STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

CARMEN L. DIAZ and ANDREW )

KOWLESSAR, as parents and ) natural guardians of GORDON ) QUINN KOWLESSAR, a minor, )

)

Petitioners, )

)

vs. )

)

FLORIDA BIRTH-RELATED )

NEUROLOGICAL INJURY )

COMPENSATION ASSOCIATION, )

)

Respondent, )

)

and )

) JULIA B. HARRIS, M.D.; HALIFAX ) STAFFING, INC.; and HALIFAX ) HOSPITAL MEDICAL CENTER, d/b/a ) HALIFAX MEDICAL CENTER, )

)

Intervenors. )

Case No. 98-3842N

)

AMENDED FINAL ORDER

Pursuant to notice, the Division of Administrative Hearings, by Administrative Law Judge William J. Kendrick, held hearings in the above-styled case on January 13, 1999, in Daytona Beach, Florida, April 29, 2003, by telephone conference, and

September 23, 2003, in Daytona Beach, Florida.

APPEARANCES1

For Petitioners: Larry Sands, Esquire

Sands, White & Sands, P.A. 760 White Street

Daytona Beach, Florida 32115-2010

For Respondent: Donald H. Whittemore, Esquire

Andrew W. Rosin, Esquire

100 South Ashley Drive, Suite 1900 Tampa, Florida 33602-5311

For Intervenors: Kirk S. Davis, Esquire

Akerman, Senterfitt & Edison, P.A.

100 South Ashley Drive, Suite 1500 Tampa, Florida 33602-5314

STATEMENT OF THE ISSUES

1. Whether Gordon Quinn Kowlessar (Gordon), a minor, suffered an injury for which compensation should be awarded under the Florida Birth-Related Neurological Injury Compensation Plan (Plan).

2. If so, the implications, if any, on Petitioners' entitlement to an award under the Plan because of Petitioners' settlement of a civil action for medical malpractice against Romeo DeGracia, M.D., Halifax Staffing, Inc., and Halifax Hospital Medical Center, d/b/a Halifax Medical Center (Halifax Medical Center) for damages associated with Gordon's birth.

3. If Petitioners' settlement of their civil suit does not bar recovery under the Plan, the amount and manner of payment of the parental award, the amount owing for attorney's fees and costs, and the amount owing for past expenses.

   PRELIMINARY STATEMENT

   
   

   On September 1, 1998, Carmen L. Diaz and Andrew Kowlessar, individually, and as the natural parents and guardians of Gordon Quinn Kowlessar, a minor, filed a petition (claim) with the Division of Administrative Hearings (DOAH) for compensation under the Florida Birth-Related Neurological Injury Compensation Plan.

   DOAH served the Florida Birth-Related Neurological Injury Compensation Association (NICA) with a copy of the claim on September 2, 1998. NICA reviewed the claim, and on November 3, 1998, gave notice that it had "determined that this claim is noncompensable on the basis that permanent and substantial mental impairment cannot be demonstrated at this time," and requested that "an order [be entered] setting a hearing in this cause [on such issue]." Such a hearing was held on January 13, 1999.

   At hearing, Carmen Diaz testified on her own behalf, and Petitioners' Exhibit 1 (the medical records filed with DOAH on September 1, 1998; September 24, 1998; and October 21, 1998) was received into evidence. Respondent's Exhibit 1 (the deposition of Michael Duchowny, M.D., taken January 11, 1999) was also received into evidence.

   On February 10, 1999, a Final Order was entered which resolved that Gordon suffered an injury to the brain caused by oxygen deprivation occurring in the course of labor, delivery, or

   resuscitation in the immediate post-delivery period in the hospital which rendered him permanently and substantially physically impaired, but the proof was insufficient to support a conclusion that Gordon also suffered a permanent and substantial mental impairment. Consequently, the claim was denied.

   Sometime later, on August 23, 2002, Julia B. Harris, M.D., Halifax Staffing, and Halifax Medical Center filed a Petition to Reopen Administrative Proceeding, Set Aside Final Order, Request for Rehearing, and Motion to Intervene, and on October 2, 2002, a Clarification for Petition to Reopen Administrative Proceeding, Set Aside Final Order, Request for Rehearing, and Motion to Intervene. Thereafter, on December 17, 2002, a hearing was held to address the pending motions, and the parties being in agreement, an Order was entered on January 16, 2003, as follows:

   Upon consideration of the pending requests and consistent with the discussions had at hearing, it is

   
   

   ORDERED that:

   
   

   1. The Petition to "Reopen Administrative Proceeding, [and] Set Aside Final Order, and Motion to Intervene," filed by Julia B. Harris, M.D., are granted. Under such circumstances, it is unnecessary to address Dr. Harris' Request for Rehearing.

      
      

   2. The Motion to Intervene, filed by Halifax Staffing, Inc., and Halifax Hospital Medical Center, d/b/a Halifax Medical Center, as the apparent employer of Dr. Harris, is granted. In all other respects, the requests filed by

      Halifax Staffing and Halifax Hospital are denied.

      
      

   3. Within 14 days of the date of this Order, the parties will confer and advise the undersigned in writing as to the following:

* * *

B. The earliest date the parties will be prepared to proceed to hearing on the issues raised, their estimate of the time required for hearing, and their choice of venue.

Ultimately, with the parties' agreement, a hearing was held on April 29, 2003, to resolve whether the claim was compensable.

At the hearing held on April 29, 2003, Intervenors' Exhibits 1A-K, 2A and B, 3A and B, 4-17, 18A-E, 19-22, 23A-C, and 24-28

(various medical records, reports, depositions, and other documents related to Gordon's birth and subsequent development, filed with DOAH on March 3, 2003), and Respondent's Exhibits 2-5 (Mr. Kowlessar's Answers to Interrogatories, Ms. Diaz's Answers to Interrogatories, Mr. Kowlessar's Response to Request to Produce, and Ms. Diaz's Response to Request to Produce, respectively, filed with DOAH on April 14, 2003), and Exhibit 6 (a report of independent medical evaluation done on March 5, 2003, by Michael Duchowny, M.D., and filed with DOAH on April 1, 2003) were received into evidence. No witnesses were called, and no further exhibits were offered.

