Temporary Justices order hearing on fee dispute involving Workman

By Steve Korris | Jun 10, 2011



CHARLESTON – Five temporary Justices of the Supreme Court of Appeals ordered Kanawha Circuit Judge Paul Zakaib to hold a hearing in a fee dispute involving Chief Justice Margaret Workman.

Everything about the case seemed to disturb the temporary Justices, who laid a triple whammy on Workman, adversary Michael Ranson and Zakaib.

They wrote that Zakaib's order awarding Workman about 96 percent of an $80,000 fee from a $250,000 settlement "must have been fashioned from whole cloth."

They wrote, "It was a challenge for this court to understand how such a comprehensive and elaborate document such as the 'revised order' could have been prepared absent an evidentiary hearing being conducted."

They found Workman proposed findings of fact and conclusions of law to Zakaib without serving them on Ranson, in clear violation of a procedural rule.

They slapped Ranson even harder for collecting the fee from his client, Eugenia Schmalhorst of Missouri, while Workman claimed it belonged to her.

Declaring themselves deeply troubled, they ordered Ranson to disgorge all fees and expenses and to deposit them with the circuit clerk.

They told Zakaib to award fees without requiring Schmalhorst to pay twice.

Former Justice Arthur Recht and circuit judges Gary Johnson, Robert Stone, Jack Alsop, and Thomas Evans decided the case, after all elected Justices disqualified themselves.

Schmalhorst's mother, Linda Kannaird, died in 2000, in a flood at Sissonville.

Rising water trapped her and other workers at Speedway Super America, as they rushed to haul merchandise away.

Charleston fire department sent a boat and the workers climbed into it, but it capsized in swift water and Kannaird drowned.

Her daughter, whose prior name Moschgat remains in the record, retained Ranson and wife Cynthia Ranson to sue Charleston, the fire department, and the rescue team.

They sued Speedway too, claiming an exception to the protection from litigation that workers compensation law would normally provide.

Soon, the temporary court found, "matters started to take on a peculiar twist."

Kannaird's 10 brothers and sisters retained Workman, then in private practice.

She claimed Moschgat couldn't administer the estate because she was estranged from her mother.

Zakaib removed Moschgat and appointed an aunt, Dianna Savilla, in her place.

Zakaib removed the Ransons as counsel for the estate, and substituted Workman.

The brothers and sisters settled claims against the city, the fire department, and the rescuers, with Moschgat receiving a portion of the proceeds.

"Following her removal as the personal representative, Ms. Moschgat, acting independent of Savilla, entered into some type of settlement agreement relating to the deliberate intent claim," the temporary Justices wrote.

Speedway moved to dismiss the claims of the brothers and sisters, arguing they didn't belong to the class that could recover under workers' compensation law.

Zakaib dismissed the claims, but the Supreme Court of Appeals reversed him in 2006.

The Justices held that only Moschgat could recover damages, but only Savilla could represent the estate.

They directed Zakaib to set conditions for resolving the claim against Speedway and to address the balance between those who desire to settle and those who don't.

They directed him to provide compensation to Savilla for fees and expenses, without creating unfairness to Moschgat.

Zakaib held two hearings and awarded $76,500 to Workman.

He awarded $3,500 to the Ransons, for filing the suit.

On appeal, the temporary Justices found the earlier court's decision plain as day.

"Despite this clear mandate, and despite at least two futile attempts to conduct a hearing contemplated by this court, no evidentiary hearing was ever conducted within the framework of the opinion and mandate of Savilla I," they wrote. "Both hearings contain discourse between and among the lawyers.

"This palaver between the lawyers and the trial court does not totally constitute the type of evidentiary hearing contemplated by Savilla I.

"This court cannot reshape the language of the remand direction in Savilla I with any greater clarity."

Edward ReBrook of Charleston represents Workman.

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