Coon v. Continental Ins. Co.

• Decision Date: 09 July 1987
• Docket Number: No. 69468,69468
• Citation: 511 So.2d 971,12 Fla. L. Weekly 335
• Parties: 12 Fla. L. Weekly 335 Pamela COON, as Personal Representative of the Estate of Jerry Frank Coon, Deceased, Petitioner, v. The CONTINENTAL INSURANCE COMPANY, c/o Underwriters Adjusting Company, Respondent.
• Court: Florida Supreme Court

Page 971

511 So.2d 971

12 Fla. L. Weekly 335

Pamela COON, as Personal Representative of the Estate of Jerry Frank Coon, Deceased, Petitioner, v. The CONTINENTAL INSURANCE COMPANY, c/o Underwriters Adjusting Company, Respondent.

No. 69468.

Supreme Court of Florida.

July 9, 1987.

Rehearing Denied Sept. 30, 1987.

Joel S. Perwin of Podhurst, Orseck, Parks, Josefberg, Eaton, Meadow and Olin, P.A., Miami, and Wagner, Cunningham, Vaughan and McLaughlin, P.A., Tampa, for petitioner.

Michael L. Rosen and Charles E. Bentley of Holland and Knight, Tallahassee, for respondent.

John P. Shevock of Gillespie, McCormick, McFall, Gilbert and McGee, Fort Lauderdale, for amicus curiae Academy of Florida Trial Lawyers.

BARKETT, Justice.

We have for review Continental Insurance Co. v. Coon, 493 So.2d 485 (Fla. 2d DCA 1986), which expressly and directly conflicts with Alexsis, Inc. v. Bryk, 471 So.2d 545 (Fla. 4th DCA 1985). We have jurisdiction. Art. V, § 3(b)(3), Fla. Const. We approve in part and quash in part the decision of the court below.

On November 4, 1981, Jerry Frank Coon was injured in an industrial accident and died five days later. His widow and personal representative of his estate, Pamela Coon, instituted a wrongful death action against third-party tortfeasors that the estate contended were responsible for Coon's death. The insurance carrier responsible for worker's compensation payments arising from Coon's injury and death, Continental Insurance Company, filed a claim of lien against a settlement received by the Coon family from several of the alleged third-party tortfeasors. Under this lien, which was authorized under section 440.39(3)(a), Florida Statutes (1981), Continental contended that it was entitled to be reimbursed for the full amount of $71,336.45 it paid to Coon's estate or his survivors.

The trial court determined that the lien should be reduced pro rata so that Continental would share in paying the attorney's fees and costs incurred by the Coon estate in prosecuting its wrongful death claim. Continental thus received a net recovery of only $30,445.49, which was deducted from the separate tort settlements paid to Pamela Coon and the surviving children. Continental subsequently appealed to the Second District, arguing that this proration was improper. The Coon estate cross-appealed on grounds that its settlement with the third-party tortfeasors was below the actual value of the damages, and that Continental's recovery also should have been reduced pro rata to reflect this difference. As its second point on cross-appeal, the Coon estate argued that the trial court erred in reducing the children's separate settlement, since the children were not named beneficiaries of the worker's compensation award.

The narrow issue before us is the construction of a portion of Florida's Worker's Compensation Law, section 440.39(3)(a), Florida Statutes (1981). Initially, we observe that the legislature in 1983 substantially amended this section to provide that the "carrier's lien" must be reduced by its pro rata share of attorney's fees and expenses incurred to effectuate a recovery against third-party tortfeasors. Thus, under the law as amended in 1983, Continental's single claim on appeal would be without merit.

However, this case arose under the law as it existed in 1981, when Coon was injured. In pertinent part, section 440.39(3)(a), Florida Statutes (1981), said:

Upon suit being filed, the employer or the insurance carrier, as the case may be, may file in the suit a notice of payment of compensation and medical benefits to the employee or his dependents, which said notice shall constitute a lien upon any judgment or settlement recovered to the extent that the court may determine to be their pro rata share for compensation and medical benefits paid or to be paid under the provisions of this law. The employer or carrier shall recover from the judgment, after attorney's fees and costs incurred by the employee or dependent in that suit have been deducted, 100 percent of what it has paid and future benefits to be paid, unless the employee or dependent can demonstrate to the court that he did not recover the full value of damages sustained because of comparative negligence or because of limits of insurance coverage and collectibility.

(Emphasis added.)

Coon's estate argues that the statute is inherently ambiguous in that the "pro rata share" language conflicts with the language permitting a carrier to recover 100 percent of what it has paid. Coon's estate thus urges us to apply the rule of statutory construction that, when ambiguity exists, we must adopt the interpretation that best accords with the underlying purpose of the statute. This purpose, argues the Coon estate, is to shoulder on industry the expense incident to the hazards of industry and to lift from the public the burden of supporting those incapacitated by industry. General Properties Co. v. Greening, 154 Fla. 814, 18 So.2d 908 (1944).

While we cannot disagree with this statement of purpose, we are unpersuaded that it requires us to accept the Coon estate's first two arguments on appeal: (1) that the carrier's lien should be reduced by a pro rata share of attorney's fees and costs incurred in suing or settling with third-party tortfeasors, and (2) that the lien should be reduced pro rata so that Continental would share in the reduction below actual damages that allegedly is reflected in the settlement.

Rules of construction "are useful only in case of doubt and should never be used to create doubt, only to remove it." State v. Egan, 287 So.2d 1, 4 (Fla.1973). We do not find any ambiguity that would necessitate applying rules of construction, especially since we believe these rules would lead to a result contrary to the legislative intent. In the case at bar, we agree with Continental that the proration requirement in section 440.39(3)(a) as it existed in 1981 refers only to those instances where the employee or survivors cannot collect the full amount of damages because of comparative negligence or the limits of insurance coverage and collectibility. To adopt the estate's interpretation of the statute would give no effect whatsoever to the clear language that a carrier can recover 100 percent except in these specific instances. Since the 1981 statute makes no mention of reducing the lien by either the amount of attorney's fees or because of a settlement below the actual value of damages we cannot accept the estate's arguments on either of these points.

Moreover, we cannot find, as Coon's estate contends, that the 1983 amendment constituted a legislative clarification of the "true" intent to mandate proration of attorney's fees and costs. The legislative staff analysis that accompanied adoption of the 1983 amendments supports only the opposite conclusion:

Presently, if an employee brings a suit against a third-party tortfeasor for an injury that resulted in worker's compensation being paid, the employer/carrier is entitled to reimbursement for 100 percent of compensation benefits paid. The employer/carrier does not share in the cost of the attorney's fees incurred by the claimant. The bill deducts from the reimbursement to the employer/carrier its pro rata share of the court costs and attorney's fees incurred by the employee.

Senate Staff Analysis, Bill No. HB-1277 (June 27, 1983) (emphasis added). Nowhere does the bill or the analysis portray the bill as a "clarification," nor does it recite that the courts improperly...