Searcy, Denney, Scarola, Barnhart & Shipley, etc. v. State of Florida

209 So. 3d 1181, 42 Fla. L. Weekly Supp. 92, 2017 Fla. LEXIS 234
CourtSupreme Court of Florida
DecidedJanuary 31, 2017
DocketSC15-1747
StatusPublished
Cited by19 cases

This text of 209 So. 3d 1181 (Searcy, Denney, Scarola, Barnhart & Shipley, etc. v. State of Florida) is published on Counsel Stack Legal Research, covering Supreme Court of Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Searcy, Denney, Scarola, Barnhart & Shipley, etc. v. State of Florida, 209 So. 3d 1181, 42 Fla. L. Weekly Supp. 92, 2017 Fla. LEXIS 234 (Fla. 2017).

Opinions

PER CURIAM.

This case is before the Court for review of the decision of the Fourth District Court of Appeal in Searcy Denney Scarola Barnhart & Shipley, P.A. v. State, 194 So.3d 349 (Fla. 4th DCA 2015). In a separate decision, the district court certified the following question to be of great public importance:

AFTER THE ENACTMENT OF SECTION 768.28, FLORIDA STATUTES, AND THE ADOPTION OF FLORIDA SENATE RULE 4.81(6), IS IT CONSTITUTIONALLY PERMISSIBLE FOR THE FLORIDA LEGISLATURE TO LIMIT THE AMOUNT OF ATTORNEYS’ FEES PAID FROM A GUARDIANSHIP TRUST ESTABLISHED BY A LEGISLATIVE CLAIMS BILL?

Searcy Denney Scarola Barnhart & Shipley, P.A. v. State, 190 So.3d 120 (Fla. 4th DCA 2015). Accordingly, we have jurisdiction. See art. V, § 3(b)(4), Fla. Const. As we explain, we answer the certified question in the negative when such limitation impairs an existing contract. Although the Legislature has complete discretion in its decision whether to grant a legislative claims bill, which is an act of grace, the claims bill may not unconstitutionally impair the preexisting contract between the claimant and the law firm for attorneys’ fees, which may be recovered subject to the limits set forth in section 768.28(8), Florida Statutes (2007), Florida’s limited waiver of sovereign immunity.

FACTS AND PROCEDURAL BACKGROUND

This case arose after the birth of Aaron Edwards, during which he sustained a catastrophic brain injury as a result of the negligence of employees at Lee Memorial Health System (Lee Memorial) in 1997. The law firm of Searcy Denney Scarola Barnhart & Shipley, P.A. (Searcy Denney) was retained by the family to seek compensation under a standard contingency fee agreement providing for a payment of 40 percent of any recovery if a lawsuit was filed, plus costs. The agreement also stated that “[i]n the event that one of the parties to pay my claim for damages is a governmental agency, I understand that Federal and Florida Law may limit the amount of attorney fees charged by [Searcy Denney], and in that event, I understand that the fees owed to [Searcy Denney] shall be the amount provided by law.”

The case proceeded to a five-week jury trial in 2007, at which the jury found Lee Memorial Health System’s employees negligent, and that the negligence resulted in damages to the child in the amount of $28.3 million. The jury also awarded the mother $1.34 million and the father $1 million. Because the hospital was an independent special district of the State of [1186]*1186Florida, the trial court enforced the sovereign immunity damage limitations in section 768.28(5), Florida Statutes (2007), and entered, a judgment against the hospital for $200,000. This ruling was affirmed per curiam in Lee Memorial Health System v. Edwards, 22 So.3d 81 (Fla. 2d DCA 2009), and is not at issue in this case.

