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02/29/96 JACK PONTHIEUX v. BILLIE V. FERNANDES

February 29, 1996

JACK PONTHIEUX, PLAINTIFF-APPELLANT,
v.
BILLIE V. FERNANDES, D/B/A FERNANDES CONSTRUCTION COMPANY, DEFENDANT-APPELLEE.



Appeal from Circuit Court of Morgan County. No. 94MR120. Honorable Ronald F. Robinson, Judge Presiding.

Released for Publication April 1, 1996. As Corrected August 9, 1996.

Justices: Honorable Rita B. Garman, J., Honorable John T. McCULLOUGH, J., Honorable James A. Knecht, J., Concurring

The opinion of the court was delivered by: Garman

The Honorable Justice GARMAN delivered the opinion of the court:

Plaintiff Jack Ponthieux appeals an order of the circuit court of Morgan County denying his request for attorney fees and costs pursuant to a petition for judgment filed by him under section 19(g) of the Workers' Compensation Act (Act) (Ill. Rev. Stat. 1989, ch. 48, par. 138.19(g) (now 820 ILCS 305/19(g) (West 1994))). We reverse and remand.

Plaintiff was injured in September 1987. In October 1988, the insurance carrier for defendant, Billie V. Fernandes, d/b/a Fernandes Construction Company, sent plaintiff a check for temporary total disability (TDD) which inadvertently exceeded the amount owed by approximately $25,000. In April 1989, the arbitrator entered an order granting defendant a credit for the overpayment and suspending all payments to plaintiff until such time as the credit was exhausted. After a hearing in December 1989, the arbitrator issued a decision in which plaintiff was found to be entitled to $299.15 per week for 57 weeks, representing a 30% loss of use of his left hand. The arbitrator found that plaintiff had failed to carry his burden of proof regarding a wage-loss differential award. On June 14, 1991, the Illinois Industrial Commission (Commission) entered a decision on review of the arbitrator's award, finding plaintiff was entitled to TTD benefits in a total amount of $39,689.82, medical benefits of $5,245, and a wage-loss differential award of $332 per week beginning September 1, 1989. Defendant was given credit for $59,407.11 in payments made to plaintiff. Defendant appealed this decision to the circuit court, arguing that plaintiff was not entitled to a wage-loss differential award and, in the alternative, that the amount of the award exceeded the statutory maximum of compensation set forth in section 8(b)(4) of the Act (Ill. Rev. Stat. 1989, ch. 48, par. 138.8(b)(4) (now, as amended, 820 ILCS 305/8(b)(4) (West 1994))), which defendant claimed was $299.15 per week. The circuit court confirmed the Commission's award in its entirety. On further review, this court affirmed the judgment entitling plaintiff to a wage-loss differential award, but reversed and remanded to the Commission to determine whether the amount of the award exceeded the statutory limits. ( Fernandes v. Industrial Comm'n (1993), 246 Ill. App. 3d 261, 268-69, 615 N.E.2d 1191, 1196-97, 186 Ill. Dec. 134.) On December 8, 1993, the Commission issued a decision on remand in which it found the amount of the wage-loss differential award to be limited to $299.15 per week. Plaintiff appealed this decision to the circuit court, where it was confirmed on April 19, 1994. His appeal to this court was voluntarily dismissed on May 25, 1994. Ponthiex v. Industrial Comm'n (May 25, 1994, 4th Dist. Gen. No. 4-94-0399WC) (order of dismissal).

Plaintiff's petition for judgment was filed in the circuit court on November 2, 1994. It alleged that on May 25, 1994, his attorney received a check from defendant's insurance carrier in the amount of $59,118.61, the amount of the award after application of defendant's credit. This amount did not include any interest on the award. According to the petition, the amount tendered satisfied in full the amount of compensation due plaintiff. The petition set forth a calculation of interest allegedly due plaintiff under section 2-1303 of the Code of Civil Procedure (Code) (Ill. Rev. Stat. 1989, ch. 110, par. 2-1303 (now 735 ILCS 5/2-1303 (West 1994))). According to plaintiff, the total amount of interest due him on the award was $11,923.49. Plaintiff then alleged that he had applied defendant's May 25, 1994, payment first to interest, leaving a balance due on his compensation of $11,923.49, which plaintiff alleged defendant had failed and refused to pay. He further alleged that his arbitration attorney fees and costs should be paid by defendant, as well as his attorney fees and costs incurred in the section 19(g) proceeding in the circuit court.

