12 Fla. L. Weekly Supp. 665b
Insurance — Personal injury protection — Workers’ compensation lien — Action by insured injured in automobile accident while in course and scope of his employment against PIP carrier that seeks to apply deductible and then pay 80% of balance due for satisfaction of workers’ compensation lien — Insurer is precluded from applying deductible in satisfaction of workers’ compensation lien because to do so would not assure complete coverage to insured for work-related injuries — To avoid duplication of coverage, PIP check should be made payable directly to workers’ compensation carrier — Insured need not pay workers’ compensation lien before seeking reimbursement from PIP insurer — Attorney’s fees — Insured is entitled to pro-rata share of attorney’s fees and costs — Contingency risk multiplier of 2.0 is awarded where likelihood of success was even at outset and amount involved, results obtained and fee arrangement in light of relevant market would require multiplier to obtain competent counsel — Costs, expert witness fee and prejudgment interest awarded
CHRISTOPHER P. MACMILLAN, Plaintiff, vs. HARBOR SPECIALTY INSURANCE COMPANY, Defendant. County Court, 6th Judicial Circuit in and for Pinellas County. Case No. 522002CC007134XXCOCO. REF. 02-007134-CO-039. September 4, 2003. Walt Fullerton, Judge. Counsel: Roy L. Glass, St. Petersburg, for Plaintiff. Joshua D. Goldis, St. Petersburg, for Defendant.
FINAL JUDGMENT FOR PLAINTIFF
Plaintiff, CHRISTOPHER P. MACMILLAN, brought suit in a four (4) count complaint for Declaratory Relief, PIP Breach of Contract, PIP Failure to Timely Pay and a PIP Statutory Claim seeking attorneys’ fees pursuant to Sections 627.428 and 57.105, Florida Statutes against Defendant, HARBOR SPECIALTY INSURANCE COMPANY, (“INSURANCE”).
On May 7, 2003 the Court granted Plaintiff’s motion for summary judgment. Because the parties could not agree upon the wording of the Order, the Court entered its written Order May 28, 2003.
INSURANCE appealed, but the Appellate Court has taken no action until Final Judgment is entered.
The case came before the Court again on August 5, 2003 for an evidentiary hearing upon Plaintiff’s motion for fees and costs.Summary Judgment for Plaintiff
In granting Summary Judgment the Court considered the argument of counsel, the pleadings of record including responses to Interrogatories and Admissions. Based upon those uncontested facts the Court found that:
1. On September 10, 1999 while in the course and scope of his employment the Plaintiff was injured in an automobile crash.
2. Suit was filed against the third party at fault tortfeasor and the case was settled for $35,000.00.
3. On the date of the crash INSURANCE had a policy with Plaintiff for personal injury protection (PIP) benefits. There was a $2,000.00 deductible upon the policy.
4. Plaintiff reserved those PIP benefits for the purpose of satisfying an anticipated workers’ compensation lien.
5. Out of a total of approximately $9,738.43 in medical bills related to this accident, Plaintiff’s employer’s workers’ compensation carrier, Florida Retail Self-Insurers Fund (“Florida Retail”) paid $5,365.66 through July 2, 2002 for past medical bills.
6. Plaintiff and Florida Retail agreed to resolve the workers’ compensation lien, including future benefits, for the total sum of $5,000.00.
7. On or about July 19, 2002 Plaintiff requested that INSURANCE issue its check under the PIP coverage in the amount of $5,000.00 payable to Florida Retail for satisfaction of the workers’ compensation lien.
8. INSURANCE, however, claimed that it was entitled to apply the $2,000.00 policy deductible against that $5,000.00 and then pay only 80% of the balance.
9. INSURANCE issued a check to Florida Retail on or about July 25, 2002 in the amount of $2,400.00 ($5,000.00 less $2,000.00 x 80% = $2,400.00).
