The Issue The sole issue in this cause is whether or not the payments received from Gadsden County by Petitioner, as set forth on pages 4 through 8 of her Amended Petition, for services rendered as Official Court Reporter pursuant to Chapter 29, Florida Statutes, constitute "compensation" within the meaning of that term in Chapter 121, Florida Statutes.
Findings Of Fact On April 27 and May 1, 1992, respectively, the Respondent and the Petitioner submitted to the Hearing Officer their Proposed Recommended Orders including proposed Findings of Fact. In the Appendix to Recommended Order, the Hearing Officer submitted recommended rulings thereon. The following constitutes the rulings in this Final Order on those proposed Findings of Fact. The Petitioner's and Respondent's proposed Findings of Fact Nos. 1, 2, 3, 4, 5, 6, and 7, are hereby accepted and adopted in that they track the stipulated facts contained in the PREHEARING STIPULATION dated and filed March 30, 1992. The Petitioner's proposed Findings of Fact Nos. 8, 9, 10, and 11, are hereby rejected in that they are conclusions of law and were not contained within the stipulated facts contained within the PREHEARING STIPULATION, and are, therefore, not based upon competent substantial evidence. The actual employment position held by the Petitioner as an employee of the judicial branch of the State of Florida is clearly identified on Florida Retirement System Form FR-11, which was executed by the Petitioner on January 24, 1990, and certified by the Chief Judge of the Second Judicial Circuit (Exhibit 6 attached to the PREHEARING STIPULATION), whereon the "Title of Position held" is stated to have been "Official Court Reporter, Second Judicial Circuit of Florida assigned to Gadsden County." The supplemental salary that was paid to the Petitioner by the County required paper work identifying her as a county employee for payroll purposes only; but, as a matter of law, she held her State position as an official court reporter solely at the pleasure of the Judges of the Second Judicial Circuit pursuant to Section 29.01, Florida Statutes. In the Conclusions of Law in this Final Order, this issue shall be fully analyzed. RULINGS ON HEARING OFFICER'S RECOMMENDED CONCLUSIONS OF LAW Recommended Conclusion of Law No. 1 is hereby accepted as a proper statement of applicable law. Recommended Conclusion of Law No. 2 is hereby accepted as a correct statement of applicable law. Recommended Conclusion of Law No. 3 is hereby rejected in that it erroneously concludes that the Petitioner's salary and fees were authorized and set by statute, when, they had to have been authorized and set pursuant to Rule 2.070, Florida Rules of Judicial Administration. The conclusion of the Hearing Officer is incorrect because under Rule 2.070, Florida Rules of Judicial Administration, the compensation of, and the fees in question to be charged by, court reporters are authorized and set by such judicial rule. Rule 2.070, Florida Rules of Judicial Administration, adopted generally by reference the annual salary for court reporters set forth in Section 29.04, Florida Statutes, for a 60-hour work month. That judicial rule then goes on to provide for overtime at the rate of $10.00 per hour. That Rule 2.070, Florida Rules of Judicial Administration, also provides that the fees in question (for transcripts and depositions) to be charged by court reporters should be set in each circuit by administrative order, and, in the absence of such order, as provided by law. Such court reporters' fees, therefore, are set pursuant to said judicial Rule 2.070, which authorizes the charging of such fees in accordance with a circuit administrative order, and, in its absence, as provided by law. The setting of such fees and the authorization to charge same arise from said judicial Rule 2.070, and not from Chapter 29, Florida Statutes. The fee schedule set forth in Chapter 29, Florida Statutes, derives its legal efficacy not from its legislative enactment alone, but from its judicial approval in said Rule 2.070 in the event that a local circuit administrative order setting such fees has not been entered. In such instance, the fees are not set by statute, but by judicial approval of a statutory fee schedule. The judicial branch has set such fees, not the legislative. Thus, any such fees were not set by statute. The citations by the Hearing Officer in recommended Conclusion of Law No. 4 of Rules 22B-1.004(4)(b)1., and 22B-6.001(49), Florida Administrative Code, are rejected as being inapplicable to the proceeding at bar inasmuch as the Petitioner as an Official Court Reporter appointed pursuant to Section 29.01, Florida Statutes, was an employee of the State of Florida and was not an employee of Gadsden County. Under said Section 29.01 all official court reporters are appointed by and serve at the pleasure of the Chief Judge and a majority of the Judges of the Court in which the reporter is serving. Provision is made in Section 29.04, Florida Statutes, for the respective counties to provide funds necessary to pay the cost of reporting in criminal cases as necessary to provide competent reporters in such proceedings, but any such monies paid to such official court reporters would be paid to state employees. The judicial branch of government in Florida is a State court system. Official Court Reporters are hired and retained by the State Judges in a Circuit, and their employment is not determined or continued to any extent whatsoever by any Board of County Commissioners. Under Section 29.04(3), Florida Statutes, provision is made for the counties to supplement the funds necessary to pay the cost of reporting in criminal cases as necessary to provide competent reporters in such proceedings. The counties are a source of funding, and are not employers of the Official Court Reporters. In the case of Matter of Compensation of Hunter, 635 P.2d 1371 (Or. App. 1981), the Court of Appeals of Oregon held that where court reporters are appointed and hold their offices at the pleasure of the Judges, and are officers of the Court subject to the direction and control of the Judges, those court reporters are employees of the State of Oregon and not of the counties. At page 1373 of 635 P.2d the Court held: "The right to control is also important from a policy standpoint. The judges of the State of Oregon benefit directly from the services of the court reporters. They not only perform reporting duties in court, but are also the judges' official secretaries. See ORS 8.330. The State benefits most directly from court reporters' services, and it should be responsible for providing their workers' compensation insurance." Recommended Conclusion of Law of No. 5 is hereby rejected as a conclusion of law in that is a recitation of the relative positions of the parties and is not of any recommended holding or ruling by the Hearing Officer. Upon the reasoning and authorities set forth in Paragraph No. (3), above, recommended Conclusion of Law No. 6 is hereby rejected in that the fees in question were not authorized or set by legislative statute but were, in fact, authorized and set pursuant to judicial Rule 2.070, Florida Rules of Judicial Administration. The first three sentences of recommended Conclusion of Law No. 7 are hereby rejected in that they misconstrue the first sentence of Section 121.021(22), Florida Statutes, that states: "`Compensation', means the monthly salary paid a member, including overtime payments paid from a salary fund, as reported by the employer on the wage and tax statement (Internal Revenue Service form W-2) or any similar form." [Emphasis supplied] A form 1099 is not a form on which an employer reports salary paid from a salary fund to an employee, but, rather is a form utilized to