ST. LOUIS — A Missouri appeals court has reversed a finding from the state's Labor and Industrial Relations Commission that granted a lawyer's request to have fees from an injured client placed into a trust in case he died before her.

Claimant Estelle Breckle had appealed a ruling from the commission, which allowed payment of fees derived from her disability benefits to a trust that was established for attorney Harry J. Nichols.

Nichols died Jan. 1 at the age of 87, according to online records at Bopp Chapel in Kirkwood.

On April 18, the Missouri Court of Appeals, Eastern Division reversed the commission's decision, which ordered the state treasurer to direct fee payments that Breckle receives from the state's Second Injury Fund (SIF) to The Nichols Living Trust in the event "her attorney predeceases her."

Breckle was awarded permanent total disability benefits by the commission to be disbursed from the SIF in November 1996. Nichols was granted an attorney fee lien of 25 percent of Brechle's compensation award, the ruling states.

In June, Nichols asked the commission to direct fees to his trust. A month later, the commission ordered parties to show cause within 30 days why it should not grant Nichols' request, the ruling states.

When Breckle failed to respond, the commission granted Nichols’ request on Sept. 7, the order says. On Sept. 26, Breckle moved to vacate the previous order, claiming that even though the Postal Service left the certified mail with an “individual,” she did not become aware of Nichols’ proposal until Sept. 17.

The following month, the Commission issued a ruling to clarify that it was not deciding whether Nichols was entitled to fees in the event he died before Breckle but was “correcting and clarifying its prior order” that fees due to Nichols should be paid to his living trust.

On the same day the commission issued its first “clarifying” order it came out with a separate “correcting order,” which called for the SIF to pay attorney fees from Breckle’s award to the Nichols living trust if he preceded her in death, according to the appeals court ruling.

The panel of appeals judges, which included Judges Sherri Sullivan, Roy L. Richter and Colleen Dolan, held that if Breckle is able to present evidence that rebuts the presumption that she received proper notice, the commission “must make a factual finding as to the notice issue.”

“If the Commission finds insufficient notice, the Commission must vacate and set aside its September 7, 2016 Order and afford Breckle a reasonable opportunity to be heard on the merits of Nichols’ request,” the appeals panel held.

The case was remanded to the commission with directions to hold an evidentiary hearing on facts surrounding Breckle’s failure to respond to its order to show cause.

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Missouri Court of Appeals Eastern District
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