At issue in this workers’ compensation appeal is whether attorney fees were properly assessed against the employer/insurer pursuant to OCGA § 34-9-108. After the Appellate Division reversed the ALJ’s assessment of attorney fees, and the Superior Court reversed the Appellate Division, the employer, J & D Trucking, and its workers’ compensation insurer, American Interstate Insurance Company, appealed. For the following reasons, we vacate the judgment of the Superior Court and remand. Jimmy Martin was injured while working as the sole proprietor of J & D Trucking. J & D and American Interstate the employer/insurer, agreed that Martin incurred a compensable injury, accepted the claim as “medical only,” and paid for medical treatment while Martin continued to work. The employer/insurer agreed that, after Martin underwent surgery for the injury, he was disabled and unable to work as a result of the injury from May 26, 2009 to July 13, 2009. Without filing a notice to controvert pursuant to OCGA § 34-9-221 d, or paying any income benefits to Martin during his disability, the employer/insurer requested a hearing at which it contended that, because Martin had failed to prove he received any wages from J & D, there was no basis under OCGA § 34-9-260 for the calculation of average weekly wages and payment of temporary total disability income benefits pursuant to OCGA § 34-9-261. Martin countered at the hearing that he proved his average weekly wages; that he was entitled to income benefits; and that he was also entitled to an assessment of attorney fees against the employer/insurer pursuant to OCGA § 34-9-108 b 1 or 2 for defending the income benefits issue without reasonable grounds, or for failing without reasonable grounds to comply with OCGA § 34-9-221 governing payment of income benefits.
Under OCGA § 34-9-261, “while the disability to work resulting from an injury is temporarily total, the employer shall pay or cause to be paid to the employee a weekly benefit equal to two-thirds of the employee’s average weekly wage but not more than $500.00 per week. . . .” The employee’s average weekly wage is calculated pursuant to methods set forth in OCGA § 34-9-260. To calculate income benefits payable to Martin, the Administrative Law Judge ALJ used the method set forth in OCGA § 34-9-260 1, which provides that, where the employee has worked “in the employment in which he was working at the time of the injury, whether for the same or another employer, during substantially the whole of 13 weeks immediately preceding the injury, his average weekly wage shall be one-thirteenth of the total amount of wages earned in such employment during the 13 weeks.” OCGA § 34-9-260 1. The ALJ found that, during the 13 weeks prior to Martin’s injury, his sole proprietorship, J & D, produced an average gross income of $8,458.28 per week, and an average net income of $1,541.32 per week after deduction of business expenses. The ALJ further found that Martin’s practice in operating his sole proprietorship was to deposit all of the gross income into his only checking account which he then used to pay business and personal expenses. The employer/insurer contended that, despite evidence of the income deposited into Martin’s checking account, Martin issued no checks to himself for wages and therefore failed to prove that he received any wages from his business. The ALJ found that to accept this argument “would result in an absurdity” and “would require that Martin write himself periodic checks from his only checking account for ‘wages’ or ‘salary’ and then to deposit those checks back into the same checking account and use them to pay his business and personal expenses.” Accordingly, the ALJ rejected the employer/insurer’s argument that, because Martin’s sole proprietorship made no payments to Martin specifically designated as wages or salary, he failed to carry the burden of proving his wages for the purpose of calculating benefits under OCGA § 34-9-260. Based on the evidence, the ALJ found that Martin proved by a preponderance of the evidence that he had an average weekly wage under OCGA § 34-9-260 sufficient to entitle him to disability income benefits pursuant to OCGA § 34-9-261 of $500.00 per week for the agreed period of disability. Because the ALJ also found under OCGA § 34-9-108 b 2 that the employer/insurer failed without reasonable grounds to comply with the provisions of OCGA § 34-9-221 requiring timely payment of income benefits or filing of a notice to controvert, the ALJ exercised his discretion to assess attorney fees against the employer/insurer and assessed fees in the amount of $12,690.00.
