Limit on Legal Fees Spurs High-Profile Bill Fight
An appeals court this month will weigh the constitutionality of a 2012 legislative decision that limited fees for attorneys who represented a severely disabled child in a lawsuit against a public hospital system.
The dispute stems from a high-profile "claim" bill that state lawmakers passed to require Lee Memorial Health System to pay $15 million because of a catastrophic brain injury suffered as Aaron Edwards was being born. The issue went to the Legislature because the public Lee Memorial hospital otherwise would have been shielded from paying more than $200,000 by the state's sovereign-immunity laws.
As part of the claim bill, lawmakers said only $100,000 of the $15 million could go to attorneys' fees and related expenses. That drew a legal challenge from the West Palm Beach-based law firm of Searcy Denney Scarola Barnhart & Shipley, P.A., which represented the boy and his family during a lengthy medical-malpractice lawsuit that led to the claim bill.
The firm contended it was legally entitled to 25 percent of the award and that $100,000 wouldn't even cover its hundreds of thousands of dollars in costs in pursuing the case. After losing before a guardianship judge, the firm took the fee dispute to the 4th District Court of Appeal, which is scheduled to hear arguments Oct. 28 in West Palm Beach.
Attorneys for the firm contend that the $100,000 limit is unconstitutional on a number of grounds, including that it violated pre-existing contracts for legal services. In court documents, they also argue that the Edwards family supports the firm receiving the agreed-upon fees.
"That ($100,000) amount did not even begin to pay the outstanding costs in the case, and therefore, essentially provided zero attorney's fees for all of Aaron's attorneys involved in the case,'' an appeals-court brief said. "The $100,000 limitation totally obliterated the attorneys' fee contracts, and therefore, is facially unconstitutional."
But the state countered in a brief that the $100,000 fee limit is constitutional and said the claim bill was an act of "legislative grace." Sovereign-immunity laws are designed to protect public agencies from costly lawsuits, and getting legislative approval of claim bills is required before agencies pay large amounts.
"This case involves the law firm's attempt to take millions of dollars from a significantly impaired child,'' the state argued. "The law firm argues that it has a right to the money because it successfully represented the child in a medical malpractice suit that resulted in a considerable judgment. But the money at issue is not payment for that judgment. Instead, the money --- $15 million --- was awarded by the Legislature in a claim bill, a unique type of legislation that is separate and apart from any lawsuit or judgment."
The Edwards bill drew widespread attention during the 2012 legislative session, with the Lee County hospital system lobbying against passage and arguing that the bill would take away money from caring for other children.
A jury in 2007 found that negligence by Lee Memorial employees caused Edwards' injuries during birth in 1997. The jury awarded nearly $31 million to Edwards and his parents, but they could not collect that amount because of the sovereign-immunity laws.
Lawmakers required Lee Memorial to pay $15 million, a reduced amount from the original verdict, and also included the attorneys' fee provision.
In an appeals-court brief, the law firm contends that the $100,000 fee limit was included, at least in part, as retaliation because the firm had mounted an advertising and public-relations campaign to try to get the bill passed.
"Aaron's attorneys feel very strongly that the leaders of the House of Representatives became upset about their public campaign, most particularly the television spots, used in an attempt to muster public support for the House to, at least, hold a hearing on Aaron's claim bill,'' the brief said. "Accordingly, the Legislature decided to help Aaron but punish his attorneys. There is no other rationale for insertion of the $100,000 fee and cost limitation in Aaron's claim bill."
But in its brief, the state said the attorneys' fees and related expenses could be as much as $3.75 million if they were pegged at 25 percent of the $15 million total.
"The law firm alleges numerous constitutional defects resulting from the fee provision,'' the state argued. "But all are meritless because claim bills are independent acts of legislative grace that are separate and apart from any lawsuit or judgment. Accordingly, the law firm has no right to more than what the Legislature expressly allowed them."