While the parties addressed the issue of compensability at the April 29, 2003, hearing, they were unable to reach agreement

on an award. Consequently, a hearing was scheduled for September 23, 2003, to resolve the amount and manner of payment of the parental award, the amount owing for attorney's fees and costs, and the amount owing for past expenses.

At hearing, Petitioners presented the testimony of Carmen Diaz and Larry Sands, Esquire, and Petitioners' Exhibits 2-5 were received into evidence; however, Petitioners' Exhibits 2 and 3, as hearsay, were received into evidence subject to the limitations of Section 120.57(1)(c).2 Respondent called

Francis Pierce, III, Esquire, as a witness, and Respondent's Exhibit 7 was received into evidence.

The transcript of the April 29, 2003, hearing was filed on June 6, 2003, and the transcript of the September 23, 2003, hearing was filed on October 20, 2003. The parties were accorded

10 days from the later date to submit proposed orders.

Petitioners and Respondent elected to file such proposals and they have been duly considered.

FINDINGS OF FACT

Findings related to compensability

1. Carmen L. Diaz and Andrew Kowlessar are the natural parents and guardians of Gordon Quinn Kowlessar, a minor. Gordon was born a live infant on August 26, 1997, at Halifax Medical Center, a hospital located in Daytona Beach, Florida, and his birth weight exceeded 2,500 grams.

2. The physicians who provided obstetrical services at Gordon's birth were Linda Hensley, M.D., and Julia B. Harris, M.D., who were, at the time, resident physicians in an approved post-graduate training program, as defined by the Board of Medicine, by rule, and who were, at the time, "supervised," as that term is defined by the Plan, by Romeo DeGracia, M.D., a participating physician in the Florida Birth-Related Neurological Injury Compensation Plan. Consequently, obstetrical services were provided at Gordon's birth by a participating physician. See §§ 766.302(7) and 766.314(4)(c), Fla. Stat. (1997).

3. Pertinent to this case, coverage is afforded by the Plan for infants who suffer a "birth-related neurological injury," defined as an "injury to the brain or spinal cord of a live infant weighing at least 2,500 grams . . . at birth caused by oxygen deprivation or mechanical injury occurring in the course of labor, delivery, or resuscitation in the immediate post- delivery period in a hospital, which renders the infant permanently and substantially mentally and physically impaired."

   § 766.302(2), Fla. Stat. See also § 766.309(1)(a), Fla. Stat.

   
   

4. Here, the parties have stipulated, and the proof is otherwise compelling, that Gordon suffered an injury to the brain caused by oxygen deprivation occurring in the course of labor, delivery or resuscitation in the immediate post-delivery period in the hospital that rendered him permanently and substantially

   mentally and physically impaired. Consequently, the proof demonstrates that Gordon suffered a "birth-related neurological injury" and, since obstetrical services were provided by a participating physician at birth, the claim is compensable.

   §§ 766.309(1) and 766.31(1), Fla. Stat.

   
   

   Findings related to the settlement of the civil suit

   
   

5. At the time of the April 29, 2003, hearing, there was pending in the Circuit Court of Volusia County, Florida, an action styled Gordon Quinn Kowlessar, an infant, by his mother and next friend, Carmen L. Diaz, and Carmen L. Diaz and

   Andrew Kowlessar, individually v. Halifax Hospital Medical Center, a special tax district under the laws of Florida, d/b/a Halifax Medical Center; Halifax Staffing, Inc.; and

   Romeo DeGracia, M.D.; Case No.: 1999-31527-CICI, Div. 31. The predicate for such suit was stated by Petitioners to be, as follows:

   As to Halifax Hospital and Halifax Staffing:

   
   

   1. Vicarious liability for the active negligence of nurses and resident physicians employed by the hospital; and/or,

      
      

   2. Vicarious liability for the active negligence of its actual or apparent agent, Dr. Romeo DeGracia.

      
      

      As to Dr. Romeo DeGracia:

      
      

      Active negligence of Dr. DeGracia, either individually or as actual or apparent agent

      of the hospital, in abandoning his patient or in failing to attend the labor and delivery of Carmen Diaz and her fetus/infant, Gordon Kowlessar.

      
      

6. Shortly after mediation on July 22, 2002, the parties in the civil action reached a verbal, "contingent or conditional settlement agreement." That agreement was confirmed by letter of August 9, 2002, from counsel for the Plaintiffs (here Petitioners) to counsel for the Defendants, as follows:

   This letter is intended to memorialize our agreement with Halifax Medical Center, Halifax Staffing, Dr. DeGracia, and

   Dr. DeGracia's professional liability insurer.

   
   

   It is my understanding that Dr. DeGracia's insurer has agreed to pay $500,000 toward this agreement. Halifax and Halifax Staffing have agreed to pay $200,000 toward this agreement. In addition, Halifax and Halifax Staffing have agreed to pay a sum in satisfaction of attorney's fees and costs, including the costs of establishing a special needs trust on Gordon's behalf, and to satisfy all liens and subrogated interests, for a combined settlement between 1.15 million dollars and 1.2 million dollars. In exchange, the plaintiffs have agreed to not oppose and, if necessary, support a petition to reopen the NICA claim.

   
   

   This will confirm that it is the intent of the parties to this agreement that Gordon and his parents receive the benefit of both this agreement and the benefits of NICA. To this end, the agreement is conditioned upon approval by NICA; a determination of compensability and the payment of benefits under NICA, including a $100,000.00 lump sum payment to the parents; and the plaintiffs' receiving the benefit of both payment under

   this agreement and the benefits provided by NICA. This will necessitate resolution of any issue with respect to exclusivity of remedy by NICA's agreement not to pursue this issue. We have also agreed that the plaintiffs will not be prejudiced by their cooperation pursuant to this settlement agreement and that should any of these conditions fail, nothing that occurs in the NICA proceedings can be raised or used for any purpose to defeat or adversely affect the plaintiffs' civil claim which we agree the plaintiffs will be free to pursue should this agreement fail. By law, this agreement must also be approved by court as it involves the claim of a minor.

