Castellanos v. Next Door Co.

• Decision Date: 28 April 2016
• Docket Number: No. SC13–2082.,SC13–2082.
• Parties: Marvin CASTELLANOS, Petitioner, v. NEXT DOOR COMPANY, et al., Respondents.
• Court: Florida Supreme Court

192 So.3d 431

Marvin CASTELLANOS, Petitioner,

v.NEXT DOOR COMPANY, et al., Respondents.

No. SC13–2082.

Supreme Court of Florida.

April 28, 2016.

Richard Anthony Sicking, Mark Andrew Touby, and Richard Eric Chait of Touby, Chait & Sicking, PL, Coral Gables, FL; and Michael Jason Winer of the Law Office of Michael J. Winer, P.A., Tampa, FL, for Petitioner.

Raoul G. Cantero, III and David P. Draigh of White & Case LLP, Miami, FL, for Respondents.

Mark Lawrence Zientz of the Law Offices of Mark L. Zientz, P.A., Miami, FL, for Amicus Curiae Workers' Injury Law and Advocacy Group.

Richard W. Ervin, III of Fox & Loquasto, P.A., Tallahassee, FL, and Susan Whaley Fox of Fox & Loquasto, P.A., Orlando, FL, for Amicus Curiae Florida Justice Association.

Christopher John Smith, Tampa, FL, for Amicus Curiae Workers' Compensation Section of The Florida Bar.

William J. McCabe, Longwood, FL, for Amicus Curiae Voices, Inc.

Geoffrey Bichler of Bichler, Kelley, Oliver & Longo, PLLC, Maitland, FL, for Amici Curiae Florida Fraternal Order of Police, Florida Police Benevolent Association, and International Union of Police Associations.

Noah Scott Warman of Sugarman & Susskind, P.A., Coral Gables, FL, for Amicus Curiae Florida Professional Firefighters, Inc.

Kimberly Ann Hill of Kimberly A. Hill, P.L., Fort Lauderdale, FL, and Kenneth Brian Schwartz of Kenneth Schwartz, P.A., West Palm Beach, FL, for Amicus Curiae Florida Workers' Advocates.

Mark Kenneth Delegal and Matthew Harrison Mears of Holland & Knight LLP, and William Wells Large, Tallahassee, FL, for Amici Curiae Florida Justice Reform Institute and Florida Chamber of Commerce, Inc.

Rayford Huxford Taylor of Casey Gilson P.C., Atlanta, GA, for Amici Curiae Associated Industries of Florida, Inc., Associated Builders & Contractors, Florida Electric Cooperatives Association, Florida Retail Federation, Florida Roofing, Sheet Metal and Air Conditioning Contractors Association, Florida United Businesses Association, and Publix Supermarkets.

Amy Lyn Koltnow and Maria Elena Abate of Colodny, Fass, Talenfeld, Karlinsky, Abate & Webb, P.A., Fort Lauderdale, FL, for Amici Curiae Property Casualty Insurers Association of America, Florida Insurance Council, American Insurance Association, and National Association of Mutual Insurance Companies.

Richard W. Ervin, III of Fox & Loquasto, P.A., Tallahassee, FL, and Charles Holden Leo of the Law Offices of Charles H. Leo, P.A., Orlando, FL, for Amicus Curiae Central Florida Trial Lawyers Association.

Louis Paul Pfeffer, Jupiter, FL, for Amicus Curiae National Employment Lawyers Association, Florida Chapter.

PARIENTE

, J.

This case asks us to evaluate the constitutionality of the mandatory fee schedule in section 440.34, Florida Statutes (2009)

, which eliminates the requirement of a reasonable attorney's fee to the successful claimant. Considering that the right of a claimant to obtain a reasonable attorney's fee has been a critical feature of the workers' compensation law, we conclude that the mandatory fee schedule in section 440.34, which creates an irrebuttable presumption that precludes any consideration of whether the fee award is reasonable to compensate the attorney, is unconstitutional under both the Florida and United States Constitutions as a violation of due process. See art. I, § 9, Fla. Const.; U.S. Const. amend. XIV, § 1.¹

This issue arises out of a question certified by the First District Court of Appeal to be of great public importance,² which we rephrase as follows:

WHETHER SECTION 440.34, FLORIDA STATUTES (2009)

, WHICH MANDATES A CONCLUSIVE FEE SCHEDULE FOR AWARDING ATTORNEY'S FEES TO THE CLAIMANT IN A WORKERS' COMPENSATION CASE, IS UNCONSTITUTIONAL AS A DENIAL OF DUE PROCESS UNDER THE FLORIDA AND UNITED STATES CONSTITUTIONS.

