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application.jpgSadly, the first thought that crosses the mind of many insurance adjusters when a claim is made is how it can be denied. At the top of the list of the ways to deny claims is rescinding the insurance contract.

Black’s Law Dictionary defines rescission as an act “where a contract is canceled, annulled, or abrogated.” An insurance policy can be rescinded before or after a claim is made. Insurance companies prefer to wait until after a claim is made. The longer they wait, the more money they receive in premium payments. If no claim is made, the carrier keeps all the premiums and pays out nothing. If a claim is made, the carrier rescinds and refunds only those insurance premiums paid to keep the policy in effect after the rescission. Heads we win, tails you lose.

Thanks to favorable legislation and case law, it is surprisingly easy for insurance companies doing business in Florida to rescind policies. Among the more popular excuses is misrepresentation. Florida Statute 627.409 (2010) allows rescission on this basis if the carrier can show the following:

a) The misrepresentation, omission, concealment, or statement is fraudulent or is material either to the acceptance of the risk or to the hazard assumed by the insurer.

(b) If the true facts had been known to the insurer pursuant to a policy requirement or other requirement, the insurer in good faith would not have issued the policy or contract, would not have issued it at the same premium rate, would not have issued a policy or contract in as large an amount, or would not have provided coverage with respect to the hazard resulting in the loss.

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truck2.jpgBecause motor vehicles, like guns, in the wrong hands and used improperly are likely to cause great damage, Florida has developed two legal doctrines aimed at holding vehicle owners liable for the harm resulting from the negligent operation of their vehicles by others. The doctrines are vicarious liability and negligent entrustment.

Regarding motor vehicles, vicarious liability has been recognized in Florida since 1920. Southern Cotton Oil Co. v. Anderson, 80 Fla. 441, 86 So. 629 (1920). Under this doctrine, a vehicle owner is liable without fault for damages caused by the negligent operation of his or her vehicle by a consensual driver. (The owner is not liable, for example, if the vehicle is stolen. However, the doctrine may be applied against the owner if a non-consensual driver comes into possession of a vehicle through the owner’s negligence, such as where the owner leaves his car keys out at a house party of unsupervised young drinking adults. This element can bleed into the doctrine of negligent entrustment, explained below.) Damages available from the vicariously liable vehicle owner are capped by Florida Statute 324.021(9)(b)3, which means that actual damages may exceed the owner’s exposure.

The distinguishing element of negligent entrustment from vicarious liability is that the owner is independently at fault in granting consensual use of the vehicle. Florida courts consistently hold that one who negligently entrusts a car to someone is liable for damages flowing from the misuse of that car. Clooney v. Geetting, 352 So. 2d 1216 (Fla. 2nd DCA 1977) (“we see no reason why this theory is not available to claimants injured in automobile accidents in this state.”) The Florida Supreme Court long ago held that because the use of a dangerous instrumentality involves such a high degree of risk of serious injury or death, the highest degree of care is required. Skinner v. Ochiltree, 5 So. 2d 605 (Fla. 1941).
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doctor.jpgAccident victims often require medical attention. Medical malpractice sometimes makes their medical conditions worse, compounding the initial injuries with additional medical expenses and pain and suffering.

When the initial injuries are caused by the negligence of a third party, the victim is entitled to be compensated by the third party for both the initial injuries and the enhanced injuries resulting from the medical negligence.

In Dungan v. Ford, 632 So. 2d 159 (Fla 1st DCA 1994), the trial court allowed the Defendant to present expert testimony that a surgeon should not have performed a percutaneous diskectomy which resulted in more pain, suffering and expenses. The trial judge’s ruling was appealed. The appellate court held that the trial judge was wrong:

“It is well-established that a wrongdoer is liable for the ultimate negligence on the part of a physician who has treated an injury in such a way that the treatment may have increased the damage which otherwise would have followed from the original wrong. Stuart v. Hertz Corp., 351 So.2d 703 (Fla. 1977); Davidson v. Gaillard, supra; Rucks v. Pushman, 541 So.2d 673 (Fla. 5th DCA), rev. denied, 549 So.2d 1014 (Fla. 1989); 57 Am.Jur.2d Negligence § 149, and Restatement (Second) of Torts § 457 (1965). Cf. Barrios v. Darrach, 629 So.2d 211 (Fla. 3d DCA 1993).”

