DUFFLY, J.
The petitioners, attorneys who are licensed to practice law in the Commonwealth, challenge the validity of two aspects of the Commonwealth's workers' compensation
The disciplinary proceedings against the petitioners arise from two separate matters before the department. James N. Ellis, Sr., Charles E. Berg, and Teresa Brooks Benoit represented Nancy Packard, and Ellis and Berg represented Pedro Ferreira, in claims for compensation for work-related injuries. In each case, an insurer's settlement offer that fully satisfied the employee's underlying claim for benefits was rejected, because the offer did not include the payment of costs and attorney's fees. Each case then proceeded to a hearing, where the claims for costs and fees were rejected. In addition, the petitioners were referred to the senior judge for discipline; in Ferreira's case, Ellis and Berg received temporary suspensions of the right "to practice or appear before the department." G. L. c. 152, § 7C.
The petitioners filed a petition in the county court seeking various forms of relief pursuant to G. L. c. 112, § 64; G. L. c. 211, § 3; and G. L. c. 231A, § 1, including injunctions against disciplinary suspensions by the department, injunctions against the imposition of any sanctions for making a claim for expenses and attorney's fees, and a judgment declaring that G. L. c. 152, § 7C, and 452 Code Mass. Regs. § 1.19(3) are void. On a joint motion of the parties, the single justice reserved and reported the case to the full court without decision. For the reasons that follow, we conclude that G. L. c. 152, § 7C, impermissibly assigns a judicial function to a department of the executive branch
1. Background. We set forth relevant details of the underlying proceedings, drawn primarily from the parties' agreed-on statement of facts submitted to the single justice, supplemented by reference to the related decisions rendered in these matters by the administrative judge, the department's reviewing board (reviewing board), and the senior judge.
a. Nancy Packard's case. The petitioners represented Packard in her claims for disability payments based on compensable injuries to her right arm that led to loss of function and disfigurement. In August, 2005, Ellis filed the claim, which the insurer denied. After two unsuccessful conciliations, an administrative judge at the conference level ordered payment of $1,768.92 for disfigurement and $4,183.50 for eleven per cent loss of function of Packard's right arm suffered in the course of her employment. The employee appealed and, pursuant to G. L. c. 152, § 11A, was examined by an impartial medical examiner, who offered the opinion that, to a reasonable medical certainty, Packard suffered from a fifteen per cent loss of function. On May 2, 2006, the insurer submitted a written offer to pay the additional $1,521.27 that was based on a fifteen per cent loss of function, but did not offer to pay attorney's fees and expenses. The employee did not accept the insurer's offer, and the case proceeded to a hearing in October, 2006.
After a hearing, the administrative judge adopted as a finding the opinion of the impartial medical examiner and ordered the insurer to compensate the employee for a fifteen per cent loss of function. He denied the employee's request for fees and costs on the ground that such fees and costs were precluded by 452 Code Mass. Regs. § 1.19(3).
b. Pedro Ferreira's case. Ferreira was injured after falling at work in August, 2004, and began receiving temporary total incapacity benefits under G. L. c. 152, § 34. In 2005, represented by Ellis and Berg, Ferreira filed a claim for compensation based on a psychiatric injury as a "sequela" to his physical injury, which was rejected by the insurer and denied at the initial conference. The employee appealed and on July 12, 2006, was examined by an impartial medical examiner. Eleven days before the scheduled hearing date, the insurer submitted a written offer to accept the claim for psychiatric benefits; the offer did not include payment of attorney's fees and expenses incurred in the course of representing Ferreira, and was rejected.
The case proceeded to a hearing in September, 2006, whereupon the employee's claim was denied.
