Defense Base Act Compensation Blog

The Modern Day DBA Casualty

Defense Base Act Attorneys: Attorney’s Fees

Posted by defensebaseactcomp on June 21, 2012

The Defense Base Act provides for claimants fees to be paid by the Insurance Company.

See Who Pays your Defense Base Act Attorney Fees ?

Why then would Defense Base Act Attorneys either charge their DBA clients on a contingency basis, by the hour, or take their fees out of a settlement amount ?

And why would you let them?

2 Responses to “Defense Base Act Attorneys: Attorney’s Fees”

  1. Doug Grauel said

    It seems hard to answer these questions in anything less than a book, but here’s my attempt to clarify how attorney fees work under the DBA.

    First, it’s important to realize that not every contingent fee is a percentage fee. A contingent fee is one where the client does not pay fees unless there is a “win” in the case. A percentage fee is one where the fee is a percentage of benefits or settlement, and it’s by definition contingent on winning something; otherwise there’s nothing to charge a percentage of. Percentage fees are pretty much disallowed under the DBA, but contingent fees are just about built into the Act. So that’s first: contingent fees and percentage fees are related but not exactly the same.

    The same is true of fees and expenses: related but not exactly the same. Expenses are costs necessary to put on a case. They can be simple, like photocopying charges or enlarging exhibits, and they can be expensive, like getting medical experts or paying for deposition transcripts. Expenses are the client’s own costs for pursuing his or her own case, and lawyers may ask clients to pay those separately. Some jurisdictions even require it.

    Second, DBA lawyers would charge clients on a contingency basis–meaning that there is no fee paid by the client unless there is a win–because they realize that most clients can’t afford to pay a lawyer to fight a DBA insurance company unless there is a good chance of winning the case. Winning the case allows a possibility of having all of the fees paid by the insurance company, if the DOL orders it. That’s good for the client, and it’s what all DBA lawyers should try to achieve.

    But if the DOL does not order all of the fees to be paid by the insurance company, then the contingent fee agreement provides something for both the client and the lawyer: The client gets a lawyer who will work for an award of benefits, and the lawyer gets paid if he or she wins those benefits. In all likelihood, that payment will come out of those benefits, but it will still require DOL approval. Without the contingent fee agreement, the client and the lawyer have no way to set up a working relationship that gives each of them the incentive to continue.

    Finally, the Longshore statute, which is the law that the DBA applies, is built to just about prohibit any other type of fee agreement. Here’s what I mean:
    Attorney fees in DBA cases are subject to many considerations, spelled out in section 928 of the Longshore statute (found here:  http://www.dol.gov/owcp/dlhwc/lhwca.htm#928), and further “clarified” by decisions from OWCP District Offices, the Benefits Review Board, various Circuit Courts of Appeal, and the U.S. Supreme Court.  Consistency in this supposedly uniform federal system is not perfect, to say the least.

    DBA/Longshore law allows for a “reasonable” attorney’s fee, which the regulations define to all but require hourly billing, and to prohibit percentage fees. Fees are paid by the insurance company only in the circumstances spelled out in 928(a) and (b) (usually when the carrier denies or ignores a claim and later pays it, whether voluntarily or because it is ordered to do so).

    Section 928(c) allows for an approved fee to be a lien against compensation–meaning that in some cases, the fee will not have to be paid by the insurance company, but will be paid by the injured worker, usually out of future DBA benefits. The DOL still has to approve the fee, and has to approve how it is to be paid.

    So the long and short of it is that in fact, most DBA cases result in an award of attorney fees to be paid by the carrier, usually because the carrier should have paid from the outset. Sometimes, though, a client needs a lawyer in order get or keep benefits, and in some cases the law does not provide for those fees to be paid by the insurance company. In those cases, the law does allow an attorney’s fee to be paid out of compensation, but it still requires DOL approval.

    Regardless, if you have any questions about how fees work, you should feel free to ask your lawyer how things work and why. Maintaining open communication with your lawyer is probably the single most important factor in maximizing your chances of a good result in a DBA case.

    Doug Grauel
    Douglas Grauel, Esq. | dgrauel@grauellaw.com | (603) 369-5010 | 15 N. Main St. Concord NH 03301 | http://www.grauellaw.com

  2. Allan said

    A relative of mine get injured in Irak, electrical discharge, with serius cognitive damage, the attorney of the company its offering a final settlement and they give us a date line 7 days to accept the offer if we dont agreed the took it out of the table. the 2/3 of his wage is us1.800, and they are oferring Us 490.000, is that a fair amount??.
    Sorry for my english but we are from chile and we not live en the EE.UU.

    Please contact me at a.cifuentes.ponce@gmail.com

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

 
%d bloggers like this: