For the prosecutor, Edward R. McGlynn (Joseph Weintraub, of counsel).
For the respondent, Leo S. Carney (Edward A. Markley and Charles W. Broadhurst, of counsel).
Before Justices Bodine, Perskie and Porter.
The opinion of the court was delivered by
PERSKIE, J. The legal question presented in this workmen's compensation case is how to treat the item for attorney's fees and expenses of suit in ascertaining the credit to which the employer is entitled in reimbursement of the sum received by the employee from a third party tort feasor. N.J.S.A. 34:15-40.
The facts are not in dispute. Robert McClare, respondent-employee, suffered injuries as the result of an accident which
arose out of and in the course of his employment and caused by the actionable negligence of a third party tort feasor, viz., J. Lieberman & Co.
Respondent sued J. Lieberman & Co., to recover his damages and that suit was settled for $15,000. Out of this sum J. Lieberman & Co., deducted the sum of $4,342.90 which prosecutor-employer had paid respondent pursuant to its liability to him under our Workmen's Compensation Act, and J. Lieberman & Co., paid the sum so deducted into the Court of Chancery on a bill of interpleader because of the conflicting claims made thereto by respondent and prosecutor or its insurance carrier. The balance of $10,657.10 was paid to respondent who, we are told, paid out of this sum the expenses of that suit and a counsel fee equal to one-third of the entire sum of $15,000.
Thereafter, respondent filed a claim petition for compensation in our Workmen's Compensation Bureau. This claim was based on the same accident for which respondent had recovered in settlement with the third party tort feasor. Respondent prayed for a determination of the amount of compensation due him from prosecutor. In light of prosecutor's refusal "to agree to a reasonable deduction for attorney's fees and expenses" incurred in his suit against the third party tort feasor, respondent additionally prayed for a determination of that amount.
Prosecutor answered that there was "nothing due" respondent because the amount received by respondent in settlement with the third party tort feasor exceeded prosecutor's liability to him.
Respondent was awarded the following ...