Wondering Whether to Object?

Do parties in litigation have a right to speak their piece? Ohio's Twelfth District Court rendered an interesting opinion in January. It was a workers' compensation case styled Courtney v. Stephen Buehrer Admr., Ohio Bureau of Workers' Compensation, Case number. CA2016-06-040.

The recovering worker in this case was injured at work and diagnosed with "cervical strain, lumbar strain, transverse process fracture L2 left, transverse process fracture L3 left, and subcutaneous contusion of the left buttock." Those conditions were accepted as compensable. The worker later sought compensability of a "substantial aggravation of pre-existing degenerative disk disease," but the Bureau of Workers' Compensation denied that claim (Ohio is a "monopolistic" system in which benefits are paid by the state itself). 

The recovering worker appealed the denial, and a hearing was scheduled. At the outset, the trial judge announced that the court would "have the parties submit written closing arguments in lieu of oral argument." With any process or procedure, there will be preferences held by various parties and attorneys. Some like writing and others prefer speaking. To some extent, this may be influenced by an individual's perception of their personal strength or their perception of what influences a particular judge. 

When there are speaking closing arguments, there is a tradition that the party with the burden of proof (the party prosecuting the particular claim or motion) speaks to the issues first, then the responding party speaks, and ultimately the prosecuting party gets the last word. I have presided over thousands of motion hearings and hundreds of trials over the years. I have had parties that preferred to voice a closing argument and others that asked for time to submit a written one. 

At the end of a workers' compensation trial, summarizing the evidence in a concise closing is not usually time-consuming. One detriment I have heard voiced about this process is that the defending party may feel they have little time to consider the prosecuting party's closing argument, and feels it has to effectively respond quickly. Similarly, the prosecuting party has little time to think and analyze after the response and before the "last word" is delivered. But, when the parties walk out of the hearing room after this process, the matter is over for them and they need only await the judge's ruling. 

This same pattern is often employed when closing arguments are instead delivered in a written form. This method allows the parties more time to think and analyze. The prosecuting party can reflect on the proceedings after the hearing, and perhaps provide a more succinct, deliberative, and persuasive argument in writing. The responding party has the same opportunity in some period of days thereafter, to digest, think and write a response. The written closing argument process might arguably be effective in that it allows time for reflection. 

But in Courtney, the judge ordered the written closing arguments "to be submitted 'in blind.'" This meant that each side was to submit closing arguments on the same due date, each side filing their argument without knowing what their opposing party would say about the evidence and the case. 

The trial judge explained the logic in the hearing. The explanation is not completely clear, but centered upon trial scheduling and the judge's calendar commitments. The pronouncement on written closing arguments was made at the outset of trial, and "neither party objected to this decision." When the presentation of evidence had concluded, "the trial court again noted the request for written argument," and afforded the parties "about 2 to 3 weeks to just submit a brief written closing statement."

It was clear at that time that these arguments would be "submitted in blind." The recovering worker's attorney specifically asked about that process and timing, the Judge confirmed the instruction, and counsel replied "that's fine." Both parties submitted their arguments, and the judge promptly issued an order in which compensability of the "additional conditions" was denied. The recovering worker then appealed the decision arguing that "closing arguments in blind" were legally inappropriate. 

The worker's complaint was essentially that this process resulted in "depriving him of an opportunity to reply to the BWC's written argument." In other words, the process denied the recovering worker, the prosecuting party, of the opportunity to have the last word before the judge ruled. 

The Courtney Court ruled that "a trial court judge possesses inherent power to regulate court proceedings." as such, it explained that rulings about the process of proceedings would be reversed only if the "complaining party demonstrates a prejudicial abuse of discretion." But, it appears the Court was most persuaded by the fact that the recovering worker "did not object to the trial court's decision."  The Court held that by failing to object, the worker "has waived all but plain error."

It explained that "the plain error doctrine" is an error which "seriously affects the basic fairness, integrity, or public reputation of the judicial process." The Court concluded that the process of requiring written closing arguments, even "in blind," was not plain error. The Court acknowledged that this procedure is contrary to the applicable statute, R.C. 2315.01(A)(6), but explained that "statute plainly authorizes a trial court to deviate from the specific procedure outlined." The trial court explained its scheduling and reason, and clearly informed the parties of the "in blind" process. 

The failure to object is a critical point in the outcome of this case. The appellate Court concluded that the "method of closing was agreed to by the parties, or, at a minimum, acquiesced to." It noted that rights can be waived by parties in litigation, and the failure to object was effectively such a waiver. 

But, a second critical point made by the Court is that "the decision to proceed in this manner did not prejudice the parties." The Court concluded that the "disputed factual issues were simple and straightforward," and "this was simply a matter of judicial discretion in the handling of its court proceedings." 

The lessons from Courtney are: (1) when you object to something, say so; and (2) understand that there will likely be times when the process employed may not be the one you personally prefer; become adept at various procedures to enhance your comfort with them and your chances of prevailing with them.

The Litigation Funnel

Litigation volumes are a frequent topic of conversation in Florida workers' compensation. It feels like it has been discussed more in the last 12 months. Since the Florida's Supreme Courts interesting decisions last year in Castellanos and Westphal, along with the First District Court's decision in Miles, there is an expectation that litigation volumes will rise in Florida. 

The evidence indicates that petition volumes increased in fiscal 2016 (July 1, 2015 through June 30, 2016). That increase was significant, just over twelve percent. There are those who expected that the trend of increasing would continue. By mid-year 2017 (July 1, 2015 through June 30, 2016), petition filing for 2017 may be up as much as 6.5%. It is impossible to predict with certainty, but it does not appear that petition filings will again increase by double digits in 2017. 

In 2016, there were 67,265 petitions filed. That total volume certainly did not proceed to trial; it never does. In fact, there were only about 600 petition trials in fiscal 2016, although there were many other evidentiary hearings. One judge even held an evidentiary hearing in 2016 on a motion for continuance. For the sake of analysis, it is important to remember that it is very probable that some of the trials in 2015-16, particularly early in the fiscal year, resolved petitions that were filed in the prior fiscal year. 