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surgery.jpgOne of the primary responsibilities of personal injury attorneys who represent Plaintiffs, those injured by the negligence of others, is to recover past and future medical expenses.

Recovering the past medical expenses requires proof that the charges are reasonable, related to the accident, and necessary. See Garrett v. Morris Kirschman & Co., Inc., 336 So.2d 566 (Fla. 1976).

Interestingly, while expert medical testimony is required to prove the relationship between the accident and the injuries, expert testimony is not always required to prove that the charges are reasonable and necessary. See, Id., and Albertson’s, Inc. v. Brady, 475 So.2d 986 (Fla. 2d DCA 1985), rev. denied, 486 So.2d 595 (Fla. 1986).

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law books.jpgFlorida employees injured at work may be able to bring a valid claim for damages against a third party. For purposes of this blog, a third party means an entity, including an individual, other than the employer or other entity entitled to workers’ compensation immunity. A third party case may exist if the work related injury was caused by the negligence or intentional act of the non-exempt entity. A simple example is where a deliveryman is injured in a motor vehicle accident by a negligent non-exempt third party. Because the accident happened in the course and scope of the employment, the worker would is eligible to recover both workers’ compensation benefits and personal injury damages.

Where workers’ compensation benefits have been furnished, Section 440.39 Florida Statutes creates a lien against the compensation the injured worker receives from a third party. In other words, the employer or its insurance carrier have the statutory right to be repaid from the money paid to the injured worker by the third party. “The lien statute has a straightforward and appropriate objective–the prevention of double recoveries by injured employees who have recovered statutory benefits under the workers’ compensation law but also have claims against responsible parties other than the employer. Jones v. Martin Elecs., Inc., 932 So.2d 1100, 1108 (Fla.2006). The statute allows the employer or insurer to be subrogated to the proceeds of such third-party tort recoveries to the extent of the amounts paid or to be paid by the employer or insurer.” Luscomb v. Liberty Mut. Ins. Co., 967 So.2d 379 (Fla. 3rd DCA 2007). Importantly, the workers’ compensation lien is capped at the claimant’s net recovery. City of Hollywood v. Lombardi, 770 So.2d 1196, 1202 (Fla.2000), and Aetna Insurance Co. v. Norman, 468 So.2d 226, 228 (Fla.1985).

The lien can be waived by the employer or carrier. However, this will typically come at the cost of the workers’ compensation case settling for less than if the lien remained in place.

When the lien isn’t waived, how is the claimant’s net recovery determined?

The formula, as set forth in the statute, can be difficult to comprehend. Extensive litigation has ensued over its meaning and application, with many appellate decisions attempting to explain the issues. In my opinion, the best play to start to understand the formula is the Florida Supreme Court case Manfredo v. Employer’s Casualty Insurance Company, 560 So.2d 1162 (Fla 1990).

This is the so-called “Manfredo Formula”: Third party settlement/recovery amount less (-) attorney fees and costs divided by (/) full case value = the % value of the wc lien.

Here’s the formula by way of a hypothetical example:

  1. WC lien (medical, indemnity, settlement, etc.): $ 100,000
  2. $ 250,000 third party settlement less fees (40%) and costs ($ 35,000) = $ 135,000
  3. Full case value: $ 1,000,000. (The case was for less due to tough liability, coverage limits, etc.)
  4. $ 135,000 divided by $ 1,000,000 = 13.5%
  5. 13.5% of $ 100,000 = $ 13,500.

Hence, the workers’ compensation employer/carrier recovers $ 13,500, 13.5%, of its $100,000 lien from the $250,000 personal injury recovery.

