Returning Fairness to Florida’s Courts

Returning Fairness to Florida’s Courts: Two Trucking Lawyers’ Suggestions for Real and Lasting Reforms

By Christopher Barkas and S. Kyle Weaver So many of our clients loathe being sued in Florida, and rightfully so. Unfortunately, civil defendants in Florida face an uphill and often unfair battle for a myriad of reasons. Among the issues are the Proposal for Settlement (PFS) statute; attorney referrals of plaintiffs to medical providers; outrageous non-economic damage (aka pain and suffering) awards; and the use of Florida’s outdated collateral source rule to incentivize plaintiffs against mitigating (reducing) their damages. The problems are not academic. In the past, Florida’s tort system accounted for $7.6 billion in direct costs, $11.8 billion in annual output, 126,139 jobs, and compensation paid out by the tort system was 3.6% of GDP, or about $4,400 per household annually. We can only imagine these grim statistics have worsened. Importantly for the trucking industry, the consequences are most evident in primary and excess insurance markets as premiums skyrocket, or coverage in certain layers is simply unavailable. We are trucking lawyers, and these are our problems: Proposal for Settlement Florida’s Legislature intended to incentivize parties to settle claims and punish parties who unreasonably failed to settle by making the “loser” pay the winner’s attorneys’ fees. In theory, it’s not a bad idea. We wrote in the Summer 2021 Florida Truck News about the many problems with proposals for settlement. Three major problems stand out with proposals. First, proposals can be sent to defendants as early as 90 days after they receive the lawsuit, meaning a defendant must have enough information (about liability, damages, venue, etc.). Second, proposals for settlement allow differing offers to be made to company and driver. Payment of the proposal to end the case against the driver does not end the case against the company. For example, plaintiff may serve a proposal for settlement to the driver for $10,000 and to the company for $100,000. Payment of the $10,000 to extract the company driver from the suit does not end the entire case, so the company must stay in the lawsuit. Finally, the fee awards for plaintiff lawyers if their proposals are activated (successful) after trial are substantial. A recent Duval County award was nearly $1,000,000 in a very simple automobile case. On the other hand, if a proposal filed by the defense wins, defendants and defense lawyers are limited to collecting fees at their contractual rate which is far less than the $500-$800/hour collected by plaintiff lawyers. Even still, many if not most plaintiffs are judgment proof, so obtaining a judgment and fee award after a successful defense PFS is usually meaningless and can never be collected. We suggest four reforms (at a minimum) to the proposal for settlement rule. First, extend the time period before a defendant may be served with a proposal for settlement. Ninety days into the lawsuit is not enough time for a defendant to gather information and be in a position to respond to a proposal for settlement, which may have substantial financial penalties later on. Second, forbid the splitting of proposals for settlement between the company and company drivers (or in cases of pure vicarious liability), bringing an end to this silly legal fiction. Next, cap attorneys’ fees for successful proposals for settlement at a more reasonable hourly rate, or fix the attorneys’ fee award at a percentage of the judgment (if plaintiff prevails). Finally, to ensure defendants are able to experience the same benefit from a successful proposal, and to deter parties from using proposals for settlement unless they are truly acting in good faith – require the posting of a bond before a PFS may be filed. In the event a party succeeds on their PFS and tries to collect, they can look to the bondholder if the other party defaults on their obligation to pay the judgment. Attorney Referrals to Medical Providers In Florida, an attorney’s referral of a client to a specific medical provider is classified as attorney client privileged, and cannot be disclosed in discovery or at trial. The (incorrect) rule stems from a 2017 decision of the Florida Supreme Court in Worley v. YMCA. It is incomprehensible to think what doctor to visit is legal advice. As an attorney, our ethical and fiduciary responsibility is to act in the best interests of our clients. The question is whether “best interests of the client” means referral to a physician who is most qualified and will best help the client get better, or referral to a physician who will help the client obtain a favorable medical opinion and greater damages in the lawsuit. Communications between attorney and client are only privileged if they concern legal advice. Certainly, the client getting the best care and getting better is not legal advice. By contrast, the client maximizing the value of their lawsuit by selecting the best litigation doctor is legal advice. The latter is what has been sanctified by the Worley decision.