report payments of income to an independent contractor. The "similar form" in that statute refers to an employer's wage and tax statement, which may be a form W-2, which is not the equivalent to a form 1099. As hereinafter discussed in Conclusions of Law Nos. (11), (12), and (13) of this Final Order, Official Court Reporters are "professional persons" within the meaning of that term in Section 121.021(22), Florida Statutes. The recommended Conclusion of Law of the Hearing Officer that the transcribing of criminal proceedings do not constitute "special or particular services" does not comport with either judicial Rule 2.070, Florida Rules of Judicial Administration, or a 1957 Opinion of the Attorney General of Florida. Under said judicial Rule 2.070 the basic salary for a court reporter is set in subsection (g) together with provision for the payment of overtime for hours in excess of 60 worked per month. In subsection (e) of Rule 2.070, provision is made for fees for what would constitute special or particular services by a court reporter, and the fees that may be charged for same. In a 1957 Opinion of the Attorney General of Florida (1957 0p. Att'y. Gen. Fla. 057- 109 (April 26, 1957)), the Attorney General of Florida analyzed Section 122.02, Florida Statutes, the predecessor to Section 121.021(22), Florida Statutes, as to what constituted compensation under the State and County Officers and Employees Retirement System (SCOERS). The opinion of the Attorney General was that hourly wages plus overtime would be included within the monthly compensation. But, at the end of that opinion the Attorney General concluded: "We conclude that in the case mentioned in the question the employing authority has prescribed the formula for fixing the monthly compensation or salary. It may vary depending upon the hours employed in discharging the routine work of the employment but the formula is fixed and applicable mathematically. This is not a situation where fees are paid for special or particular services. It is a regular retainer made depending upon the actual hours engaged in performing the month by month routine duties as School Board Attorney. It has no reference to fees for handing special items such as bond validation or other litigation." Under Rule 2.070, Florida Rules of Judicial Administration, official court reporters are paid their basic salary and overtime for their court appearances in reporting the proceedings. But, if they are to furnish transcripts of proceedings or depositions, which work would be done after their regular working hours, then the fees for such special or particular services are to be set by local circuit administrative order, or in the absence of same, as provided by law. These special or particular services that the court reporters are performing for such additional fees are not performed during their regular working hours, which by said Rule 2.070, is limited to 60 hours per month. And the last sentence of Recommended Conclusion of Law No. 7 that the Petitioner was a county employee is hereby rejected upon the grounds and reasoning set forth in Paragraph No. (4) above. The Hearing Officer's Recommended Conclusion of Law No. 8 (misnumbered as "7") is hereby rejected upon the grounds and for the reasons set forth in Paragraph Nos. (3) through (7) set forth above.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is recommended that respondent enter a final order approving petitioner's request for additional retirement benefits by including in the calculation of average final compensation those fees received by petitioner between January 1973 and February 1990 as set forth on pages 4 through 8 of her amended petition. RECOMMENDED this 24th day of June, 1992, in Tallahassee, Florida. DONALD R. ALEXANDER Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, FL 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this day of June, 1992. APPENDIX TO RECOMMENDED ORDER, CASE NO. 91-3168 Petitioner: Accepted in finding of fact 1. Accepted in finding of fact 2. 3-4. Accepted in finding of fact 3. 5-6. Accepted in finding of fact 4. 7. Accepted in finding of fact 5. 8-11. Accepted in finding of fact 3. Respondent: Accepted in finding of fact 1. Covered in preliminary statement and in finding of fact 2. 3-4. Accepted in finding of fact 3. 5-6. Accepted in finding of fact 4. 7. Accepted in finding of fact 5. COPIES FURNISHED: A. J. McMullian, III, Director Division of Retirement Cedars Executive Center, Building C 2639 North Monroe Street Tallahassee, FL 32399-1560 John A. Pieno, Secretary Department of Administration 435 Carlton Building Tallahassee, FL 32399-1500 Edgar Lee Elzie, Esquire P. O. Box 82 Tallahassee, FL 32302 Burton M. Michaels, Esquire Cedars Executive Center, Building C 2630 North Monroe Street Tallahassee, FL 32399-1560
The Issue The issue to be resolved in this proceeding concerns whether the Petitioner, Albert F. Cook, had a relationship with the Department of Corrections (DOC) at any time during the month of April, 1993, and if so, whether he was eligible to receive a retirement benefit for that month, as well.
Findings Of Fact The Petitioner was employed at times pertinent hereto by the Department of Corrections (DOC) at its Baker Correctional Institution facility. On February 19, 1993, he was notified of his transfer to the Florida State Prison, purportedly for disciplinary reasons. Upon learning of this eventuality, the Petitioner immediately went on sick leave. He maintains that it was duly- approved sick leave. No medical evidence to that effect was presented, but the Petitioner suggested that his illness might be of a psychiatric nature. He clearly was disgusted with the action taken by the DOC to transfer him. Subsequently thereto, he decided to apply for retirement, effective March 31, 1993. Shortly thereafter, he sought to have his retirement request rescinded or withdrawn; however, that request was denied. He was thereupon removed from the DOC payroll, effective March 31, 1993, essentially as a termination action. He received a retirement benefit check for the period of April 1-30, 1993 in the amount of $2,324.53 from the Division of Retirement. The Petitioner appealed the DOC employment action to the Public Employees Relations Commission and an administrative proceeding ensued. Ultimately, a settlement agreement was reached in that case which resulted in the Petitioner being allowed to resign, effective April 16, 1993, rather than suffer termination effective March 31, 1993. That agreement entered into by the parties in that case specifically stated that "the agency [DOC] will take whatever action is necessary to return the employee [Cook] to the payroll for the period between March 31, 1993 and April 16, 1993". The Division of Retirement was, of course, not a party to that agreement since it was not a party to the litigation involved. The agreement was incorporated into a Final Order issued by the Public Employees Relations Commission in Case No. CF-93-196, entered June 7, 1993. The Petitioner sent a letter to E.I. Perrin, the Superintendent of Florida State Prison, dated April 12, 1993, in which he stated "that if I am still on the payroll, I hereby resign my position with the Florida Department of Corrections effective April 16, 1993 . . .". According to attendance and leave reports signed by both the Petitioner and Marion Bronson, the Personnel Director of Florida State Prison, the Petitioner was on sick leave for the payroll period of March 26, 1993 through April 8, 1993. While the date of the Petitioner's signature on the relevant time sheet was April 8, 1993, the end of the pay period, the Petitioner testified that the time sheets had actually been submitted earlier. Attendance and leave reports for the following pay period