Gunn Law Blog

Murray v Mariner Health: The Florida Supreme Court Keeps Open the Courthouse Doors for Injured Workers

Emma Murray is a certified nursing assistant who suffered an injury when lifting a patient at work. She was diagnosed with a prolapsed uterus and underwent a total hysterectomy.  Her employer/carrier disputed the claim and asserted that there was no injury related to the lifting of the patient and that her claim was fraudulent making her guilty of the crime of insurance fraud.  Ms. Murray hired an experienced attorney and sued for the recovery of the denied benefits.  She won.  The judge hearing her case determined that the independent medical examiner's testimony was "most convincing" in relating her hysterectomy to the workplace incident.  Ms. Murray was awarded $3,244.21 in benefits.  Because Ms. Murray proved that she was wrongfully denied benefits, the judge then awarded her the statutory formula of $684.84, as attorney's fees for her counsel's 80 hours of attorney time.  This computed to $8.11 per hour.  The employer/carrier attorneys were paid by their client the amount of $16,050 (135 hours x $125 per hour), "win or lose", to lose the case.  An appeal of the claimant's fee award was taken arguing that the award was unconstitutionally too low.

In 2003, Florida's legislature passed "reforms" to its Worker's Compensation laws.  The changes included an effort to limit a claimant's right to recover a reasonable attorney's fees, as was provided for by the pre-2003 statutory scheme.  The 2003 amendments provided that a scheduled attorney's fee based upon 20% of the first $5,000 of the benefits secured, 15% of the next $5,000, and 10% of the first ten years of benefits and 5% of the next ten years of benefits secured be paid by the employer/carrier as claimant's attorney's fees.  Such fee shifting would only occur when the injured worker went to court and proved that the employer/carrier had failed to pay the benefits legally due under the law.  The 2003 amendments did not, however, delete an existing reference to "recovery of a reasonable attorney's fee from the carrier or employer" contained in another subsection of the Act.  Sections 440.43(1), (3), Florida Statutes (2003).  On October 23, 2008, the Florida Supreme Court held that the 2003 amendment merely created an ambiguity in the overall statutory scheme and held that the schedule of attorney's fees provision did not preclude an award of a higher "reasonable fee".  By its ruling, the Court avoided reaching a broader issue of whether the 2003 Amendments in totality were unconstitutional.

"The first thing we do, lets kill all the lawyers",  Henry VI, William Shakespeare.

This classic line is often quoted in the context of support for the notion of the filing of too many frivolous lawsuits and the need to rid America of the lawyers who are responsible for such outrage.  Yet, William Shakespeare's famous line was intended to convey the notion that without lawyers there would be anarchy and a revolution more easily brought about.  So too, without lawyers to advocate in court on behalf the rights of the injured, the abrogation of these rights is more easily brought about.  Industry groups who lobby for castigation of attorney's fees are certainly aware of the fact that without the ability of worker's to hire a lawyer then their wrongful denial of benefits can go unchecked.  Of course, if the worker's rights to benefits are stripped, the cost of doing business goes down.

It is a sad comment that American industry is so willing to pay $16,000 to its lawyers to unsuccessfully avoid the responsibility to pay benefits legally due, yet expresses outrage that the claimant's lawyer who was only paid because of his success would be likewise compensated.  Nonetheless, here is what leaders of industry groups are quoted as saying about the decision:

The National Federation of Independent Business/Florida and Florida Chamber of Commerce both expressed disappointment with Thursday's ruling.

“Workers’ compensation rates have dropped over 50 percent in the last five years and were scheduled to continue to decrease,” NFIB/Florida Executive Director Bill Herrle said. “However, this Supreme Court ruling jeopardizes the low rates, which is devastating for small business owners. Losing the attorneys’ fee schedule will cost the small business community hundreds of millions of dollars at a time when they can least afford it.”

David Daniel, Florida Chamber of Commerce vice president of government affairs, called the ruling "just another example of plaintiffs' trial lawyers attempting to bleed more attorney fees from Florida employers using our state's workers' compensation system."

Orlando Business Journal, Tuesday, October 28, 2008.

The Florida Supreme Court has continued to perform its duty to act as an equal and independent arm of government and has used its interpretive skills and remained vigilant in its obligation to protect citizen's rights to access to the courts.  At least for now, efforts to kill all of the claimant worker's compensation lawyers in Florida have failed.

