In re Zukowski

260 Md. App. 220

309 A.3d 12

In the MATTER OF Mark ZUKOWSKI, et al.

No. 1121, Sept. Term, 2022

No. 796, Sept. Term, 2023

Appellate Court of Maryland.

January 31, 2024

Circuit Court for Anne Arundel County, Case No. C-02-CV-21-000697, Case No. C-02-CV-21-001642, Michael E. Malone, Judge.

Argued by James K. MacAlister, Cohen, Snyder, Eisenberg & Katzenberg, P.A., Baltimore, MD, on brief, for Appellant.

Argued by Joseph M. Marshall, Asst. County Atty. (Gregory J. Swain,, County Atty., Anne Arundel County Office of Law, Annapolis, MD), on brief, for Appellee.

Argued before: Graeff, Nazarian, Tang, JJ.

Tang, J.

This appeal is about attorney’s fees in a workers’ compensation case. The appellants, Mark Zukowski and Joshua Ruggiero, received service-connected disability retirement benefits from their employer due to work-related injuries. These benefits offset part of their workers’ compensation benefits awarded by the Maryland Workers’ Compensation Commission. In each case, their counsel sought attorney’s fees calculated from the compensation award before applying the offset. But the Commission calculated and awarded the attorney’s fees from the compensation award after applying the offset. This resulted in a lower amount of attorney’s fees than if they had been calculated from the compensation award before the offset was applied.

In a consolidated action for judicial review, the Circuit Court for Anne Arundel County affirmed the Commission’s decisions, and the appellants appealed. The central issue is whether the Commission erred in declining to award attorney’s fees based on the compensation award before applying the statutory offset. Before discussing the merits of this issue, we address a threshold issue not raised by the parties: whether the notice of appeal by Mr. Zukowski was also effective to note an appeal by Mr. Ruggerio. We conclude that it was. On the merits, we hold that the Commission did not err, and we affirm the circuit court’s judgments.

FACTUAL AND PROCEDURAL BACKGROUND

The events that led to this appeal are not in dispute. The appellants were officers for the Anne Arundel County Police Department. They sustained injuries while on duty and hired the same attorney to represent them in their workers’ compensation claims. The appellants applied for and were granted service-connected disability retirement by their employer, Anne Arundel County, based oh their work-related injuries. The Commission granted the appellants awards of permanent partial disability and ordered an allowance for attorney’s fees, as detailed below.

Mark Zukowski

Mr. Zukowski had an accidental injury on July 3, 2018. Before leaving his employer, he was paid full wages in lieu of temporary total disability benefits from July 20, 2018, to October 17, 2018, and from November 29, 2018, to February 16, 2019. He resumed full-time work on February 17, 2019, but in a light-duty capacity until September 30, 2019. He was then granted service-connected disability retirement that went into effect on October 1, 2019.

In an order dated April 22, 2021, the Commission found a 44% permanent, partial disability to the right knee and a 22% permanent, partial disability due to psychological conditions. The compensation award amounted to 200 weeks, payable at $365 per week beginning February 17, 2019, for a total award of $73,000. The Commission further determined that the County was entitled to, a statutory offset of benefits of $1,195.15 per week beginning October 1, 2019. This weekly amount exceeded the weekly rate of $365 awarded by the Commission. Therefore, Mr. Zukowski was only entitled to receive compensation benefits for the gap period between February 17, 2019, and September 30, 2019. This resulted, in a reduced total award of about $11,700.

At the Commission hearing, Mr. Zukowski argued that the attorney’s fee should be calculated from the initial compensation award, which totaled $73,000 before applying the offset, instead of the award after applying the offset. He interpreted the statutory offset to only apply to the benefits for the claimant and not to the allowance of compensation for payment of the attorney’s fee.

The Commission examined the practical implications of Mr. Zukowski’s statutory interpretation, specifically, who would pay the attorney’s fee. The Commission considered a hypothetical scenario where Mr. Zukowski’s award for a 34-week gap period would be $12,410 ($365 x 34 weeks). According to the fee schedule, the maximum allowable attorney’s fee would be 20% of this award, which amounts to $2,482. However, if the attorney’s fee is calculated from the initial compensation award of $73,000, it would be over $10,000. The Commission asked whether the County should pay the fee in addition to Mr. Zukowski’s award of $12,410.