   
   

   I understand that you have drafted a stipulation to continue/stay the trial (which is set for hearing on Judge Johnson's expedited calendar per his request for Tuesday, August 13, 2002, at 8:00 a.m.) and a petition to reopen NICA. We need to draft a settlement agreement that will put us in the best posture to satisfy the intent of this agreement. I have requested your input in this regard. Until then, this letter will memorialize our agreement. If there is anything that is incorrect or incomplete with respect to the terms set forth above, please contact me immediately; otherwise we will proceed accordingly.

   
   

   As of the April 29, 2003, hearing, the parties' agreement had not been further formalized; however, by the time the hearing was held on September 23, 2003, the settlement (for $1,200,000.00) had been approved by order of the Circuit Court, dated

   September 18, 2003 (Respondent's Exhibit 7), and releases had been exchanged.

   The award

   
   

7. Pertinent to this case, at the time of Gordon's birth, and when the claim was filed, Section 766.31(1), Florida Statutes, provided for an award of the following items:

   1. Actual expenses for medically necessary and reasonable medical and hospital, habilitative and training, residential, and custodial care and service, for medically necessary drugs, special equipment, and facilities, and for related travel. However, such expenses shall not include:

      
      

      1. Expenses for items or services that the infant has received, or is entitled to receive, under the laws of any state or the Federal Government, except to the extent such exclusion may be prohibited by federal law.

      
      

      * * *

      
      

      Expenses included under this paragraph shall be limited to reasonable charges prevailing in the same community for similar treatment of injured persons when such treatment is paid for by the injured person.

      
      

   2. 1. Periodic payments of an award to the parents or legal guardians of the infant found to have sustained a birth-related neurological injury, which award shall not exceed $100,000. However, at the discretion of the administrative law judge, such award may be made in a lump sum.

      
      

      * * *

      
      

   3. Reasonable expenses incurred in connection with the filing of a claim under ss. 766.301-766.316, including reasonable attorney's fees, which shall be subject to the approval and award of the administrative law judge. In determining an award for

   attorney's fees, the administrative law judge shall consider the following factors:

   
   

   1. The time and labor required, the novelty and difficulty of the questions involved, and the skill requisite to perform the legal services properly.

      
      

   2. The fee customarily charged in the locality for similar legal services.

      
      

   3. The time limitations imposed by the claimant or the circumstances.

      
      

   4. The nature and length of the professional relationship with the claimant.

      
      

   5. The experience, reputation, and ability of the lawyer or lawyers performing services.

   
   

8. Effective June 7, 2002, Section 766.31(1)(a), Florida Statutes, was amended to read, as follows:

   (a) Actual expenses for medically necessary and reasonable medical and hospital, habilitative and training, family residential or custodial care, professional residential, and custodial care and service, for medically necessary drugs, special equipment, and facilities, and for related travel . . . .

   (Emphasis added)

   
   

   Ch. 02-401, § 6, Laws of Fla. And, Section 766.302, Florida Statutes, was amended to include the following definitions:

   1. "Family member" means a father, mother, or legal guardian.

      
      

   2. "Family residential or custodial care" means care normally rendered by trained professional attendants which is beyond the scope of child care duties, but which is provided by family members. Family members who provide nonprofessional residential or custodial care may not be compensated under

      this act for care that falls within the scope of child care duties and other services normally and gratuitously provided by family members. Family residential or custodial care shall be performed only at the direction and control of a physician when such care is medically necessary. Reasonable charges for expenses for family residential or custodial care provided by a family member shall be determined as follows:

      
      

      1. If the family member is not employed, the per-hour value equals the federal minimum hourly wage.

         
         

      2. If the family member is employed and elects to leave that employment to provide such care, the per-hour value of that care shall equal the rates established by Medicaid for private-duty services provided by a home health aide. A family member or a combination of family members providing care in accordance with this definition may not be compensated for more than a total of 10 hours per day. Family care is in lieu of professional residential or custodial care, and no professional residential or custodial care may be awarded for the period of time during the day that family care is being provided.

   
   

   Ch. 02-401, § 5, Laws of Fla. Here, to the extent the amendments to Section 766.31(1)(a), Florida Statutes, are more restrictive, the provisions in effect when Gordon was born would apply.

   Findings related to past expenses

   
   

9. Here, Petitioners claim for past expenses is two-fold.

   
   

   First, Petitioners seek an award of $77,568.86, for a lien claimed by the Agency for Health Care Administration for Medicaid benefits provided Gordon. Second, Petitioners seek an award for

   family residential or custodial care they, as well as Gordon's grandmother, provided Gordon.

10. With regard to the Medicaid claim, the only proof offered was a letter of June 2, 2003, to Larry Sands, Petitioners' counsel, which provided:

    Dear Larry Sands:

    
    

    Sections 409.901 and 409.910, Florida Statutes, provides that the Agency for Health Care Administration has a statutory lien and is entitled to any rights a Medicaid recipient has to third party payments in this claim.

    
    

    If a settlement has been made, please send a check made payable to the Agency for Health Care Administration in the amount of

    $77,568.86, to the following address:

    
    

    PUBLIC CONSULTING GROUP, INC. CASUALTY RECOVERY UNIT

    P.O. BOX 4364 TALLAHASSEE, FL 32315-4364

    PHONE: (850) 309-0631

    or (800) 973-7828

    FAX: (850) 309-0632

    
    

    Thank you for your assistance in this matter. If you have any questions, please feel free to contact Deborah Thoma at the above address.

    
    

    (Petitioners' Exhibit 2.) Notably, the letter is hearsay, and was received into evidence subject to the limitations imposed by Section 120.57(1)(c), Florida Statutes. ("Hearsay evidence may be used for the purpose of supplementing or explaining other evidence, but it shall not be sufficient in itself to support a

    finding unless it would be admissible over objection in civil actions.")