Preparing For and Presenting a Hurricane Flood or Windstorm Claim

Below, I am posting a brief list of basic resources that may help with the claim process.

Just a few of quick points for emphasis.  First, DO NOT DISCARD damaged property until the adjuster has inspected and photographed the loss.  It is very important that you have your own photographs of the damages.  Even if all you have access to is a disposable camera, take lots of pictures that show the loss as soon after the storm as possible.

Second, keep a "critical post-loss events" notebook or diary on paper or PDA.  Insureds may be examined under oath weeks, months, or even years after the storm.  Memories made during the post-storm frenzy may fade.  Record your dates of communication, persons involved, and summary of what was discussed.  Also, record your efforts to make the required temporary repairs to the covered property.  Although the Work Product Doctrine may protect these notes from discovery, prepare them in a professional way, as they may be used in coverage litigation.  Avoid describing the adjuster in colorful terms, as a judge or jury may not appreciate your frustration and get a negative impression of you.

Third, know the deadline for submitting your Sworn Statement in Proof of Loss.  This is a condition to coverage under most polices.  The Texas Windstorm Insurance Association requires a Proof of Loss within 91 days of the claim acknowledgment, unless the time is extended IN WRITING.  Do not rely upon a verbal extension from an adjuster.  The National Flood Insurance Program requires a proof within 60 days of the flood.  ONLY FEMA may consent to extend the 60-day period.  Even the written extension by the servicing insurance company is not sufficient to extend the time to submit a fully compliant proof of loss.  Failure to meet this condition is fatal to coverage and precludes any enforcement of payment allegedly due under the Standard Flood Insurance Policy ("SFIP") by a "Write-Your-Own" private insurer participating in the National Flood Insurance Program ("NFIP").  See, Suopys v. Omaha Property & Casualty, 404 F.3d 805 (2005).   

I hope that this helps you achieve a prompt and fair settlement.

Regards,

Lee Gunn

Flood Insurance

HURRICANE PREPARATION:
Quick Steps Consumers Can Take Now to Make Filing A Claim Easier After the Storm http://www.naic.org/documents/consumer_alert_gustav.htm

Allstate Home Inventory Software

Texas Windstorm Insurance Association Claims

AIG: Needed Regulatory Accounting Of A Failed Trust

Taxpayers now own 80% of American International Group, Inc., as a result of an $85 billion "bridge" loan.  The insuring public deserves to know the cause and that those responsible for this financial disaster are held appropriately accountable.  As the ripples of economic consequences created by the corporate greed that drove the reckless business risks undertaken expand, it is clear that ultimate accountability of the involved corporate leaders is imperative.  Otherwise, we are creating a "moral hazard" by having de facto government insurance against the consequences of corporate malfeasance.

Certainly, AIG executives' conduct deserves public scrutiny in the same way any creditor would scrutinize any borrower.  The basic questions that must be addressed are; why do you need this loan, and how can I be sure that you can pay it back?  To answer the why, regulators must look at the business practices of AIG that placed so many policyholders at risk.  Next, to assure the ability to pay back the loan, a clear separation of the insurance business from investment risk-taking must be a mandate.

Insurance is, at its core, a holding of premium dollars in trust for the benefit of the policyholders.  By pooling the financial risks of society, insurers facilitate the orderly funding of health care, risks of commerce, and the compensation of those damaged by natural disasters and negligence.  Insurance performs a public function and is highly regulated by the states.  The coordination of the regulatory schemes is facilitated, in part, by the National Association of Insurance Commissioners.  The financial conduct of licensed and authorized insurers is overseen by the states.  Strict requirements for adequate liquidity in the form of cash reserves to pay claims, minimum surplus funds in excess of expected claim payments, and restrictions to low risk investments, such as bonds, for to these funds, provides the necessary solvency and security that is essential to a viable insurance system.

So, how can the consumer of AIG's insurance products be at risk for the improvident investment practices of AIG Financial Services?  After all, AIG FS is a separate company, not subject to the same strict solvency requirements of the regulated, publically audited insurance companies within the AIG holding companies.  Will the needed investigations reveal that AIG was impermissibly leveraging its insurance assets to prop up the failed practices of AIG FS?  Did AIG disclose these practices to insurance regulators?  If the insurance assets were not placed at risk by improper cross-collateral practices, then why were the adequately funded and "healthy" insurance companies at risk?  If the insuring public was not at risk, then what public purpose was served in using public dollars to salvage a failed business?