In this scenario, Mr. Zukowski said the County should pay the attorney’s fee. The Commission should enter the attorney’s fee award against the County, just as it would the permanency award. This approach would ensure that the claimant does not receive double recovery for the same work-related injury. It would also ensure that his counsel is adequately compensated for the time spent prosecuting the claim.

The County disagreed with that approach and directed the Commission to the statutory scheme for awarding attorney’s fees in workers’ compensation cases. The County explained that the attorney’s fee is a lien against the compensation due to the claimant, and it is the claimant’s responsibility to pay it. There can only be a single award of compensation that the County is responsible for, and the attorney’s fee is paid from that compensation. There cannot be a separate award to pay the attorney’s fee.

The Commission determined that "the fee awarded is limited to 15%¹ of the benefits actually payable to [Mr. Zukowski] after the offset is applied, not on what would have been payable under the attorney fee guideline had no offset been applied." Thus, from Mr. Zukowski’s award, counsel was entitled to a fee of about $1,700.

Joshua Ruggiero

On November 16, 2018, Mr. Ruggiero was injured while working. Before leaving his employer, he received full wages instead of temporary total disability benefits from November 24, 2018, to July 10, 2019. He then returned to full-time work in a light-duty capacity from July 11, 2019, to March 31, 2020. He was then granted service-connected disability retirement that went into effect on April 1, 2020.

In an order dated November 1, 2021, the Commission found a 75% permanent, partial disability due to injuries to his head, face, nose, cervical spine, and left shoulder, as well as psychological injuries. The compensation award amounted to 500 weeks, payable at $821 per week beginning July 11, 2019, for a total award of $410,500. The Commission further determined that the employer was entitled to an offset of benefits of $1,191.73 per week beginning April 1, 2020. This weekly rate surpassed the weekly rate of $821 awarded by the Commission. As a result, Mr. Ruggiero was only entitled to receive compensation benefits for the gap period between, July 11, 2019, and March 31, 2020, which reduced the total award to $30,787.50.

As for the attorney’s fee, Mr. Ruggiero reiterated the arguments made in Mr. Zukowski’s case. However, the Commission awarded an attorney’s fee of $6,157.50, calculated from the compensation award after applying the offset.

Circuit Court Review

The appellants filed separate petitions for judicial review in the circuit court, and a different attorney represented them. Since both cases involved the same issue, they were consolidated, with Mr. Zukowski’s case as the lead case.² The court identified the main issue as "whether a claim for attorney’s fees attaches before or after the offset of benefits." During the consolidated hearing, the appellants asked the court to reverse the Commission’s decisions on attorney’s fees and calculate them from the initial compensation awards before the offsets were applied.

On August 23, 2022, the court issued a memorandum opinion and order affirming the Commission’s decision. The court concluded that the attorney’s fee is to be taken after offsetting the compensation benefits, not before.

Despite the consolidation and identical issue, the court’s opinion and order only addressed Mr. Zukowski’s case and did not mention Mr. Ruggiero’s.

Notices of Appeal Filed by Mr. Zukowski

On September 1, 2022, Mr. Zukowski noted his appeal, docketed with this Court under case number CSA-REG-1121-2022. The parties briefed their arguments and presented them at oral argument as if Mr. Ruggiero’s case was also before the Court. During oral argument, the Court raised concerns about the finality of judgment in Mr. Ruggiero’s case. Their counsel acknowledged the concern but argued that both cases involved the same legal issue.

After oral argument, the Court issued an order remanding the case to the circuit court without affirmance or reversal. The circuit court was instructed to enter a separate written judgment as to Mr. Ruggiero. On June 20, 2023, the circuit court issued an order disposing of the consolidated action, this time including the names and case numbers of Mr. Zukowski and Mr. Ruggiero in the caption of the order.

The next day, counsel for Mr. Zukowski and Mr. Ruggiero filed a notice of appeal. The caption of the notice included the names of both parties along with their circuit court case numbers. But the body of the notice only indicated that Mr. Zukowski was appealing. The notice read:

Claimant, Mark Zukowski, by and through his attorneys … hereby gives notice of an appeal to the Appellate Courtof Maryland from the Order of Compliance … docketed and entered by the Circuit Court on June 20, 2023.

WHEREFORE, Mark Zukowski, Claimant, respectfully gives notice of this appeal to the Appellate Court of Maryland[.]

(Emphasis added.) Counsel signed the notice of appeal on behalf of "Claimant/Appellant"

This notice of, appeal was docketed with the Court,...