It may take 210 days or more for a petition to reach trial in Florida. In 2015-16, the average for all trials was 234 days. And, the entry of a final order may be up to thirty days after trial. A final order entered on the first of the year, July 1, 2016, might have therefore been filed 264 days earlier, or on October 11, 2015. It is therefore difficult to draw direct analysis between what was filed in a year and the trials that year. However, the following is offered as what is known, and how meaningful that is may be decided by the reader.

Many of the petitions filed in Florida must be mediated. There are two main exceptions to this requirement. Parties may seek waiver of mandatory mediation, which can only be granted by the Deputy Chief Judge. Each year, there are very few of those waiver orders entered, likely less than 20 such orders in any fiscal year. There is also provision in the law for some claims and petitions to be scheduled for "expedited final hearing," instead of mediation. Those issues are valued monetarily at less than $5,000. 

There was a time in Florida that many petitions were set each month for expedited final hearing. During the years I presided in Pensacola, there were periods when thirty to one hundred petitions were scheduled for expedited hearing each month. Over the several years that such volumes were set for expedited hearing, I can recall actually hearing less than ten. It turned out that scheduling such hearings provided a deadline, and perhaps we all work better when we have a deadline? With the pending deadline, there tended to be resolution. 

This "deadline" hypothesis is perhaps illustrated in the path and process of petitions in Florida today. In fiscal 2016 (2015-2016) there were 67,265 petitions for benefits filed. 

Of those, 12,208 were dismissed before the state mediation, which statutorily was within 130 days (the vast majority of state mediations occurred within this statutory deadline). These petitions were filed because someone felt they were not getting that to which they were entitled. 

One might hypothesize that those workers' asked for these benefits before filing a petition, that a "good faith effort" was first made, and then the petition was filed as a "last resort. See Section 440.192(4), Fla. Stat. Others might hypothesize that perhaps the "good faith" in some instances was less than clear, or misdirected or misunderstood and that receipt of the petition was sufficient to result in benefit delivery. Or, that some petitions were filed that were ineffective, against the wrong party, for benefits not actually ripe due and owing, etc. For whatever reason 12,208 of those filed petitions were dismissed. 

Another 14,201 petitions were also not mediated; their mediations were precluded by the parties reporting that either the issues in that petition or the case itself had either "resolved" or "settled" prior to mediation. Of the 67,265, these two outcomes together account for 26,409, or about 39% of all petitions filed. This is the "funnel of litigation," in which many cases come into a system at the beginning of the litigation process, but over the course of litigation they are thinned. Few complaints proceed all the way to trial. The concept of a "funnel" is illustrated in this graphic of 2015-16.

Mediation was successful at resolving another 23,592 petitions, 35% of the filed volume. Thus, by the conclusion of mediation the parties have worked out 74% of the petitions filed. It is worth noting that more of those resolutions (39%) have been worked out or dismissed by the parties without assistance of any formalized process than those that have required intervention of formal mediation (35%). 

It is possible, however, that the "deadline" of that pending mediation brought attention to various petitions and stimulated resolution or dismissal in the 39% as well. Some would argue that mediation should be credited with such resolution. In this argument, they might be disregarding the anecdotal evidence that the "deadline" of an expedited final hearing has exceptionally high resolution and dismissal results also. 

Notably, there remain a significant volume of petitions at the conclusion of the mediation process. But, only 600 cases will proceed to trial on average. It is worth noting that each trial may involve more than one petition for benefits. In my experience, I can recall a few trials that involved only one petition, but that was not my perception of the "norm." I can recall one exceptional trial that involved more than 15 petitions, but that is also aptly described as uncommon. It is perhaps fair to conclude that generally three petitions in each trial is a reasonable average. Thus, the 600 trials likely represents about 1,800 petitions for benefits. That number is a guess, educated perhaps, but a guess nonetheless.

So, a question may be, how do the 17,264 petitions remaining at the conclusion of mediation reach the estimated 1,800 petitions that actually proceed to trial. Somehow another 15,464 petitions that could not (or were not) resolved at mediation somehow become resolved or dismissed prior to trial.

I hear anecdotal explanations for this. Some complain that parties do not appear at mediation with all of their evidence ready. They have perhaps postponed certain discovery or documentation, to delay the cost of it, until after mediation. Therefore, they present at mediation with what they believe a particular physician may or may not testify. They present at mediation with medical records or reports, but without the deposition of that physician. Through lack of certainty, perhaps resolution potential in some cases is enhanced while in others that uncertainty is an obstacle. 

There is also anecdotal suggestion that what is said at mediation is not like what happens in Vegas. This is not to suggest that there is not confidentiality in the mediation process. The parties have certainly shown over the years that mediation confidentiality works. But, mediation includes difficult discussions about claims, in which any party may have previously only heard their own attorney's perspective upon various issues. At mediation, that party may first hear another perspective or perception of issues, proof, probabilities, potentialities and more. What is said at mediation, by the opposing party or the mediator may not persuade at mediation. However, as weeks pass after mediation those comments, criticisms and ideas may "sink in," and persuade a party towards conciliation. 

For whatever reason, in the eighty days or more (mediation must occur within 130, and trial within 210 days, but many mediations occur far sooner), the parties come to possess better information or perspective. They obtain testimony of experts and fact witnesses, they consider prognostications from mediation, and they work toward the challenge of actually trying the case. And, many trials are therefore cancelled. Unfortunately, a fair number of those cancellation happen on the day before or day of trial. And those late-notice cancellations make docket management and judicial calendars a real challenge. 

So, the sides of the "litigation funnel" may be steep, or shallow, depending on the timing imposed by "deadlines" and volumes of a particular system. The pace at which litigation enters or leaves any system will vary. But, in a general sense, the "funnel" concept is likely to remain consistent with far more claims or complaints entering the top than culminate with a full trial at the bottom. It is an intriguing method for illustrating the dispute process. 

Being There is Half the Battle Sometimes

Florida's Fourth District Court of Appeal rendered an interesting opinion in November 2016, Natiello v. Winn-Dixie Stores, Inc., Case number 4D15-2501. It is not a workers' compensation case, but it is interesting nonetheless, and instructive for attorneys and judges alike. 

