NCCI Court Case Update, New Mexico – July 2025

Meaning of "Single Accidental Injury" When Calculating Attorney Fees

On July 9, 2025, the Supreme Court of New Mexico, in Hanrahan v. State of New Mexico, interpreted the meaning of the phrase "single accidental injury" for purposes of calculating a workers compensation (WC) claimant's attorney fee award pursuant to New Mexico statute 52-1-54(I), which caps attorney fees in WC cases to $22,500 per "single accidental injury."

An employee suffered a compensable slip and fall injury in the course and scope of employment and received WC benefits. This injury led to complications that resulted in two other injuries. The employee argued that he was entitled to recover attorney fees for each individual injury he sustained, the primary injury and each of the subsequent injuries. The court of appeals disagreed, reasoning that only the original slip and fall injury arose in the course and scope of employment and therefore, the employee was only entitled to attorney fees on that claim.

In reversing the appellate court’s decision, the New Mexico Supreme Court clarified that to prove entitlement to more than one award of attorney fees, the attorney fee statute does not require an employee to connect a secondary injury—sustained as a result of a primary workplace injury—back to a risk the employee was subjected to in the course of employment. The court held that the plain language of the statute indicates that a subsequent injury that flows from a primary workplace injury may constitute a "single accidental injury" for purposes of awarding attorney fees, and the policy underlying the statute—to ensure adequate representation while avoiding excessive legal costs—supports an interpretation that allows a claimant to collect an attorney fee award for the primary injury as well as for each subsequent accidental injury.

Constitutional Challenge to Attorney Fee Statute

On July 3, 2025, the Supreme Court of New Mexico, in Pena v. State, considered whether the workers compensation statutory cap on attorney fees violated the New Mexico Constitution.

The court reviewed New Mexico statute 52-1-54(I), which provides that attorney fees for a single accidental injury claim, including representation before the workers’ compensation administration and the courts on appeal, shall not exceed $22,500.^* The supreme court noted that statute 52-1-54(I) governs attorney fees beyond the administrative level context, as it applies the attorney fee cap to representation before the courts on appeal. This, the court concluded, conflicts with a court rule that requires and governs reasonable attorney fees in the courts. As a result, the court concluded, statute 52-1-54(I) violates the separation of powers provision of the state constitution and cannot be relied upon in judicial proceedings outside of the administrative workers compensation system.

For more information on other cases monitored by NCCI's Legal Division, visit previous Court Case Updates and Court Case Insights under the Legal section of INSIGHTS on ncci.com.

^*The statute was recently amended to increase the attorney fees cap amount to $30,000 in 2025, $32,000 in 2027, and $34,000 in 2029.

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