indicated that the Petitioner continued on sick leave status through April 16, 1993. The time sheets for the latter period were not signed by the Petitioner but were signed by Marion Bronson. DOC ordered a manual payroll made up to record payment and to pay the Petitioner through April 16, 1993. He received a salary warrant for $1,234.43 for that period from April 1-16, 1993. That salary check and warrant reflects that retirement contributions were paid as to that April payroll period salary. Because he received additional retirement service credit and a new average final compensation as a result of being in a payroll status and being paid for the period of time in April 1993, the Petitioner's monthly retirement benefits actually now exceed what he would receive as retirement benefit payments had he not been compensated as an employee for his service through April 16, 1993. The Petitioner testified at hearing that he was terminated on March 31, 1993 and not re-hired. He further testified that he neither wanted nor expected payment from DOC for the period of March 31, 1993 through April 16, 1993 and that he "merely wanted to clear his name". Nevertheless, he entered into the settlement agreement which provided for him to be compensated and on payroll status through April 16, 1993, when he entered into the settlement with DOC in the proceeding before the Public Employees Relations Commission. He is presumed to have full knowledge of the content of that settlement agreement, and it reflects that he freely and voluntarily entered into it, as does his testimony. According to Mr. Bronson's testimony, during the relevant period from March 31, 1993 through April 16, 1993, the Petitioner was occupying an authorized and established employment position with DOC. His employment relationship continued with the Department, as a result of the settlement agreement, until April 16, 1993. Because Mr. Bronson and DOC are not parties to the present proceeding and have no financial interest in the outcome of this litigation, Mr. Bronson's testimony is deemed credible and is accepted insofar as it may differ from that of the Petitioner. The Respondent agency learned that a payroll had been prepared for the period of time in April of 1993 in question and that a salary warrant was issued on the basis of the settlement agreement extending the Petitioner's employment with DOC through April 16, 1993. The Division of Retirement thus temporarily reduced the Petitioner's retirement benefits to recover the amount of the resulting, unauthorized April retirement check. It was unauthorized because he remained employed for the period of time in April and was paid as though he were employed, as a result of the settlement agreement. Consequently, he was not entitled to retirement benefits for that period of time in April 1993 ending on April 16, 1993. Mr. Snuggs testified that every retirement applicant, such as the Petitioner, receives a form FRS-TAR, entitled "Retirement System Termination and Re-Employment". The Petitioner did not deny receiving that form (Respondent's Exhibit 4) which advises prospective retirees of their rights and obligations in terms of retirement and retirement benefits as it relates to re- employment.
Recommendation Having considered the foregoing Findings of Fact, Conclusions of Law, the evidence of record, the candor and demeanor of the witnesses, and the pleadings and arguments of the parties, it is RECOMMENDED that a Final Order be entered by the Department of Management Services, Division of Retirement, temporarily reducing the Petitioner's retirement benefits, in the manner already proposed by that agency, until such time as his April 1993 retirement benefit, paid to him previously, has been reimbursed to the agency. DONE AND ENTERED this 30th day of December, 1994, in Tallahassee, Florida. P. MICHAEL RUFF Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 30th day of December, 1994. APPENDIX TO RECOMMENDED ORDER, CASE NO. 94-2292 Respondent's Proposed Findings of Fact 1-11. Accepted. The Petitioner filed no proposed findings of fact. COPIES FURNISHED: Albert F. Cook Post Office Box 782 Sneads, Florida 32460 Robert B. Button, Esquire Department of Management Services Division of Retirement 2639 North Monroe Street, Bldg. C Tallahassee, Florida 32399-1560 A.J. McMullian, III, Director Division of Retirement 2639 North Monroe Street, Bldg. C Tallahassee, Florida 32399-1560 William H. Lindner, Secretary Department of Management Services Knight Building, Ste. 307 Koger Executive Center 2737 Centerview Drive Tallahassee, Florida 32399-0950
The Issue The issue in this case is whether Respondent, Eric Kachnycz, LLC d/b/a Done Right Irrigation and Lighting (“Done Right”), should have a penalty assessed against it by Petitioner, Department of Financial Services, Division of Workers’ Compensation (the “Department”), and, if so, the amount of such penalty or assessment.
Findings Of Fact The Department is the State agency responsible for, inter alia, ensuring that all businesses operating in this State have workers’ compensation insurance coverage. Done Right is a duly-formed and validly-existing limited liability company in the State of Florida. It was formed on July 27, 2004, for the purpose of conducting any and all lawful business. At the time of its formation, Eric Kachnycz was the only listed manager or managing member of the company. His address was listed as 9 Twin River Drive, Ormond Beach, Florida. The registered agent for the company was listed as Betty C. Kachnycz, at the same address. In 2011, Daniel Dupuis was added as a managing member of the company. His address was listed as a post office box in Ormond Beach, Florida. By way of a document filed with the Secretary of State, Division of Corporations, on March 1, 2016, Daniel Dupuis was withdrawn as a managing member of the company. On January 14, 2016, Kent Howe, a compliance investigator with the Department, conducted an investigation at 316 Ocean Dunes Road in Daytona Beach, Florida. Upon arrival at the site at around 11:00 a.m., Mr. Howe noted the presence of a large white truck and work trailer parked in front of the residence. The truck and trailer were imprinted with the name and contact information for Done Right. Mr. Howe saw a person (later identified as Daniel Dupuis) engaged in repair work on a sprinkler or irrigation system in the front yard of the residence. After about ten minutes observing Mr. Dupuis, Mr. Howe approached and asked him for whom he worked. Mr. Dupuis responded that he worked for Done Right and that Mr. Kachnycz owned and operated the business. There was another person at the job site who Mr. Dupuis identified as the owner of the residence. That person, with whom Mr. Howe did not converse, was observed walking into and out of the house and, just before Mr. Howe left the site at 1:00 p.m., was seen using a shovel to back-fill some of the irrigation ditches that had been dug.1/ Mr. Howe tracked down and called Mr. Kachnycz to inquire as to the existence of workers’ compensation insurance for his employees, including Mr. Dupuis. Mr. Kachnycz said that the only two persons associated with Done Right, he and Mr. Dupuis, had existing exemptions from workers’ compensation coverage. Further, Mr. Kachnycz said the he had personally applied for the exemptions himself. Mr. Howe checked the Department’s compliance and coverage automated system (CCAS) to verify the exemptions. He found that Mr. Kachnycz had a current exemption, but Mr. Dupuis’ exemption had expired on April 26, 2015, approximately nine months previous. Exemptions have a two-year term once granted, but may be renewed on-line prior to their expiration. Mr. Kachnycz obtained an exemption in 2004 and has renewed it every two years