By: Fred Vitale, Associate, Tampa

Just prior to the Florida Supreme Court’s decision in Castellanos, the First DCA issued another important opinion regarding attorney’s fees in Miles v. City of Edgewater Police Department, Case No. 1D15-0165, 41 Fla. L. Weekly D 985 (Fla. 1st DCA April 20, 2016), finding a portion of the attorney fee section of Chapter 440 unconstitutional, and thereby paving the way for claimants to contract directly with their attorney for payment of reasonable attorney’s fees.

It is a first-degree misdemeanor for an attorney to accept a fee not approved by the JCC under 440.105(3)(c). A claimant is not permitted to pay their attorney out of their own pocket to represent them. These prohibitions were challenged in the Miles case.

Miles was a police officer who filed an exposure claim which the employer/carrier denied.  The claimant’s first attorney withdrew, and the claimant retained a second attorney. Because proving exposure claims can be very difficult and expensive, her new attorney only agreed to represent the claimant if there was a retainer.  The police union, on behalf of the claimant, agreed to pay a $1,500.00 retainer ($100.00 per hour for 15 hours) and the claimant agreed to pay an hourly fee once the retainer was depleted.   The claimant acknowledged that the law prohibited such a fee arrangement, but she specifically waived those prohibitions.

The claimant’s attorney filed a motion to have the JCC approve the retainer agreement, and he certified that if the fee agreement was not approved, he would have to withdraw due to the costs of litigation.  The JCC denied the fee agreement, and the Claimant’s second attorney withdrew. The claimant proceeded to trial pro se.  She filed 6 affidavits from attorneys who refused to take her case under the contingent guideline fee.  The claimant could not carry her burden of proof and lost her case.  The claimant then appealed the JCC’s denial of the retainer agreement and compensability of her claim.

The First DCA found that, as applied in this situation, the statute prohibited the claimant from hiring an attorney and it violated her right to Freedom of Speech (the claimant’s own words given voice through her attorney).  Because the statute makes it a crime for an attorney to accept a fee that is not approved by the JCC, and the JCC could not approve a fee that was not tied to the amount of benefits secured, the two statutory sections operated as an unconstitutional infringement on her right to hire an attorney.  

The Court also found that the statute unconstitutionally violated the claimant’s right to contract and her right to seek redress of grievances.   These statutory sections are intended to protect claimants, but actually operated to harm this claimant by discouraging attorneys from representing her.   The First DCA held that a claimant can waive the prohibitions in the statute and agree to pay her attorney with her own funds, subject to a JCC’s finding that the fee is reasonable.   

Even though this only applies to claimant paid fees, it will likely increase litigation and settlement costs.   Employers and carriers will undoubtedly be seeing an indirect increase in exposure resulting from this decision.