The plaintiffs in this case sued a grocery store for damages that they alleged were caused by a slip and fall on the defendant's premises. There is nothing in the Court's decision that suggests the facts or legal issues in the case were extraordinary in any way. It is common, in such litigation, for parties to ask the trial judge to decide some issues and facts before trial. 

One common decision that often arises is whether to end the case short of trial, through a "motion to dismiss" the case on some basis, or a "motion for summary judgment." When moving for summary judgment, a party is essentially saying that there are no issues of fact (whether the traffic light was green as one party says or red as the other party says is a "fact issue"), and that the party seeking summary judgment is entitled to judgment as a matter of law. A party that is granted summary judgment wins the case, without the expense and time of trial. 

In Natiello, the defendant moved for summary judgment, and a hearing was scheduled. The "plaintiffs’ counsel arrived for the summary judgment hearing at the scheduled time." However, because he did not see the defense counsel present, the attorney "left to go to the restroom." When the plaintiff's attorney returned "a few minutes later," the summary judgment motion hearing was in progress. The Court opinion says that "the trial court and defense counsel were wrapping up the summary judgment hearing" by the time counsel returned.

Apparently, the plaintiff's attorney then wanted to restart the hearing from the beginning. The defense counsel expressed "willingness to reargue the matter." But,"the trial court refused to allow plaintiffs’ counsel to argue." The trial court noted several reasons for the denial. The judge noted that the plaintiff counsel had not sought continuance of the motion hearing, had filed no "memorandum in opposition" to the motion. The judge therefore granted the requested summary judgment. 

The plaintiff's attorney then filed a "verified motion for rehearing." A "verified motion" means that it is under oath, and is thus evidence of facts stated in the motion such as the attorney's arrival time, the trip to the bathroom, etc. As an aside, the appellate Court's decision leaves one wondering how far away that restroom was? Counsel arrived on time, defense counsel was not there. By the time counsel could use the restroom, the hearing on the summary judgment motion was "wrapping up?" Was this a 5 minute washroom stop across the hall from chambers?

The Fourth District Court concluded that the issue in this case is "whether a party has been denied procedural due process." This is a question of law, and so the Court reviewed the trial judge's decision "de novo," essentially meaning "start over." Interpretations of law are usually reviewed by appellate courts de novo, and there is no deference to the legal interpretation of the trial judge. 

The Court concluded that "plaintiffs’ counsel was only a few minutes late," and counsel "offered a patently reasonable explanation for his tardy appearance" (see above regarding how far away that bathroom might have been; "patently" means "without a doubt;" of course the appellate Court may know facts it did not include in the opinion). As I read, I could not help remembering the 1999 comedy American Pie, in which Finch could not bring himself to use the restroom at school. Perhaps the coffee shop across the street is more hygienic than the courthouse?

The Court also concluded, in what is the critical point, "there was no showing of prejudice or willful misconduct." Based on these three conclusions of minimal delay, patently reasonable explanation and lack of prejudice, the appellate Court concluded that "the trial court abused its discretion in refusing to allow plaintiffs’ counsel to present argument at the hearing."

The Court held that due process "requires that before summary judgment is entered, the non-moving party must have a full and fair opportunity to contest" the motion. Certainly, that right and virtually any right can be waived. However, in the circumstances of this case, the Court concluded there was not waiver. The Court found no relevance in the Plaintiff's failure "to file anything in opposition to the defendant’s motion for summary judgment." Despite that failure, the Court held the Plaintiff "should have been permitted to present argument.

The case is instructive. Recently on this blog I have discussed cases in which compliance with rules was an issue. Compliance with rules is important. Even the Florida First District Court has sometimes stressed that time limitations should be enforced regardless of prejudice or circumstances. But, even when rules are not followed, even when pleadings are not filed, parties should be provided an opportunity to present their side of an argument.

This issue comes up periodically in conversations I have about OJCC motion practice. Someone will complaint that an order was entered without a hearing, or even without allowing the other side to respond to the motion. There is a feeling that this violates due process. Rule 60Q-6.115 says that it is appropriate for the Judge to decide a motion without a hearing. In fact, hearings are supposed to occur only in "exceptional" circumstances. 

But, there are some who perceive every disagreement as "exceptional" and every motion as an emergency. Some lawyers tell me that not only are they summoned to hearings on mundane motions, but they are summoned with little to no notice. They complain that they are not afforded the "15 days" in Rule 60Q-6.115 to file "a response in opposition." In these conversations, I often ask "did you object to hearing on such 'short notice' grounds?" Lawyers typically look at me knowingly and say something to the effect of "you've practiced law, you know what happens when a lawyer objects to what the judge wants to do." It is tragic that a lawyer would be dissuaded from voicing opposition to a judge's violation of procedural rules. 

Another aside, there was a time when a Florida JCC was accused of coercing all parties in all cases to file a "waiver of statutory time constraints" Lawyers told us they felt pressured and threatened by that judge's persistent reminders and questions about any failure to file such a waiver of rights. When I confronted the judge, I was assured that the pressure perceived by attorneys was not intended. But, that pressure was felt nonetheless. An audit of case dockets revealed almost 100% of cases had such waivers in that district, but rarely if ever appeared in other districts; curiouser and curiouser.

So, when should a judge adjudicate a motion in Florida's workers' compensation adjudication system? The Rule says to file the motion. Then, the other side(s) should normally be allowed 15 days to file  a response. That response will normally be the only "full and fair opportunity to contest" a motion. It should be filed. It should be timely. It should be complete. After that 15 days, an order should issue based upon the sufficiency and persuasiveness of the motion and the response. As the Fourth District Court reminded in Natiello, the response should be considered even if it was filed late, unless that untimeliness resulted in "actual prejudice."

If a party wants a hearing, they should say so, in the motion or the response. A party seeking a hearing, rather than a decision based on the written filings, should explain that they want a hearing, how the situation is "exceptional," and what the "good cause" for the hearing would be. And, judges should respect the time and commitments of the parties and attorneys and schedule motion hearings only "in exceptional circumstances and for good cause shown," like the rules say. This is likely what the parties and attorneys expect, since it is what is in the published rules. Should people be able to expect that the procedures in their case will be what is published in the procedural rules? Or, should they be summoned to unexpected hearings for which they have not enjoyed the time to prepare, and about which they acquiesce out of fear of the judge?