thereafter. Mr. Dupuis obtained his first exemption in February 2011, but did not timely renew it before it expired two years later. He then obtained an exemption in April 2013, but it expired in 2015. He did not have an exemption in place on January 14, 2016, while working at the job site. He did, however, apply for an exemption just two days later, i.e., on January 16, 2016. After verifying the corporate information for Done Right and checking CCAS to see if any other insurance coverage was in place, Mr. Howe determined that Done Right was not in compliance with workers’ compensation insurance requirements. The information gathered by Mr. Howe was presented to his area district manager, who approved the issuance of a stop work order. Mr. Howe prepared the SWO (along with a request for business records) and hand-delivered the documents to Mr. Dupuis at the job site. Mr. Howe attempted to serve the registered agent of Done Right, Betty C. Kachnycz, at her residence but Mr. Kachnycz said she was working out of town at her job as a registered nurse. So, instead of hand-delivery, Mr. Howe sent a copy of the SWO and request for business records to Mrs. Kachnycz via certified mail. The documents were delivered and signed as accepted by Mrs. Kachnycz on January 23, 2016. Subsequently, Mr. Howe had a conversation with Mr. Kachnycz concerning the possibility of Mr. Kachnycz signing a Conditional Agreed Release from the SWO. A blank copy of that agreement was provided for Mr. Kachnycz’ review, but he never signed the agreement. Mr. Howe later had another conversation with Mr. Kachnycz during which the latter inquired about the “criminal” charges against him related to the SWO. Mr. Howe knew nothing of any criminal charges and no evidence of such was offered at final hearing. Mr. Howe had no further contact with Mr. Kachnycz. Mr. Kachnycz ultimately asked for a formal administrative hearing to contest the SWO and penalty assessment, resulting in the instant case. During the preparation phase prior to final hearing, the Department continued to attempt to obtain the business records for Done Right. The Department served interlocking discovery on Done Right to obtain the business records along with other information. Mr. Kachnycz, however, steadfastly refused to provide the records unless, in his words, “[the records are] not used against me in a court of law.” During his deposition in this matter, Mr. Kachnycz reiterated his demand that his business records not be used against him in this proceeding, a clear indication of Mr. Kachnycz’ lack of understanding of the administrative process. There is no basis in law for such a demand by a party to an administrative proceeding. Mr. Kachnycz also invoked his Fifth Amendment rights and otherwise refused to answer questions posed to him during the deposition.2/ Review of an entity’s business records by the Department allows it to assess the amount of workers’ compensation insurance coverage for the business. A review also allows the Department to determine whether a penalty should be imposed at all. Had Done Right provided its business records in the instant case, it may have resolved the dispute without the necessity of a final administrative hearing. We shall never know. Based upon the absence of business records for Done Right, the Department used its existing rule constructs to formulate the amount of the penalty to be assessed. Anita Proano, an employee in the Department’s bureau of compliance, established a penalty using standard guidelines. Since Done Right did not provide business records for review, the imputed method was employed.3/ First, the payroll was calculated by using the average weekly wage in effect at the time of the issuance of the SWO and, per statute, multiplying by two. Class Code 5183-–under the construction umbrella, but specifically including irrigation and lawn sprinkler systems-– was assigned to the work being done by Done Right. The period of non-compliance was set at September 3, 2015, through December 31, 2015, and January 1, 2016, through January 14, 2016. Those are the dates within the Department’s two-year audit period that Done Right was deemed to be out of compliance. The imputed gross payroll amount was $29,571.77 for the first period of non-compliance and $3,450.04 for the second period. Those figures, divided by 100, resulted in the amounts of $295.72 and $34.50, respectively. The approved manual rate set for the two periods was $5.46 and $5.11, reflecting the rates for Class Code 5183. The premium owed by the employer for the first period was calculated at $1,614.62 and the premium it should have paid for the second period was $176.30. Those amounts, multiplied by two, resulted in assessed penalties of $3,229.24 and $352.60, for a total penalty of $3,581.84. Done Right presented no evidence to contest the amount of the penalty or the calculation thereof. Instead, Mr. Kachnycz inquired of the Department’s witnesses whether they had signed loyalty oaths and, if so, if they remembered what was in the oath. He expressed his displeasure at the process for penalizing small businesses and invoked his Constitutional rights (State and Federal), but provided no evidence germane to the issues of this case.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered assessing a penalty of $3,581.84 against Respondent, Eric Kachnycz, LLC, d/b/a Done Right Irrigation and Lighting. DONE AND ENTERED this 18th day of May, 2016, in Tallahassee, Leon County, Florida. S R. BRUCE MCKIBBEN Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 18th day of May, 2016
Findings Of Fact Case history On January 25, 2006, Renee Michelle Oliver, on behalf of and as parent and natural guardian of Ian David Oliver (Ian), a minor, and Renee Michelle Oliver, individually, filed a petition with the Division of Administrative Hearings (DOAH) to resolve whether Ian qualified for compensation under the Florida Birth-Related Neurological Injury Compensation Plan (Plan), and whether the hospital at which Ian was born (Central Florida Regional Hospital) and the participating physician who delivered obstetrical services at Ian's birth (David C. Mowere, M.D.) complied with notice provisions of the Plan. Additionally, the petition raised certain constitutional issues regarding the Plan. More particularly, the petition alleged: This Petition is being filed in compliance with the Circuit Court Order of Honorable James Perry dated January 18, 2006.[1] The Petitioners do not believe this claim falls properly under the NICA Act and file this Petition under protest. Further, Petitioners state that the NICA Act is unconstitutional as written and unconstitutional as specifically applied to this claim. Further, Petitioners state that clear and concise notice was never given to Renee Oliver by either Dr. Mowere or Central Florida Regional Hospital as required by 766.316, Florida Statutes of her rights and limitations under the NICA plan. Additionally, Petitioners would state that the composition of the NICA Board of Directors is biased on its face and it creates an unconstitutional lack of due process and proper access to the Courts. DOAH served the Florida Birth-Related Neurological Injury Compensation Association (NICA) with a copy of the petition on January 25, 2006, and on July 28, 2006, following a number of extensions of time within which to do so, NICA gave notice that it was of the view the claim was compensable, and requested that a hearing be scheduled to resolve compensability. In the interim, Central Florida Regional Hospital, as well as Dr. Mowere and Mid-Florida OB/GYN Specialists, P.A. (the practice at which Dr. Mowere was a member, and at which Ms. Oliver received her prenatal care), were accorded leave to intervene. (Order on Compensability and