11. Given the paucity of proof, the record fails to support an award for the expense claimed with regard to the Medicaid lien. Notably, since the letter is hearsay, it is neither competent proof of the existence of a lien or that the amount claimed ($77,568.86) accurately reflects sums paid for the care of Gordon. § 120.57(1)(c), Fla. Stat. See also Mercy Hospital v. Johnson, 431 So. 2d 687 (Fla. 3d DCA 1983)(Attorney's affidavit was hearsay, and was not competent proof of the number of hours or the nature of the legal services rendered).

    Moreover, if competent, the letter does not describe the services provided or their cost, and consequently fails to support a conclusion that the services provided, and for which Medicaid claims a lien, were medically necessary or that the charges were reasonable, as required for payment under the Plan.

    § 766.31(1)(a), Fla. Stat. Finally, under the terms of the settlement agreement in the civil suit, discussed supra at paragraph 6, Halifax Hospital and Halifax Staffing agreed to satisfy all liens and subrogated interests. Since the settlement has been consummated, and there being no proof to the contrary, it is reasonable to infer that the Medicaid lien was been satisfied, consistent with the parties' settlement agreement.

12. While Ms. Diaz's testimony supports the conclusion that she, Mr. Kowlessar, and Gordon's grandmother provided care for Gordon during his infancy, it fails to provide sufficient specificity from which a conclusion could be drawn, with any degree of confidence, as to the number of hours each dedicated to Gordon's care or, of the time dedicated to Gordon's care, what portion could reasonably be considered beyond the normal caregiving one would expect of a parent or that one could reasonably consider extraordinary. Petitioners also failed to establish, by competent proof, that extraordinary care was necessary. Ms. Diaz's affidavit, albeit not competent proof, suffers the same deficiencies. Consequently, the proof fails to support an award for residential or custodial care.

    Findings related to the parental award

    
    

13. At hearing, Petitioners, as the parents of Gordon Kowlessar, a minor, requested a lump sum award of $100,000.00.

    § 766.31(1)(b), Fla. Stat. Respondent, provided Petitioners' settlement of their civil suit does not bar them from an award under the Plan, does not oppose Petitioners' request.

    Findings related to attorney's fees and costs

    
    

14. The initial step in deriving a reasonable attorney's fee is to determine the number of hours reasonably expended to pursue the claim. Pertinent to this aspect of the case, Petitioners submitted what was titled "Time records Re: Carmen

    L. Diaz and Andrew Kowlessar, as parents and natural guardians of Gordon Kowlessar, a minor v. NICA" (Time Records) reflecting the time their counsel, Mr. Sands, claimed was dedicated to the claim.3 According to the time record, Mr. Sands dedicated 331.5 hours pursuing the claim.

15. While counsel may have expended 331.5 hours on the claim, it is, "[u]nder the 'hour-setting' portion of the lodestar computation, . . . important to distinguish between 'hours actually worked' versus 'hours reasonably expended.'" Florida Birth-Related Neurological Injury Compensation Association v.

    Carreras, 633 So. 2d 1103, 1110 (Fla. 3d DCA 1994). Moreover, only time incurred affirmatively pursuing a claim is compensable, not time incurred in exploring opportunities to avoid Plan exclusivity, such as lack of notice. Carreras, supra, at page 1109. Moreover, block billing, the practice of recording the gross number of hours each day for multiple tasks, as practiced by Mr. Sands, makes it difficult to quantify time associated with the NICA claim, and may result in a reduction in hours. Florida

    Compensation Fund v. Rowe, 472 So. 2d 1145, 1150 (Fla. 1985)("Inadequate documentation may result in a reduction in the number of hours claimed . . . ."). Notably, apart from the description of the services rendered reflected in the Time Records, Mr. Sands offered neither testimony nor competent proof to explain the services performed, and called no expert witness

    to substantiate the reasonableness of the hours claimed. Yakubik v. Board of County Commissioner's of Lee County, 656 So. 2d 591 (Fla. 2d DCA 1995)("The testimony of an expert witness concerning reasonable attorney's fees is necessary to support the establishment of the fees.")

16. Contrasted to the proof offered by Petitioners, Respondent called Francis E. Pierce, III, an attorney licensed to practice law in the State of Florida, who is experienced in medical malpractice, as well as the Plan. Based on his review of the pleadings in the case, Mr. Sands' Time Records, a chronological timeline of the circuit court action and administrative proceeding, and the opinion in Carreras, supra, Mr. Pierce expressed two opinions regarding the hours identified by Mr. Sands' Time Records.

17. In his first analysis of Mr. Sands' Time Records,

    
    

    Mr. Pierce accepted that Mr. Sands affirmatively sought NICA benefits from November 25, 1997, until January 13, 1999, when he appeared for the hearing on compensability and presented evidence, through Ms. Diaz, that Gordon was not mentally impaired. Thereafter, on January 14, 1999, Mr. Sands' prepared a proposed final order, which resolved that, given the absence of proof to demonstrate that Gordon was substantially mentally impaired, the claim be dismissed with prejudice. Not credited during this period in Mr. Pierce's calculation, were the entries

    of October 7, 1998, and October 28, 1998, which exclusively involved communication with the referring attorney. This calculation derived 59.85 hours.

18. From the Time Records, Mr. Pierce identified July 23, 2002, as the first date to reflect a change in Plaintiff's position, and an interest in again pursuing a NICA claim.

    Mr. Pierce also identified the entries for August 5, 2002; August 14, 2002; August 22, 2002; September 12, 2002;

    September 17, 2002; September 23, 2002; and from October 1, 2002, through May 19, 2003, as being consistent with the pursuit of NICA benefits. That time totaled 78.4 hours which, combined with the period of November 25, 1995, to January 13, 1999, derived a total of 138.25 hours.

19. In his second analysis, Mr. Pierce refined his first evaluation by eliminating the hours claimed for block-billed entries that included noncompensable tasks, such as conference with referring attorney, issues concerning the amount of attorney's fees, or the exclusiveness of the NICA remedy (an issue pertinent to the civil suit but not the NICA claim). Mr. Pierce's rationale for excluding those entries was his inability, absent speculation, to allocate the time among the various tasks mentioned in the entry. Identified entries included November 25, 1997 (5.5 hours); April 13, 1998 (2.1 hours); October 30, 1998 (1.5 hours); November 10, 1998 (.7

    hours); August 5, 2002 (6.5 hours); September 17, 2002 (2.5

    
    

    hours); April 21, 2003 (.6 hours); April 30, 2003 (.7 hours);

    
    

    May 5, 2003 (1.5 hours); May 7, 2003 (.8 hours); and May 12, 2003 (.5 hours), which totaled 22.9 hours. Reducing Mr. Pierce's initial calculation (138.25 hours) by the 22.9 hours identified in his second evaluation derives a calculation of 115.35 hours, as related to the NICA claim.

