Argued February 3, 1983
March 10, 1983.
Workmen's compensation — Attorney fees — Reasonableness of contest — Credibility.
1. Attorney fees will not be awarded a claimant in a workmen's compensation case if the employer had a reasonable basis for the contest, and the fact that the referee found witnesses who alleged they were told by claimant that the injury was not employment related not to be credible is not determinative of whether the employer acted reasonably in contesting the claim. 
2. An employer's contest of a workmen's compensation claim is not rendered unreasonable because it chooses not to present medical testimony but to rely on cross-examination of claimant's medical witness and upon statements allegedly made by claimant to the effect that the injury was not employment related. 
Argued February 3, 1983, before Judges ROGERS, BLATT and MacPHAIL, sitting as a panel of three.
Appeal, No. 85 C.D. 1982, from the Orders of the Workmen's Compensation Appeal Board in cases of Linda Y. Cleaver v. Robert E. Wiley/Continental Food Service, Nos. A-78237 and A-81444.
Petition to the Department of Labor and Industry for workmen's compensation benefits. Benefits and counsel fees awarded. Employer appealed to the Workmen's Compensation Appeal Board. Award of benefits affirmed. Counsel fee award reversed. Case remanded. Counsel fees awarded. Employer appealed to the Workmen's Compensation Appeal Board. Counsel fees denied. Petitioner appealed to the Commonwealth Court of Pennsylvania. Held: Affirmed.
J. Christian Ness, with him William H. Poole, Jr., Shoemaker Ness, for petitioner.
Stephen J. Harlen, Swartz, Campbell Detweiler, for respondents.
The claimant in this Workmen's Compensation case has petitioned for review of an order of the Workmen's Compensation Appeal Board which reversed a referee's award of counsel fees.
The award of reasonable attorney fees is authorized where liability is contested, "Provided, That cost for attorney fees may be excluded when a reasonable basis for the contest has been established." Section 440 of the Workmen's Compensation Act, Act of June 2, 1915, P.L. 736, Art. IV, as amended, 77 P. S. § 996.
The claimant was involved in a motor vehicle accident while engaged in the course of her employment but she continued to work for about a month. The claimant testified that she was afflicted with a stiff neck the day after the work related accident, that she visited a local hospital, and that her problem with her neck and arm persisted and increased with time until she was disabled. However, her employer testified that he was not aware of any claim of injury arising from the auto accident until at least 30 days after, and both the employer and another employee testified that the claimant stated that she thought she had injured her neck diving into a swimming pool. The referee found the petitioner's evidence to be credible but that the employer's evidence was "incredulous" and awarded compensation and attorney fees.
The employer appealed this decision to the Board, which affirmed the referee's finding of compensible disability and remanded to the referee for a determination of work availability and extent of claimant's disability. The Board also reversed the referee's imposition of attorney fees on the ground that there was a reasonable basis for the contest.
On remand, the referee made the required findings on other matters and also reinstated his prior award of attorney fees, referring to the employer's case as a "flimsy fabrication." The employer appealed the reinstatement of attorney fees and the Board again reversed the referee's award. We affirm the Board's order.
The question of whether a contest has a reasonable basis is one of law based of course on the facts. Truskey v. Workmen's Compensation Appeal Board, 56 Pa. Commw. 315, 424 A.2d 627 (1981). It is therefore "within the Board's power to reverse the conclusion of the referee on this point, and it is within this Court's scope of review to examine the conclusion reached by the Board." Ball v. Workmen's Compensation Appeal Board, 19 Pa. Commw. 157, 160, 340 A.2d 610, 611 (1975).
The fact that the employer did not adduce medical evidence, but rather chose to rely upon the cross-examination of the claimant's physician does not render his basis for contest unreasonable. Vovericz v. Workmen's Compensation Appeal Board, 41 Pa. Commw. 94, 398 A.2d 734 (1979). The employer's case rested on the testimony of the employer and another employee, both of whom said that they heard the claimant attribute her injury to an accident away from her work. The fact that the referee found these witnesses not to be credible does not render the contest baseless. This is what referees are for where the testimony is inconsistent. "The question however is not whether the referee believed the employer's witness but whether the opinion of the witness provided a reasonable basis for the . . . contest of the claim." Spatola Thompson v. Workmen's Compensation Appeal Board, 43 Pa. Commw. 137, 142, 401 A.2d 877, 880 (1979). An issue of credibility is a legitimate and reasonable subject of inquiry and challenge. McGowan v. Workmen's Compensation Appeal Board, 60 Pa. Commw. 508, 432 A.2d 272 (1981). This would seem especially to be the case where an employer, as here, is insured. Surely the carrier is not to be held to have launched a baseless contest because he has believed his insured's evidence as to how the claimant was injured.
Further, the fact that the claimant worked for 33 days after the work-related accident would tend to dispel a suggestion that the claimant's disability as the result of that accident was within the obvious knowledge of the employer. Cavanaugh v. Workmen's Compensation Appeal Board, 50 Pa. Commw. 495, 413 A.2d 442 (1980).
AND NOW, this 10th day of March, 1983, the order of the Workmen's Compensation Appeal Board in the above captioned matter is hereby affirmed.