Notice, p. 4, and paragraph 8). Given the issues raised by the petition, a hearing was scheduled for October 10, 2006, to address compensability and notice, and leaving issues related to an award, if any, to be addressed in a subsequent proceeding. § 766.309(4), Fla. Stat.2 The parties were also accorded the opportunity to make a record with regard to the constitutional issues Petitioners had raised. Shortly before hearing, on September 29, 2006, the parties filed a Joint Pre-Hearing Stipulation whereby it was agreed the claim was compensable (a "participating physician" (Dr. Mowere) delivered obstetrical services at Ian's birth and Ian suffered a "birth-related neurological injury"), and that the hospital and the participating physician provided Ms. Oliver a copy of the NICA brochure, as required by Section 766.316, Florida Statutes. Left to resolve, with regard to notice, was whether the NICA brochure "include[d] a clear and concise explanation of a patient's rights and limitations under the plan," as required by Section 766.316, Florida Statutes. Otherwise, the only unresolved matter pending was the opportunity for the parties to make a record on the constitutional issues Petitioners had raised. As heretofore noted in the Preliminary Statement, the hearing was held as scheduled, on October 10, 2006, and on November 16, 2006, an Order on Compensability and Notice was entered. Thereafter, following Petitioners' unsuccessful appeal of that order to the Fifth District Court of Appeal, the parties resolved all issues related to the award, except those related to the amount owing for reasonable attorney's fees and expenses. The award provisions of the Plan relating to attorney's fees and costs Pertinent to this case, Section 766.31(1)(c), Florida Statutes, provides for an award of the following expenses: (c) 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: The time and labor required, the novelty and difficulty of the questions involved, and the skill requisite to perform the legal services properly. The fee customarily charged in the locality for similar legal services. The time limitations imposed by the claimant or the circumstances. The nature and length of the professional relationship with the claimant. The experience, reputation, and ability of the lawyer or lawyers performing services. The contingency or certainty of a fee. The claim for attorney's fees To calculate a reasonable attorney's fee, the first step is to determine the number of hours reasonably expended pursuing the claim. See Standard Guarantee Insurance Co. v. Quanstrom, 555 So. 2d 828 (Fla. 1990); Florida Patient's Compensation Fund v. Rowe, 472 So. 2d 1145 (Fla. 1985); Florida Birth-Related Neurological Injury Compensation Association v. Carreras, 633 So. 2d 1103 (Fla. 3d DCA 1994). Notably, "[u]nder the 'hour-setting' portion of the lodestar computation, it is important to distinguish between 'hours actually worked' versus 'hours reasonably expended'." Carreras, 633 So. 2d at 1110. . . . "Hours actually worked" is not the issue. The objective instead is for the trier of fact to determine the number of hours reasonably expended in providing the service. 'Reasonably expended' means the time that ordinarily would be spent by lawyers in the community to resolve this particular type of dispute. It is not necessarily the number of hours actually expended by counsel in the case. Rather, the court must consider the number of hours that should reasonably have been expended in that particular case. The court is not required to accept the hours stated by counsel. In re Estate of Platt, 586 So. 2d 333-34 (emphasis in original). The trier of fact must determine a reasonable time allowance for the work performed-which allowance may be less than the number of hours actually worked. Such a reduction does not reflect a judgment that the hours were not worked, but instead reflects a determination that a fair hourly allowance is lower than the time put in. Id. Moreover, only time incurred pursuing the claim is compensable, not time incurred exploring civil remedies or opportunities to opt out of the Plan through lack of notice or otherwise. Carreras, 633 So. 2d at 1109. See also Braniff v. Galen of Florida, Inc., 669 So. 2d 1051, 1053 (Fla. 1st DCA 1995)("The presence or absence of notice will neither advance nor defeat the claim of an eligible NICA claimant who has decided to invoke the NICA remedy . . .; thus, there is no reason to inquire whether proper notice was given to an individual who has decided to proceed under NICA. Notice is only relevant to the defendants' assertion of NICA exclusivity where the individual attempts to invoke a civil remedy."). Accord, O'Leary v. Florida Birth-Related Neurological Injury Compensation Plan, 757 So. 2d 624, 627 (Fla. 5th DCA 2000)("We recognize that lack of notice does not affect a claimant's ability to obtain compensation from the Plan."). Finally, a fee award must be supported with expert testimony, and cannot be based entirely on the testimony of the claimant's attorney. Palmetto Federal Savings and Loan Association v. Day, 512 So. 2d 332 (Fla. 3d DCA 1987); Fitzgerald v. State of Florida, 756 So. 2d 110 (Fla. 2d DCA 1999). See Nants v. Griffin, 783 So. 2d 363, 366 (Fla. 5th DCA 2001)("To support a fee award, there must be evidence detailing the services performed and expert testimony as to the reasonableness of the fee Expert testimony is required to determine both the reasonableness of the hours and reasonable hour rate."). To support the claim for attorney's fees, Petitioners offered an "Attorney Services" statement, which reflects a claim for 81 hours Petitioners' counsel, Gary Cohen, claims he dedicated to the claim. (Petitioners' Exhibit 1). Notably, the statement is not a business record, since Mr. Cohen did not, and does not in the ordinary course of his practice, maintain time records. Rather, the statement represents an effort to construct a time record to support Petitioners' claim for fees, and provides a summary of activities performed, with an estimate of time expended for each activity documented. The major activities were noted as "Meeting with Clients (2005)," 4.0 hours; "Preparation of Petition for Benefits," .5 hours; "Research before Petition re: NICA" (five areas listed), 10.5 hours; "Medical Records Review" (21 providers listed), 17.5 hours; "Depositions: Preparation and Attendance at" (6 depositions), 16.5 hours; "Hearings: Preparation and Attendance at" (9 entries), 8.75 hours; "Motions and Pleadings" (23 entries), 9.25 hours; "Correspondence: 2/06-9/06 77 letters and attachments," 10 hours; and "Expert Conferences" (with Dr. Mary Minkin, Dr. James Balducci, Frederick Raffa, Ph.D., and Paul Deutch, Ph.D., at 1 hour each), 4 hours. Where, as here, "attorneys have not kept contemporaneous time records, it is permissible for a reconstruction of time to be prepared." Brake v. Murphy, 736 So. 2d 745, 747 (Fla. 3d DCA 1999). However, the attorney must present evidence of his services in "sufficient . . . detail to allow a determination of whether each activity was reasonably necessary and whether the time allocation for each was reasonable." Id. (Emphasis omitted). See Florida Patient's Compensation Fund v. Rowe, 472 So. 2d at 1150 ("Inadequate documentation may result in a reduction of hours claimed, as will a claim for hours that the court finds to be excessive or unnecessary."); Lubkey v. Compuvac Systems, Inc., 857 So. 2d 966, 968 (Fla. 2d DCA 2003)("[T]he party seeking fees has the burden to allocate them to the issues for which fees are awardable or to show that the issues were so intertwined that allocation is not feasible."). Here, counsel claims 4 hours for a "Meeting with Clients (2005)," that likely predated the trial court's order of