              IN THE COMMONWEALTH COURT OF PENNSYLVANIA


Rosemarie Dymek,                        :
                Petitioner              :
                                        :   No. 1261 C.D. 2018
            v.                          :
                                        :   Submitted: January 25, 2019
Workers’ Compensation Appeal            :
Board (Harper & Row Keystone            :
Employees FCU and Cumis                 :
Insurance Society, Inc.),               :
                   Respondents          :


BEFORE:     HONORABLE MARY HANNAH LEAVITT, President Judge
            HONORABLE PATRICIA A. McCULLOUGH, Judge
            HONORABLE ELLEN CEISLER, Judge


OPINION NOT REPORTED

MEMORANDUM OPINION
BY JUDGE McCULLOUGH                                          FILED: April 12, 2019


            Rosemarie Dymek (Claimant) petitions for review of the August 16, 2018
order of the Workers’ Compensation Appeal Board (Board) affirming the decision of
the Workers’ Compensation Judge (WCJ) granting Claimant’s penalty petition but
refusing to award Claimant unreasonable contest attorney fees.


                          Facts and Procedural History
            Claimant originally sustained a work-related injury on June 7, 1996. On
May 17, 2016, WCJ J. Joseph Grady circulated a decision granting the petition of
Harper & Row Keystone Employees Federal Credit Union (Employer) seeking to have
Claimant undergo a physical examination with Stuart Gordon, M.D., in Limerick,
Pennsylvania. In his decision, WCJ Grady further directed Employer to reimburse
Claimant for one night at a hotel in the King of Prussia vicinity, not to exceed $200.00.1
On January 5, 2017, Claimant filed a petition for penalties alleging that Employer
violated the Act by failing to comply with WCJ Grady’s order directing that she be
reimbursed for the hotel room bill related to the medical examination conducted by Dr.
Gordon.2     (Findings of Fact Nos. 1-3.)            Employer filed an answer denying the
allegations of Claimant’s petition. (R.R. at 13a-14a.)
               WCJ Howard Spizer conducted a hearing on February 7, 2017, at which
counsel for Employer noted that a change of adjusters may have complicated and
delayed payment of the reimbursement of the hotel bill. The parties also discussed
Claimant’s counsel’s demand of an attorney’s fee of $750.00, which Employer alleged
was unreasonable for a claim worth $150.00. Claimant’s counsel later indicated that
he would accept a fee of $585.00, after which the penalty petition would be withdrawn.
At the request of Employer’s counsel, the WCJ directed that said fee be paid within 30
days of the hearing date. (Findings of Fact Nos. 3-4.)
               WCJ Spizer conducted a subsequent hearing on May 8, 2017. At this
hearing, Claimant’s counsel stated that he had not yet received his fee of $585.00, as
agreed to at the prior hearing. Counsel for Employer again noted a change of adjusters
in delaying payment, but indicated that a check in the amount of $750.00 was sent to


       1
          Dr. Gordon conducted the medical examination on June 16, 2016. Claimant’s counsel sent
a letter dated July 13, 2016, to Employer’s counsel along with a copy of the hotel bill in the amount
of $150.12 seeking reimbursement for the same. (Reproduced Record (R.R.) at 6a-7a.) Employer
did not immediately reimburse Claimant. By letter dated October 3, 2016, Claimant’s counsel advised
Employer’s counsel of the lack of reimbursement and that a penalty petition would be filed if payment
was not made within 30 days. (R.R. at 8a.)

       2
        By letter dated January 25, 2017, Employer provided Claimant’s counsel with a check in the
amount of $150.12 for reimbursement of Claimant’s hotel bill. (R.R. at 15a-16a.)


                                                 2
Claimant’s counsel on March 31, 2017. However, Claimant’s counsel refused to accept
the check and instead demanded full payment of $2,873.05, which represented 9.3
hours of work at a rate of $300.00 per hour. Claimant’s counsel also sought costs for
a transcript totaling $154.15. (Findings of Fact Nos. 5-9.)
             By decision circulated September 13, 2017, WCJ Spizer granted
Claimant’s penalty petition, concluding that Employer failed to timely reimburse
Claimant for her hotel expense incurred for traveling to the medical examination. WCJ
Spizer awarded Claimant a 10% penalty on the $150.12 bill, or $15.00. WCJ Spizer
next addressed Claimant’s request for unreasonable contest attorney fees. WCJ Spizer
characterized Claimant’s counsel’s request for a fee in excess of $2,800.00 as
unreasonable given the nature of the original $150.00 hotel bill and declared
Employer’s violation in this matter to be de minimis. WCJ Spizer further found
Claimant’s counsel’s rate of $300.00 per hour to be in excess of what is normally
charged with regard to legal fees in the area. Moreover, WCJ Spizer agreed with an
assertion by Employer’s counsel that the fee was inflated, did not reflect the difficulty
of the matter involved, and appeared to be calculated to punish Employer. WCJ Spizer
noted that Claimant’s counsel had the opportunity to accept a payment of $750.00,
which he described as generous and fair, but rejected such payment. Ultimately, WCJ
Spizer concluded that Employer’s contest was not unreasonable and refused to award
attorney fees to Claimant’s counsel. (Findings of Fact Nos. 9-16.)
             Claimant appealed to the Board, but the Board affirmed.           Claimant
thereafter filed a petition for review with this Court.