Resolving the WC lien is not always this simple. In the Aetna case, the Florida Supreme Court noted some complicating factors. In speaking of 440.39, the court wrote:

This very logical process, and the statute describing it, becomes more complicated because of the broad array of circumstances that may occur with the third-party claims and recoveries. They may be brought by the employee, employer, or insurer (based on the one-year windows described above), and the attorneys prosecuting the claims may therefore be compensated by the employee, employer, or insurer. The employee may have settled all the workers’ compensation medical and indemnity claims for a lump sum (as here), or the benefits may continue to be payable into the future. The third-party recoveries may exceed the total benefits paid and to be paid by the employer or its insurer, or they may be less than that total (as here). There may be multiple third-party claims and recoveries, and therefore multiple computations of the lien, and the recoveries may occur at different times. A particular recovery may be less than the “full value” of the third-party claim for a variety of reasons: other third-party tortfeasors may be responsible for some of the damages, the employee may have been comparatively negligent, or the plaintiff and counsel for the plaintiff may discount the value of the claim in order to avoid the risk and delay inherent in any lawsuit.

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cemetery1.jpgUnderstanding who may be eligible for compensation under the “Florida Wrongful Death Act,” sections 768.16 through 768.26, can be difficult, like piecing together a puzzle. Reproduced here is an easy to understand chart showing that information as well as the type of compensation that may be available. Of particular importance concerning these issues is Section 768.21 of the Act. It is that section which is broken down in the chart.

According to the Act, only statutory “survivors” and the decedent’s estate are eligible for compensation resulting from a loss caused by the intentional act or negligence of a third party. A Personal Representative, often the decedent’s family member, is appointed by the court to manage the estate after due notice to the survivors and other interested parties. The PR hires the attorney to prosecute the case to recover damages. While the survivors typically agree with the PR’s choice, they may hire their own attorney. The lawyer or lawyers will handle the case on a contingent fee basis.

The Act has survived many court challenges to its fairness. Many of its provisions are counter-intuitive and unfair. One of the most glaring faults involves an exemption for medical providers whose negligence caused death. (See Gigantic Loophole in Florida’s Wrongful Death Act.) Changes must come from the Florida Legislature.

Spouse Dies – Surviving Spouse but no Surviving Children
Spouse’s Damages:

  • Loss of Decendent’s Companionship and Protection
  • Mental Pain and Suffering from date of injury
  • Loss of Support and Services from date of injury to date of death (w/ interest)
  • Future Loss of Support and Services from date of death (at present value)
  • Medical and Funeral Expenses due to decedent’s injury/death if paid by survivor

Spouse Dies with Surviving Children and Surviving Spouse
Spouse’s Damages:

  • Loss of Decendent’s Companionship and Protection
  • Mental Pain and Suffering from date of injury
  • Loss of Support and Services from date of injury to date of death (w/ interest)
  • Future Loss of Support and Services from date of death (at present value)
  • Medical and Funeral Expenses due to decedent’s injury/death if paid by survivor

Childrens’ Damages:

  • Loss of Support and Services from date of injury to date of death (w/ interest)
  • Future Loss of Support and Services from date of death (at present value)
  • Minor children only (under the age of 25 – Section 768.18(2) Florida Statutes), or all children if there is no surviving spouse, may also recover loss of parental companionship, instruction, and guidance and mental pain and suffering from date of the injury

Parent Dies with Surviving Children but no Surviving Spouse
Surviving Children:

  • Loss of Support and Services from date of injury to date of death (w/interest)
  • Future Loss of Support and Services from date of death (at present value)
  • All children may recover loss of parental companionship, instruction, and guidance and mental pain and suffering from date of the injury

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In Owens v. Publix Supermarkets, Inc., 802 So. 2d 315 (Fla. 2001), the Florida Supreme Court described Florida’s slip and fall law as it then existed:

All premises owners owe a duty to their invitees to exercise reasonable care to maintain their premises in a safe condition. See, e.g., Everett v. Restaurant & Catering Corp., 738 So.2d 1015, 1016 (Fla. 2d DCA 1999). Despite this general proposition, when a person slips and falls on a transitory foreign substance, the rule has developed that the injured person must prove that the premises owner had actual knowledge or constructive knowledge of the dangerous condition “in that the condition existed for such a length of time that in the exercise of ordinary care, the premises owner should have known of it and taken action to remedy it.” Colon v. Outback Steakhouse of Florida, Inc., 721 So.2d 769, 771 (Fla. 3d DCA 1998).[4] Constructive knowledge may be established by circumstantial evidence showing that: (1) “the dangerous condition existed for such a length of time that in the exercise of ordinary care, the premises owner should have known of the condition;” or (2) “the condition occurred with regularity and was therefore foreseeable.” Brooks v. Phillip Watts Enter., Inc., 560 So.2d 339, 341 (Fla. 1st DCA 1990). In the latter category, evidence of recurring or ongoing problems that could have resulted from operational negligence or negligent maintenance becomes relevant to the issue of foreseeability of a dangerous condition. See generally Wal-Mart Stores, Inc. v. Reggie, 714 So.2d 601, 603 (Fla. 4th DCA 1998); Nance v. Winn Dixie Stores, Inc., 436 So.2d 1075, 1076 (Fla. 3d DCA 1983).