abatement and likely involved a discussion of matters not directly related to the NICA claim (Tr., p. 37). Nevertheless, an initial conference with a client, and the information obtained regarding her circumstances, is a natural starting point for any claim, be it a NICA claim or one sounding in medical malpractice. Consequently, the time claimed (4 hours) being reasonable, counsel should be compensated for his time. Also reasonable, is counsel's claim of .5 hours for "Preparation of Petition for Benefits." However, counsel's claim for "Research before Petition re: NICA," 10.5 hours, is, but for the claim of "NICA statute 766.302," 1 hour, rejected as the activities noted were not shown to be reasonably necessary to filing or pursuing the claim, and the time allocation for each activity was not shown to be reasonable. In so concluding, it is noted that the research activities mentioned ("Benefit Handbook," 2 hours; "NICA Notice and handout," .5 hours; "Case law re: NICA," 2.5 hours; and "Task Force Recommendation," 4.5 hours) are vague on specifics, and not demonstrative of necessity to filing a petition. It is further noted that the requisites for filing a claim are straight forward, and an attorney of moderate experience should experience no difficulty in filing a claim. Additionally, it is noted that counsel's testimony revealed he had filed 24 to 36 claims for compensation, and presumably was familiar with the requisites to file a claim. Consequently, if such "research" was done, apart from reviewing the statutory provisions of the Plan, it likely related to the issues of notice and constitutionality, and not issues related to compensability or benefits, which are prescribed by Sections 766.301, et seq., Florida Statutes. Finally, there is nothing to support a conclusion that the time claimed for each task was reasonable. Consequently, for Petitioners' claim for "Research before Petition re: NICA," 1 hour is considered reasonable. Next, counsel claims 17.5 hours for "Medical Records Review." Included are the medical records of 19 providers, and the reports of Michael Duchowny, M.D. (Respondent's Exhibit 2), and Donald Willis, M.D. (Respondent's Exhibit 1). With regard to the time claimed for reviewing (reading) Dr. Duchowny's report (.5 hours) and Dr. Willis' report (.5 hours), that time is disallowed as unreasonable (excessive) and redundant, since counsel requested and was granted credit, discussed infra, under "Motions and Pleadings" for .5 hours associated with "Receipt and review of NICA's Notice of Compensability, which included a copy of the reports of Doctors Duchowny and Willis. Otherwise, the remaining record review, as well as the time allocation (16.5 hours), was reasonable. Next, counsel claims 16.5 hours for "Depositions: Preparation and Attendance at " the depositions of Renee Oliver, on July 17, 2006; Patty Osbourne, R.N., on July 20, 2006; Jenette Dorff, R.N., on July 20, 2006; Debra Brinkmeyer, R.N., M.D., on July 20, 2006; David Mowere, M.D., on August 3, 2006; and Kenney Shipley, on September 27, 2006. With regard to the time claimed incident to the depositions of Dr. Mowere and Ms. Shipley (6 hours), it must be resolved that such time was not shown to be reasonably necessary to the pursuit of the claim. In so concluding, it is noted that by the time Dr. Mowere was deposed (August 3, 2006), NICA had agreed the claim was compensable. Under such circumstances it is unreasonable to expect NICA to pay for time expended that addressed compensability and notice. With regard to Ms. Shipley's deposition, taken September 27, 2006, it is also observed that when she was deposed, NICA had agreed the claim was compensable, and the only issues pertinent to her deposition were notice and the constitutionality of the Plan. Indeed, those were the announced reasons Petitioners requested, and were accorded leave to take her deposition. (See Petitioners' Motion for Request of the Deposition of Kenney Shipley, Executive Director of NICA, filed May 1, 2006; Order, July 13, 2006.) Such being the case, it is not reasonable to expect NICA to pay for time associated with Ms. Shipley's deposition. With regard to time associated with the depositions of Ms. Oliver, taken by Intervenors on July 17, 2006, and Nurses Osbourne, Dorff, and Brinkmeyer, taken July 20, 2006, the circumstances are different since NICA had not yet agreed the claim was compensable. Consequently, since Nurse Osborne's deposition addressed compensability, the 1.5 hours incurred attending her deposition was reasonably related to the claim. With regard to the depositions of Ms. Oliver, and Nurses Dorff and Brinkmeyer, those depositions addressed both compensability and notice. However, the time associated with notice was de minimus. Consequently, the 5 hours incurred in attending their depositions (Ms. Oliver, 3.5 hours, Nurse Dorff, .5 hours, and Nurse Brinkmeyer, 1 hour) were reasonably related to the claim. Also reasonably related to the claim were the 4 hours incurred preparing for Ms. Olivers' and the nurses' depositions. In all, 10.5 hours were reasonably dedicated to preparation and attendance at depositions. Next, counsel claims 8.75 hours for "Hearings: Preparation and Attendance at," 7 hearings (items a-f and h), preparation for final hearing (item g), and review of judge's final order (item i). With regard to the time claimed for a hearing on February 23, 2006 (.25 hours) and September 15, 2006 (.25 hours), no hearing was held, and that time is disallowed. However, with regard to the hearing of March 22, 2006 (item b), Petitioner overlooked noting time dedicated to that hearing, and is entitled to a .5 hour credit.3 With regard to the time claimed for attendance at the final hearing of October 10, 2006 (2.0 hours), given that issues related to compensability were resolved prior to hearing, and most of the time at hearing involved issues related to notice and compensability, only .5 hours are approved as reasonably related to the claim. Moreover, given the issues left to address at hearing, of the time claimed for preparation for hearing (4.0 hours), only 1 hour will be approved as reasonable. Petitioners' claim of .5 hours to review the final order is reasonable. In all, under the activity "Hearings: Preparation and Attendance at," 4.25 hours are found to be reasonably incurred in pursuing the claim. Next, counsel claims 9.25 hours for various activities associated with "Motions and Pleadings," such as preparation, receipt, review, and research, and has documented a claim for 23 entries (items a-w). With regard to Petitioners' claim of 1.0 hour for "Receipt, review, research into Defendant Mowere & Hosp Motion to Intervene; Petitioners' Objection to Motion to Intervene" (item a), that claim is disallowed as such activities that related to Petitioners' objection (apart from receipt and review of the motions, which time was de minimus), were frivolous.4 As for Petitioners' claim of .5 hours related to preparation of motion to depose Ms. Shipley (item i), and .25 hours related to review of Respondent's response (item k), that .75 hours is disallowed, as it relates to Petitioners' notice and constitutional claims. As for items f (.25 hours), j (.25 hours), n (.25 hours), o (.25 hours), p (.25 hours), s (.25 hours), and u (.25 hours), 1.75 hours, those activities only warrant a claim for .1 hours each (.7 hours). The other activities (5.75 hours) are reasonable. In all, 6.45 hours were reasonably expended on motions and pleadings. Next, counsel claims 10.0 hours for preparing or reviewing, from "2/06-9/06 [,] 77 letters and attachments by and between counsel for Petitioner, counsel for NICA and Judge Kendrick." Notably, there was no explanation of what those letters related to, what issues they addressed, or any method offered to assess whether the time allocation was reasonable. Accordingly, the proof failed to support a conclusion that the activity or hours claimed was reasonable, and the 10 hours claimed is disallowed. Finally, counsel claims 4 hours for "Expert Conferences" with Dr. Minkin (1 hour), Dr. Balducci (1 hour), Dr. Raffa (1 hour), and Dr. Deutch (1 hour). However, there was no explanation of when the conference occurred, what was discussed, or any proof to support a conclusion that the time allocation was reasonable and related to the pursuit of the claim. Accordingly, the proof failed to support the conclusion that the activity or hours were reasonable.5 Here, the total time and labor reasonably expended to pursue the claim was 43.20 hours. 