The Petitioner, Marvin Castellanos, was injured during the course of his employment with the Respondent, Next Door Company. Through the assistance of an attorney, Castellanos prevailed in his workers' compensation claim, after the attorney successfully refuted numerous defenses raised by the employer and its insurance carrier. However, because section 440.34

limits a claimant's ability to recover attorney's fees to a sliding scale based on the amount of workers' compensation benefits obtained, the fee awarded to Castellanos' attorney amounted to only $1.53 per hour for 107.2 hours of work determined by the Judge of Compensation Claims (JCC) to be “reasonable and necessary” in litigating this complex case.

Castellanos had no ability to challenge the reasonableness of the $1.53 hourly rate, and both the JCC and the First District were precluded by section 440.34

from assessing whether the fee award—calculated in strict compliance with the statutory fee schedule—was reasonable. Instead, the statute presumes that the ultimate fee will always be reasonable to compensate the attorney, without providing any mechanism for refutation.

The right of a claimant to obtain a reasonable attorney's fee when successful in securing benefits has been considered a critical feature of the workers' compensation law since 1941. See Murray v. Mariner Health, 994 So.2d 1051, 1057–58 (Fla.2008)

. From its outset, the workers' compensation law was designed to assure, as the current legislative statement of purpose provides, “the quick and efficient delivery of disability and medical benefits to an injured worker.” § 440.015, Fla. Stat. (2009).

Yet, while the Legislature has continued to enunciate this purpose, in reality, the workers' compensation system has become increasingly complex to the detriment of the claimant, who depends on the assistance of a competent attorney to navigate the thicket.³ Indeed, as this Court long ago observed, allowing a claimant to “engage competent legal assistance” actually “discourages the carrier from unnecessarily resisting claims” and encourages attorneys to undertake representation in non-frivolous claims, “realizing that a reasonable fee will be paid for [their] labor.” Ohio Cas. Grp. v. Parrish, 350 So.2d 466, 470 (Fla.1977)

.

We reject the assertion of Justice Polston's dissenting opinion that our holding “turns this Court's well-established precedent regarding facial challenges on its head.” Dissenting op. at 455 (Polston, J.). It is immaterial to our holding whether, as Justice Polston points out, the statutory fee schedule could, in some cases, result in a constitutionally adequate fee. It certainly could.

But the facial constitutional due process issue, based on our well-established precedent regarding conclusive irrebuttable presumptions, is that the statute precludes every injured worker from challenging the reasonableness of the fee award. See Recchi Am. Inc. v. Hall, 692 So.2d 153, 154 (Fla.1997)

(clarifying that its holding “invalidates the irrebuttable presumption altogether,” including as applied to certain situations). It is the irrebuttable statutory presumption—not the ultimate statutory fee awarded in a given case—that we hold unconstitutional.

The contrary approach embraced by Justice Polston's dissenting opinion, which leaves open the possibility of an as applied challenge to the statute on a case-by-case basis, would be both unworkable and without any standards for determining when the fee schedule produces a constitutionally inadequate fee. Simply put, the statute is not susceptible to an as applied challenge, but instead fits into our precedent governing the constitutionality of irrebuttable presumptions, which is a distinct body of case law that differs from the typical “facial” versus “as applied” cases cited by Justice Polston's dissent.

We also reject the assertion of Justice Canady's dissenting opinion that we “fail[ ] to directly address the actual policy of the statute.” Dissenting op. at 450 (Canady, J.). Rather, it is Justice Canady's dissent that fails to acknowledge that a reasonable attorney's fee has always been the linchpin to the constitutionality of the workers' compensation law.

It is undeniable that without the right to an attorney with a reasonable fee, the workers' compensation law can no longer “assure the quick and efficient delivery of disability and medical benefits to an injured worker,” as is the stated legislative intent in section 440.015, Florida Statutes (2009)

, nor can it provide workers with “full medical care and wage-loss payments for total or partial disability regardless of fault and without the delay and uncertainty of tort litigation.” Martinez v. Scanlan, 582 So.2d 1167, 1172 (Fla.1991).

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. Accordingly, we answer the rephrased certified question in the affirmative, quash the First District's decision upholding the patently unreasonable $1.53 hourly fee award, and direct that this case be remanded to the JCC for entry of a reasonable attorney's fee.

I. FACTS AND PROCEDURAL HISTORY

In 2009, Marvin Castellanos, then forty-six years old, suffered an injury during the course of his employment as a press break operator for Next Door Company, a manufacturer of metal doors and door frames located in Miami, Florida. Castellanos requested medical treatment, and Next Door authorized him to seek treatment at the Physician's Health Center in Hialeah, Florida, the health insurance clinic designated for medical diagnoses by Next Door's workers' compensation insurance carrier, Amerisure Insurance Company. At the clinic, Castellanos was diagnosed with multiple contusions to his head, neck, and right shoulder. A doctor requested authorization of medically necessary treatment, including x-rays, medications, and physical therapy.

Next Door, as the employer, and Amerisure, as Next Door's insurance carrier (collectively, the “E/C”), failed to authorize its own...