Does an employer have an obligation to pay attorney's fees to an employee where a judgment has been obtained against a third party tortfeasor for the employer's benefit?

California, United States of America


The following excerpt is from Harbor View Hills Community Assn. v. Torley, 5 Cal.App.4th 343, 7 Cal.Rptr.2d 96 (Cal. App. 1992):

3 The court followed a different line of reasoning yet arrived at the same result in Record v. Indemnity Ins. Co., supra, 103 Cal.App.2d 434, 229 P.2d 851. There the court considered applicability to a pending action of an amendment to Labor Code section 3856, providing for payment of reasonable attorney's fees incurred by an employee where judgment was obtained against a third party tortfeasor for the employer's benefit. The court held that application of the amendment to a judgment on a cause of action which arose prior to the effective date of the amendment was prospective. It applied the amended statute to the judgment and awarded attorney's fees reasoning that because the basis for recovery of attorney's fees was for "service rendered" to effect recovery, not the previous injury sued on, "this new obligation is not based on a past transaction but rather on a future [action]" and "[s]uch a statute is necessarily prospective in its operation. [Citation.]" (Id., at p. 444, 229 P.2d 851.)

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