REGAL WOOD PRODUCTS AND HEWITT & ASSOCIATES, APPELLANTS,
v.
PETER BASCHANSCI, APPELLEE
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In a workers' compensation appeal, the First District Court of Appeal affirmed the judge of compensation claims' finding of bad faith against the employer and its insurance carrier, but reversed and remanded the award of $27,500 in attorney's fees because the JCC's justifications for departing from the statutory fee formula were insufficiently supported or unsupported by evidence.
The court affirmed the finding of bad faith based on ample evidence of delay in payments and miscalculations. However, the court reversed the $27,500 attorney's fee award because several of the JCC's conclusions regarding the statutory fee factors were either insufficient or unsupported by evidence, and remanded for reconsideration with the requirement that any departure from the statutory formula be supported by competent evidence.
[1] A judge of compensation claims may find an employer/carrier acted in bad faith in handling a workers' compensation claim based on evidence of delay in payments and miscal…
[2] Delay in the payment of workers' compensation benefits can constitute sufficient economic loss to justify a bad faith attorney's fee award.
Previewing 2 of 6 headnotes on this case. FLexlaw’s editorially structured points of law — every proposition, pinpointed — are reserved for members.
Join FLexlaw to unlock all legal intelligence“Without detailing the evidence, suffice it to say that there was ample evidence of delay in payments and miscalculation of the amount due to claimant to support the JCC's finding of bad faith.”
Establishes that the appellate court found sufficient evidence to support the bad faith finding and therefore affirmed that portion of the lower court's order.
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Join FLexlaw to unlock all legal intelligenceThe employer Regal Wood Products and its insurance carrier Hewitt & Associates (E/C) mishandled a workers' compensation claim through delayed payments…
The full statement of facts, procedural history, and disposition for this case are member content.
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ERVIN, Judge.
Appellants in this workers’ compensation appeal, the employer, Regal Wood Products, and its insurance carrier, Hewitt & Associates (E/C), seek review of an order wherein the judge of compensation claims (JCC) found that the E/C acted in bad faith in handling the claim and directed the E/C to pay claimant’s attorney $27,500 as a reasonable attorney’s fee. Because the record contains competent, substantial evidence to support the finding of bad faith, we affirm that portion of the order. We reverse, however, that portion of the order finding $27,500 to be a reasonable attorney’s fee, because several of the reasons the JCC propounded to justify his departure from the statutory fee formula are either insufficient or unsupported.
Without detailing the evidence, suffice it to say that there was ample evidence of delay in payments and miscalculation of the amount due to claimant to support the JCC’s finding of bad faith. See Wometco Enters. v. Caballero, 585 So. 2d 1072 (Fla. 1st DCA 1991) (E/C’s erratic payment of benefits from timely to untimely and in incorrect amounts over a period of seven years with no explanation for late payments or miscalculations supported bad faith finding). The delay in the payment of benefits to claimant constitutes sufficient economic loss so as to justify a bad faith attorney’s fee. Barosy v. Landscape Crane, 418 So. 2d 400, 401 (Fla. 1st DCA 1982).
As for the amount of the fee, the JCC determined that strict application of the statutory fee formula set out in Section 440.34(1), Florida Statutes (1979), would result in an inequitable fee to claimant’s attorney, and, after considering the factors set out in subsections 440.34(l)(a)-(h), concluded that a fee of $27,500 was reasonable. Although we find no fault in many of the JCC’s conclusions regarding the statutory factors, we find that several of those conclusions are either insufficient or unsupported.
As to the first factor, “[t]he time and labor required, the novelty and difficulty of the questions involved, and the skill requisite to perform the legal service properly,” 1 the JCC concluded this to be a positive factor, supporting an upward departure from the statutory fee. In so concluding, the JCC relied on a fee affidavit and testimony from claimant’s attorney indicating that he had spent 125 hours on the case since his initial involvement in 1982. That amount of time included, however, time spent preparing for the attorney-fee hearing, traveling to the hearing, and attending the hearing. Admittedly some of that time was expended on proving the bad faith issue, which may be considered in the attorney’s fee. See Crittenden Orange Blossom Fruit v. Stone, 514 So. 2d 351, 353 (Fla.1987). However, some portion of that time was also expended on proving the amount of the fee, which is not includable in a fee award. See id. at 353; Barr v. Pantry Pride, 518 So. 2d 1309, 1319-20 (Fla. 1st DCA 1987), review denied, 525 So. 2d 876 (Fla.1988). Additionally, it was not disputed before this court that the fee affidavit included at least one entry associated with an unrelated claim. Consequently, claimant’s attorney, on remand, should submit a detailed affidavit, including only the time spent on this claim and excluding the time spent in proving the amount of the fee.
As for the balance of the first factor, although the JCC found that the issues involved were not novel or difficult, he nonetheless concluded that a significant degree of skill and expertise was required to achieve the results. Admittedly, claimant’s attorney is a specialist in the area of workers’ compensation, however, because all the evidence indicates that the issues involved were not novel or difficult, consisting merely of increases in the average weekly wage based on an insurance fringe benefit and standard cost of living increases, regardless of the attorney’s expertise, it is not logical to conclude that a high degree of skill was necessary to obtain the result reached on these simple issues.
