STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

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FINAL ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, James E. Bradwell, held a public hearing in this case on February 17, 1986, in Tallahassee, Florida.

APPEARANCES

For Petitioner: Thomas J. Maida, Esquire

Post Office Drawer 229 Tallahassee, Florida 32302

For Respondent: Louise Ramsey, Esquire

Suite 131, Montgomery Building 2562 Executive Center Circle, E. Tallahassee, Florida 32301

ISSUE PRESENTED

Petitioner challenges the validity of Rule 3SF-2.13, Florida Administrative Code. 1/

FINDINGS OF FACT

Based on the entire record compiled herein, including the parties' factual stipulation, the following relevant facts are found.

1. MISSION Insurance Co. (MISSION) is a corporation duly authorized to issue insurance policies, including workers' compensation insurance policies in the State of Florida. MISSION conducts its adjusting operations at North Regency One, Suite 400, 985 Regency Square Boulevard, Jacksonville, Florida.

   
   

2. In the regular course of its business, MISSION adjusted the worker's compensation claim of Katrine Graham, who was injured on April 30, 1984 in an accident arising out of and in the course of her employment with Smiley's Mobey Dick Restaurant.

   
   

3. MISSION received notice of the accident on May 21, 1984.

   
   

4. On September 1, 1984, MISSION filed with the DIVISION its initial Injury Progress report (LES From BCL-13), in connection with the claim.

   
   

5. On February 11, 1985, MISSION received from the DIVISION's Bureau of Workers' Compensation Carrier practices a letter dated February 4, 1985, notifying MISSION that the Bureau had assessed against MISSION the penalty of $100.00 for filing the form 11 days after the time prescribed by Rule 38F-3.16, F.A.C. A copy of the letter is attached hereto as Joint Exhibit "A."

   
   

6. Since at least 1979, the DEPARTMENT has had a policy of imposing a fine of $100.00 on any insurance carrier who files its initial Injury Progress Report (LES From BCL-13) more than 105 days after it receives notice of the accident.

   
   

7. The DEPARTMENT applies this policy, through its Bureau of Workers' Compensation Carrier Practices, to all insurance carriers and self-insured employers who come within the jurisdiction of the DEPARTMENT.

   
   

8. The DEPARTMENT imposes penalties for the untimely filing of forms other than the BCL-13 form. The penalties to be imposed for the untimely filing of the BCL-13 form, as well as other forms, are stated in a "Penalty Assessment Chart," a copy of which is attached hereto as Joint Exhibit "B."

   
   

9. At the time the subject penalty was imposed on MISSION, this chart was used by the DEPARTMENT's workers' compensation examiners in determining whether a penalty should be imposed and, if so, the amount of the penalty.

10. The DEPARTMENT did not implement or use Chapter 120 rulemaking procedures to adopt the Penalty Assessment Chart, or the policy it represents, as a rule.

    
    

    PETITIONER'S POSITION

    
    

11. Petitioner contends that the Penalty Assessment Chart amounts to an unpublished rule which has the effect of exacting a penalty for "late" filing in excess of Respondent's legislative authority inasmuch as Respondent is only authorized to impose a penalty based on a carriers failure or refusal to file forms, reports, or notices pursuant to Section 445.185(9), Florida Statutes. Petitioner avers that in the absence of specific statutory authorization for Respondent to impose a penalty or assessment for an untimely filing, there is no basis upon which Respondent can impose the penalty involved herein, that the rule should be declared invalid and the $100.00 penalty imposed based thereon, should be rescinded.

RESPONDENT'S POSITION

1. Respondent avers that timely filings are inextricably tied to the Division's reporting requirements and that to conclude that a carrier could file reports, notices, etc. at will, without any directive, would lead to an absurd result in contravention of Respondent's long-standing reporting policy which has been effective since approximately 1979. Finally, Respondent urges that the legislature has authorized it to exact penalties for late filings based on the authority granted in Sections 440.185(5) and (9), Florida Statutes.

   
   

   CONCLUSIONS OF LAW

   
   

2. The Division of Administrative Hearings has jurisdiction over the subject matter and the parties to this action. Sections 120.56(1) and 120.54(1), Florida Statutes.

   
   

3. Section 440.185(9), Florida Statutes, provides in pertinent part that:

   
   

   Any employer or carrier who fails or refuses to send any form, report, or notice required by this section shall be subject to a civil penalty not to exceed $100.00 for each such failure.

