ADJ13363828 · May 15, 2026

The WCJ and WCAB found that defendant improperly took attorney's fees from accrued permanent disability benefits before commuting the balance to the far end of the Award, causing an interruption of benefits to applicant, contrary to the stipulations and Labor Code section 5100.

From the decision · page 6whether applicant was entitled to payment of the full amount of accrued permanent disability benefits at the time of the Award on May 1, 2024. Specifically, the WCJ found it was inappropriate for defendant to satisfy a portion of attorney fees from the accrued permanent disability benefits owed to applicant before commuting the remaining balance from the far end of the Award. Based on the WCJ's analysis of the merits of defendant's arguments, and for the reasons discussed below, we find no basis to disturb the WCJ's findings.

The stipulations provided for attorney's fees to be commuted from the far end of the Award to avoid interruption in applicant's benefits.

Favours Applicant prevailed

This language was interpreted to prohibit taking accrued permanent disability benefits for attorney's fees before commuting the balance, supporting the applicant's position.

Defendant exhausted applicant's accrued permanent disability benefits to pay attorney's fees before commuting the remaining balance to the far end, contrary to the stipulations.

Favours Applicant prevailed

This action caused an interruption of benefits to the applicant, which was found improper by the WCJ and upheld by the WCAB.

From the decision · page 6Defendant claims that the Stipulations language "as necessary to avoid interruption in applicant's benefits" is "sufficiently clear" regarding how benefits were to be paid to applicant after payment of the applicant attorney's fee. (Petition, p. 5, § 5.) We disagree with defendant's characterization of the language. Examining the actual language of the Stipulations, there is no reference to commuted attorney's fees as payable from accrued permanent disability benefits or for reduction of the weekly rate due to commutation of attorney's fees that would warrant defendant's interpretation of how payment was to be made of the Award. Defendant effectively commuted from the front end of the Award by exhausting applicant's accrued permanent disability benefits to pay attorney's fees before commuting the remaining balance to the far end of the Award, which was not provided for by the terms of the Stipulations.

Defendant presented no evidence or witnesses to justify its method of applying accrued benefits toward attorney's fees before commuting the remainder.

Favours Applicant prevailed

Lack of evidence supported the WCJ's finding that the defendant abused discretion and it was not in the applicant's best interest.

From the decision · page 7Defendant bore the burden of providing evidence to establish that its execution of the Award with respect to attorney's fees was proper, and that the WCJ abused his discretion. Defendant offered no such evidence. Defendant presented no witnesses nor produced other documentary evidence to show why it was necessary to apply all of applicant's accrued permanent disability benefits toward attorney's fees before commuting the remainder to the far end. We discern no abuse of discretion on the part of the WCJ in finding it was not in applicant's best interest to not receive the full amount of the accrued permanent disability benefits when the Award was paid. (See Lab. Code, § 5100.)

Claxton v. Waters (2004) 34 Cal.4th 367

All workers' compensation statutes are to be liberally construed in favor of the injured worker.

Applied to interpret the stipulations and commutation of attorney's fees.

From the decision · page 4It is universally accepted that "all workers' compensation statutes are to be liberally construed in favor of the injured worker." (Claxton v. Waters (2004) 34 Cal.4th 367, 373; County of Kern v. Workers' Comp. Appeals Bd. (2011) 200 Cal.App.4th 509, 517 [76 Cal.Comp.Cases 1037]; Lab. Code, § 3202.)

Labor Code section 5100

The WCJ must determine whether to commute compensation payable as a lump sum for the protection or best interest of the applicant (Lab. Code, § 5100).

Applied to assess the propriety of commuting attorney's fees from accrued benefits.

From the decision · page 4Pursuant to section 5100, the WCJ must determine whether to commute compensation payable as a lump sum and order it to be paid forthwith "if such commutation is necessary for the protection of the person entitled thereto or for the best interest of the applicant." (Lab. Code, § 5100.) Considerations attendant to a commutation of attorney's fees include an applicant's ability to live with reduced periodic payments, or without periodic indemnity payments entirely, and

Labor Code section 5803

The Appeals Board has continuing jurisdiction to rescind, alter, or amend any order, decision, or award for good cause (Lab. Code, § 5803).

Applied to enforce the terms of stipulations as written and uphold the WCJ's discretion.

From the decision · page 5Section 5803 provides, "[t]he appeals board has continuing jurisdiction over all its orders, decisions, and awards made and entered under the provisions of [Division 4]... At any time, upon notice and after the opportunity to be heard is given to the parties in interest, the appeals board may rescind, alter, or amend any order. decision, or award, good cause appearing therefor." (Lab. Code, § 5803.)

Camacho v. Target Corp. (2018) 24 Cal.App.5th 291

Contract interpretation principles require giving effect to the mutual intention of the parties and the whole contract (Camacho v. Target Corp. (2018) 24 Cal.App.5th 291).

Applied to interpret the stipulations' language regarding attorney's fees commutation.

From the decision · page 5Under the Appeals Board's enforcement authority in section 5803, we retain jurisdiction to enforce the terms of stipulations as written. The legal principles governing stipulations with request for award are the same as those governing other contracts. (Burbank Studios v. Workers' Comp. Appeals Bd. (Yount) (1982) 134 Cal.App.3d 929, 935 [47 Cal.Comp.Cases 832].) In Camacho v. Target Corp. (2018) 24 Cal.App.5th 291 [83 Cal.Comp.Cases 1014], the Court of Appeal stated that:

Defendant presented no witnesses or documentary evidence to justify taking accrued benefits for attorney's fees before commuting the remainder to the far end of the Award.

From the decision · page 7Defendant bore the burden of providing evidence to establish that its execution of the Award with respect to attorney's fees was proper, and that the WCJ abused his discretion. Defendant offered no such evidence. Defendant presented no witnesses nor produced other documentary evidence to show why it was necessary to apply all of applicant's accrued permanent disability benefits toward attorney's fees before commuting the remainder to the far end. We discern no abuse of discretion on the part of the WCJ in finding it was not in applicant's best interest to not receive the full amount of the accrued permanent disability benefits when the Award was paid. (See Lab. Code, § 5100.)