Searcy Denney and various other firms were involved in litigation of the medical malpractice suit, the first appeal, and a subsequent two-year lobbying effort to se^ cure a claims bill from the Legislature' on behalf of the injured child and his parents.1 Because the waiver of sovereign immunity in section 768.28 limited the family's recovery to only $200,000 of the $28.3 million judgment, a claims bill for the excess judgment amount was filed in the Florida Legislature in 2011, but was not passed during that legislative session. However, in 2012 the Legislature passed a claims bill, chapter 2012-249, Laws of Florida, directing Lee Memorial to pay $10 million, with .an additional $5 million to be paid in annual installments of $1 million each to “the Guardianship of Aaron Edwards, to ,b.e placed in a special needs trust created for the exclusive use and benefit of Aaron Edwards, a minor.” Ch. 2012-249, § 2, Laws of Fla. The claims bill further stated that payment of fees and costs from funds awarded in the claims bill shall not exceed $100,000. No funds were awarded in the claims bill for the parents. In November 2012, the child’s mother petitioned to es: tablish a guardianship over the minor son)s property, and Lee Memorial subsequently made its first payment of $10 million.

Searcy Denney, with the full support óf the family, then petitioned the guardianship court to approve a closing statement allowing $2.5 million for attorneys’ fees and costs. This requested amount, was based on the contract that existed with the Edwards family, as limited by the provisions of section 768.28(8), Florida Statutes. Section 768.28(8), a provision of the limited waiver of sovereign immunity statute, states in pertinent part, “No attorney may charge, demand, receive, or collect, for services rendered, fees in excess of 25 percent of any judgment or settlement.”

Because the petition to approve the closing statement also contended that the limit on fees contained in the claims bill was unconstitutional, the State of Florida intervened to defend the constitutionality of the claims bill enactment. And because of competing claims for a portion of the proceeds of the claims bill, the guardianship court appointed a guardian ad litem for the injured child. The evidence presented to the guardianship court revealed that the firms seeking fees and costs spent moré than 7000 hours representing the family at trial, on appeal, and during the claims bill process. The evidence also demonstrated that costs of more than $500,000 were expended during-the representation. As to the law firm’s request for fees and costs óf $2.5 million from funds provided by the claims bill, the guardianship court, relying' on precedent from this Court and the Fourth District,2 denied the request for fees in that amount, concluding that the court lacked judicial authority to contravene the fee and cost limitation the Legislature placed in the claims bill. The guardianship court also denied the request to find the fee limitation invalid and sever it from the remainder of the claims bill.

[1187]*1187Searcy Denney and the other firms appealed the order of the guardianship court denying the $2.5 million in fees and costs, contending that the $100,000 fee and cost limitation in the claims bill was an unconstitutional impairment of their contract with the Edwards family, and that the provision should be severed from the claims bill. Alternatively, the firms argued in the district court that the guardianship court had inherent jurisdiction to depart from the legislative limitation because section 768.28(8), Florida Statutes, would allow a fee up to 25 percent of the award.3

The Fourth District rejected these contentions, stating that “[ajlthough sympathetic to Appellants’ situation, we must disagree with their legal arguments based on separation of powers principles, supported by reasoning set forth from the Florida Supreme Court.” Searcy Denney, 194 So.3d at 349. After reciting a brief history of sovereign immunity, both federal and state, the district court noted that section 768.28 is the codification of the State’s limited waiver of sovereign immunity in tort actions, which limits recovery against the state or its agencies or subdivisions to $100,000 per person or $200,000 per incident, with a 25 percent cap on attorneys’ fees. The statute further states that any portion of the judgment that exceeds the amounts allowed under the limited waiver of sovereign immunity may be paid in whole or in part only by an act of the Legislature.

In finding the fee limitation in the claims bill valid, the district court relied on this Court’s decision in Gamble v. Wells, 450 So.2d 850 (Fla.

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Cite This Page — Counsel Stack

Bluebook (online)
209 So. 3d 1181, 42 Fla. L. Weekly Supp. 92, 2017 Fla. LEXIS 234, Counsel Stack Legal Research, https://law.counselstack.com/opinion/searcy-denney-scarola-barnhart-shipley-etc-v-state-of-florida-fla-2017.