20. Mr. Pierce's analysis was rationally based and, there being no further explanation of record from Mr. Sands, is accepted. However, the figure calculated by Mr. Pierce should be further reduced by 5.35 hours, which represents time expended investigating notice as an opportunity to avoid Plan exclusivity.4 Consequently, 110 hours can be identified as related to the affirmative pursuit of Plan benefits.

21. The next consideration in establishing a reasonable fee is the determination of the fee customarily charged in the locality for similar legal services, when the fee basis is hourly billing for time worked. Carreras, supra, at page 1108. Here, in his affidavit, but not his testimony, Mr. Sands addressed the reasonableness of the $300.00 per hour rate he requested, and described it as "well below the rate normally obtained by this attorney and other comparable attorneys in civil actions involving comparable injuries and damages." (Petitioners' Exhibit 4.) Mr. Sands also offered the affidavit of

    James Cunningham, an attorney licensed to practice law in the State of Florida, who opined that "the hourly rate for the legal services performed by Mr. Sands of $300 per hour is fair and reasonable." (Petitioners' Exhibit 5.) Regarding

    Mr. Cunningham's statement, Respondent agreed, if Mr. Cunningham were to appear at hearing, he would so testify. (Transcript, page 49.) In contrast, Mr. Pierce, based on his experience, where the fee basis is hourly billing, opined that a reasonable fee for the services provided in this case was $175.00 per hour. (Transcript, pages 57-59 and 68.) Here, given the standard by which an hourly rate must be derived, Mr. Pierce's opinion is credited.

22. A reasonable fee, under the methodology established by Florida Patient's Compensation Fund v. Rowe, 472 So. 2d 1145 (Fla. 1985) and Florida Birth-Related Neurological Injury Compensation Plan v. Carreras, supra, is determined by multiplying the hours reasonably expended by the reasonable hourly rate. The results produce the "lodestar figure" which, if appropriate, may be adjusted because of the remaining factors contained in Section 766.31(1)(c), Florida Statutes. Applying such methodology to the facts of this case produces a "lodestar figure" of $19,250.00.

23. Upon consideration of the facts of this case, and the remaining criteria established at Section 766.31(1)(c) 3-6,

    Florida Statutes, there is no apparent basis or reason to adjust the "lodestar figure." In this regard, it is observed that there were no significant time limitations shown to have been imposed by the claimant or the circumstances in this particular case, and the nature and length of the professional relationship with the claimants was likewise a neutral consideration. The experience, reputation and ability of the lawyer who performed the services has been considered in establishing the reasonable hours and hourly rate, and does not, in this case, afford a basis to adjust the "lodestar figure." Finally, although counsel was employed on a contingency fee basis and stood to recover no fee if he proved unsuccessful in pursuing the claim or, alternatively, a medical malpractice suit, the contingency nature of the fee arrangement does not warrant an adjustment of the "lodestar figure." Given the nature of the claim, if pursued soberly, there was little risk the claim would not have been accepted, as compensable.

24. Finally, Petitioners' counsel incurred certain expenses in his representation of Petitioners for which recovery is sought. Such costs total $2,879.21, and are set forth on

    Mr. Sands' Cost Statement (Petitioners' Exhibit 4, Exhibit B), as follows:

    8/28/98- Copying charges for 895.25

    8/31/98 medical records filed

    with NICA

    8/31/98	Clerk, Div. Of Adm. Hearings, Filing Petition for Compensation	15.00
    11/10/98	Federal Express for sending add'l client medical records and expert report of Leon Charash	25.00
    12/15/98	Westlaw, legal research	32.54
    10/18/99	Database Techologies, legal research	24.50
    10/16/00	Westlaw, legal research	50.00
    6/20/01	Westlaw, legal research	50.00
    8/30/01	Photocopying, 25 Fla L Weekly	.50
    11/19/01	Westlaw, legal research	50.00
    1/28/02	Westlaw, legal research	50.00
    1/28/02	Fed Ex to Hon. Jon S. Wheeler Clerk First Dist. Ct. of Appeal	21.82
    3/20/02	Travel to Tallahassee for oral argument (air, hotels, meals -	398.00
    	HMC's appeal)
    6/26/02	Travel to Tallahassee for oral argument (air, hotel, meals - DeGracia's appeal)	398.00
    8/05/02	Westlaw, legal research	50.00
    8/14/02	Steven L. Sands, travel to Tallahassee to meet with Kirk Davis, Wilbur Brewton, Bruce Culpepper	466.50
    8/20/02	Westlaw, legal research	150.00
    8/27/02	Westlaw, legal research	50.00
    10/22/02	Westlaw, legal research	50.00

    1/15/03 The Reporters Group transcript 102.10 of 12/17/02 NICA telephonic

    hearing

    
    

    TOTAL COSTS $2,879.21

    
    

25. Here, Respondent does not object to the copying charges for medical records ($895.25), the filing fee for the Division of Administrative Hearings ($15.00), or the cost of the transcript of the December 17, 2002, hearing ($102.10). Accordingly, those expenses, which total $1,012.35, are awarded without further discussion.

26. Regarding the costs or expenses to which Respondent objects, it is observed that apart from the itemization of these expenses (Petitioners' Exhibit 4), Petitioners offered no other proof or explanation for such expenses. There being no such proof, it would be speculative to conclude they were reasonable in amount or necessarily incurred in pursuing the claim. Moreover, the cost of postage (or Federal Express), research, and copying (generally considered as part of office overhead) and the cost of travel (including "air, hotel, meals") are generally not taxable. See Florida Rules of Civil Procedure, Statewide Uniform Guidelines for Taxation of Costs in Civil Action.