And if someone is late for such an "exceptional circumstance" hearing, because they were in traffic or the restroom, perhaps it may be best in many circumstances to just begin again? 

Compelling Florida Fee Petitions

The Florida First District Court of Appeal in September 2016 rendered Law Offices of William Souza v. Truly Nolan,  It is an interesting analysis that has answered a few questions, but perhaps also left some curiosity in its wake. The case arose when the Employer/Carrier asked the Judge of Compensation Claims to compel the claimant's attorney to file a verified motion for attorneys fees and costs. This is an authority found in  Rule 60Q-6.124(5). The judge granted the request, claimant's counsel appealed.

The Court concluded that the Judge "lacked subject matter jurisdiction to grant the E/SA’s motion to compel." Subject matter jurisdiction refers to the authority over the claim. The Court noted that the claimant had previously settled his workers' compensation case in 2008. There had been some dispute about that settlement, and the Judge held a hearing, concluded that the case was settled, and all of the pending petitions were dismissed at that time. The claimant's attorney was troubled by that decision and appealed those conclusions. In 2009, the Court affirmed. 

When the workers' case was settled in 2008, all of the pending petitions had been dismissed. The Court noted that "jurisdiction was not reserved on any claim." Reservation of jurisdiction is a procedural tool used when a complaint or claim is dismissed, but the adjudicator retains some specific authority over some aspect(s). In that instance, the dismissal is partial rather than complete. It is somewhat common in Florida for a workers' compensation dismissal to include a reservation of jurisdiction over issues such as attorney fees or costs. 

In 2015, six years after the District Court's affirmance of the Judge's order dismissing all petitions, the Employer/Carrier (E/C) filed a motion to compel the filing of a verified motion for attorney's fees pursuant to Rule 60Q-6.124(5), F.A.C. Apparently, the E/C either believed that some outstanding fee issues either existed or was arguable. The motion was granted, but claimant's counsel objected through a motion for rehearing, alleging that the "JCC had no authority to compel the filing of a verified motion for attorney’s fees in the absence of a pending PFB." The motion for rehearing was denied. 

This set of circumstances thus sets an interesting dispute. The E/C seeks to achieve closure of any remaining claims in the case, and consequently clarification of whether any allegedly remain. Following the settlement of the case, the only likely such remaining claims would be regarding fees owed for some previously litigated benefits. In some instances, the E/C might wait for counsel to file for such fees. In others, the E/C might seek to spur that filing with a motion. In this instance, the E/C apparently waited for action for about 6 years before seeking relief. 

The Court in 2016 reiterated its conclusion that "the dismissal of all PFBs divests the JCC of jurisdiction." Because there were no pending petitions, "the JCC had no jurisdiction over any particular claim, including a claim for entitlement to attorney’s fees, because all PFBs were dismissed with no reservation of jurisdiction."

In the absence of pending petitions, "there is no justiciable controversy before the JCC about the parties’ rights or obligations under the Workers’ Compensation Act." The Court explained that Rule 60Q-6.124(5) F.A.C. can only apply in cases in which there is a "pending claim for attorney’s fees via a PFB." Such could be pending because the petition itself remains pending or because jurisdiction regarding fees had been reserved for future determination when some petition(s) was dismissed. The Court explained in Truly Nolan, that because there was no pending PFB and no reservation of jurisdiction, there was no outstanding claim for fees.

Rule 60Q-6.124(5) F.A.C. is a procedural rule and affords the Judge of Compensation Claims authority to manage the docket of pending claims. It is not a grant of authority for a judge to compel a party to file a claim. The Court was clear that the party "cannot be forced to make a claim, under either the statute or the rule, if he does not wish to do so." And, in the absence of a claim, the judge of compensation claims lacks jurisdiction. 

Some would perhaps argue that there is thus a friction point apparent in Florida's workers' compensation system. The Court has previously ruled that a pending claim for attorney fees regarding some other claims or benefits will toll the statute of limitations. Thus, from the perspective of an E/C any potential outstanding claim for attorney's fees may require that a claim remain open and monitored for activity, perhaps indefinitely. They might advocate that closure of such claims is beneficial in bringing certainty.

Others, would perhaps argue that determining the value of various obtained benefits can require time. After some course of care or treatment is approved, it may not be immediately clear how long such care will continue, or what its value might ultimately be. In the Florida system, there has historically been a statutory relationship between the value of those obtained benefits and the attorney fee calculations. How relevant that value is to the fee amount may be debated, but some would argue that the value has at least some relevance. 

Thus, each side in a dispute over fees may have valid arguments that the time is ripe or not for determining fees. The process depends either upon the Claimant's attorney electing to file a verified motion for such fees, or the Employer/Carrier moving to compel such filing. The analysis in either event must then be whether the Office of Judges of Compensation Claims has authority ("jurisdiction") to decide the fee issue. That decision is dependent upon two questions: (1) is there a pending petition that provides jurisdiction, and if not (2) whether there was some reservation of jurisdiction when some past petition was dismissed?

The Court's Truly Nolan decision in September 2016 clarifies that the answer to these two questions should provide both the Claimant and the Employer/Carrier with understanding. In its wake, some have questioned the "point" or "purpose" of Rule 60Q-6.124(5) F.A.C. Simply stated, if such petition or reservation exists, then a Judge may compel filing and resolution of the dispute under this rule. If not, then the OJCC has no jurisdiction, and since no such petition or reservation exits, perhaps there is no reason for the E/C to maintain an "open" claims file. When there is no authority, there is likewise no pleading affecting the claim's statute of limitations. 

Either way, the Rule 60Q-6.124(5) F.A.C. process perhaps provides both sides with answers. There is either a dispute to be adjudicated, or there is not. For those in doubt, perhaps the  60Q-6.124(5) motion will provide answers. 