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, 633 So. 2d at 1108. Here, given the nature of the expertise and legal skills required, for what may be described as a moderately complex case, the proof supports the conclusion that the "market rate" (a rate actually being charged to paying clients) is $300.00 an hour. A reasonable fee under the methodology established by Florida Patient's Compensation Fund v. Rowe, supra, and Florida Birth-Related Neurological Injury Compensation Association 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 $12,960.00 (43.20 hours x $300 per hour). 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 claimants 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 reasonable hourly rate and does not, in this case, afford any additional 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, in pursuing a malpractice action, the contingency nature of the fee arrangement does not warrant an adjustment of the "lodestar figure." Given the nature of the claim, which was relatively straight-forward, lacked any novel aspects, and the earliest medical records disclosed the infant had likely suffered a significant brain injury during birth, the risk of nonrecovery was not sufficient to warrant any adjustments. The claim for other expenses Finally, Petitioners' counsel incurred certain expenses in his representation of Petitioners for which he seeks recovery. (Petitioners' Exhibit 2). Such costs total $33,075.24. However, at hearing, Petitioners withdrew the claim for "Services," set forth at the top of page 1, Petitioners' Exhibit 2, in the sum of $3,537.50, leaving a claim for $29,537.74. (Tr., pp. 73 and 73). Of those costs, NICA did not object to the following expenses: 08/09/05 OB/GYN Clinic Records $ 19.31 09/07/05 West Volusia Pediatrics $ 150.00 09/08/05 Pediatric Surgery $ 4.00 09/13/05 Community Medical Assoc. $ 7.82 09/16/05 Florida Hospital $ 1,360.55 09/21/05 Seminole County $ 3.50 09/28/05 Childrens Resp. Care $ 9.00 09/28/05 Donald Willis, M.D. $ 1,000.00 10/11/05 Pediatric Neurology $ 7.00 01/20/06 DOAH Filing Fee $ 15.00 08/09/06 Depo. Renee Oliver $ 496.30 11/01/06 Hearing Transcript $ 604.72 12/04/06 Halifax Med. Center $ 68.10 $ 3,745.30 Accordingly, such expenses, totaling $3,745.30, are awarded without further discussion. Pertinent to an award of expenses, the Statewide Uniform Guidelines for Taxation of Costs in Civil Actions, effective January 1, 2006, provide: Purpose and Application. These guidelines are advisory only. The taxation of costs in any particular proceeding is within the broad discretion of the trial court. The trial court should exercise that discretion in a manner that is consistent with the policy of reducing the overall costs of litigation and of keeping such costs as low as justice will permit. . . . Burden of Proof. Under these guidelines, it is the burden of the moving party to show that all requested costs were reasonably necessary either to defend or prosecute the case at the time the action precipitating the cost was taken. Litigation Costs That Should Be Taxed. Depositions The original and one copy of the deposition and court reporter's per diem for all depositions. The original and/or one copy of the electronic deposition and the cost of the services of a technician for electronic depositions used at trial. Telephone toll and electronic conferencing charges for the conduct of telephone and electronic depositions. Documents and Exhibits The costs of copies of documents filed (in lieu of "actually cited") with the court, which are reasonably necessary to assist the court in reaching a conclusion. The costs of copies obtained in discovery, even if the copies were not used at trial. Expert Witnesses A reasonable fee for deposition and/or trial testimony, and the costs of preparation of any court ordered report. Witnesses Costs of subpoena, witness fee, and service of witnesses for deposition and/or trial. Court Reporting Costs Other than for Depositions Reasonable court reporter's per diem for the reporting of evidentiary hearings, trial and post-trial hearings. * * * III. Litigation Costs That Should Not Be Taxed as Costs. The Cost of Long Distance Telephone Calls with Witnesses, both Expert and Non- Expert (including conferences concerning scheduling of depositions or requesting witnesses to attend trial) Any Expenses Relating to Consulting But Non-Testifying Experts Cost Incurred in Connection with Any Matter Which Was Not Reasonably Calculated to Lead to the Discovery of Admissible Evidence Travel Time Travel time of attorney(s). Travel time of expert(s) Travel Expenses of Attorney(s) Also pertinent to an award of expenses are the following decisions: Miller v. Hayman, 766 So. 2d 1116 (Fla. 4th DCA 2000)(recognizing that in the absence of exceptional circumstances, travel expenses for attorney to attend depositions should not be taxed as costs); Department of Transportation v. Skidmore, 720 So. 2d 1125 (Fla. 4th DCA 1998)(recognizing that postage, long distance calls, fax transmissions, delivery service, and computer research are overhead and not properly taxable as costs); Gray v. Bradbury, 668 So. 2d 296, 298 (Fla. 1st DCA 1996)("The prevailing party's burden, at an evidentiary cost hearing, to recover an expert witness fee is 'to present testimony concerning the necessity and reasonableness of the fee.'"); Powell v. Barnes, 629 So. 2d 185 (Fla. 5th DCA 1993)(recognizing that evidence to support an award for expert witness fees must come from witnesses qualified in the areas concerned); Gray v. Bradbury, 668 So. 2d at 298. (Testimony of "a trial attorney and an insurance casualty claim manager, who were not shown to have proficiency in the various fields of expertise at issue (ranging from accident reconstruction to neurosurgery)," was not competent to support an award for expert witness fees.); Carreras, 633 So. 2d at 1109 ("[T]he exploration of the possibility of opting out of NICA through the 'bad faith' exception or otherwise is not, as the statute requires, work performed 'in connection with the filing of a claim '"). Considering the foregoing standards, Petitioners have established their entitlement to the recovery of $828.00 as the court reporter's fee for the depositions of Nurses Osbourne, Brinkmeyer, and Dorff. However, since the electronic depositions were not used at hearing, those expenses are not recoverable. Expenses associated with the depositions of Dr. Ravello, which addressed notice; Dr. Mowere, the only relevant portion of which, at the time it was taken, dealt with notice; and Ms. Shipley, which addressed notice and the constitutionality of the Plan, are not recoverable. Also not recoverable are the fees Petitioners paid their various experts, since they were neither deposed nor testified at hearing, and there was no showing that their consideration of the claim was necessary or that their fee was reasonable. Finally, the remaining items were either not explicated or are considered overhead, and not taxable.
