Court Opinion

ID: 9699723
Source: CourtListenerOpinion
Date Created: 2023-08-25 20:49:18.871826+00
Date Added: 2024-06-11T18:20:56.377026
License: Public Domain

GRAVES, Justice,
dissenting.
A court dealing with a challenge to the constitutionality of an act of the General Assembly must “necessarily begin with the strong presumption in favor of constitutionality and should so hold if possible.” Brooks v. Island Creek Coal Co., Ky.App., 678 S.W.2d 791, 792 (1984). Due process or equal protection is violated “only if the resultant classifications or deprivations of liberty rest on grounds wholly irrelevant to a reasonable state objective.” Kentucky Association of Chiropractors, Inc. v. Jefferson Co. Medical Society, Ky., 549 S.W.2d 817, 822 (1977). “When economic and business rights are involved, rather than fundamental rights, substantive due process requires that a statute be rationally related to a legitimate state objective.” Stephens v. State Farm Mut. Auto. Ins. Co., Ky., 894 S.W.2d 624, 627 (1995).
Section 59 of the Kentucky Constitution does not prohibit the legislature from making reasonable classifications. Kentucky Milk Marketing & Anti-Monopoly Commission v. Borden Co., Ky., 456 S.W.2d 831, 835 (1969). Under the rational basis test, a classification will withstand an equal protection challenge if there is any reasonably conceivable state of facts that could provide a rational basis for the classification. Heller v. Doe, 509 U.S. 312, 113 S.Ct. 2637, 125 L.Ed.2d 257 (1993) (citing F.C.C. v. Beach Communications, Inc., 508 U.S. 307, 113 S.Ct. 2096, 124 L.Ed.2d 211 (1993)); Commonwealth v. Howard, Ky., 969 S.W.2d 700 (1998). “[I]n *814the workers’ compensation context, the General Assembly may properly classify in its legislation, provided the ‘objective is legitimate and the classification is rationally related to that objective.’ ” Mullins v. Manning Coal Corp., Ky., 938 S.W.2d 260, 263 (1997), cert. denied, 521 U.S. 1119, 117 S.Ct. 2511, 138 L.Ed.2d 1014 (1997) (quoting Chapman v. Eastern Coal Corp., Ky., 519 S.W.2d 390, 393 (1975)); see also Kentucky Harlan Coal Co. v. Holmes, Ky., 872 S.W.2d 446 (1994).
KRS 342.320(2)(c) reasonably requires employers to assume an employee’s additional attorney fees when the employer appeals a benefit determination decision and does not prevail on the appeal. The discrepancy of financial resources available to an employer and its insurance carrier in comparison to the financial resources available to a partially or wholly disabled employee is a rational basis sufficient to justify requiring employers to pay attorney fees upon losing an appeal, while not requiring employees to do likewise. Hence, “discrimination” between the employer “class” and the employee “class” is founded upon a reasonable distinction and is not impermissible class legislation under Section 59. Therefore, KRS 342.320(2)(c), under the equal protection rational basis test, does not create unconstitutional impermissible classifications by permitting employees to recover attorney fees from nonpre-vailing employers, while not permitting employers to recover from nonprevailing employees.
KRS 342.320(2)(c) does not deny procedural due process protections because the fundamental requirement of procedural due process is the opportunity to be heard at a meaningful time and manner. Mathews v. Eldridge, 424 U.S. 319, 96 S.Ct. 893, 47 L.Ed.2d 18 (1976); Conrad v. Lexington-Fayette Urban County Government, Ky., 659 S.W.2d 190 (1983). “It is an established rule that an enactment accords due process of law, if it affords a method of procedure, with notice, and operates on all alike.” Parrish v. Claxon Truck Lines, Inc., Ky., 286 S.W.2d 508, 512 (1955) (quoting Pacific Live Stock Co. v. Lewis, 241 U.S. 440, 36 S.Ct. 637, 60 L.Ed. 1084 (1916)). Procedural due process is satisfied when a party has sufficient notice and opportunity to make his defense. Somsen v. Sanitation Dist. of Jefferson County, Ky., 303 Ky. 284, 197 S.W.2d 410 (1946). Such was afforded the employer in this case.
There is a growing trend toward adding attorney fees to a claimant’s award. In 1972, Section 28 of the Longshoremen’s and Harbor Workers’ Compensation Act1 was amended to provide a claimant payment for legal fees in cases in which the existence or extent of liability is controverted and the claimant employs legal counsel and successfully prevails on his or her claim. The criteria for entitlement of attorney fees is only that: (1) the claim is disputed; (2) the claimant utilizes the services of counsel; and (3) the claim is successfully prosecuted. 33 U.S.C.A. § 928(a); see also Ford Aerospace & Communications Corp. v. Boling, 684 F.2d 640 (9th Cir.1982). In upholding the constitutionality of § 28, courts have relied on a “congressional intent” that attorney fees not diminish the recovery by a claimant “when an employer contests its liability for compensation in whole or in part and the claimant is ultimately successful ... ‘regardless of how close a case might be which is litigated but finally lost by (the employer).’ ” Hole v. Miami Shipyards Corp., 640 F.2d 769, 774 (5th Cir.1981) (quoting Overseas African Construction Corp. v. McMullen, 500 F.2d 1291, 1298 n. 14 (2nd Cir.1974)).