Florida's SB1582 - More Comp Discussion

On Friday, March 3, 2017, Florida Senator Bradley filed SB1582. It is a 28-page document that addresses workers’ compensation definitions, the pleading and adjudication of disputes, calculation of attorney fees, insurance rate-making, and the expenditures that carriers can make to defend cases, find work for injured workers, and more.

The bill defines "specificity," amending Section 440.02(40) significantly. Following the changes, underlined words added and strikethrough deleted, the definition would be:

(40) “Specificity” means information on the petition for benefits sufficient to put the employer or carrier on notice of the exact statutory classification and outstanding time period for each requested benefit, the specific amount of each requested benefit, the calculation used for computing the requested benefit, of benefits being requested and includes a detailed explanation of any benefits received that should be increased.

Some will say that defining a "specific amount of each requested benefit" will be challenging in some cases. It is not uncommon that claims for indemnity benefits are made with a definite starting point, but no end. That is, they are from mm/dd/yy to the present (the day the petition is filed) and continuing. When benefits are continuing and ongoing, calculating a value of those benefits may be a challenge. 

The bill removes Section 440.105(3)(c) entirely. 

(c) It is unlawful for any attorney or other person, in his or her individual capacity or in his or her capacity as a public or private employee, or for any firm, corporation, partnership, or association to receive any fee or other consideration or any gratuity from a person on account of services rendered for a person in connection with any proceedings arising under this chapter, unless such fee, consideration, or gratuity is approved by a judge of compensation claims or by the Deputy Chief Judge of Compensation Claims.

This section has received significant discussion over recent decades. It is language that various people have various perspectives upon. The application of that section to attorneys who represent injured workers was a focus of the First District Court last year in Miles. As that decision precludes the application of this section to attorneys, the logic for striking it seems supported by Miles. Others may question whether the attorney's prohibition of Miles justifies striking the entire section, which some could argue has a broader prohibition than attorneys alone. See Some Interesting Questions on Miles. 

There has been much discussion of time limitations in Florida workers' compensation. See A Victory (Whose) on One-Time Change. The bill addresses "day" calculations with a new definition in Section 440.13(1)(c). Some will point out that this definition, in the medical portion of the Act, Section 440.13(1)(c), will apply as a modifier of "days" only in the medical contexts of the law. That is, "business day" as defined in 440.13 will likely only apply in 440.13 and not in the rest of the Florida workers' compensation law. It provides:

(c) “Business day” means Monday through Friday, excluding the following holidays: New Year’s Day, Birthday of Dr. Martin Luther King, Jr., Memorial Day, Independence Day, Labor Day, Veterans’ Day, Thanksgiving Day and the Friday after Thanksgiving, and Christmas Day. If any of the holidays falls on Saturday or Sunday, the term does not include the day on Monday through Friday on which the holiday is observed.

Under this definition, only the actual holidays would be excluded from the calculation of days. When offices are closed on a weekday, in observation of a holiday that falls naturally on a weekend, the observation day would be included as a business day. This, despite the fact that state and federal offices might nonetheless be closed for that observation. And, more importantly, the very doctor whose office needs to be contacted, whose agreement to undertake care is needed, may likewise be closed in observation. 

One-time change would require a written request, but the 5-day response period would now be “5 business days.” Section 440.13(2). The addition of “business” to modify “days” is proposed in various sections, including 440.13(4) ”Notice of Treatment,” (5) “independent medical examinations,” and (9) “expert medical advisors.”

Requests from an “authorized health care provider,” under Section 440.13(3)(d) would no longer require a “response.” Instead, the “carrier” would be required to “authorize or decline a request for authorization” by the end of the “third business day after receipt of the request.” Failure to respond to a written request means the carrier “authorizes the request.” A similar time period of 10 days in Section 440.13(3)(i) would afford “10 business days” when the claim is for “specialist consultations, surgical operations, physiotherapeutic (sic) or occupational therapy procedures, X-ray examinations, or special diagnostic laboratory tests” of specified cost.

This holds the employer or carrier to a higher standard. The statute currently requires a response. Some would argue that "thank you," or any acknowledgement, is a response. The bill would seem to require a more substantive response that takes one of two forms, that is, to provide the treatment or deny that request. This language might be interpreted to provide little "middle ground."

  

Clarity perhaps comes to the subject of temporary benefits from this bill. Following the Supreme Court’s decision in Westphal, there has been discussion of the maximum period during which temporary benefits might be payable. This proposal clarifies that eligibility for temporary total would be 260 weeks, Section 440.15(2). The provision for temporary partial would also be 260 weeks. But this section says “as provided by this subsection and subsection (2).” Thus, arguably, the total period of combined TTD and TPD would be 260 weeks. See Westphal is Over, Questions Remain. 

The bill amends Section 440.192 to remove the requirement of including a social security number when filing a petition for benefits. It also requires including the “Florida county or, if outside of Florida, the state of the occurrence of injury." It is possible that this location clarity would be of benefit to some process or procedure in the system. The bill includes further requirements for specificity in petitions for benefits in Section 440.192. These include a “specific date of maximum medical improvement” and “the specific date that such permanent benefits are claimed to begin” for any “claim for permanent benefits.” Section 440.192(2)(f).

Claims for change in the calculation of a worker’s average weekly wage (AWW) in Section 440.192(2)(j) would also require enhanced specificity. The petition would have to include “the specific amount of compensation claimed,” as well as “the methodology claimed to accurately calculate the average weekly wage.” And, if the petition does not include an AWW calculation claim, then the AWW calculated by the “employer or carrier are presumed to be accurate.” It is unclear if that presumption is for the claim or merely applies during the pendency of that particular petition.

Determination of motions for dismissal of petitions would be expedited. The bill mandates Judges of Compensation Claims “enter an order on the motion” in most instances “within 10 days after the motion is filed.” That is not the “10 business days” afforded regarding various provisions in Section 440.13 (above). That is 10 days. A motion filed on a Friday would have to be decided one week from the following Monday (S, S, M, T, W, Th, F, S, S, M). So, this 10 days is essentially 6 business days, unless there are holidays involved. So, in various weeks through the year, the requirement might require an order in 4-5 business days. When a hearing is required for such a motion, the judge would be afforded 20 days in which to enter an order.

