Rowan v. Rowan

Cook, J. In this case, we must determine whether the statutes governing the payment of child-support arrearages from workers’ compensation awards prohibit the deduction of attorney fees from such awards. We hold that a trial court’s deduction of an attorney’s contingent fee from a lump-sum workers’ compensation payment does not offend R.C. 4123.67 or 3113.21. In its only proposition of law, LCCSEA relies on R.C. 4123.67 and 3113.21 to argue that a trial court may not award attorney fees from a lump-sum workers’ compensation payment. We, therefore, consider each of these statutes in turn.1 R.C. 4123.67 provides in pertinent part, “Except as otherwise provided in sections 3111.23 and 3113.21 of the Revised Code, compensation before payment shall be exempt from all claims of creditors and from any attachment or execution, and shall be paid only to the employees or their dependents.” For the following reasons, we do not find that this provision prevents the trial court from ordering payment of Tekavec’s contingent fee. R.C. 4123.67 precludes the Bureau from paying a claimant’s unpaid, preexisting debts through attachment proceedings. The statute not only relieves the Bureau from the processing of such attachments, but also ensures that the awards are initially available to the claimant or his dependents. In situations of child-support arrearages, the Bureau transfers lump-sum awards to the jurisdiction of the common pleas court pursuant to statute. The trial court then exercises its jurisdiction to order payment of the arrearages from the lump-sum award. R.C. 4123.67 does not limit what a trial court may order with respect to a lump-sum award. R.C. 4123.67 does not preclude a court from reducing a lump-sum award by the amount necessary to satisfy a claimant’s voluntary agreement to pay the attorney whose efforts generated the award. Thus, we conclude that a [488] trial court’s deduction of an attorney’s contingent fee from a lump-sum workers’ compensation payment does not offend R.C. 4123.67. LCCSEA also relies on R.C. 3113.21, which directly applies to situations in which workers’ compensation payments are required to be applied toward satisfaction of child-support arrearages. The portions of R.C. 3113.21 relevant to this appeal require trial courts to order that workers’ compensation benefits be paid directly to a child-support enforcement agency in order to satisfy a claimant’s unpaid child-support obligations. R.C. 3113.21(H)(3)(a)(i) provides the following: “If the obligor is in default under the support order or has any unpaid arrearages under the support order, [the court must] issue an order requiring the transmittal of the lump-sum payment to the child support enforcement agency.” LCCSEA argues that the foregoing language expressly requires a trial court to apply the entire lump-sum workers’ compensation award toward payment of a child-support arrearage. We disagree. R.C. 3113.21(D)(2) outlines the process by which workers’ compensation benefits are withheld for the purpose of paying a claimant’s child-support obligations. As occurred in this case, R.C. 3113.21(D)(2)(b)(iii) requires that, upon the court’s order, the Bureau must notify the child-support enforcement agency when a lump-sum workers’ compensation payment of $500 or more is to be paid to the claimant/obligor. After such notification, the Bureau must “hold the lump-sum payment for thirty days after the date on which the lump-sum payment otherwise would be paid to the obligor, and, upon order of the court, pay any specified amount of the lump-sum payment to the [child-support enforcement] agency.” (Emphasis added.) R.C. 3113.21(D)(2)(b)(iii). Under the foregoing provision, a trial court is not prohibited from recognizing an attorney’s contractual right to collect a portion of a workers’ compensation lump-sum award as payment for the attorney’s efforts in obtaining the award. We find support for this interpretation in other provisions of R.C. 3113.21(D)(2). For example, R.C. 3113.21(D)(2)(c) requires the following: “If the obligor’s workers’ compensation benefits are being paid by an employer, the order issued by the court also shall indicate that the employer may withhold a fee from the obligor’s benefits as a charge for its services in complying with the order and shall specify the amount that may be withheld.” (Emphasis added.) Under this provision, the court determines not only the amount of the claimant’s workers’ compensation benefits that must be withheld for child-support payments, but also the amount that must be paid to the employer in recognition of the costs the employer incurred in processing the payment. We do not find that allowing attorneys to recover contingent fees from workers’ compensation awards obtained through their efforts offends the public policy underlying R.C. 3113.21. In fact, in a very practical way, it furthers the [489] statute’s ultimate goal. Permitting attorneys to be paid for their services in obtaining lump-sum awards encourages the pursuit of legitimate workers’ compensation claims that will ultimately benefit children who receive child support. Furthermore, potential claimants will be more likely to seek workers’ compensation payments that ultimately will be paid to a child-support enforcement agency if they know that their attorney’s fees will be paid from the award. With the benefit of an attorney’s expertise, claimants should receive the appropriate compensation and avoid mistakes in the processing, and, therefore, more child support should be recovered. While we are sensitive to the state’s substantial interest in satisfying the total amount of a child-support arrearage, we point out that, even allowing the payment of attorney fees, the objective of R.C. 3113.21 is met. Based on the contingent fee agreement, Edwin Rowan was entitled to only two thirds of the lump-sum award, and under our interpretation, that entire amount is directed to the payment of past-due child support. Thus, we find that the welfare of children is better served, by encouraging attorneys to assist clients with workers’ compensation claims. For reason of the foregoing, the judgment of the court of appeals is affirmed. Judgment affirmed. Moyer, C.J., Douglas, Wright, F.E. Sweeney and Pfeifer, JJ., concur. Resnick, J., concurs in the syllabus and judgment only. Footnotes [1] Throughout our discussion of this case, we consider the relevant provisions of R.C. 3113.21 as they existed at the time the lump-sum payment was awarded herein.