Likewise, other jurisdictions have enacted statutory provisions for adding on attorney fees under specific circumstances. In Baker v. Louisiana Pac. Corp., 123 Idaho 799, 853 P.2d 544 (1993), cert. denied, 510 U.S. 1024, 114 S.Ct. 634, 126 L.Ed.2d 592 (1993), the Idaho Supreme *815Court found the employer’s appeal to be essentially an attempt to have the court reweigh the evidence, and awarded attorney fees to the claimant under a statute permitting fees to be awarded when an employer appeals a compensation award “without reasonable grounds.” In Herndon v. Albuquerque Public Schools, 92 N.M. 287, 587 P.2d 434 (1978), the court of appeals had increased a claimant’s award but awarded no additional attorney’s fees. The New Mexico Supreme Court held that the failure to award attorney’s fees for the appeal was an abuse of discretion by the lower court. The supreme court based its decision on the state policy favoring representation of workers, protecting particularly the right to such representation when the employer appeals.
Several states have statutes providing for the award of attorney fees to be assessed against the employer in cases where the claimant prevailed below and the award was affirmed on the employer’s appeal. Ark.Code. Ann. § 11 — 9—715(b)(1) (Michie 1999); Cal. Lab.Code §, 5801 (Deering 2000); DeLCode Ann. tit. 19, § 2350(f) (2000); Haw.Rev.Stat. § 386-93 (2000). The Florida statute provides, “If any proceedings are had for review of any claim, award, or compensation order before any court, the court may award the injured employee or dependent an attorney’s fee to be paid by the employer or carrier, in its discretion, which shall be paid as the court may direct.” Fla. Stat. Ann. § 440.34(5) (West 2000).
In the United States, the “American Rule” provides that each party pays its own attorney fees, win or lose. Alyeska Pipeline Service Co. v. Wilderness Society, 421 U.S. 240, 95 S.Ct. 1612, 44 L.Ed.2d 141 (1975). The inability of a litigant, who has incurred a legal bill because of the (as it turns out) mistaken resistance of his or her opponent, to shift that bill to the opponent has always been a somewhat paradoxical tradition of the American legal system. The successful plaintiff, who was supposed to be made whole by the recovery, is made something less than whole by the time the lawyer is paid; or a vindicated defendant, who feels that the outcome of the trial proves there should never have been a suit filed in the first place, emerges from the supposedly successful legal contest with considerably less money than he or she had when entering the contest. The obligation to bear one’s own legal fees, then, has become established as a necessary evil, which each client must contrive to bear as cheerfully as he or she can.
When, however, this practice is superimposed upon a closely calculated system of wage-loss 'benefits, a serious question arises whether the social objectives of the legislation may to some extent be thwarted. The benefit scales are so tailored as to cover only the minimum support of a claimant during disability. There is nothing to indicate that the framers of the benefit rates included any padding to take care of legal and other expenses incurred in obtaining the award. The level of benefits is so closely calculated that all costs must be regulated to prevent frustration of the purposes of the act. Accordingly, exceptions to the American Rule have developed when “overriding considerations of justice seem to compel such a result.” Fleischmann Distilling Corp. v. Maier Brewing Co., 386 U.S. 714, 718, 87 S.Ct. 1404, 1407, 18 L.Ed.2d 475 (1967).
Workers’ compensation law is a strictly regulated statutory system which may make allowance for attorney fees in addition to the award. The Workers’ Compensation Act is remedial legislation and must be liberally construed to accomplish its humanitarian purposes. One purpose is to provide prompt and certain payment of compensation to injured workers without protracted litigation. KRS 342.320(2)(c) benefits a claimant by providing attorney fees in the event an employer unsuccessfully appeals an award favorable to the claimant. To allow the reverse would inhibit the claimant from pursuing an administrative action in his own behalf for fear he would be assessed heavy costs if he lost. *816Claimants successful in litigation of their claims should receive compensation undiminished by the costs of litigation on appeal.
KRS 342.320(2)(c) is a constitutional exercise of legislative authority, and is rationally related to the legitimate purposes of the Workers’ Compensation Act. The decision in Burns v. Shepherd, Ky., 264 S.W.2d 685 (1953) is outdated and should be overruled.
LAMBERT, C.J., and STUMBO, J., join in this dissent.

. 33 U.S.C.A. § 901 etseq.