Colonial Restaurant Corp. v. State Dept. of Commerce, 70--881

• Decision Date: 26 May 1971
• Docket Number: No. 70--881,70--881
• Citation: 248 So.2d 494
• Parties: COLONIAL RESTAURANT CORPORATION, Appellant, v. STATE of Florida DEPARTMENT OF COMMERCE, a department of the executive branch of the government of the State of Florida, as successor to the Florida Industrial Commission, formerly an agency of the State of Florida, and the Trustees of the Florida Restaurant Self Insurers Fund, and Alan-Melvin Corporation, Appellees.
• Court: Florida District Court of Appeals

Page 494

248 So.2d 494

COLONIAL RESTAURANT CORPORATION, Appellant, v. STATE of Florida DEPARTMENT OF COMMERCE, a department of the executive branch of the government of the State of Florida, as successor to the Florida Industrial Commission, formerly an agency of the State of Florida, and the Trustees of the Florida Restaurant Self Insurers Fund, and Alan-Melvin Corporation, Appellees.

No. 70--881.

District Court of Appeal of Florida, Fourth District.

May 26, 1971.

Albert P. Schwarz, Orlando, for appellant.

Edward H. Hurt and Leonard V. Wood of Maris, Wood, Muller & Boroughs, Winter Park, for appellees.

PER CURIAM.

This is an appeal by Colonial Restaurant Corporation, d/b/a Ronnie's Restaurant, appellant-defendant, from a final judgment entered in favor of the State of Florida Department of Commerce and the Trustees of the Florida Restaurant Self Insurers Fund, plaintiffs-appellees. The material facts, as refleced in the record of the proceedings below, are as follows.

On June 20, 1969, the then Florida Industrial Commission (now a division of the State of Florida Department of Commerce) entered an order declaring in part 'that each and every employer who is a member of the Florida Restaurant Self Insurers Fund during any period between July 1, 1961 and December 31, 1966, be and hereby found to be jointly and severally liable for the assessments levied by the Board of Trustees'. The order was predicated upon the provisions of F.S. section 440.58, F.S.A., providing in part as follows:

'Upon petition of the trustees of the following self-insurers groups: * * * Florida Restaurant Association * * * the division shall enter its order requiring the employer members and former members of said groups liable therefor to pay all delinquent premiums and all necessary assessments, such payments to be paid to the division and by it disbursed to said trustees to be used for the payment of workmen's compensation claims and related compensation expenses.'

The petition filed by the Board of Trustees of the Florida Restaurant Self Insurers Fund, upon which the aforementioned order was predicated, reflects that a meeting of all fund members was held in Orlando on April 15, 1969, at which time it was determined, among other things, 'because of the insolvency of the insurance carrier which reinsured the said fund for the period from July 1, 1961 through December 31, 1966, there are now insufficient funds available for the payment of claims for which the fund is liable based upon injuries occurring subsequent to July 1, 1961 and prior to January 1, 1967'. The petition further reflects that although the Commission had previously entered an order directing the payment of premium and assessment balances due, the Trustees were unsuccessful in collecting sufficient monies to permit the discharge of all liabilities and that the trustees had 'determined that it would be necessary to impose additional assessment to secure the necessary monies to permit the discharge of fund obligations on behalf of the members'. The petition additionally reflects that the agreement pursuant to which the self insurers fund was created and filed with the Commission in accordance with the provisions of Chapter 440 provided:

'2. That the Fund agreement filed with the Florida Industrial Commission and approved as set forth in Paragraph One (1) hereof, provides that the members of the Fund will jointly and severally covenant to assume and discharge, by payment, any lawful awards against any member of the group entered by the Commission and subsequently sustained by the Courts, wherein appeal is taken by either party. The indenture further provides that 'the members of this Fund do jointly covenant and agree that they will pay any such award as would otherwise be a claim against the surety bond or government bonds above mentioned, as soon as the same shall become payable under the laws of the state of Florida;"'

At this juncture it should be pointed out that every employer within the provisions of the Workmen's Compensation Law is liable for and must secure the payment for his employees for the compensation payable under the Act. The employer may discharge the responsibility of securing compensation either by obtaining appropriate insurance coverage or by becoming a self insurer (F.S. section 440.38, F.S.A.). The provisions of Chapter 440, as well as the rules and regulations promulgated thereunder, set forth the necessary prerequisites to becoming a self insurer. One such requirement pursuant to Rule 8AW--4.21, Fla.Adm.Code, is the filing of an indemnity agreement with the Commission executed by the members of such self insurer fund. ¹

