Injured Workers Lack the Capacity to Contract, Unaware of Their Rights.

Guided by the Red-Headed Step-Children of Injury Law: Claimant Attorneys

No offense intended to Red-Headed Step-Children. If you are one, you probably rank above Claimant Attorneys. The cliché seems fitting. Lawyers representing injured workers in the Florida Workers’ Compensation system have always struggled against the laws promulgated by the state legislature. Workers’ Compensation Insurance Companies are in fact protected by the State of Florida. Example: did you know that workers’ compensation carriers are the only insurance carriers in the state that are not subject to the Florida Bad Faith Law? That’s right: a workers’ compensation adjuster can act in bad faith and there is no remedy for the injured worker. “Why did you deny my surgery?” “Because it’s Tuesday, and I don’t feel like authorizing surgeries today.” And that is the tip of the iceberg. But I digress….

It seems that the issue of how the Judges of Compensation Claims should be approving attorneys fees just won’t go away. In my blog SHOW ME THE CONTRACT! Rule 4-1.5(b) vs Rules 4-1.5(d)&(f) and The Right to Contract in Florida Workers’ Compensation Cases, I explained how I thought many JCCs were misinterpreting the case law surrounding approval of attorneys’ fees in workers’ compensation claims. Why is this important and why is it happening? Much like bad faith, it’s another “only in workers’ compensation cases” thing. Claimant Attorneys apparently can’t be trusted to be officers of the court the way other lawyers can. Nor does their Oath of Attorney hold any value.

Recently, a Judge of Compensation Claims intervened in a contract between a lawyer and their client and denied approval of the attorney’s fee that the client wanted to pay their lawyer, stating:

On one hand, as it has been suggested, if the fee is within the agreed percentage in the contract, then it should be perfunctorily approved. On the other hand, a judge must engage in the Lee Engineering considerations. This latter function, unfortunately places a Judge in the uncomfortable position of becoming a quasi-advocate for the injured worker, thus losing the impartiality required of the position. See Code of Judicial Conduct, Canon 3. This is because the injured worker is both unaware of his/her rights, and secondly is in the position that in a settlement they just want their money now. Thus, the reality is that a hearing is a one-party event, and for a Judge not to approve a required fee, involves advocating for the injured worker, silent and they are otherwise unaware of what is going on (emphasis added).

Wait, what? Unaware of his/her rights? That statement is so incredibly offensive to me as a Claimant Attorney that I don’t even know where to begin. It epitomizes everything wrong with how judges view Claimant Attorneys in the Florida Workers’ Compensation system. That statement basically accuses the lawyer of not informing their client about the fee agreement that the client signed. More on that later.

No Dispute = No Lee Engineering.

The Judge gets it right: on one hand…if the fee is within the agreed percentage in the contract, then it should be perfunctorily approved. YES! It’s a contract between two parties. The Claimant knowingly waives their statutory right contained in F.S. 440.34(1) and voluntarily agrees to the fee, in writing. Rule 4-1.5(d) says the fee contract will ordinarily be enforced. It’s within the guidelines of Rule 4-1.5(f). The Claimant wants it paid. No dispute about the fee. Done. Approved.

The Judge gets it wrong: a judge must engage in the Lee Engineering considerations. This is the misinterpretation of Miles v. City of Edgewater Police Dept., 190 So. 3d 171 (Fla. 1st Dist. Ct. App. 2016) that the OJCC keep making. Miles mentions Lee Engineering, yes, but not in the sense it is being cited by the OJCC, and no appellate decision by any court in entire State of Florida uses Lee Engineering or Rule 4-1.5(b) (the codified version of Lee Engineering) to intervene in a stipulated fee that has been agreed to by the parties. They only do that in fee-shifting cases or common-fund cases where the fee is in dispute. Find a case where they apply Rule 4-1.5(b) to an agreed upon fee. You can’t. There isn’t one. What Miles says is that the fee agreement must be approved by the JCC:

the proper remedy is to allow an injured worker and an attorney to enter into a fee agreement approved by the JCC. Miles, supra (emphasis added).

This makes perfect sense and is how it is done in Medical Malpractice cases. But, we aren’t medical malpractice lawyers, we are Claimant Attorneys. As I said: “only in the workers’ compensation system….”

Claimant Attorneys Can’t be Trusted with Their Clients?

Now back to the Claimant’s unawareness: an injured worker who is represented by counsel is unaware of their rights? Lawyers are obligated to have contingent fee agreements in writing and signed by the client. Lawyers entering contingent fee agreements must first have their clients read and sign The Statement of Client’s Rights, which is a document written by The Florida Bar and contained in Rule 4-1.5 of The Rules Regulating The Florida Bar. In order to get their attorney’s fees approved by the Judge of Compensation Claims, an attorney must also have their client sign a “Waiver” that explains their rights under F.S. 440.34(1) and that the lawyer is asking for a fee in excess of the statutory guidelines.  All of this must be submitted to the JCC with a motion signed by the Claimant asking for the fee to be approved. But, after all that, they are still unaware of their rights?

Do Injured Workers Need a Guardian Ad Litem?

