Disability Law

Florida Supreme Court Invalidates 2003 Amendment to Attorney's Fee Statute

By David A. McCranie, Esq.

In what is surely the most widely followed workers' compensation case in several years, the Florida Supreme Court has invalidated the 2003 amendment to §440.34.  The amendment purported to limit the attorney's fees which could be paid to prevailing claimants to a strict percentage of the benefits secured through the attorney's efforts.  See Murray v. Mariner Health, decided on 10/23/2008.  The court's ruling was 5-0.  Justices Canady and Polston, recently appointed to the court by Governor Crist, did not participate in the decision.

Although the claimant had raised a number of constitutional challenges to the amendment, the court declined to rest its decision on those grounds.  Rather, the court concluded that the statute was ambiguous because, while subsection (1) forbids the JCC from awarding attorney's fees in any amount other than a percentage of the benefits secured by the attorney, subsection (3) requires the JCC to award "a reasonable attorney's fee."  And a fee which compensates an attorney at the rate of $8.11 per hour for his efforts is unreasonable.  "Inadequate fees and excessive fees are not reasonable attorney's fees," said the court. Therefore, when awarding a carrier-paid claimant's attorney's fee under the statute, the court must use the factors enumerated in rule 4-1.5(b) of the Rules Regulating the Florida Bar.

The ruling essentially returns the law governing the award of carrier-paid claimant's attorney's fees to its pre-2003 state.  That is, the JCC will award such fees using the statutory percentages unless he determines that the resulting fee would be "manifestly unfair."  In that event, he will apply the factors enumerated in rule 4-1.5(b) to arrive at a reasonable fee. [The factors in the rule are the same as the ones deleted from §440.34 in 2003 and which had previously been adopted by the supreme court in Lee Engineering & Construction Co. v. Fellows, 209 So.2d 454 (Fla. 1968).

The ruling has already been criticized by several industry groups who predict that the ruling will result in increased workers' compensation premiums for Florida employers.  You can read coverage from the Miami Herald here and from the South Florida Business Journal here.

Full post as published by Florida Workers’ Compensation Law Blog on October 23, 2008 (boomark / email).