Monday, May 2, 2016

Florida Supreme Court Workers' Comp Fee Ruling Signals Unease With Law

Noreen Marcus, Daily Business Review
May 2, 2016

The Florida Supreme Court ruled for workers in an opinion that ensures they can hire lawyers when they battle their employers over injury benefits. In a 5-2 ruling Thursday, the court decided a statute that standardizes fees for claimant lawyers in workers' compensation cases fails the due process test. The majority opinion in Castellanos v. Next Door rejects an hourly fee of $1.53. Writing for the majority, Justice Barbara Pariente took aim at how the law bars judges from even addressing whether some fees are unacceptably low. It decrees that all fees based on the formula are fair.

"The statute prevents every injured worker from challenging the reasonableness of the fee award in his or her individual case — an issue of serious constitutional concern given the critical importance, as a key feature of the workers' compensation statutory scheme, of a reasonable attorney's fee for the successful claimant," she wrote.

Business interests were apoplectic.

"Without immediate legislative action, this decision will result in a devastating rise in workers' compensation insurance rates that will adversely affect our economy, job growth and small businesses," Bill Herrle, executive director of the National Federation of Independent Business/Florida, said in a statement.

Joel Perwin found the decision significant for an entirely different reason. "It gets rid of a statutory prohibition that was draconian and ridiculous," said the veteran Miami appellate lawyer, who is not involved in the Castellanos case.

"Now at least the playing field has been leveled. Balance and fairness have been restored," said Tampa lawyer Michael Winer, co-counsel for Castellanos.

"It's a great day for the plaintiffs bar, but more importantly it's a great day for injured workers," he said. "Now they have the ability to have their rights vindicated."

The interests that Herrle represents dodged a much more dangerous bullet. The court released a two-paragraph unanimous decision Thursday that discharged jurisdiction in Stahl v. Hialeah Hospital.

That case disparaged the entire 75-year-old workers' comp system on the basis that legislative tinkering has left it nearly ineffectual for employees. The First District Court of Appeal upheld the law's constitutionality, providing high court entree for workers' comp lawyer Mark Zientz.

The outcome announced Thursday in the hospital case was signaled during Supreme Court arguments April 6. Several justices wondered how the sparse record in the Stahl litigation could support a sweeping constitutional ruling.

And Justice Fred Lewis referred to the question of the court's jurisdiction to hear the case as "the elephant in the room." Now the elephant has trumpeted defeat for Stahl.

Still, the Castellanos opinion suggests the majority processed Zientz's message. Footnote 3 lists "just a few of the ways in which the workers' compensation system has become increasingly complex and difficult, if not impossible, for an injured worker to successfully navigate without the assistance of an attorney."

The footnote describes seven legislative changes to Florida Statutes Chapter 440 including the addition of "an extensive fraud and penalty provision" and "the elimination of the provision that the workers' compensation law be liberally construed in favor of the injured worker."

Both Winer and Perwin pointed to Footnote 3 as indicating a majority of justices agree with Zientz that workers have given away too many rights in exchange for too few benefits.

"The court is acutely aware of the fact that the Legislature has been cutting away at benefits for quite some time now," Winer said.

Perwin added, "I see Footnote 3 as at least recognition that it may not be just this provision that is undermining the original purpose and benefits of the workers' comp law."

Read full article, click here.