The court was reviewing a case where the Plaintiff (Owens) slipped on a banana peel inside a Publix supermarket. Arguing that Owens failed to present any evidence that it had actual or constructive knowledge that the banana piece was on the floor, Publix moved for a directed verdict. Finding that the evidence of the condition of the banana was insufficient to establish a basis for Publix’s liability, the trial court directed a verdict and entered final judgment for Publix.

From its analysis of the case before it and a handful of other Florida cases, the court concluded that “an injured person’s ability to establish constructive notice is often dependent on the fortuitous circumstance of the observed condition of the substance.” Finding this unacceptable, the court changed the law in premises liability cases involving transitory foreign substances by shifting the burden to the premises owner or operator to establish by the greater weight of evidence that it exercised reasonable care in the maintenance of the premises, “eliminating the specific requirement that the customer establish that the store had constructive knowledge” of the existence of the transitory foreign substance. See Kenz v. Miami-Dade County, at 13, n. 1 (Fla. App. 2013). In enacting section 768.0710, the Florida Legislature returned to the claimant the burden of proving that the premises owner or operator negligently failed to exercise reasonable care, but codified that part of Owens that a claimant was not required to prove actual or constructive notice of the transitory foreign substance.
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dollars.jpgIndividuals seriously injured through the negligence of others often require medical care and treatment long after the case is resolved. Settlements and jury verdicts must take these future medical expenses into account.

Some individuals harmed through the negligence of others are eligible for medical care through governmental or charitable services for a pre-existing disability unrelated to the tort claim. The most common of these services is Medicare.

Governmental and charitable reimbursements are always a fraction of a medical provider’s usual and customary charges. While the services may cover medical expenses related to the accident, there are no guarantees as to what will be covered and for how long. Given these factors, should juries be allowed to consider evidence of the reduced rates in calculating future medical expenses.

The answer in Florida appears to be Yes.

In State Farm v. Joerg, the trial court did not allow State Farm to introduce evidence that Joerg’s future medical expenses might be reduced under the Medicare program. The trial court’s decision was reversed on appeal.

Relying on Florida Physician’s Insurance Reciprocal v. Stanley, 452 So. 2d 514 (1984), a Florida Supreme Court case, Florida’s 2nd DCA held that since Joerg did not earn the Medicare benefit, the jury should be allowed to consider Medicare’s rates in calculating future medical expenses.
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law books.jpgOne of the primary objectives of every Plaintiff’s personal injury lawyer is to fairly and honestly maximize his or her client’s recovery. For Defendants and their insurance companies, the opposite outcome is their primary goal.

For a Plaintiff’s lawyer to be successful, he must know the personal injury insurance laws.

In the area of personal injury law involving motor vehicle accidents, uninsured/underinsured motorist insurance frequently comes into play. See F.S. 627.727. While there are many different aspects to UM/UIM coverage, this blog will focus on whether the UM/UIM carrier is entitled to a credit for the money its insured receives for personal injury damages from a self-insured.

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Tylenol can cause liver failure! It accounts for 40% of liver failure hospitalizations, Recommendations for FDA Interventions to Decrease the Occurrence of Acetaminophen Hepatotoxicitymore, more than “100,000 calls to Poison Control Centers, 56,000 emergency room visits, 2,600 hospitalizations and nearly 500 deaths” in this country annually. William M. Lee, Acetaminophen Toxicity: Changing Perceptions on a Social/Medical Issue, 46(4) Hepatology 966, 966 (2007).

While the brand name Tylenol has been used in the United States since 1955, id., it was not until the late 1990s that independent research established the link between acetaminophen, the active ingredient in Tylenol, and acute liver failure.
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