I hope that consumers will get these answers and that the investigative media and public regulators will provide both truth and accountability.  Otherwise, the government is simply encouraging bad business by insuring against its consequences to the wrongdoer; the definition of a moral hazard.

Regards,

Lee Gunn

Hurricane Gustav early damage assessments

It is the morning after Gustav's landfall and the early assessments are favorable for New Orleans.  It is clear that the hard-learned lessons from Katrina have resulted in a much better organized and funded initial preparedness plan.  It is too early to really know what property damage was done to the areas to the west of New Orleans which received the highest winds associated with the center of the storm.  Risk Management Solutions places early insured losses at $4 billion to $10 billion, not inclusive of flood claims.  AIR Worldwide Corporation estimates losses at between $2 billion and $4.5 Billion, noting that Rita was more intense and did $5.6 billion in insured loss.

As Hurricane Gustav makes its way north, Hannah makes its way toward the U.S. coast, Ike chugs behind Hannah, and other disturbances are off of the coast of Africa, we are reminded to stay vigilant.

Stay well,

Lee D. Gunn IV

Gunn Law Group, P.A.

777 S. Harbour Island Blvd., Suite 765

Tampa, FL  33602

(813) 228-7070 - ofc

(866) GUNNLAW - toll free

Gustav & Hanna - Fee Caps for Public Adjusters

It is clear that we are in the midst of an active hurricane season with Gustav and Hanna approaching the continental U.S. and much of Florida still absorbing Fay's deluge. Yesterday, the St. Petersburg Times reported that insurance claims from Tropical Storm Fay were approaching 17,000. Our thoughts are with all those who may be in the path of Gustav, as this storm seems to be particularly well-organized. Residents along the gulf coast should take advantage of the long weekend to take precautions.

For those public adjusters in Florida, please be aware that the Governor's declaration of a State of Emergency triggers FAC Rule 69B-220.201(5) which caps the fee a Public Adjuster can charge to 10% of the claim amount paid and also prohibits a Public Adjuster from collecting any fees, retainers, deposits or anything of value prior to the insured or claimant receiving a claim payment. This applies to any Tropical Storm Fay insurance claims that you may handle. 

Regards,
Lee D. Gunn IV
Gunn Law Group, P.A.
Tampa, Florida

Insurance Policy Holders Beware, Hurricane Deductibles DO NOT Apply to Fay

As of August 22, 2008, Tropical Storm Fay is not a hurricane and the higher deductible associated with homeowner insurance policies in Florida does not apply. Review your policy for the "all other perils deductibles." When presenting a claim to your insurance carrier, be sure to confirm that they agree that the proper deductible applies. Visit the Office of Insurance Regulation website at www.floir.com to find out more about hurricane deductibles.

Fay is a good example of why all homeowners should consider buying flood insurance, even if you do not live near water or in a defined flood zone. Inland rains of over 20 inches in various Florida counties are causing catastrophic floods far from any river or coastal area. Flood damage is typically not covered by a standard homeowner's policy. Flood coverage is afforded by the National Flood Insurance Program and remains one of the more affordable coverages in the market. Find out more at: www.floodsmart.gov . There is still time to purchase flood insurance this season; however, keep in mind that in most cases there is a 30 day waiting period before flood coverage takes effect.

Best Regards,
Lee D. Gunn IV
Gunn Law Group, P.A.
Tampa, Florida 

Tropical Storm Fay Far From Done

The 2008 Hurricane Season is now a reality. TS Fay has brought torrential rains and associated flooding to much of south and central Florida and her work is far from done.

Please stay safe. Even though this storm does not have high winds or surge, it can still be dangerous. As the video of the kite boarder shows a storm like Fay is not to be taken lightly. Wind gusts and undertow can make beach activities unpredictably dangerous. Be cautious when encountering street flooding.

This storm will likely cause most of its damage with flooding. Be sure to have your homeowners and property insurance policies in a safe place. Remember that flood policies have especially critical time limitations for presenting claims. FEMA has a new website for flood policy information: www.floodsmart.gov .

Kind Regard
Lee D. Gunn IV
Gunn Law Group, P.A.
Tampa, Florida