Appended to the petition of the Trustees is an exhibit listing in excess of 200 members upon whom various assessments were levied for the years 1961--1966. An assessment of $8,779.43 was imposed on 'Ronnie's Restaurant & Coffee Shop', member number 074 for the years 1961 through 1966. Based upon the order of the Commission entered on June 20, 1969, which was predicated upon the aforementioned petition, the plaintiffs filed a complaint on August 15, 1969, against the named delinquent members of the Florida Restaurant Self Insurers Fund in the amount and for the years named in the exhibit. The complaint which originally named 'Larry Leckart d/b/a Ronnie's Restaurant & Coffee Shop' alleged that the said defendant (and all other members of the self insurers fund named therein) had refused or failed to comply with the order of the Commission and requested the court to 'issue a rule nisi directed to the defendants to show cause why writ of execution or other such process to enforce the terms of the order shall not be issued'. In addition, the complaint asked for costs and 'reasonable attorneys' fees'. The complaint seeking the issuance of a rule nisi was filed pursuant to the provisions of Section 440.24 relating to the procedure to be utilized in the enforcement of compensation orders. Subsequent to the filing of this complaint the court, pursuant to the joint agreement of the parties, entered an order dismissing the complaint insofar as it related to the defendant 'Larry Leckart d/b/a Ronnie's Restaurant & Coffee Shop'. Thereafter the plaintiffs moved to amend the complaint for the purpose of joining as a defendant 'Colonial Restaurant Corporation d/b/a Ronnie's Restaurant' which motion was granted by the trial court. Defendant filed a general denial of the allegations in the plaintiff's complaint, further alleging that 'it was not a party to nor did it receive notice of proceedings for the Florida Industrial Commission which resulted in the entry of the order * * * and which the plaintiff seeks to enforce in these proceedings'. Defendant additionally filed a motion to strike the allegation relating to 'reasonable attorneys' fees' as well as defensive motions seeking to dismiss the complaint on the ground that it did not state the facts upon which any relief could be granted against that named defendant. Defendant's defensive notions were predicated upon: the absence of any allegation of fact in the original or amended complaint pertaining to Colonial Restaurant upon which any relief could be granted against Colonial Restaurant; that Colonial Restaurant was not named as a party to the proceedings before the Florida Industrial Commission; that the trial court lacked jurisdiction to enforce the order; that the Florida Industrial Commission attempted to unconstitutionally apply the provisions of F.S. section 440.58, F.S.A., retroactively contrary to the requirements of due process and equal protection of the law; that the provisions of Section 440.58, if applied to Colonial Restaurant, constituted an impairment of the obligation of contract.

Hearings were held before the trial court at which time testimony was taken and exhibits introduced. Among the documents introduced was a certificate executed by the chief of the Bureau of Workmen's Compensation, Division of Labor, Florida Department of Commerce, reflecting that the order of the full Commission dated June 20, 1969, was transmitted to 'Ronnie's Restaurant & Coffee Shop' by certified mail, with a return receipt. ² In addition, plaintiffs introduced an affidavit filed with the Clerk of the Circuit Court of Orange County pursuant to the Fictitions Name Statute (F.S. section 865.09, F.S.A.) reflecting that Colonial Restaurant Corporation was doing business under the name 'Ronnie's Restaurant'. The affidavit reflects that it was executed on January 17, 1970, and filed with the clerk on September 24, 1970. The trial court entered a final judgment on September 24, 1970, finding that the court had jurisdiction over the parties and subject matter 'under Section 440.24, Florida Statutes (F.S.A.)' and declaring that the plaintiffs were entitled to recover the $8,779.43 assessment together with attorneys' fees in the amount of $3,073.00.

Defendant's appeal is based primarily upon the same matters alleged in its defensive motions and can be condensed into two main points: (1) whether an assessment against a self insurer and the payment of attorneys' fees in connection with the collection thereof may be enforced pursuant to the provisions of Sections 440.24(1) and 440.34(1); and (2) whether the payment of such assessment and attorneys' fees may be imposed upon a defendant who is not a party to the proceedings giving rise to the assessment.

As to the first point, a review of Sections 440.24(1) and 440.34(1) reflects that the provisions thereof are concerned with the enforcement of 'any compensation order', 'payment of compensation', or 'award for compensation'. Compensation is defined in Section 440.02(11) as 'money allowance payable to an employee or to his dependents as provided for in this chapter'. The introductory language to Section 440.24(1) provides that 'in case of default by the employer or carrier in the payment of compensation due under Any compensation order of a...