Rivas

This is a proceeding to review, at the petition of Fred M. Rivas, an applicant for workmen’s compensation, an award of the respondent commission.

The sole question presented is: Has the respondent commission power to deduct from the credit to which a compensation insurance carrier is entitled under section 3861 of the Labor Code, attorneys’ fees paid by the applicant for legal services rendered in the prosecution and compromise of an action against a third party, in cases where the carrier has contracted with the applicant’s attorney to represent it in the prosecution of the said action. We have concluded that this question must be answered in the negative.

The facts: Rivas, petitioner here, on November 3, 1955, *674 sustained an injury arising out of and in the course of his employment. As a result, his employer’s compensation carrier, the respondent Industrial Indemnity Company hereinafter called “Industrial,” paid compensation in the form of medical treatment furnished the employee and weekly compensation disability benefits.

The injury in question was sustained in a highway accident and Rivas employed an attorney to prosecute an action against a third party to recover…