                                            3
                                          Discussion
              On appeal,3 Claimant argues that WCJ Spizer erred in denying her request
for unreasonable contest attorney fees. More specifically, Claimant argues that the
WCJ improperly shifted the burden of establishing an unreasonable contest to her and
erred in relying upon argument of Employer’s counsel which was not supported by any
evidence. We agree.
              Section 440(a) of the Workers’ Compensation Act (Act)4 provides as
follows:

              In any contested case where the insurer has contested
              liability in whole or in part, including contested cases
              involving petitions to terminate, reinstate, increase, reduce or
              otherwise modify compensation awards, agreements or other
              payment arrangements or to set aside final receipts, the
              employe or his dependent, as the case may be, in whose favor
              the matter at issue has been finally determined in whole or in
              part shall be awarded, in addition to the award for
              compensation, a reasonable sum for costs incurred for
              attorney’s fee, witnesses, necessary medical examination,
              and the value of unreimbursed lost time to attend the
              proceedings: Provided, That cost for attorney fees may be
              excluded when a reasonable basis for the contest has been
              established by the employer or the insurer.
77 P.S. §996(a). In determining the reasonableness of an employer’s contest, the
primary question is whether the contest was brought to resolve a genuinely disputed
issue or merely for purposes of harassment.             Montgomery Hospital v. Workers’
Compensation Appeal Board (Armstrong), 793 A.2d 182, 190 (Pa. Cmwlth. 2002).

       3
          Our scope of review is limited to determining whether constitutional rights have been
violated, whether an error of law has been committed, or whether findings of fact are supported by
substantial evidence. Anderson v. Workers’ Compensation Appeal Board (Penn Center for Rehab),
15 A.3d 944, 947 n.1 (Pa. Cmwlth. 2010).

       4
         Act of June 2, 1915, P.L. 736, as amended, added by the Act of February 8, 1972, P.L. 25,
77 P.S. §996(a).


                                                4
Whether an employer’s contest is reasonable is a question of law fully reviewable by
this Court. Id.
              In the present case, Employer denied the allegation of Claimant’s penalty
petition, i.e., that it failed to reimburse Claimant for the hotel bill, knowing the same
to be false. In fact, within 20 days of the filing of Claimant’s claim petition, Employer
forwarded a check to Claimant in the amount of $150.12, representing the
reimbursement for this bill. Hence, there can be no question that Employer’s contest
in this matter was unreasonable and the WCJ erred to the extent he concluded
otherwise.5 However, a legitimate question remains as to the extent of attorney fees
owed to Claimant’s counsel. In that regard, we note that at the first hearing in this
matter, Claimant’s counsel was only seeking attorney fees in the amount of $750.00,
which was later negotiated to a reduced amount of $585.00. However, as of the second
hearing before WCJ Spizer, Claimant’s counsel had rejected an untimely check from
Employer in the amount of $750.00 and instead sought attorney fees in excess of
$2,800.00, as well as costs. Thus, a remand is warranted to allow the WCJ to reconsider
the timesheet submitted by Claimant’s counsel and determine the appropriate amount
of the attorney fees and costs due to said counsel.
              Accordingly, the order of the Board, to the extent that it affirmed WCJ
Spizer’s award of a 10% penalty to Claimant, is affirmed. However, the order of the
Board, to the extent that it affirmed WCJ Spizer’s denial of Claimant’s counsel’s
request for attorney fees and costs, is reversed and the matter is remanded to the Board,



       5
         Further, we agree with Claimant that WCJ Spizer improperly shifted the burden to her to
establish a reasonable contest, as evidenced by the WCJ’s conclusion that “Claimant has failed to
meet her burden of proof to establish that the [Employer] acted unreasonably, which would justify
any award of counsel fees for an unreasonable contest.” (Conclusion of Law No. 3.) Section 440(a)
of the Act squarely places the burden on an employer to establish that its contest was reasonable.


                                                5
with specific instruction to remand to the WCJ, for further findings consistent with this
opinion.




                                            ________________________________
                                            PATRICIA A. McCULLOUGH, Judge




                                           6
             IN THE COMMONWEALTH COURT OF PENNSYLVANIA


Rosemarie Dymek,                          :
                   Petitioner             :
                                          :    No. 1261 C.D. 2018
             v.                           :
                                          :
Workers’ Compensation Appeal              :
Board (Harper & Row Keystone              :
Employees FCU and Cumis                   :
Insurance Society, Inc.),                 :
                   Respondents            :


                                      ORDER


             AND NOW, this 12th day of April, 2019, the order of the Workers’
Compensation Appeal Board (Board), to the extent that it affirmed the Workers’
Compensation Judge’s (WCJ) award of a 10% penalty to Rosemarie Dymek
(Claimant), is affirmed. However, the order of the Board, to the extent that it
affirmed the WCJ’s denial of Claimant’s counsel’s request for attorney fees and
costs, is reversed. The matter is remanded to the Board, with specific instruction to
remand to the WCJ, for further findings consistent with this opinion.
             Jurisdiction relinquished.




                                              ________________________________
                                              PATRICIA A. McCULLOUGH, Judge