According to this line of thought: Claimants are either mislead by their attorneys or they are stupid and incompetent. If they aren’t able to understand what their lawyers tell them, then they must be incompetent and the court should appoint a Guardian Ad Litem to insure that they have someone to protect all of their interests, not just attorneys’ fees. In fact, if a Claimant needs a judge to intervene to make sure they understand their rights when it comes to an attorney’s fee, how can it be said that they have the capacity to sign the contract in the first place? Or, how about the capacity to understand the settlement of their case. Apparently every settled case that hasn’t been approved by the JCC is now subject to being undone and set aside because their lawyers must not have been able to explain their rights to them and they weren’t competent enough to understand the settlement, which is far more complicated than the attorney’s fee. Hold the phone! Did we just invalidate every workers’ compensation settlement since 2001 on the grounds of competency?

The idea that an injured worker doesn’t understand their rights when they have a lawyer representing them calls into question many other things that they are supposed to understand.

Do Injured Workers Understand Fraud?

F.S. 440.105(4)(b)(1) states:

It shall be unlawful for any person:

1. To knowingly make, or cause to be made, any false, fraudulent, or misleading oral or written statement for the purpose of obtaining or denying any benefit or payment under this chapter.

When an injured worker forgets to tell their workers’ compensation doctor about a time they went to the doctor 8 years ago, they can be accused of fraud. When they tell their doctor, figuratively speaking, that they “never leave the house,” but are caught on video going to the grocery store, they can be accused of fraud. Even when they are not represented at the time they make such a “false” statement, the Judge doesn’t jump in to the fray and protect them from getting accused of fraud. Nope. The Claimant signed a “Fraud Statement”; they will be held to have understood F.S. 440.105, and they will lose all of their benefits if the Judge finds they committed fraud. They lose.

Do Injured Workers Understand the Statute of Limitations?

F.S. 440.19 states:

(1) Except to the extent provided elsewhere in this section, all employee petitions for benefits under this chapter shall be barred unless the employee, or the employee’s estate if the employee is deceased, has advised the employer of the injury or death pursuant to s. 440.185(1) and the petition is filed within 2 years after the date on which the employee knew or should have known that the injury or death arose out of work performed in the course and scope of employment.

(2) Payment of any indemnity benefit or the furnishing of remedial treatment, care, or attendance pursuant to either a notice of injury or a petition for benefits shall toll the limitations period set forth above for 1 year from the date of such payment. This tolling period does not apply to the issues of compensability, date of maximum medical improvement, or permanent impairment.

This is an incredibly convoluted statute. Read that for a moment and tell me what it means. Got it? Injured workers are given a pamphlet that tells them about this at the beginning of their claim. Then they are on their own. If they miss the deadline and the statute of limitations runs on their claim, they lose all of their benefits. The judge doesn’t intervene and protect them. They lose.

Injured Workers DON’T Understand Attorneys’ Fees?

When a Claimant Attorney takes a workers’ compensation case, the vast majority do this: explain their fee agreement to the client; have the client sign the fee agreement; have the client sign the Statement of Client’s Rights; have the client sign a waiver of statutory rights that explains that the lawyer is asking for a fee above the statutorily restricted guidelines. Apparently that’s not good enough to be sure that they are aware of their rights, but signing a Fraud Statement and receiving a pamphlet in the mail on the Statute of Limitations are both crystal clear.

Good for The Goose, Not The Gander?

In short, they are given notice of the statute of limitations once and they are bound by that statute. They are given notice of the Fraud Statute, sign a Fraud Warning once, and will be hung out to dry at their first misstep. Yet, when they sign a Contingent Fee Agreement, a Statement of Client’s Rights, a Waiver of Statutory Rights, a Motion for Approval of Attorney’s Fees and an Affidavit that they understand the fee they are paying, they need judicial protection from their attorney. It seems that injured workers are held to incredibly high standards when it comes to ways they can screw up and lose their claim, but when it comes to paying the attorneys who try to protect them from those missteps, they lack the capacity to understand what 25% is.

Clearly Excessive? Rule 4-1.5(a):

(1) after a review of the facts, a lawyer of ordinary prudence would
be left with a definite and firm conviction that the fee or the cost
exceeds a reasonable fee or cost for services provided to such a
degree as to constitute clear overreaching or an unconscionable
demand by the lawyer (emphasis added).

The fee denied in this case came to $621 per hour. Does that give a lawyer of ordinary prudence a definite and firm conviction that the fee is excessive? Does it exceed a reasonable fee to such a degree as to constitute clear overreaching or an unconscionable demand by the lawyer? If so, doesn’t that warrant a referral to the Bar for violation of Rule 4-1.5? I consulted an ethics lawyer for this issue. His hourly rate is $550 and is guaranteed. Is $71 more, in a contingent fee case, clear overreaching? Unconscionable demand?

Injured Workers Lose Again

The Judge who wrote this opinion is, by reputation, an excellent judge. The OJCC is full of excellent judges. They are just getting this terribly wrong. In the end, injured workers will suffer. If lawyers can’t rely on the contracts they enter into, it will by necessity impact their representation. Because of the Contingency Risk Factor, Contingency Fee lawyers must be paid more than their counterparts who are guaranteed payment. See Florida Patient’s Compensation Fund v. Rowe, 472 So.2d 1145 (Fla. 1985). If they are not, their business model will fail. It’s math and economics. If the OJCC keep reducing contingency fees that are high and not raising those that are low, the law of averages will crush Claimant Attorneys and they will no longer be able to effectively represent injured workers. That will be the real harm to injured workers. Fewer good lawyers to choose from and an inability for those lawyers who are left to spend the time on their case that they would otherwise like to. Then they’ll be wishing they could pay those unconscionably excessive attorneys’ fees.