The employee appealed, and the reviewing board affirmed the denial of his claim. Additionally, the panel found that Ellis and Berg had pursued the appeal "without reasonable grounds," and assessed the cost of the proceeding as a sanction; it also referred the matter to the senior judge for further discipline. Thereafter, proceedings commenced before the senior judge, who exercised his power under G. L. c. 152, § 7C, to suspend the right of Ellis and Berg "to practice or appear before the
2. Discussion. a. Statutory scheme. Workers' compensation in the Commonwealth is governed by G. L. c. 152 (act), a statutory scheme that was enacted in response to the inadequacy of remedies available to injured workers through common-law tort claims and prior employers' liability statutes. See generally L.Y. Nason, C.W. Koziol, & R.A. Wall, Workers' Compensation § 1.1 (3d ed. 2003 & Supp. 2011). Today, the act functions as one component in a comprehensive system of publicly and privately administered programs designed to provide financial security for workers and their families in the event of work-related injury or death. See id. at §§ 1.2-1.4. Specifically, the act sets forth exclusive procedures by which an employee may be awarded compensation for injuries "arising out of and in the course of" employment. G. L. c. 152, § 26. See G. L. c. 152, §§ 1 (7A), 6.
A workers' compensation case for initial liability begins when an injured employee files a claim for benefits with an insurer (or self-insured employer). See G. L. c. 152, § 10 (1).
A party may appeal from the conference order and obtain a hearing before the administrative judge. G. L. c. 152, §§ 10A (3),
Throughout the proceedings at the division of dispute resolution, a party may be represented by any person, including a licensed attorney. G. L. c. 152, § 7C. Only an attorney can be compensated for representing a claimant. Id. The award of attorney's fees and "necessary expenses" incurred in the course of representation of injured employees is governed exclusively by § 13A of the act; that is to say, the fees provided by § 13A are "the only fees payable for any services provided to employees" seeking workers' compensation through the department's claims resolution process.
In addition to regulating the payment of attorney's fees, the statute authorizes the department to discipline any person, including an attorney, who represents a party in proceedings before the department. Section 7C of G. L. c. 152 provides, in relevant part: "The senior judge may, for cause, deny or suspend the right of any person to practice or appear before the department."
b. Power to discipline attorneys. We address first the petitioners' claim that G. L. c. 152, § 7C, violates art. 30 by permitting a member of the executive branch, the department's senior judge, to deny or suspend the right "of any person," including an attorney,
"What art. 30 forbids — `the essence of what cannot be tolerated' — is legislative interference with the judiciary's core functions." First Justice of the Bristol Div. of the Juvenile Court Dep't v. Clerk-Magistrate of the Bristol Div. of the Juvenile Court Dep't, 438 Mass. 387, 396 (2003) (First Justice), citing Chief Admin. Justice of the Trial Court v. Labor Relations Comm'n, 404 Mass. 53, 56 (1989). Among these core functions is the power to admit and remove officers of the court, and to regulate their professional conduct. See, e.g., Collins v. Godfrey, 324 Mass. 574, 576 (1949); Opinion of the Justices, 279 Mass. 607, 610-611 (1932). "There is nothing in the Constitution, either in terms or by implication, to indicate an intent that the power of the judiciary over the admission of persons to become attorneys is subject to legislative control," and "[n]o
We have recognized a limited role for the Legislature in enacting statutes that assist the judiciary in regulating the legal profession. Such enactments respecting the admission or removal of attorneys from practice can be "convenient, if not essential, to enable the judicial department properly to perform this duty." Opinion of the Justices, 279 Mass. at 611 (noting as an example the establishment, in 1897, of a State Board of Bar Examiners). But the judicial power to admit or remove members of the bar is "inherent and exists without a statute." Id. at 610. See First Justice, supra at 397. And where a legislative enactment relative to attorney admission or discipline conflicts with this court's jurisprudence, it is the statute that must yield. See Collins v. Godfrey, supra. "Only the court can determine whether any member of the bar is guilty of improper conduct, and only the court can decide what consequences shall be visited upon him." Id. at 578. Legislative enactments relating to the professional discipline of attorneys serve only as "an expression of policy for the guidance of the judicial department in exercising its constitutional prerogative of controlling the practice of law in the Commonwealth." DiLuzio v. United Elec., Radio & Mach. Workers, Local 274, 391 Mass. 211, 215 (1984).
