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LEMERY v. BUFFALO AIRWAYS

April 6, 1990.

JOHN-BRANDON MATTHEW LEMERY, a minor, and RYAN SEBASTIAN LEMERY, a minor, by and through DEBRA L. GARRISON, their mother and natural guardian; and KENNETH M. DUCKWORTH, as Special Administrator of the Estate of John E. Lemery, Deceased, Appellees,
v.
BUFFALO AIRWAYS, INC., Defendant, and MID-CONTINENT TRANSPORT, INC., and BITUMINOUS INSURANCE COMPANY, Intervenors/Appellants.



John Lemery was killed in the course of his employment on April 13, 1987. His children were paid workers compensation benefits until they recovered against Buffalo Airways, Inc., the owner and operator of the plane in which Lemery was riding at the time of his death. Mid-Continent Transport, Inc., and Bituminous Insurance Company appeal the district court's order requiring them to contribute attorney fees proportionate to the amount Lemery's children would have received under workers compensation beyond the date of plaintiffs' settlement with Buffalo.

John Lemery was employed by Mid-Continent Transport, Inc., at the time of his death. He was survived by two minor sons, the plaintiffs in this action, who bring this action through their mother and natural guardian, Debra L. Garrison, Lemery's former wife.

Garrison filed a claim for workers compensation death benefits on behalf of her minor sons. An award was entered by the Workers Compensation Director on January 26, 1988, in favor of the minor children against Mid-Continent Transport, Inc., and its compensation carrier, Bituminous Insurance Company. The award provided the boys with maximum benefits of $247 per week from the date of John Lemery's death until age 18, or age 23, provided certain statutory conditions were met. Funeral expenses were also ordered paid.

  Garrison, as guardian for the minor boys, instituted a civil action against Buffalo Airways, Inc., the owner of the aircraft in which Lemery was riding at the time of his death. K.S.A. 1989

[14 Kan. App. 2d 303]

      Supp. 44-504(b) allowed Mid-Continent to intervene as subrogee in that civil action and gave Mid-Continent a lien on any recovery by the minors to the extent of the workers compensation benefits paid.

  Following discovery, Buffalo settled with the minor boys for $450,000. This settlement was approved by the court on March 31, 1989, and Buffalo was dismissed. After deducting litigation expenses of $6,584.87 from the total recovery, a one-third contingency attorney fee in the amount of $147,805.05 was also approved by the court.

  The plaintiffs and Mid-Continent could not agree on each party's liability for attorney fees. A hearing was held to resolve two issues: (1) the attorney fees Mid-Continent should pay for plaintiffs' recovery of amounts paid as workers compensation benefits to the date of the civil settlement and (2) whether attorney fees and expenses should be paid on future credits from the settlement.

  Mid-Continent stipulated that a one-third contingency fee was reasonable for the recovery of the amounts previously paid as workers compensation benefits, but did not stipulate that a one-third contingency fee was a reasonable attorney fee on future credits or that such fee was even allowable under K.S.A. 1989 Supp. 44-504(g).

  Following oral argument, the court concluded that K.S.A. 1989 Supp. 44-504(g) requires Mid-Continent to pay attorney fees based not only on amounts previously paid as benefits, but also on future credits. Mid-Continent was ordered to pay $8,852.85 in attorney fees and expenses on the $26,770.95 lien recovery for benefits paid to the date of the settlement. On the issue of future credits, the district court concluded that Mid-Continent was responsible for its proportionate share of attorney fees and litigation expenses. However, since it is unknown how long the plaintiffs will remain eligible for workers compensation benefits, the total amount of future credits is uncertain. Therefore, Mid-Continent was ordered to send the plaintiffs a check for $85.95 for each week the plaintiffs are eligible for workers compensation benefits.

  Mid-Continent timely appeals and we affirm.

[14 Kan. App. 2d 304]

     

  Mid-Continent contends that K.S.A. 1989 Supp. 44-504 does not require it to contribute to attorney fees and litigation expenses beyond the date of plaintiffs' settlement with Buffalo and that the district court erred as a matter of law by construing the statute to require proportionate contributions beyond March 31, 1989.

  The construction and interpretation of K.S.A. 1989 Supp. 44-504(g) is a question of law, subject to unlimited appellate review. Pyeatt v. Roadway Express, ...


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