    CONCLUSIONS OF LAW

    
    

    Jurisdiction

    
    

27. The Division of Administrative Hearings has jurisdiction over the parties to, and the subject matter of, these proceedings. § 766.301, et seq., Fla. Stat. Compensability

28. The Florida Birth-Related Neurological Injury Compensation Plan was established by the Legislature "for the purpose of providing compensation, irrespective of fault, for birth-related neurological injury claims" relating to births occurring on or after January 1, 1989. § 766.303(1), Fla. Stat.

29. The injured "infant, her or his personal representative, parents, dependents, and next of kin," may seek compensation under the Plan by filing a claim for compensation with the Division of Administrative Hearings. §§ 766.302(3), 766.303(2), 766.305(1), and 766.313, Fla. Stat. The Florida Birth-Related Neurological Injury Compensation Association, which administers the Plan, has "45 days from the date of service of a complete claim . . . in which to file a response to the petition and to submit relevant written information relating to the issue of whether the injury is a birth-related neurological injury."

    § 766.305(3), Fla. Stat.

    
    

30. If NICA determines that the injury alleged in a claim is a compensable birth-related neurological injury, it may award

    compensation to the claimant, provided that the award is approved by the administrative law judge to whom the claim has been assigned. § 766.305(6), Fla. Stat. If, however, NICA disputes the claim, the dispute must be resolved by the assigned administrative law judge in accordance with the provisions of Chapter 120, Florida Statutes. §§ 766.304, 766.307, 766.309, and

    766.31, Fla. Stat.

    
    

31. In discharging this responsibility, the administrative law judge must make the following determination based upon the available evidence:

    1. Whether the injury claimed is a birth- related neurological injury. If the claimant has demonstrated, to the satisfaction of the administrative law judge, that the infant has sustained a brain or spinal cord injury caused by oxygen deprivation or mechanical injury and that the infant was thereby rendered permanently and substantially mentally and physically impaired, a rebuttable presumption shall arise that the injury is a birth-related neurological injury as defined in s. 766.303(2).

       
       

    2. Whether obstetrical services were delivered by a participating physician in the course of labor, delivery, or resuscitation in the immediate post-delivery period in a hospital; or by a certified nurse midwife in a teaching hospital supervised by a participating physician in the course of labor, delivery, or resuscitation in the immediate post-delivery period in a hospital.

    
    

    § 766.309(1), Fla. Stat. An award may be sustained only if the administrative law judge concludes that the "infant has sustained

    a birth-related neurological injury and that obstetrical services were delivered by a participating physician at birth."

    § 766.31(1), Fla. Stat.

    
    

32. Pertinent to this case, "birth-related neurological injury" is defined by Section 766.302(2), Florida Statutes, to mean:

    . . . injury to the brain or spinal cord of a live infant weighing at least 2,500 grams for a single gestation or, in the case of a multiple gestation, a live infant weighing at least 2,000 grams at birth caused by oxygen deprivation or mechanical injury occurring in the course of labor, delivery, or resuscitation in the immediate postdelivery period in a hospital, which renders the infant permanently and substantially mentally and physically impaired. This definition shall apply to live births only and shall not include disability or death caused by genetic or congenital abnormality.

    
    

33. Here, it has been established that the physicians who provided obstetrical services at birth were "participating physician[s]," as that term is defined by the Plan, and that Gordon suffered a "birth-related neurological injury," as that term is defined by the Plan. Consequently, the administrative law judge is required to make an award of compensation unless, as alleged by NICA, Petitioners are barred from pursuing an award by virtue of their settlement of the civil suit. See §§ 766.304 and 766.31(1), Fla. Stat.

    The statutory bar to recovery (Section 766.304)

    
    

34. The Florida Birth-Related Neurological Injury Compensation Plan establishes an administrative system that provides compensation on a no-fault basis for an infant who suffers a narrowly defined birth-related neurological injury, and was intended to be a substitute, a limited no-fault alternative, for common law rights and liabilities. See §§ 766.301, 766.303(2), and 766.316, Fla. Stat.; and Humana of Florida, Inc. v. McKaughan, 652 So. 2d 852, (Fla. 2d DCA 1995), approved, Florida Birth-Related Neurological Injury Compensation

    Association v. McKaughan, 668 So. 2d 974 (Fla. 1996). Nevertheless, in Gilbert v. Florida Birth-Related Neurological Injury Compensation Association, 724 So. 2d 688 (Fla. 2d DCA 1999), the court, in construing the existent provisions of the Plan, held that the doctrine of election of remedies did not bar a claimant from settling a civil suit and then pursuing benefits under the Plan. The court expressed its reasoning as follows:

    We first address the issue of whether the receipt of compensation by a "NICA baby" from a source other than NICA "would thwart the purpose of the plan." It clearly does not.

    Section 766.31(1)(a), Florida Statutes (Supp. 1988), recognizes that a NICA infant may receive compensation from other sources, such as state and federal governments and health insurance. It provides that these benefits shall be an offset to benefits under the Plan. The law does not address benefits which may be received from other collateral sources, such as charities, or even from the

    health care provider on a voluntary basis. Therefore, the fact that Michael has received benefits from other sources, in and of itself, has no effect on his entitlement to Plan benefits.

    
    

    The sole issue is whether the obtaining of benefits as a product of a civil action forecloses access to Plan benefits. The answer is yes if that action resulted in a factual determination that the infant was not a NICA baby. Conversely, if an administrative petition results in a determination that the infant is a NICA baby, a civil action is foreclosed. The remedies are mutually exclusive, but only upon a determination of whether the infant is a NICA baby.

    
    

    * * *

    
    

    Finally, the facts of this case do not fit within the law of election of remedies. Our leading authority in the area is Williams v. Robineau, 124 Fla. 422, 168 So. 644, 646 (Fla. 1936), where the court explained:

    
    

    An election of remedies presupposes a right to elect. It is a choice shown by an overt act between two inconsistent rights, either of which may be asserted at the will of the chooser alone. It is generally conceded that to be conclusive it must be efficacious to some extent. A position taken which does not injure the opposite party is not an election which precludes a change or raises an estoppel. The election is matured when the rights of the parties have been materially affected to the advantage of one or the disadvantage of the other.

