paid the attorney fees and discounted the importance of the attorney’s efforts having resulted in a “fund.” The Court noted that its past cases
“have departed further from the traditional metes and bounds of the [common fund] doctrine, to permit reimbursement in cases where the litigation has conferred a substantial benefit on the members of an ascertainable class, and where the court’s jurisdiction over the subject matter of the suit makes possible an award that will operate to spread the costs proportionately among them.” Mills, 396 U.S. at 393-94.
As such, the Court concluded the failure to create a fund that was the subject of the lawsuit did not prevent application of the doctrine. The Court stated:
“The fact that this suit has not yet produced, and may never produce, a monetary recovery from which the fees could be paid does not preclude an award based on this rationale. Although the earliest cases recognizing a right to reimbursement involved litigation that had produced or preserved a ‘common fund’ for the benefit of a group, nothing in these cases indicates that the suit must actually bring money into the court as a prerequisite to the court’s power to order reimbursement of expenses. ... This Court in Sprague [v. Ticonic Nat. Bank, 307 U.S. 161, 166, 83 L. Ed. 1184, 59 S. Ct. 777 (1939)], upheld the District Court’s power to grant reimbursement for a plaintiff s litigation expenses even though she had sued only on her own behalf and not for a class, because her success would have a stare decisis effect entitling others to recover out of specific assets of the same defendant. Although those others were not parties before the court, they could be forced to contribute to the costs of the suit by an order reimbursing the plaintiff from the defendant’s assets out of which their recoveries later would have to come. The Court observed that ‘the absence of an avowed class suit or the creation of a fund, as it were, through stare decisis rather than through a decree — hardly toucbfes] the power of equity in doing justice as between a party and the beneficiaries of his litigation.’ [Sprague, 307 U.S.] at 167.” Mills, 396 U.S. at 392-93.
The Court emphasized that equity was the principle concern, stating that “[t]o allow the others to obtain full benefit from the plaintiffs efforts without contributing equally to the litigation expenses would be to enrich the others unjustly at the plaintiff s expense.” Mills, 396 U.S. at 392.
While the facts and circumstances of Mills are clearly distinguishable from this case, I view the decision as indicating the common fund doctrine need not be adhered to with the rigid view that constrained the Nebraska Supreme Court. Reflecting this shift, *298some courts have suggested that using the term the “common benefit” doctrine better describes a Mills-type application. See, e.g., Petow v. Warehime, 996 A.2d 1083 (Pa. Super. 2010). Regardless of how the doctrine is labeled, the focus is on whether the efforts provide a common benefit in a fund in which both parties have an interest, such as the retirement pension fund. The Mills-type view is better reflected in the analysis in Leonard, 341 F.3d 696; Young, 294 Ill. App. 3d 839; and the majority opinion in Flynn, 312 Mont. 410.
A second rationale of the Nebraska Supreme Court and the dissent in Flynn that was adopted by the majority in this case is that the clear language of the provision controls and does not create an exception for attorney fees. This rationale ignores K.S.A. 77-109, which states in part: “The common law as modified by constitutional and statutory law, judicial decisions, and the conditions and wants of the people, shall remain in force in aid of the General Statutes of this state.” In other words, when the legislature intends to abolish a common-law rule, it must do so in an explicit manner. “In the absence of such an expression of legislative intent, the common law remains part of our law.” American General Financial Services, Inc. v. Carter, 39 Kan. App. 2d 683, 687, 184 P.3d 273 (2008); see In re Estate of Mettee, 10 Kan. App. 2d 184, 187, 694 P.2d 1325, aff'd 237 Kan. 652, 702 P.2d 1381 (1985).
In my view, an explicit abolition of the common fund doctrine can be found in a provision cited by the majority, K.S.A. 2009 Supp. 74-4927(l)(B). As noted by the majority, K.S.A. 2009 Supp. 74-4927(1)(B) specifically states: “As used in this section, workers compensation benefits’ means the total award of disability benefits payments under the workers compensation act notwithstanding any payment of attorney fees from such benefits as provided in the workers compensation act.” (Emphasis added.) This clear language, I would conclude, is sufficient to abrogate the application of the common fund doctrine. On the other hand, Wichita Code Section 2.28.150(d)(3) lacks this clarity and does not displace the doctrine.
Hence, the common fund doctrine can apply, and it is appropriate to do so in this case because Robinson’s efforts saved the *299Retirement Board the $93,750 it would have owed to Robinson if she had not received her workers compensation award. This $93,750 is now available to the Retirement Board, which has benefited from the efforts of Robinson’s attorney. Consequently, I would affirm the district court.
Johnson, J., joins in the foregoing dissent.