The statute before us allocates to an agency of the executive branch the power to deny to an attorney, admitted to practice in the Commonwealth, the right to practice law, a power that, under our Constitution, is held only by the judicial branch. That the statute limits the exercise of this power to practice or appearance before the department, and does not purport to deprive attorneys of their right to practice before courts, does not save it.
Nor does it matter that the department's rules are largely congruent with those adopted by this court. A parallel disciplinary system such as that created by the statute could lead to the interpretation and application of disciplinary rules in the context of workers' compensation cases that is inconsistent with the rules of professional conduct promulgated by this court.
It is similarly unavailing that the department's disciplinary decisions would be subject to judicial review before the Superior Court. See G. L. c. 30A, § 14. That court is without jurisdiction to hear attorney discipline cases. See S.J.C. Rule 4:01, § 1, as amended, 430 Mass. 1319 (2000). Further, appeals under the State Administrative Procedure Act, G. L. c. 30A, §§ 7 and 14, require that substantial deference be granted to the agency's factual determinations and its interpretations of its own rules. See part 2.c, infra. Such "attenuated" review does not suffice to save the statute. Opinion of the Justices, 365 Mass. 639, 647 (1974) (bill that creates an agency with power to exert control over all branches of government is antithetical "to the notion of separation of powers").
In sum, the Massachusetts Declaration of Rights does not afford the executive branch of government the power to impose
c. Regulation of attorney's fees and expenses. In both Packard's case and Ferreira's case, the administrative judge concluded that the award of attorney's fees and expenses was precluded by 452 Code Mass. Regs. § 1.19(3). See note 3, supra. The petitioners claim that the regulation conflicts with G. L. c. 152, § 13A (5), which governs the award of attorney's fees and expenses where a claim proceeds beyond conference to the hearing stage:
According to the petitioners, the regulation is inconsistent with what they view as the statute's stated requirement that attorney's fees and expenses be awarded in all cases in which the employee "prevails at [a] hearing," so long as an offer made by the insurer (even in the full amount of the compensation claim) is rejected by the employee.
Because the Legislature has expressly delegated to the department authority over the administration of the workers' compensation system, see G. L. c. 152, § 5, our review is "guided by the
Consistent with these principles, our review proceeds in two stages. "First, we determine, using conventional tools of statutory interpretation, whether the Legislature has spoken with certainty on the topic in question, and if we conclude that the statute is unambiguous, we give effect to the Legislature's intent." Goldberg v. Board of Health of Granby, 444 Mass. 627, 632-633 (2005). If, however, "the Legislature has not addressed directly the pertinent issue, we determine whether the agency's resolution of that issue may `be reconciled with the governing legislation.'" Id. at 633, quoting Nuclear Metals, Inc. v. Low Level Radioactive Waste Mgt. Bd., 421 Mass. 196, 211 (1995).
The statute at issue addresses specifically the circumstances in which an employee is entitled to an award of attorney's fees on resolution of a claim. Section 13A calibrates the award of fees based on when in the life of a case pending before the department the claim is resolved, either by agreement or order. Whether an employee will be awarded fees, and in what amount, relates directly to the stage at which proceedings terminate; with exceptions not here relevant, the only fees payable are attorney's fees "specified in" G. L. c. 152, § 13A (10).
At the beginning of a claim proceeding, a $700 fee will be awarded where an insurer contests an initial liability claim "by failing to commence the compensation requested within twenty-one days" of receiving the claim, but then "agrees to pay," the claimed compensation at any time prior to a conference. G. L.