    
    

    Here, the guardian's positions in the civil action and the administrative proceeding were inconsistent, but he did not have the option of choosing his theory of recovery. His theory of recovery was dependent upon the determination of whether Michael met the

    statutory definition of a NICA baby. Michael's remedies, therefore, were not coexistent and inconsistent as is required to apply the election of remedies doctrine. See Barbe v. Villeneuve, 505 So. 2d 1331 (Fla.

    1987).

    
    

    The fact that the defendants in the civil action elected to "buy their way out" of possible liability in no way adversely affects NICA. NICA has no more or no less liability now then it did absent the civil action. Thus, the doctrine of election of remedies does not apply. Therefore, we reverse the administrative law judge's summary order dismissing the petition for benefits under the Plan and remand for the resolution of factual issues which will determine NICA's liability.

    
    

    Gilbert, 724 So. 2d at 690-92. The court further noted that the Legislature, at the time the Gilbert claim was filed, had not incorporated an election of remedies clause.5

35. "In an effort to prevent the recurrence of the Gilbert

    
    

    situation, the Legislature amended section 766.304 in 1998 to preclude both a civil and a NICA claim recovery." Romine v. Florida Birth-Related Neurological Injury Compensation Association, 842 So. 2d 148, 152 (Fla. 5th DCA 2003). Pertinent to this case, the amendments (underlined) to Section 766.304, Florida Statutes, were as follows:

    * * *

    
    

    766.304 Administrative law judge to determine claims.--The administrative law judge shall hear and determine all claims filed pursuant to ss. 766.301-766.316 and shall exercise the full power and authority

    granted to her or him in chapter 120, as necessary, to carry out the purposes of such sections. The administrative law judge has exclusive jurisdiction to determine whether a claim filed under this act is compensable.

    No civil action may be brought until the determinations under s. 766.309 have been made by the administrative law judge. If the administrative law judge determines that the claimant is entitled to compensation from the association, no civil action may be brought or continued in violation of the exclusiveness of remedy provisions of s.

    1. An action may not be brought

       under ss. 766.301-766.316 if the claimant recovers or final judgment is entered . . . .

       
       

       Ch. 98-113, § 1, Laws of Fla. (emphasis added). In doing so, the Legislature provided:

       The amendments to sections 766.301 and 766.304, Florida Statutes, shall take effect July 1, 1998, and shall apply only to claims filed on or after that date and to that extent shall apply retroactively regardless of the date of birth.

       
       

       Ch. 98-113, § 6, Laws of Fla.

       
       

36. In Romine v. Florida Birth-Related Neurological Injury Compensation Association, supra, the court resolved that the amendments to Section 766.304, could not be applied retroactively to bar the recovery of NICA benefits for an infant born prior to the effective date of the amendment, although the claimant had settled a civil suit against the participating physician and hospital. In so concluding, the court reasoned, as follows:

    The 1998 amendment to section 766.304, if applicable to the Romine's claim, significantly changes their ability to

    recover under NICA. Prior to the 1998 amendments, the Romines could have recovered both under NICA and in a civil action. See Gilbert, 724 So. 2d at 690. However, the 1998 amendment, if applicable, bars the Romines from receiving NICA benefits because they recovered a settlement in their medical malpractice case.

    
    

    The Romines argue that a retroactive application of the 1998 amendment to section

    1. would materially alter their substantive rights to receive benefits under NICA. NICA asserts that the ALJ correctly applied the 1998 amendment to section 766.304 because it is clear that the Legislature intended the amendment to section 766.304 to be retroactive. NICA further contends that the amendment is purely procedural and did not change substantive rights to compensation.

    
    

    * * *

    
    

    Because NICA has long been compared to the workers' compensation system, cases construing the workers' compensation statutes provide us with guidance. Fla. Birth-Related Neurological Injury Comp. Ass'n v. Carreras, 633 So. 2d 1103, 1107 (Fla. 3d DCA 1994)(the

    NICA's no-fault system "is one comparable to the workers' compensation system"). The general rule in workers' compensation cases is that the substantive rights of the parties are fixed by the law in effect on the date of the injury, but that no party has a vested right in any particular procedure.

    Consequently, procedural amendments may be applied retroactively. McCarthy v. Bay Area Signs, 639 So. 2d 1114, 1115-16 (Fla. 1st DCA

    1994).

    
    

    Under NICA, an injured infant or his personal representative may seek compensation under NICA by filing a claim for compensation with the DOAH within five years of the infant's birth. See §§ 766.302(3), 766.305(1), and

    766.313, Fla. Stat. (1998). The date of the child's birth and the injuries sustained at that birth, if any, establish the right of the infant to receive NICA benefits and the scope of those benefits. Thus, we conclude that the Romines had a substantive, vested right the day Loren was born, because they had "a present, fixed right of future enjoyment" to receive NICA benefits if she was otherwise qualified to receive such benefits. See Brevda, 420 So. 2d at 891. We conclude that the amendment is more than a mere change in procedure; rather, it changes the right itself.

    
    

    For the foregoing reasons, we conclude that the ALJ erred in applying the 1998 amendment to section 766.304, Florida Statutes (1998), to bar the Romines' claim. We remand this matter to the DOAH for further proceedings consistent herewith.

    
    

37. Consequently, it must be resolved that, given the infant's date of birth (August 26, 1997), Petitioners' settlement of their civil suit does not preclude recovery under the Plan. Romine v. Florida Birth-Related Neurological Injury Compensation Association, supra.

    The award

    
    

38. Where, as here, it has been resolved that a claim qualifies for coverage under Section 766.309, Florida Statutes, and an award is not otherwise barred, the administrative law judge is required to make a determination of how much compensation, if any, should be awarded. § 766.31(1), Fla. Stat. Here, for the reasons noted in the Findings of Fact, it has been resolved that Petitioners' claim for past expenses be denied;

    Petitioners receive a parental award of $100,000.00, payable in lump sum; and Petitioners receive an award of attorney's fees in the sum of $19,250.00 and costs in the sum of $1,012.35.