10. Plaintiff rejected and returned the $2,400.00 check.
11. Additionally, Plaintiff requested $2,100.00 in attorney’s fees permitted by Section 440.39(3)(a), Florida Statutes ($5,000.00 workers’ compensation lien is approximately 15% of $35,000.00 third party settlement. $14,000.00 attorneys’ fees paid x 15%=$2,100.00).
12. The workers’ compensation carrier, Florida Retail, has not yet been paid in satisfaction of its lien. The $5,000.00 received by Plaintiff from its settlement with the third party remains held in trust by Plaintiff’s counsel pending the outcome of this case.
Plaintiff filed this lawsuit because INSURANCE would not make the $5,000.00 payment as requested. Instead, INSURANCE attempted to pay the reduced sum of $2,400.00.
At the hearing upon the motion for summary judgment INSURANCE made a different argument. Even though INSURANCE had conceded the obligation to pay by tendering its check, it now maintained that the primary issue turned upon whether the workers’ compensation lien must be satisfied by Plaintiff before INSURANCE must make any payment to Plaintiff under his PIP coverage.
The possibility of “double payment”, however,” was obviated by Plaintiff’s suggestion that INSURANCE issue the PIP payment made payable to Florida Retail so that the lien was sure to be satisfied. In fact, INSURANCE did exactly that by tendering $2,400.00 payable directly to Florida Retail.
Additionally, Plaintiff’s entitlement to attorneys’ fees permitted by Section 440.39(3)(a) Florida Statutes, became an issue.
In granting Summary Judgment this Court found that the PIP carrier is precluded from applying a deductible in the satisfaction of a workers’ compensation lien because to do so would not assure complete coverage to the insured for his injuries sustained in a work related accident.
Had Plaintiff requested that INSURANCE make PIP benefits first, Plaintiff would have had a greater initial exposure, even after application of the $2,000.00 deductible, because the medical bills well exceeded the scheduled amounts paid by the workers’ compensation carrier.
The Second District Court of Appeals addressed the deductible issue in Fortune Insurance Company vs. McGhee, 571 So.2d 546 (Fla. 2nd DCA, 1991) at p547 when it reasoned:
We hold that a PIP deductible can be exhausted by payment from other sources including workers’ compensation coverage, and need not be exhausted by payments from the claimant’s personal funds. . .
Thus, the PIP deductible has already been satisfied in this case and must not be applied to the PIP benefits ultimately due. . .because to do so would not provide complete insurance coverage. . .
Plaintiff is entitled to those benefits only to the extent that Plaintiff would not thereby receive double payment from both workers’ compensation and PIP. Atlanta Casualty Company v. Yadevia, 579 So.2d 213 (2nd DCA 1991).
So as to avoid duplication of coverage the PIP check could be payable directly to the workers’ compensation carrier, as was requested in this case, in satisfaction of the agreed lien amount and as INSURANCE initially attempted to do by issuing its check in a lesser amount.
In the Fortune case, Ibid., the court reviewed a similar set of facts. There it was held that:
When the liability claim is settled, however, the plaintiff is obligated to reimburse the workers’ compensation carrier. At that point, the plaintiff is entitled to receive additional benefits from the PIP carrier because the credit for workers’ compensation no longer exists.
In granting Summary Judgment for Plaintiff the Court rejected INSURANCE’S contention that the workers’ compensation lien must be paid by Plaintiff before a PIP insured is entitled to reimbursement from his PIP carrier.
The Second District Court of Appeals again reviewed this issue in Delehanty v. Coronet Insurance Company, 619 So.2d 990 (Fla. 2nd DCA 1993). In reiterating its previous Fortune decision, the Court mentions the word “paid” when it reasoned that:
Plaintiff is entitled to PIP benefits only to the extent that her satisfaction of the (workers’) compensation lien. . .depleted the amount of. . .settlement with the tortfeasor, i.e., to the extent plaintiff paid the workers’ compensation carrier for satisfaction of the workers’ compensation lien. . .
Plaintiff argues and this Court agrees that there is no requirement that the insured actually pay before being entitled to either PIP or workers’ compensation benefits.
