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Republic Steel Corp. v. U.S. Department of Labor Director

decided: December 28, 1978.



Before Gibbons and Weis, Circuit Judges and Dumbauld, District Judge.*fn*

Author: Weis


After petitioner was awarded benefits by the Benefits Review Board under the Black Lung Benefits Act for the death of her husband, decedent's employer, Republic Steel Corporation, filed a petition to set aside the order. We affirmed the action of the Board, but because the 1977 amendments to the Act relieved mine operators such as Republic Steel from the obligation to pay benefits in pre-1970 employment cases, payments must be made through the Secretary of Labor and ultimately by the Black Lung Disability Fund. There is no further dispute among the parties as to the entitlement to compensation and the obligation of the Fund to pay it, but claimant has now petitioned for the allowance of counsel fees incurred in pressing the appeal. The amount is not contested.

Before the 1977 amendments became effective, a coal operator was responsible for payment of miners' black lung claims for coal mine employment terminating before January 1, 1970. If no responsible operator or one financially able to respond could be identified, then payment was to be assumed by the Secretary of Labor, 30 U.S.C. § 934 (1976). Section 7(h) of the amendments of 1977, formally entitled the Black Lung Benefits Reform Act of 1977, Pub.L.No.95-239, 92 Stat. 99 (to be codified at 30 U.S.C. § 932(j)) (Reform Act) changed the previous practice and provided that operators would not be liable for payments on pre-1970 employment claims. Under the amended Act, responsibility for payment of these claims was shifted to a Trust Fund created by companion legislation, the Black Lung Benefits Revenue Act of 1977, Pub.L.No.95-227, § 3(d), 92 Stat. 13 (to be codified at 30 U.S.C. § 934(a) (Revenue Act)).*fn1 These provisions were made applicable to pending cases. Reform Act, § 15, 92 Stat. 103 (to be codified at 30 U.S.C. § 945).

Both petitioner and Republic Steel contend that counsel fees should be paid by the Fund. The Director of Office of Workers' Compensation Programs, however, insists that the fee should either be paid by the employer or assumed by claimant. The 1977 amendments do not specifically refer to the question of counsel fees in connection with pre-1970 employment cases, nor is there any reference to the issue in the legislative history. It is necessary, therefore, to review the Act in some detail.

Entitlement to counsel fees in the circumstances here comes not from explicit provisions of the Black Lung Benefits Act, but rather by its reference to selected portions of the Longshoremen's and Harbor Workers' Compensation Act (hereafter LHWCA), 33 U.S.C. §§ 901-950 (1976). Congress chose to incorporate certain of that Act's procedural and substantive aspects by reference into the Black Lung Benefits Act to avoid repeating them in the latter statute. The complexities of this convoluted process and the confusion it provokes were reviewed in Director, Office of Workers' Compensation Programs v. Peabody Coal Co., 554 F.2d 310 (7th Cir. 1977), and discussed by this court in Krolick Contracting Corp. v. Benefits Review Board, 558 F.2d 685 (3d Cir. 1977). Judge Goldberg has aptly characterized the procedure as a "statutory thicket" and a "gordian knot." Director, Office of Workmen's Compensation Program v. Alabama By-Products Corp., 560 F.2d 710, 711, 720 (5th Cir. 1977).

The Black Lung Benefits Act, 30 U.S.C. § 932(a), pertaining to claims filed after December 31, 1973, incorporated the counsel fee provisions of the Longshoremen's Act, 33 U.S.C. § 928(a). That section provides that "(if) the employer or (insurance) carrier declines to pay any compensation . . . (and) the person seeking benefits shall thereafter have utilized the services of an attorney at law in the successful prosecution of his claim, there shall be awarded, in addition to the award of compensation . . . a reasonable attorney's fee against the employer or carrier." Clearly, then, without the 1977 amendments, the claimant here would have been entitled to seek counsel fees from Republic Steel.

Among the changes included in the 1977 amendments, however, two are pertinent here. Section 7(a)(3) of the Reform Act, 92 Stat. 98, modifies 30 U.S.C. § 932(a), the crossover section referring to the LHWCA, so that it now reads in part:

". . . the provisions of the (LHWCA) shall (except as otherwise provided in this subsection or by regulations of the Secretary and except that references in (the LHWCA) to the employer shall be considered to refer to the trustees of the fund, as the Secretary considers appropriate and as is consistent with the provisions of section 424 (30 U.S.C. § 934)) be applicable . . . ."

In cases before the effective date of the 1977 amendments, where the Secretary of Labor had been required to make compensation payments because no responsible operator had been identified, See 30 U.S.C. § 934, no counsel fees for the claimant were allowed. The denial was based on the Secretary's position that he was neither an "employer or carrier," the terms used in the LHWCA. See also 33 U.S.C. § 928(c). Under the amendments, however, the trustees are in no position to rely heavily on that defense since the current language, "references in such Act to the employer shall be considered to refer to the trustees of the Fund," requires reevaluation of the issue.

The Director relies upon a regulation recently promulgated by the Secretary of Labor governing the post-amendment processing of claims. 43 Fed.Reg. 36789 (to be codified at 20 C.F.R. § 725.367). Comment f of this regulation, which discusses payment of counsel fees by coal operators or insurance carriers, reads:

"It is the position of the Department that the Black Lung Disability Trust Fund is not authorized under any circumstances to pay a claimant's attorney's fee in addition to compensation. There is no statutory authorization for such expenses in determining the amount of the tax necessary to keep the Fund solvent. The obligations of the Fund are carefully set forth in the act and legislative history, and no mention of a claimant's attorney's fee is made. In the absence of specific, statutory authority, a claimant's attorney's fees cannot and will not be paid by the fund (See also 28 U.S.C. § 2412)."

Interestingly enough, the Benefits Review Board has recently taken a position contrary to the Director by assessing claimant's counsel fees against the Fund in circumstances similar to those under review. Solarczyk v. Rochester & Pittsburgh Coal Co., 8 BRBS 1026, BRB No. 77-888 BLA (June 30, 1978), Appeal docketed, No. 78-2031 (3d Cir. Aug. 7, 1978). Thus, we are confronted with conflicting interpretations of a governing statute by an administrative agency and its adjudicative arm. The situation is comparable to that in Bethlehem Steel Corp. v. Occupational Safety & Health Review Commission, 573 F.2d 157, 160 (3d Cir. 1978), where we said: "we do not ...

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