So Much for A Contingency Plan: Can the Florida Legislature Abrogate an Attorney’s Contingency Fee in Tort Claims Against the Government?

by Butler Snow LLP

Like many states, Florida has only partially waived its sovereign immunity by statute.  Thus, a plaintiff’s recovery against the state is generally limited to no more than $200,000 per incident.  This statutory cap, however, is not always a bar on recovery beyond $200,000. The Legislature has reserved its right to exceed the cap by passing a claims bill. A plaintiff with a jury verdict in excess of $200,000 can thus submit such a bill to the Legislature, and the Legislature then can choose to pass an act granting the additional funds.

In Searcy v. Florida,[1] a child suffered a catastrophic brain injury at birth as the result of negligence on the part of a Florida hospital. While the jury awarded the child $28,300,000 in damages, the court found that the hospital was an independent special district of the state and thus limited the award to the $200,000 statutory cap.  The child’s family submitted a claims bill to the Florida Legislature seeking the remainder of the verdict. After a public campaign in support of the claims bill, the Legislature appropriated $10,000,000 to a trust for the child, with an additional $5,000,000 to be paid into the trust in annual installments.

While this was a happy ending for the family of the victim, it was not so happy for their attorneys.  In addition to granting the child and his family the additional funds, the claims bill passed by the Legislature contained a stipulation that “[t]he total amount paid for attorney’s fees, lobbying fees, costs, and other similar expenses related to this claim may not exceed $100,000.”  The family’s attorneys had originally negotiated a 40% contingency fee, and during the pendency of the case they put in more than 7,000 hours and incurred $500,000 in costs.  The claims bill left the attorneys with only 1% of the $15,000,000 award.

The attorneys challenged the claims bill’s limitation on constitutional grounds, arguing that it not only impaired the private contingency contract between attorney and client but also usurped the judiciary’s power to award 25% contingency fees in such cases.  On July 15, 2015, Florida’s Fourth District Court of Appeal upheld the claims bill, finding that because the bill was an act of Legislative grace, (1) the Legislature’s sovereign will was not limited by the prior contingency fee contract between the attorneys and their clients and (2) the 25% contingency fee statute was not an issue because it set a ceiling for damages awards, not a floor.

In a dissenting opinion, Chief Judge Ciklin found that the claims bill’s limitation on attorneys’ fees and costs was an unconstitutional impairment on the right to contract.  He argued that the contingency fee contract was the “poor man’s key to the courthouse,” and that allowing the Legislature to create a loss for plaintiffs’ attorneys would leave future plaintiffs with meritorious claims without representation.  He also found that in this particular instance there was no legitimate end served by the limitation because, as a contingency contract, the same amount of money would be coming from the state treasury regardless of the contingency fee amount.

The dissent’s reasoning must have resonated with other members of the appellate court, because on September 16, 2015, in a per curiam opinion, the court reconsidered its opinion and granted the attorneys’ “Motion For Certification of Questions of Great Public Importance.” The certified question asks the Florida Supreme Court whether the $100,000 contingency fee limitation contained in the claims bill is constitutionally permissible. The Florida Supreme Court’s answer could have huge ramifications moving forward for individuals of limited means who may suffer catastrophic injuries at the hands of Florida state actors.

[1] 2015 Fla. App. LEXIS 10778 (Fla. Dist. Ct. App. 4th Dist. July 15, 2015).

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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