On appeal from judgment of the Superior Court, Appellate Division.
For affirmance -- Chief Justice Weintraub, and Justices Wachenfeld, Burling, Jacobs, Francis and Proctor. For reversal -- Justice Heher. The opinion of the court was delivered by Francis, J.
Certification was granted in this matter 25 N.J. 539, to review the adequacy of the fee allowed to petitioner's counsel for services rendered in the Workmen's Compensation Division.
The award of attorneys' fees in workmen's compensation proceedings at the hearing level is regulated by statute. Under N.J.S.A. 34:15-64 a reasonable fee not exceeding
20% of the judgment may be allowed, subject to the limitation which is the source of this controversy and which will be discussed later.
One of the major objectives of the Workmen's Compensation Act was to provide a speedy and efficient partial substitute for wages when an employee suffers a work connected injury. It was recognized that when disabling mishaps occur, many employees with families to support are without financial reserves to sustain them either during the period of temporary disability or thereafter if the injury results in a permanent lessening of physical capacity for work. And manifestly the legislative purpose was to create benefits which would issue automatically and promptly according to the specifications of the statute. After the waiting period, N.J.S.A. 34:15-14, payments are to be made for the duration of temporary disability and afterward, without cessation, for any sequential permanent dysfunction, N.J.S.A. 34:15-16. The basic idea was to avoid the disaster that delay might bring to the workman and his family, or the loss of self-respect that the necessity of appeal for public relief might visit upon them. Compensation was to be a benefit earned. It was to be a matter of right and not of grace or related in any way to the dole.
The Legislature was aware that bona fide disputes would arise both as to liability and as to extent of disability. So a tribunal was created for the adjudication of such controversies, and procedures were established regulating the manner of presenting them. However, the legislative attention was so focused upon payment of benefits with dispatch that by a 1927 amendment attorneys were undesignedly treated unfairly. The act ordained that:
"When, however, prior to any hearing compensation has been offered or paid, the reasonable allowance for attorney fee shall be based upon only that part of the judgment or award in excess of the amount of compensation theretofore offered or paid." L. 1927, c. 324.
As a result, no matter how unmindful an employer was of his obligation or how tardy he was in making payments,
he could diminish or defeat an award of counsel fees simply by tendering an offer of settlement immediately "prior to any hearing." And no matter how much time, effort or expense the workman's attorney had put into the prosecution of the action, no counsel fee could be allowed, accepted or privately contracted for. Haberberger v. Myer, 4 N.J. 116 (1950); N.J.S.A. 34:15-26.
The Legislature, sensitive to the inequitable decision which the court was compelled to reach in the Haberberger case, revised the ...