The only other conclusion that we find unsupported is that concerning the fifth factor, i.e., “[t]he time limitation imposed by the claimant or the circumstances.” 2 The JCC considered this a positive factor in that a significant amount of time had to be expended on the case, and because the E/C contested claimant’s entitlement to various benefits, thereby requiring litigation. We believe the JCC has misinterpreted the factor by merely considering the amount of hours expended, which properly falls under factor (a). This factor generally encompasses instances where an attorney must act quickly in order to secure benefits for the claimant, see What an Idea, Inc. v. Sitko, 505 So. 2d 497, 501 (Fla. 1st DCA) (time limitations placed on counsel due to claimant’s condition: brain-damaged, quadriplegic who was suicidal), review denied, 513 So. 2d 1064 (Fla.1987), or when the attorney gives up vacations and weekends to pursue the claim, id., or when the case precludes the attorney from handling other cases, see Fumigation Department v. Pearson, 559 So. 2d 587, 589 (Fla. 1st DCA 1989). Here, there is no evidence that claimant’s condition imposed time restraints on his attorney. In fact, claimant was capable of working, although not at his former level, and consequently was not as needy as a claimant who is, for instance, permanently and totally disabled. Moreover, there was no evidence that this case particularly precluded counsel from working on other cases or that counsel sacrificed weekends or vacations to work on this claim.
As for the fact that the E/C contested the claim for various benefits, thereby requiring litigation, such action was warranted as evidenced by the fact that the E/C prevailed on two of the three claimed bases for increasing the average weekly wage — concurrent employment earnings and the value of a vehicle used in such employment. The E/C should not be penalized for appropriately disputing a claim. As to the third basis, the insurance fringe benefit, the E/C did stipulate to that increase prior to the hearing.
In conclusion, because the reasons given by the JCC as to the above factors are insufficient or unsupported, they cannot be used to justify a departure from the statutory fee. We therefore reverse the order as it relates to the amount of the attorney’s fee and remand for reconsideration of the fee. See Marsh v. Benedetto, 566 So. 2d 324 (Fla. 1st DCA 1990) (fee award was excessive because evidence and findings of fact did not warrant exceeding statutory formula); Roundtree Transp., Inc. v. Godek, 412 So. 2d 66 (Fla. 1st DCA 1982) (reasons given insufficient to justify disparity between statutory fee and that awarded). In so saying, we do not preclude the JCC from awarding a fee in excess of the statutory amount, but merely caution that such award must be supported by the evidence.
AFFIRMED in part, REVERSED in part, and REMANDED for further proceedings.
SMITH and KAHN, JJ., concur. . § 440.34(l)(a), Fla.Stat. (1979).
. § 440.34(l)(e), Fla.Stat. (1979).
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Smith v. U.S. Sugar Corp. & Gallagher Bassett Serv., 624 So. 2d 315 (Fla. 1st DCA 1993)…attorney-fee hearing, so long as the time is related to proving the substantive issue of bad faith, rather than proving the amount of the fee. Crittenden Orange Blossom Fruit v. Stone, 514 So. 2d 351, 353 (Fla.1987); Regal Wood Prods. v. Baschansci, 603 So. 2d 551, 553 (Fla. 1st DCA 1992). Fees are awarded in cases of bad faith because, by establishing bad faith, the claimant’s attorney obtained a benefit for his or her client which was not otherwise available. Crittenden, 514 So. 2d at 353. Claimant’s attor…
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Hyatt Regency Grand Cypress & Scott Wetzel Servs. v. Williams, 639 So. 2d 1119 (Fla. 1st DCA 1994)…he merits order in which fee entitlement was established, has been excluded from the fee predicate since the supreme court’s ruling in Crittenden Orange Blossom Fruit v. Stone, 514 So. 2d 351 (Fla.1987). See, e.g., Regal Wood Products v. Baschansci, 603 So. 2d 551 (Fla. 1st DCA 1992); Dobbs v. Suncoast Acoustics, 590 So. 2d 7 (Fla. 1st DCA 1991). Even if these additional hours were necessitated by the employer/servicing agent’s resistance, so that the claimant’s attorney had to spend more tiriie in proving th…
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Steel Fabricators v. Jordan, 643 So. 2d 35 (Fla. 1st DCA 1994)…tage formula in section 440.34(1), Florida Statutes (1989). However, in departing from the percentage formula the judge referred to certain factors which do not comport with the standards announced in cases such as Regal Wood Products v. Baschansci, 603 So. 2d 551 (Fla. 1st DCA 1992). See also Bowe Septic Tank Service v. Grooms, 397 So. 2d 721 (Fla. 1st DCA 1981). Among other pertinent concerns, these cases indicate that an attorney’s fee should not be based on time and labor expended on unrelated claims, or…
Previewing 3 of 4 citing cases — full citator treatment, depth of discussion, and citing context are member features.
Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- Crittenden Orange Blossom Fruit v. Stone, 514 So. 2d 351 (Fla. 1987)
- What AN Idea, Inc. v. Sitko, 505 So. 2d 497 (Fla. 1st DCA 1987)
- Barr v. Pantry Pride, 518 So. 2d 1309 (Fla. 1st DCA 1987)
- Fumigation Dep't & Claims Ctr. v. Pearson, 559 So. 2d 587 (Fla. 1st DCA 1989)
- Marsh v. Carlos Benedetto and the Division of Workers' Compensation, 566 So. 2d 324 (Fla. 1st DCA 1990)
- Richards v. Fla. Parole & Prob. Comm'n, 418 So. 2d 400 (Fla. 1st DCA 1982)
- Brown v. State, 412 So. 2d 66 (Fla. 1st DCA 1982)
- Roundtree Transp., Inc. v. Godek, 412 So. 2d 66 (Fla. 1st DCA 1982)
- Wometco Enters. & Aetna Cas. & Sur. Co. v. Angelica Caballero & the Fla. Dep't of Labor & Emp. Sec., 585 So. 2d 1072 (Fla. 1st DCA 1991)