The bill amends Section 440.34 regarding attorney fees. Essentially, the statutory "formula fee" would be retained. But, the Judge would be empowered to depart from that fee, to “increase or decrease” based upon findings regarding 6 factors. This, in large part, resurrects the provisions of Section 440.34 prior to the 2003 statutory amendments. The significant difference in this fee statute proposal, compared to the pre-2003 provisions of Section 440.34 is a cap on the hourly rate to “a maximum hourly rate of $250 per hour.” The bill would also delete Section 440.34(7), which provides an “alternative” fee in certain “medical only claims.” That fee was limited in both the number of hours that could be compensated and in the maximum hourly rate that could be paid ($150.00) per hour.

The bill would end Florida’s workers’ compensation rate-making process for workers’ compensation. Instead, Florida would adopt a “loss cost” rate-making. Significant portions of Section 627.072(5) would be deleted, and language would be added to Section 627.091. This would result in “each insurer” making an independent filing with the Office of Insurance Regulation. Currently, most carriers in Florida allow an aggregator (see Another 2017 Legislative Discussion for a definition of "aggregator"), NCCI, to file for annual rates on their behalf. And significant portions of Section 627.211 would be deleted.

The bill creates a new Section 627.2151, titled “workers’ compensation excessive defense and cost containment expenses.” This would require accounting for a variety of carrier expenses, including attorney fees, expert witness fees, bill auditing, utilization review, vocational rehabilitation, and medical examinations. These totaled expenses would be compared to the overall “incurred losses” of the carrier. If those accounted expenses exceed 15% of the incurred losses, then those expenses are deemed “excessive.”

The bill requires that the excess “amount must be returned to policyholders in the form of a cash refund or credit toward the future purchase of insurance.” There are details for the process and timing of both excess refund processes.

The bill would be effective July 1, 2017. 

The Florida Legislative session starts Tuesday, March 7, 2017. It will conclude May 5, 2017, and it promises to provide much to talk about in the world of workers' compensation.

Another 2017 Legislative Discussion

It is March 2, 2017 and the Florida regular legislative session begins next Tuesday, March 7, 2017. It will run no later than May 5, 2017, The Florida constitution limits regular sessions of the legislation to 60 days. It is a busy time each spring. Though the session is only 60 days, members and staff have significant work to do throughout the year. Some therefore recognize Florida's as a "full time" legislature.  

Some years workers' compensation, and the people involved in it, seemingly have little to watch in Florida legislation; 2017 may be different. The landscape of Florida workers' compensation in 2017 may be perceived as ripe for change. There have been various prognostication and discussions about legislative changes in a variety of topics. 

One bill of workers' compensation interest may be HB 7011. It does not amend Chapter 440, but it does refine delivery of medical care in some respects. It would allow "registered nurses who meet certain criteria to practice advanced or specialized nursing without physician supervision." And, for clarity in the growing paradigm of "telehealth," it "authorizes Florida-licensed health care professionals to use telehealth." It could be seen as encouraging and somewhat defining that tool. Telehealth has demonstrated value for those who have difficulty travelling, particularly in rural areas.

But, Florida waits to see what bills will be introduced that would specifically amend Chapter 440. One proposal was recently made by a Florida interest group, and was discussed at length in An Act Related to Workers' Compensation on Valentine's Day. Last December, there was another bill discussed in A Legislative Seismic Shift in Florida. At least as far as I can find, neither of those bills has yet been filed for the upcoming session. 

There is discussion that other legislative proposals may come to light soon. I have been told that the Florida Justice Association has suggested legislative changes, but I have not seen a proposed or filed bill, nor any documents discussing or summarizing such a bill. 

And, there are other discussions as well. This week, I received a memo discussing potential changes to the law. It was divided into various sections, each addressing a perceived concern with Chapter 440 and suggesting legislative action. 

The first section is directed at the payment of attorney fees by injured workers. The stated goal to "conform statute to the holding of the Miles case." The proposed outcome would be for the employer and the employee to each "be responsible for their own attorney’s fees, except when a Judge of Compensation Claims (JCC) awards the injured worker an amount for their attorney’s fees pursuant to statute." This would involve changes to Section 440.105 and 440.34, Fla. Stat. There is discussion of requiring attorney fee contracts between employees and their attorneys to be filed with the Office of Judges of Compensation Claims. This would apparently be to make the contract provisions known, because though filing would be required, JCC approval of the contracts would not be. 

The proposal would constrain employee attorney fees in other instances. There would apparently be a "statutory attorney fee" defined. But, a JCC might depart from that "statutory" fee to an hourly fee, but with constraints or parameters. There would be "express authority" for the JCC to depart from the "statutory" fee if "the JCC finds that the statutory attorney fee schedule produces an equivalent hourly rate" that is beyond particular deviations from the "fee customarily charged in the locality for similar legal services." There would be "factors" for deviation, perhaps "using the ones that were removed from this statute in 2003." 

It is possible that this statute would address interpretations from appellate decisions. In a situation in which two experts testify regarding the appropriate hourly rate for fees, appellate courts have held that the JCC can select between the two rates expressed. In other words, expert one says the appropriate rate is $100 per hour and expert two says that it is $300. The Court has ruled that the JCC must select one of these two rates. But, in a curious logic, the Court has held that the JCC cannot select a rate in between the two. Awarding a rate of $200 in this example would be error. This latest discussion mentions eliminating this illogical outcome by providing discretion to "eliminate the current judicial restriction to select only from the amounts plead by a party."

There is discussion of placing a statutory "cap" on the hourly rate that an employer/carrier could be ordered to pay. This might be any particular rate selected by the legislature, some have suggested "$250 per hour." Whenever dollar figures are put into statute, there is concern that inflation of deflation might render such a figure illogical sometime in the future. To address that concern, the proposal would "create a statutory mechanism to annually adjust the $250 per hour, cap." The discussion is of tying that limit to the existing cap on the "statewide average weekly wage."