The decision is bad public policy on a number of levels. It creates dramatic moral hazard problems for plaintiff attorneys – namely, the attorney chooses to send the client to physicians who will help obtain a larger judgment and proportionately, a bigger attorney fee for themselves, while the client bears the risk of subpar medical care and the lifelong complications therefrom. In addition, it creates an overly cozy and confidential referral network between attorneys and their favorite referral doctors. The result is an overwhelming bias toward the plaintiff (and her attorney) in opinion testimony, the depth of which the defendant is not permitted explore or expose to the jury. The cottage industry of lawyer referrals also seems to alter normal market forces. Traditionally, consumers want to pay less for goods and services, and they will seek out the best value for their dollar. In litigation cases, the cottage network between attorneys and doctors allows medical providers to charge drastically more than a market rate for care, knowing all the while they will dramatically cut the bills once the case is resolved. Some even refuse to accept health insurance to ensure the bills remain owing! In all, the plaintiff’s normal incentives to seek the lowest price for the best service in the medical market is upended. Many plaintiffs now seek (with the advice of counsel) more expensive and societally wasteful care from a litigation doctor. The Florida Supreme Court had a chance to overturn Worley in late 2021, but declined because it felt the issue was not truly before them for a decision. The Worley decision needs to be overturned quickly, and we hope the Supreme Court will take the next opportunity it is presented with to correct this dangerous (to society and our profession) decision. Non-Economic Damage Reform Our own survey of recent large verdicts (exceeding $1,000,000) revealed an alarming trend. Nearly all large verdicts were comprised of 80% non-economic (pain and suffering) damages. In our recent trials, we’ve noticed a prevalence of the “per diem” arguments to drive up non-economic damages awards. The argument asks jurors to award some amount of money per hour for every waking hour of the day, for the rest of the plaintiff’s life. For example, $10/hr for 16 waking hours a day, for 35 years is a little more than $2 million. Non-economic damages awards, regardless of their size, are troubling because it is the only element of damages without real, tangible evidence. There is no limit to what the jury can award, and no guidelines for what they can or cannot consider in awarding damages. In theory, it focuses on the plaintiff’s pain and suffering, which by its very nature, is personal to the plaintiff and cannot be felt by the jurors. Awarding pain and suffering in any amount essentially requires jurors to place themselves in the shoes of the plaintiff, which is ordinarily forbidden by the “Golden Rule.” We also believe the compensatory element of non-economic damages has been largely replaced by a more punitive mindset. Jurors who sympathize with the plaintiff (not a legal basis for an award of damages) or dislike the defendant or their counsel, take the opportunity to award substantial non-economic damages for which there are no real guidelines, transforming them from compensatory, into effectively punitive damages or an excessive fine/penalty because of their size. Certainly, that is not the goal of our tort system of “compensation.” Caps on economic damages were previously implemented and swiftly determined to be unconstitutional because, among other reasons, it deprived plaintiffs of the right to access Florida’s courts without a reasonable alternative remedy, and there was no overpowering public necessity shown. Presently, there are only eight states with non-economic damages caps in place. Certainly, the time to discuss non-economic damages reforms has returned in the midst of the current litigation and insurance climate in Florida. Mitigation of Damages and an Outdated Collateral Source Rule As discussed earlier, ordinarily consumers want to pay less for the goods and services they need in the market. Consumers with a coupon for a TV purchase are unlikely to affirmatively ask to pay more for a TV. Unfortunately, under the existing incentive structure created in Florida’s courts – this is exactly what is playing out, but on a far more expensive scale. Many plaintiffs who have health insurance specifically direct their physicians not to bill their health insurance, or just visit litigation-only practices who do not accept any insurance. The prevailing (and incorrect) view is evidence plaintiff has health insurance is not admissible because it is evidence of a “collateral source” of indemnity. The rule is an old one and has been modified or abrogated by statute in many places, including Florida. Here, the rule remains partially in effect and bars evidence of payments (for healthcare, for example) made on behalf of the plaintiff by a collateral source of indemnity. Courts and plaintiff lawyers have seized on this to say evidence the plaintiff had health insurance but did not use it, is collateral source evidence, and is therefore inadmissible. Pure legal fiction! It is also legally incorrect. The collateral source rule bars evidence of payments by collateral sources. There is no evidence of payments if plaintiffs do not use their health insurance to pay for care. It is, however, strong evidence of a plaintiff’s attempt to unnecessarily drive up their damages (aka fail to mitigate their damages) and of a plaintiff’s participation in a “litigation game.” Evidence of a plaintiff’s failure to submit their medical bills to available insurance should be admissible to expose the games being played by plaintiffs and their lawyers. .

Christopher Barkas is a shareholder in Carr Allison’s Tallahassee office where he defends transportation, employment, product liability and retail claims. S. Kyle Weaver serves as counsel in Carr Allison’s Tallahassee office. His practice is dedicated to the defense of transportation claims across Florida, Georgia, and Alabama. Carr Allison is a member of FTA.