General Laws c. 152, § 13A (5), the statutory provision at issue here, entitles an employee to an attorney's fee, presumptively in the amount of $3,500,
This construction is supported by the statute's legislative history. The modern workers' compensation act, St. 1985, c. 572, § 28A (1985 act), added the new G. L. c. 152, § 13A, in part to encourage early voluntary resolution of claims and eliminate incentives to prolong litigation.
Under the 1985 act, inserted by St. 1985, c. 572, § 28A, G. L. c. 152, § 13A, made specific provision for an award of fees in increasing amounts, correlating with the length of time that an insurer fails to act as the case progressed through various stages of the dispute resolution process.
This structure — in which the statute made specific provision for when an attorney's fee would, and would not, be paid — was altered when G. L. c. 152, § 13A was rewritten in 1987. See St. 1987, c. 691, § 8. Section 13A (7) was eliminated. The current provision provides that "[t]he attorneys' fees specified in this section shall be the only fees payable for any services
G. L. c. 152, § 13A (1), as appearing in St. 1987, c. 691, § 8.
The Legislature again made comprehensive changes to the act in 1991. See St. 1991, c. 398. It eliminated from § 13A the very language cited above that would have provided for an
The petitioners raise a further concern that merits comment. They note that 452 Code Mass. Regs. § 1.19(3) eliminates attorney's fees altogether in cases where an insurer successfully disputes a claim through the conference stage, and then makes a timely settlement offer prior to a hearing. Indeed, the administrative judge, in his written decision in Packard's case, acknowledged that the proceedings in that matter exemplified the "unfortunate," though "not uncommon," scenario in which a claim for benefits is denied at the conference stage and appealed by the employee; and then, more than five days before the scheduled hearing date, the insurer offers to satisfy the claim in
The petitioners argue that the prospect of escaping entirely the payment of attorney's fees may provide insurers an incentive to contest any claim through conference, even one with apparent merit, and thereafter make a prompt settlement offer for the full amount of the claim, excluding attorney's fees. So long as the insurer meets with success through the conference stage, the insurer will have avoided the $1,000 attorney's fee owed where an employee succeeds at conference, while also escaping the $3,500 fee that would be assessed at a hearing. Conversely, employee's counsel will go entirely uncompensated. They claim that, if such a dynamic were repeated in a sufficient number of cases, the result would be to drive private attorneys out of the workers' compensation business.
Although the incentives described by the petitioners may well manifest themselves in some number of cases,
The department could reasonably have concluded that any residual risk of abuse was outweighed by the regulation's potential benefits: the regulation may reasonably be thought to further the prompt and efficient resolution of workers' compensation disputes. For example, the regulation places a strong incentive on counsel to collect and present persuasive and credible medical evidence at the conference stage rather than relying upon the postconference report of the independent medical examiner. Similarly, the regulation undermines the incentive that an employee's counsel might otherwise have to advise the employee to prolong litigation through the hearing stage in order to obtain the heightened fees associated with the hearing. In these and other ways the regulation can reasonably be thought to reflect the Legislature's strong preference that workers' compensation claims be processed efficiently and that parties not engage in protracted litigation.
The question whether the regulation's potential salutary effects will predominate over its risks is best answered in light of
3. Conclusion. We conclude that G. L. c. 152, § 7C, is invalid as a violation of art. 30, insofar as it authorizes the senior judge of the Department of Industrial Accidents to suspend attorneys from appearing before the department. We conclude also that 452 Code Mass. Regs. § 1.19(3) is a valid interpretation of G. L. c. 152, § 13A. The matter is remanded to the county court for further proceedings consistent with this opinion.
So ordered.
452 Code Mass. Regs. § 1.19(3) (2008).
The parties continue to dispute whether the petitioners relayed the offer to their client before proceeding to hearing. The administrative judge found that the employee was never informed of it prior to the hearing in October, 2006.
See comment [6] to rule 1.7 ("The lawyer's own interests should not be permitted to have an adverse effect on representation of a client").