A PIP insured is entitled to receive additional benefits from the PIP carrier so that Plaintiff can pay or satisfy a workers’ compensation lien when the third party liability claim has been settled. The insured need not pay from personal funds or otherwise satisfy the workers compensation lien before seeking such payment from the PIP carrier. In this case “to the extent plaintiff paid”, would be satisfaction of the lien upon settlement of the liability claim. The PIP check made payable to workers’ compensation satisfies that lien.
Frankly, the disputed issue argued by INSURANCE is a distinction without a difference. When INSURANCE issues the PIP check made payable to Workman’s compensation, the lien is paid. Plaintiff’s settlement with the tortfeasor is not depleted. All parties are satisfied, or should have been.
Plaintiff also rightfully claims a pro-rata share of attorney’s fees and costs permitted by section 440.39(3)(a), Florida Statutes. Delehanty, Ibid. at990:
In this case the trial court erroneously declined to find that Plaintiff was entitled to recover from his PIP carrier the above referenced “amount of attorney’s fees and costs permitted by section 440.39(3)(a).”
Therefore, this Court awards to Plaintiff the requested sum of $2,100.00. As a result, satisfaction of the workers’ compensation lien and fees shall not and, in fact, will not exceed the maximum amount, $8,000.00, of Plaintiff’s PIP coverage.Plaintiff’s Award of Attorneys’ Fees and Costs
At issue in the motion for fees and costs was the number of hours Plaintiff’s counsel devoted to this matter and the hourly rate requested by counsel. Also contested was whether Plaintiff’s request for a multiplier is appropriate and if so, the factor to use in calculating the multiplier.
At the beginning of the August 5, 2003 hearing the Defendant acknowledged Plaintiff’s entitlement to a reasonable award. In dispute also was the point in time when Plaintiff became aware that his entitlement to an award of fees and costs would not be contested by INSURANCE.
Having considered the pleadings, testimony, documentary evidence and argument and pursuant to Sections 627.736(8) and 627.428, Florida Statutes, Plaintiff’s motion is granted.
Under the standards and factors as set out in Bell v. U.S.B. Acquisition Company, Inc., 734 So. 2d 403 (Fla. 1999); Standard Guaranty Ins. Co. v. Quanstrom, 555 So. 2d 828 (Fla. 1990); Florida Patient’s Compensation Fund v. Rowe, 472 So. 2d 1145 (Fla. 1985); and having analyzed the articulated fee criteria the Court finds as follows:
1. Plaintiff is entitled to an award of attorney’s fees and prejudgment interest on the fee award as was acknowledged by INSURANCE.
2. Costs in the amount of $136.50 are uncontested.
3. Plaintiff’s counsel, Roy L. Glass, reasonably devoted twenty (25.6) hours at $300 per hour for a total of $7,680.00 to this case.
4. Plaintiff’s expert, Bradley Souders, reasonably devoted three (3) hours at a reasonable rate of $250.00 per hour for a total fee of $750.00.
5. A 2.0 multiplier is awarded because the likelihood of success was approximately even at the outset and because the amount involved, results obtained and fee arrangement in light of the relevant market would require a fee multiplier to obtain competent counsel in order to present this matter.
Therefore, Final Judgment shall enter in favor of Plaintiff, CHRISTOPHER P. MACMILLIAN, against the Defendant, HARBOR SPECIALTY INSURANCE COMPANY in the principal amount of $5,000.00, together with fees and costs of:
Plaintiff’s pro rata fees of settlement: $2,400.00
Interest upon pro rata fee: 168.00
Plaintiff’s fees with multiplier: 15,360.00
Interest upon fee: 307.20
Expert fee: 750.00
Total: $18,985.20
Prejudgment interest upon $5,000.00 principal in the amount of $350.00 and court costs of $136.50 shall be added to the principal sum for a total Final Judgment in the amount of $24,471.70. For these sums let Execution issue. Interest shall accrue at six (6%) percent until paid or satisfied.
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