There is discussion of Westphal and Jones. Westphal was the Supreme Court's decision concluding that statutory caps on temporary total disability (TTD) benefits are unconstitutional. That was a decision that led to extensive discussion and prognostication. It's implications remain unclear in some respects, and some wish the Court had provided further analysis and explanation. The First District Court, later in 2016, rendered Jones, in which it concluded that temporary partial disability (TPD) constrictions were similarly unconstitutional. 

The effect of the two is to strike the 104 week limitation and revive the prior provisions providing 260 week limitations. Neither decision provides clarity regarding whether that means 260 of each temporary benefit or a combined 260 weeks of any temporary benefit. Some lament the lack of clarity on this point from the courts, while others seemingly enjoy the resulting dysfunction and confusion. 

This latest document proposes removing the (stricken) "104 week limitation" and replacing it with "a combined total of 260 weeks of temporary total disability (TTD) and temporary partial disability (TPD)." That would address the curiosity of the system left by the court. by design or not. This document also proposes a possible "26 additional weeks" of TTD" if the injured worker is not at maximum medical improvement (MMI) when the 260 expires. During that 26 weeks, MMI and impairment would be determined. Effectively, this would limit the combined temporary indemnity period to 286 weeks. Some would perhaps say that such a combination would leave a potential constitutional challenge, should some worker reach the (app.) 5.5 year limit without attaining maximum medical improvement. But, others would perhaps say that hypothetical potential bridge could be crossed later. 

The document proposes that upon expiration of the "additional TTD" period, that "the JCC is required, upon motion, to determine the injured workers’ eligibility for permanent total disability benefits." It is apparently hoped that because this is "five and one half years into the claim" that most workers will have reached MMI by that time that this provision would be rarely engaged. It also discusses changing requirements for impairment income benefits so that an injured worker would receive them at the expiration of the 286 weeks even if overall MMI has not been reached. 

There is discussion of the current litigation and debate regarding how insurance rates are set in Florida workers' compensation. Insurance rates have become a contentious subject in Florida at various times, in and out of workers' compensation. The current debate has to do with Florida's current practice in which the Office of Insurance Regulation (OIR) sets the applicable workers' compensation rates for various occupations. With this single rate, each carrier charges essentially identical rates. Critics have argued that this may prevent competition. 

The critics ignore that Florida's current ratemaking process does not mandate a single rate. The law does allow a single rate, and in practice the vast majority of insurance carriers use this single rate. That rate is determined by an entity acting as an "aggregator" (no, this is not a UF graduate interested in crops) of loss data. This entity compiles data and files a rate request with OIR. Based on that filing, OIR sets the resulting rate. The various carriers may adopt that rate. But, under Florida law, any carrier that wished to could make its own rate filing, rather than utilizing that resulting from the aggregator's filing. But, few if any carriers engage in that independent exercise each year. 

The document reviewed today expresses a goal of increased competition in rates. It says a bill might "permit insurer discretion to depart from" the rate which OIR approves based on the aggregator filing. Carriers, without making an independent filing to justify rates, could perhaps deviate from that rate "by no more than five percent." Carriers would have to notify OIR of their departure, and OIR would be able to deny the departure "if it violates the ratemaking standards, imperils the financial condition of the insurer, or results in predatory pricing." Thus, there would be more flexibility and competition, but still government oversight.

The document discusses elimination of "cost drivers." This would afford employer/carriers more time to provide benefits without incurring attorney fee liability, from 30 to 60 days. It would appear that attorneys could still be compensated for their time in that 60 day period, but the injured worker and not the employer/carrier would pay. It discusses requiring reporting of defense attorney fees and changing the "reimbursement methodology for outpatient services provided by hospitals and ambulatory surgical centers." The new methodology would provide reimbursement based on averages of prevailing charges in some instances and based on billed charges in others. 

There is discussion of medical authorization. The document proposes that employer/carriers would have to respond to medical care requests within a specific time, "3 business days, or 10 business days in certain circumstances." See A Victory (Whose") on One-Time Change. 

Finally, the document expresses a need to "protect sensitive personal information of injured workers." This concern would be addressed by exempting certain information about the worker from "public records." It notes that a "similar provision was law from 1998 to 2003 and that provision automatically sunset during the workers’ compensation reforms of 2003." Reenacting this exemption is seen as protecting injured workers' identity, and perhaps as shielding them from solicitations from various service providers. Purportedly, such an exemption would again be subject to a similar "sunset" provision that would require future legislative action to readopt.  

Whether this document portends legislative amendment this year or not remains to be seen. But, regardless of the ultimate outcome, the document provides interesting reading and may engender discussions and debates that contribute to understanding of the workers' compensation system. The many various proposals for change and the discussions are interesting. 

What will the session hold for Florida's workers' compensation? It is a valid discussion. Quoting the great Mr. Spicoli, from Fast Times at Ridgemont High, I provide my grand prediction for 2017 "I don't know."

Separation of Powers - An Intersting Analysis

Can Courts convey authority, or do they just interpret the law, which they are given by the Legislature?

There is a concept of American constitutional construction that seeks to define and constrain government, called "separation of powers." The idea is simple enough, though it is perhaps less respected today than historically; perhaps less than intended. But, interpreting the intent of constitutional framers can be a difficult endeavor. 

Separation of powers, stated simply, keeps the state's executive out of legislative and judicial responsibilities, while keeping the courts out of executive and legislative responsibilities, and keeping the legislature out our executive and judicial responsibilities. The message of separation of powers is "focus on the job that the people have given to you"; after all, under our American concept of government, the people are the root-source of all authority. 

In this constitutional construct, "we the people" have given specific (called "enumerated") powers to the government through the U.S. and various state constitutions. From our delegation of our authority, we have empowered government. From our delegation comes government's power, and from our delineation and definition comes the need for their various powers to be separated and distinct. This came to mind when I read a recent thought-provoking piece in which former U.S. Representative Mickey Edwards asserts that We No Longer Have Three Branches of Government. 

In 2004, the Florida Supreme Court provided us some insight on separation of powers in Amendments to the Florida Rules of Workers' Compensation Procedure, 891 So.2d 494 (Fla. 2004). The Court ended by clarifying that separation of powers precluded it from making rules for workers' compensation proceedings in the Office of Judges of Compensation Claims. First, It began by describing a long history through which it had nonetheless done so for decades.