4. That statute is implemented by Rule 38F-2.13, Florida Administrative Code, which provides for the imposition of a penalty based on a carriers failure or refusal to file reports. That rule in pertinent part provides:

   
   

   Any carrier which fails to timely send any forms, reports or notice required by statute or the rules of the Division of Workers' Compensation shall be subject to a civil penalty of up to $100.00 for each such failure. (Emphasis Supplied)

   
   

5. Inasmuch as the legislature has authorized the Division of Worker's Compensation to subject a carrier to a civil penalty based on a failure or refusal to send forms, reports, etc., as required, there is no basis upon which the Respondent can impose a penalty for an "untimely" submission of forms, reports, etc. through Section 440.185(9), Florida Statutes. Based on the maxim expressio unius est exclusio alterius, the Respondent is only authorized to exact a penalty based on a carriers failure or refusal to submit reports as required by Chapter 440, Florida Statutes, and not merely based on a late submission of reports.

   
   

6. While it is true that the Respondent is authorized to require carriers to submit additional reports with respect to injuries "at such times and in such manner as the DIVISION may prescribe," that section 2/ does not provide for the exaction of a penalty based on untimely (late) filings. The authority for the exaction of penalties rests in Section 440.185(9), Florida Statutes which authorize the imposition of penalties only for failure or refusal to submit reports, etc. Respondent, as an administrative agency, has only such authority as is conferred by statute, lacking inherent authority to promulgate rules. Respondent lacks statutory authority to promulgate Rule 38F-2.13 to the extent that it subjects a carrier to a civil penalty based on a failure to "timely" submit forms, reports or notices required by Chapter 440 or Respondent's rules. Gulf Stream Park v. Department of Business Regulation, 3 So.2d 113 (Fla. 3rd DCA 1983) and Section 120.5(15), Florida Statutes.

   
   

7. Recognizing that rule-making authority may be implied to the extent necessary to properly implement a statute governing an agency's statutory duties and responsibilities, Department of Professional Regulation, Board of Professional Engineers v. Florida Society of Professional Land Surveyors 10 FLW 2081 (Fla. 1st DCA 1985) where, as here, the legislature expressly has provided a method for implementation, it would be erroneous to

additionally imply authority on behalf of the DIVISION to exact a penalty against carriers for late filings. Therefore, it is concluded that Rule 38F-2.13, Florida Administrative Code is not authorized by statute and is thus an invalid exercise of delegated legislative authority. The Penalty Assessment Chart is used by Petitioner to implement its policy of imposing penalties for untimely filings. The chart is unpublished and was not adopted pursuant to rulemaking adoption procedures set forth in Section 120.54(1), Florida Statutes. The Chart is an agency statement of general applicability that implements Respondent's policy respecting the imposition of late filing penalties. As such, it is a rule which required compliance with Section 120.54(1), Florida Statutes, adoption procedures. Since those procedures were not followed, the Penalty Assessment Chart was invalidly adopted.

ORDER

Based on the foregoing Findings of Fact and Conclusions of Law, it is ORDERED that Rule 38F-2.13, Florida Administrative Code, is an invalid exercise of delegated legislative authority and is therefore invalidated. 3/ The Penalty Assessment Chart, not being adopted pursuant to rulemaking adoption procedures, is hereby declared invalid.

DONE and ORDERED this 19th of March, 1986, in Tallahassee, Florida.

JAMES E. BRADWELL

Hearing Officer

Division of Administrative Hearings The Oakland Building

2009 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 20th day of March, 1986.

ENDNOTES

1/ Petitioner also challenges, on the ground that it was not properly adopted, a Penalty Assessment Chart used in conjunction with the referenced rule.

2/ Section 440.185(5), Florida Statutes.

3/ Petitioner's prayer for a refund of the penalty imposed by Respondent is the type relief which cannot be granted in a Section 120.56, Florida Statutes rule challenge proceeding.

COPIES FURNISHED:

Thomas J. Maida, Esquire Post Office Drawer 229 Tallahassee, Florida 32302

Louise Ramsey, Esquire

Suite 131, Montgomery Building 2562 Executive Center Circle, E. Tallahassee, Florida 32301

Wallace E. Orr, Secretary

206 Berkeley Building

2590 Executive Center Circle, E. Tallahassee, Florida 32301

Kenneth Hart, General Counsel Suite 131, Montgomery Building 2562 Executive Center Circle, E. Tallahassee, Florida 32301

Liz Cloud

Bureau of Administrative code Department of State

1801 The Capitol

Tallahassee, Florida 32301

Carroll Webb, Executive Director Administrative Procedures Committee

120 Holland Building Tallahassee, Florida 32301

NOTICE OF RIGHT TO JUDICIAL REVIEW

A party who is adversely affected by this final order is entitled, to judicial review pursuant to section 120.68, Florida Statutes. Review proceedings are governed by the Florida Rules of Appellate Procedure such proceedings are commenced by filing one copy of a Notice of Appeal with the agency clerk of the Division of Administrative Hearings and a second copy, accompanied by filing fees prescribed by law, with the District Court of Appeal, first district, or with the District Court of Appeal in the Appellate District where the party resides. The Notice of Appeal must be filed within 30 days of rendition of the order to be reviewed.

Docket for Case No: 85-000774RX

Orders for Case No: 85-000774RX