After the Commission's decision on remand was issued, and prior to the filing of a petition for review in the circuit court, plaintiff's counsel wrote a letter dated December 20, 1993, to defendant's counsel, in which she explained her calculation of interest due on the award in the amount of $11,277.33. On January 10, 1994, defendant's attorney replied to that letter, disputing this calculation and asserting that interest was due only under section 19(n) of the Act (Ill. Rev. Stat. 1989, ch. 48, par. 138.19(n) (now 820 ILCS 305/19(n) (West 1994))) and accrued from the date of the Commission's decision on remand, amounting to $774.59. The attorney argued in his letter that the Commission's June 14, 1991, decision on review of the arbitrator's decision never became final and that it was the Commission's decision on remand issued on December 8, 1993, which marked the point at which interest began accruing. In a January 21, 1994, letter, plaintiff's attorney replied to that letter, citing legal authority in support of her interest calculation. She argued that due to the existence of the pre-arbitration credit to defendant, section 19(n) of the Act was inapplicable and interest accrued only under section 2-1303 of the Code. The record does not show any response to this letter. In a letter to plaintiff's counsel dated May 23, 1994, a representative of defendant's insurance carrier sent a check in full payment of the compensation due plaintiff, but noted that no interest was included in the check because of the substantial discrepancy between the parties' interest calculations. The letter noted that wage-loss differential payments would continue to be made.

Plaintiff's counsel replied to the insurance carrier in a letter dated May 31, 1994, in which it was asserted that the payment made by the carrier would be applied first to interest accrued, then to principal. Apparently, between May 31 and November 2, 1994, there was only one attempted contact between the parties' counsel, which consisted of an unreturned telephone call from plaintiff's counsel to defendant's counsel. Plaintiff received no offers from defendant to pay any additional interest prior to the filing of his petition.

The circuit court received briefs from the parties and heard arguments of counsel on March 16, 1995. Counsel for both parties represented to the court that they were in agreement on the method to be used in calculating interest due once the date on which it began to accrue was determined. On April 11, 1995, the circuit court entered an order in which it found that interest under section 2-1303 of the Code began to accrue on the award as of June 14, 1991, the date of the Commission's decision on review. The court also found that plaintiff was entitled to apply the amount paid by defendant in May 1994 to accrued interest first, which left a balance of unpaid compensation. As to sanctions, the court found that "considering all the facts and circumstances of this case," plaintiff was not entitled to attorney fees and costs. The parties ultimately agreed upon an interest figure of $9,555.34 due as of May 23, 1994. The total judgment entered was $10,355.38. Plaintiff filed his notice of appeal to this court on May 2, 1995.

Section 19(g) of the Act provides in pertinent part as follows:

"Except in the case of a claim against the State of Illinois, either party may present a certified copy of the award of the Arbitrator, or a certified copy of the decision of the Commission when the same has become final, when no proceedings for review are pending, providing for the payment of compensation according to this Act, to the Circuit Court of the county in which such accident occurred or either of the parties are residents, whereupon the court shall enter a judgment in accordance therewith. In a case where the employer refuses to pay compensation according to such final award or such final decision upon which such judgment is entered the court shall in entering judgment thereon, tax as costs against him the reasonable costs and attorney fees in the arbitration proceedings and in the court entering the judgment for the person in whose favor the judgment is entered." Ill. Rev. Stat. 1989, ch. 48, par. 138.19(g) (now 820 ILCS 305/19(g) (West 1994)).

The mere filing of a petition under section 19(g) of the Act does not carry with it an automatic right to an award of attorney fees and costs. ( Bettis v. Oscar Mayer Foods Corp. (1993), 242 Ill. App. 3d 689, 691, 610 N.E.2d 1354, 1356, 183 Ill. Dec. 110.) There must be a refusal to pay compensation when it becomes due. ( Evans v. Corporate Services (1990), 207 Ill. App. 3d 297, 303, 565 N.E.2d 724, 728-29, 152 Ill. Dec. 191.) Some courts have upheld a refusal to award attorney fees where the failure to pay involved a dispute over interest due on the award. See Wirth v. Industrial Comm'n (1976), 63 Ill. 2d 237, 242, 347 N.E.2d 136, 138; Poe v. Industrial Comm'n (1992), 230 Ill. App. 3d 1, 11, 595 N.E.2d 593, 599-600, 172 Ill. Dec. 232; Aper v. National Union Electric Corp. (1988), 165 Ill. App. 3d 482, 488, 519 N.E.2d 117, 121, 116 Ill. Dec. 527.

In Wirth, the Commission set aside the arbitrator's award, and this decision was confirmed by the circuit court. On appeal to the supreme court, the circuit court's judgment was reversed and the cause remanded for entry of judgment based upon the arbitrator's award. On remand, petitioner argued she was entitled to interest from the date of the arbitrator's award and attorney fees pursuant to section 19(g) of the Act. The circuit court denied attorney fees and awarded petitioner interest from the date of the supreme court's mandate. On appeal, the supreme court held that petitioner was entitled to interest accrued from the date of the arbitrator's decision. The court held that petitioner was not entitled to attorney fees, noting that tender of the award had been made within 60 days of the court's mandate and that the delay in ...


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