It began in 1973. Workers' compensation had come to Florida in 1935, and had managed without procedural rules for almost 40 years. Then, in 1973, the Court adopted formal rules of workers' compensation procedure in In re Florida Workmen's Compensation Rules of Procedure, 285 So.2d 601, 601 (Fla. 1973). The process began with rules drafted and proposed by the Industrial Relations Commission of the State of Florida ("IRC"). The Court recognized then that the proposed rules were for executive branch agency officials, then called "a judge of industrial claims" which was a "quasi-judicial officer.” As an aside, back then the judge's decisions were subject to appellate review by the IRC. 

Under the statutory construct, the appellate decisions of the IRC could then be reviewed by the Supreme Court, and therefore the Court found it had "a direct interest in" the process and procedure by which cases progressed. Under its constitutional authority to "adopt rules for the practice and procedure in all courts...,” the Court adopted those 1973 procedural rules, finding that the fact that a "court" would later potentially review the decisions made the whole workers' compensation process "more judicial than quasi-judicial." In that decision, the Supreme Court was in error, and it unconstitutionally adopted rules for the executive branch to follow. 

But, the Court was not alone. The next year, the Florida Legislature passed a statute that said the procedural rules would come from the Court, essentially legislatively "delegating" the rule-making authority to the Court. Thereafter, the Supreme Court adopted rules and revisions repeatedly, approximately every two years. Initially, the Court had cited the Florida constitution for its authority, but in each decision of the Court thereafter, adopting new rules, it cited instead to the 1974 statutory delegation. Each time that is until 1992 when the state constitution was mentioned again. 

In 1993, the legislature amended the statute and instead delegated authority to make rules to the "Office of Judges of Compensation Claims (OJCC)," part of the Department of Labor and Employment Security (DLES). The OJCC ignored that delegation. In 2001, when the OJCC became a part of the Division of Administrative Hearings (DOAH), the statute was amended yet again delegating that authority to DOAH. Unlike the Department of Labor, DOAH took the legislature at its word and promulgated rules. 

The Florida Bar disagreed with the legislature. The Bar saw this legislative action as taking away the authority of the Supreme Court. It sought to have the Court continue rule adoption for the OJCC in 2002. The Bar felt that the "Legislature had improperly usurped" the Court's rule-making authority. It was the Bar's petition to amend the Court's then existing workers' compensation rules in 2004 that resulted in Amendments to the Florida Rules of Workers' Compensation Procedure, 891 So.2d 494 (Fla. 2004).

The Florida Supreme Court concluded there that it lacked "the authority to promulgate rules of workers' compensation procedure." The Court explained that its authority and powers emanated from "article V. of the Florida Constitution." And, that article's grant of authority to "adopt rules for the practice and procedure in all courts” is limited to courts. After a review of the constitutional definition of "courts," the Court concluded that the OJCC is not a "court of this State." (Confusion abounds still among practitioners and judges alike who for some reason still refer to JCCs as "courts," despite this clear authoritative interpretation to the contrary). 

In its analysis, the Court noted that it previously clearly made this same point in 1994, concluding that “compensation claims judges are executive branch officials, not judicial branch officials.” Jones v. Chiles, 638 So.2d 48, 51-52 (Fla.1994). But despite that recognition, the Court continued thereafter to make rules for the executive branch for another ten years. 

The Court in 2004 then explained separation of powers and concluded that it had no authority to make rules for the executive branch. It said "this Court has no authority," and "nor has this Court ever had the constitutional authority" to make rules of procedure "for this executive entity." The Court concluded that it had acted unconstitutionally for over thirty years, from 1973 to 2004. And, the Court therefore receded "from the decision in In re Florida Workmen's Compensation Rules of Procedure, 285 So.2d 601 (Fla.1973), to the extent that that case and all subsequent cases conclude that this Court had jurisdiction to promulgate such rules." (Yes, Florida used to regurlarly use the genderist "workmen's")

The Court also addressed the legislative delegation of rule-making authority. It held that the "Legislature in 1974 had no authority to" delegate authorization, authority or power over such rules to the Court. It clarified that the power "conferred upon the courts by the Constitution cannot be enlarged or abridged by the Legislature.” The Legislature's 1974 enactment of section 440.29(3), Fla. Stat., which said the Court would make rules, was "an unconstitutional delegation of executive branch authority to the judicial branch in violation of the Separation of Powers Clause of the Florida Constitution. See art. II, § 3, Fla. Const."

The Florida "Separation of Powers Clause" says "no person belonging to one branch shall exercise any powers appertaining to either of the other branches unless expressly provided herein.” Thus, only when the Florida Constitution provides for delegation of authority will the exercise of delegation be appropriate. The Court noted that were it "to conclude otherwise, the Legislature would have the discretion to statutorily alter this Court's jurisdiction under the Florida Constitution." So, what the people delegate to the Courts in our constitution, the Legislature cannot change. The power of government comes from the people. 

Thus, the Supreme Court retreated in 2004 from a decades-long involvement in workers' compensation rules in the executive branch. In it, the Court conceded that it had acted unconstitutionally for decades. It provided explanation of both Separation of Powers and Delegation. The Court clearly and succinctly clarified that Judges of Compensation Claims are not, and frankly have never been, "courts." It took 30 years for the Court to reach that conclusion. In the thirteen years since 2004, practitioners and judges have nonetheless continued to refer to the OJCC as "this court." 

Perhaps before the 30th anniversary of Amendments to the Florida Rules of Workers' Compensation Procedure, 891 So.2d 494 (Fla. 2004), practitioners and judges alike will accept that the OJCC is not a "court of this State," and will quit referring to this office as "this court?" Perhaps the Court's analysis is of value in recognizing that because we become accustomed to the way things are, that does not necessarily mean things are the way they should be? 

Today, I insert the 2016 "Best Blogs" banner in my post for the last time. As nominations open tomorrow for the 2017 "Best Blogs" awards, the 2016 banner becomes history. I am proud to have been selected last year. When the 2017 judging is concluded, perhaps I will be able to display that banner here for the next year?