    Notice of the award

    
    

39. When the administrative law judge determines that a claim qualifies for coverage under the Plan, he is required to enter an order to such effect, and cause a copy of such order to "be sent immediately by registered or certified mail to each person served with a copy of the petition under s. 766.305(2)."

§ 766.31(3), Fla. Stat. Such an order constitutes final agency action subject to appellant court review.

§ 766.311, Fla. Stat.

CONCLUSION

Based on the foregoing Findings of Fact and Conclusions of Law, it is

ORDERED that the claim for compensation filed by Carmen L. Diaz and Andrew Kowlessar, individually, and as the natural parents and guardians of Gordon Quinn Kowlessar, a minor, is approved.

It is further ORDERED that Carmen L. Diaz and Andrew Kowlessar, as the natural parents and guardians of

Gordon Quinn Kowlessar, a minor, are awarded One Hundred Thousand Dollars ($100,000.00), to be paid in lump sum.

It is further ORDERED that Petitioners are awarded

$20,262.35 for attorney's fees ($19,250.00) and other expenses ($1,012.35) incurred in pursuing the subject claim.

It is further ORDERED that, Petitioners' claim for past expenses is denied, and that, consistent with Section 766.31(1)(a), Florida Statutes, Respondent shall pay future expenses as incurred.

It is further ORDERED that, consistent with Section 766.312, Florida Statutes, the Division of Administrative Hearings retains jurisdiction over this matter to resolve any disputes, should they arise, regarding the parties' compliance with the terms of this Amended Final Order.

DONE AND ORDERED this 18th day of November, 2003, in Tallahassee, Leon County, Florida.

S

WILLIAM J. KENDRICK

Administrative Law Judge

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

(850) 488-9675 SUNCOM 278-9675

Fax Filing (850) 921-6847 www.doah.state.fl.us

Filed with the Clerk of the Division of Administrative Hearings this 18th day of November, 2003.

ENDNOTES

1/ These are the last appearances of record. Over time, various other attorneys have appeared.

2/ All citations are to Florida Statutes (2002) unless otherwise indicated.

3/ The Time Record was attached as Exhibit A to Mr. Sands' affidavit. (Petitioners' Exhibit 4). Mr. Sands' affidavit, like Ms. Diaz's affidavit, was hearsay and subject to the limitations imposed by Section 120.57(1)(e).

4/ Time recorded for September 8, 1998 (.8 hours); October 6,

1998 (.5 hours); October 9, 1998 (1.5 hours); October 16, 1998

(1.8 hours); and October 26, 1998 (.75 hours).

5/ In Gilbert, at page 691, footnote 1, the court observed:

1. The Plan was first proposed by the 1987 Academic Task Force for Review of the Insurance and Tort Systems. See Galen of Fla., Inc. v. Braniff, 696 So. 2d 308 (Fla. 1997). In its November 6, 1987, report, the Task Force recommended adoption of a no-fault compensation plan for birth-related neurological injuries similar to the then newly-enacted Virginia Plan (1987 Va. Acts Ch. 540). Id. In 1990, the Virginia plan was amended to include, in relevant part, the following provision in its exclusivity clause, § 38.2-5002:

D. Notwithstanding anything to the contrary in this section, a civil action arising out of or related to a birth-related neurological injury under this chapter, brought by an infant, . . . shall not be foreclosed against a nonparticipating physician or hospital, provided that (i) no participating physician or hospital shall be made a party to any such action or related action, and (ii) the commencement of any such action, regardless of its outcome, shall constitute an election of remedies, to the exclusion of any claim under this

chapter . . . . 1990 Va. Acts Ch. 535

(emphasis added). In 1993, the Florida Legislature amended the Plan. See Ch. 93- 251, Laws of Fla. (1993). Among other changes, the legislature reduced the time to file a Plan petition from seven years to five years. However, the legislature did not incorporate an election of remedies clause like Virginia's statute.

In 1998, however, the legislature did amend section 766.304 to provide . . . [inter alia, that] [a]n action may not be brought under ss. 766.301-766.316 if the claimant recovers or final judgment is entered . . . .

As discussed infra, the amendments to Section 766.304 only applied to claims filed on or after July 1, 1998. Consequently, the amendments did not apply to and were not addressed in Gilbert.

COPIES FURNISHED:

(By certified mail)

Larry Sands, Esquire Sands, White & Sands, P.A. 760 White Street

Daytona Beach, Florida 32115-2010

Bruce Culpepper, Esquire

Akerman, Senterfitt & Eidson, P.A.

301 South Bronough Street, Suite 200 Tallahassee, Florida 32302-2555

Kirk S. Davis, Esquire

Akerman, Senterfitt & Edison, P.A.

100 South Ashley Drive, Suite 1500 Tampa, Florida 33602-5314

Donald H. Whittemore, Esquire Andrew W. Rosin, Esquire Phelps Dunlap LLP

100 South Ashley Drive, Suite 1900 Tampa, Florida 33602-5311

Kenney Shipley, Executive Director Florida Birth-Related Neurological

Injury Compensation Association 1435 Piedmont Drive, East, Suite 101 Post Office Box 14567

Tallahassee, Florida 32308

Ms. Charlene Willoughby Department of Health

4052 Bald Cypress Way, Bin C-75 Tallahassee, Florida 32399-3275

NOTICE OF RIGHT TO JUDICIAL REVIEW

A party who is adversely affected by this final order is entitled to judicial review pursuant to Sections 120.68 and 766.311.

Review proceedings are governed by the Florida Rules of Appellate Procedure. Such proceedings are commenced by filing the original of a notice of appeal with the Agency Clerk of the Division of Administrative Hearings and a copy, accompanied by filing fees prescribed by law, with the appropriate District Court of Appeal. See Section 766.311, and Florida Birth-Related Neurological Injury Compensation Association v. Carreras, 598 So. 2d 299 (Fla. 1st DCA 1992). The notice of appeal must be filed within 30 days of rendition of the order to be reviewed.

Docket for Case No: 98-003842N

Orders for Case No: 98-003842N