The Issue The issue in this case is whether Petitioner should be permitted to transfer credit of certain hours of accrued sick leave from Petitioner's former place of employment, P.K. Yonge School, to Petitioner's current leave balance with Respondent, the Alachua County School Board (Board).
Findings Of Fact Petitioner, Tom E. Massey, began his employment with Respondent at the start of the 1983-84 school year. He had been previously employed at the University of Florida's P.K. Yonge Laboratory School since September 1, 1967. During the 1983-84 and 1984-85 school years, Petitioner was technically on a leave of absence from the University of Florida. At the conclusion of that two year period, Petitioner determined that he would make his employment relationship with Respondent permanent and formally terminate his employment with the University of Florida. At the time of separation from employment with the University of Florida, Petitioner had accrued a balance in that employment of 336 hours of unused sick leave prior to October 1, 1973, and 686.4 hours of sick leave after that date. Petitioner learned from Respondent's personnel department that existing policy did not provide for transfer of such leave to the Alachua County School Board employment. Transfers of existing leave balances were limited to other school boards in the state and educational personnel in residential care facilities of the Department of Health and Rehabilitative Services. Consequently, Petitioner elected, on September 6, 1985, to be paid by the University of Florida for unused sick leave under prevailing personnel rules at his existing salary rate for one-eighth of the hours accrued prior to October 1, 1973, and one-fourth of the hours accrued on or after October 1, 1973. As a result of his decision to sell his sick leave, Petitioner was paid approximately $2,419 by the University of Florida. At the present, Petitioner has no unused sick leave hours accrued at the University. As a result of the legislative enactment in 1990 of the "Sidney Martin Developmental Research School Act" (Section 2 of 90-49, Laws of Florida), codified at Section 228.053, Florida Statutes, university sponsored developmental schools were established as a category of public schools funded under the Florida Education Finance Program (FEFP), as opposed to the previous practice of funding such "laboratory schools" through the budget of the State University System. On June 4, 1991, Respondent amended its policy to permit transfer of sick leave from other public schools in Florida funded through the FEFP. Pursuant to that policy, Respondent also permitted certain existing employees of the Alachua County School Board to transfer unpaid leave balances resulting from prior employment with the University of Florida. Leonard D. Jackson was employed at P.K. Yonge School from August 1, 1971, until November 23, 1973, when he left that employment with the University of Florida to commence employment with Respondent. Jackson had accrued 18 days and seven hours of sick leave (151 hours) during that period, but was ineligible for leave payment since the length of his employment with the University was less than 10 years. Following Respondent's June 4, 1991, policy change, Leonard D. Jackson transferred the 151 hours of accrued sick leave from the University of Florida to his then current employer, the Alachua County School Board. Upon his retirement, Jackson received payment for the leave at a rate of 110 percent of his final salary rate. Totsye J. Connor, employed at the University of Florida from September 1, 1968, until May 20, 1982, elected not to be paid for accrued sick leave when she left that employment for her subsequent employment with Respondent. Following Respondent's policy change in 1991, she then transferred 59 hours of accrued sick leave to her employment with Respondent and was paid for that leave upon her retirement. Petitioner intends to retire from employment at the conclusion of the present school term in June of 1996. Petitioner will receive compensation at that time for the leave balance accrued by him in Respondent's employment. Petitioner argues that he has been treated unfairly and should now be permitted to transfer and receive compensation for all or a portion of his previous unused sick leave balance accrued at the University of Florida's P.K. Yonge School.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is recommended that a Final Order be entered denying Petitioner's request for transfer and subsequent compensation for sick leave from the University of Florida's P.K. Yonge School. DONE and ENTERED this 11th day of June, 1996, in Tallahassee, Leon County, Florida. DON W. DAVIS Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 11th day of June, 1996. APPENDIX In accordance with provisions of Section 120.59, Florida Statutes, the following rulings are made on the proposed findings of fact submitted on behalf of the parties. Petitioner's Proposed Findings Petitioner's handwritten proposed findings were unnumbered and basically restated his argument that he has been treated unfairly by what he views as a discriminatory school board rule. The findings of fact, as set forth above, address, to the extent possible, facts proposed by Petitioner. Respondent's Proposed Findings 1.-8. Accepted. Rejected, unnecessary to result. Accepted. COPIES FURNISHED: Tom E. Massey c/o Susan C. Massey 5160 Northeast Elliott Circle Corvallis, Oregon 97330 Thomas L. Wittmer, Esquire School Board of Alachua County 620 East University Avenue Gainesville, Florida 32601 Robert W. Hughes, Superintendent Alachua County School Board 620 East University Avenue Gainesville, Florida 32601 Frank T. Brogan, Commissioner Department of Education The Capitol Tallahassee, Florida 32399-0400 Michael Olenick, Esquire Department of Education The Capitol Tallahassee, Florida 32399-0400
The Issue Whether deceased retiree's prior selection of Option One retirement benefit pay-out and his receipt and negotiation of retirement several checks should now be set aside, due to his wife's alleged forgery of her signature on the Spousal Acknowledgement (Form FR-11).
Findings Of Fact 1. Irvin M. Carpenter was born November 16, 1934, and died of cancer on November 18, 1997. Mr. Carpenter was employed by the Hillsborough County Aviation Authority as a police officer on September 10, 1984, and attained the rank of police sergeant at the time of his retirement. Mr. Carpenter was a member of the Florida Retirement System. 2. On January 20, 1991, Irvin M. Carpenter and Susan Ann Prescott were married. Susan Ann Carpenter is now, and has been at all time pertinent to these proceeding, employed by the Hillsborough County Aviation Authority as a police officer. Susan Carpenter is a member of the Florida Retirement System. 3. In October of 1996, Irvin Carpenter and Susan Carpenter separated and continued to live separately. Dissolution of marriage proceedings were initiated but was not finalized at the time of Irvin Carpenter's death in November 1997. At all times pertinent to these proceedings, Irvin Carpenter and Susan Ann Carpenter were husband and wife. 4. On July 8, 1997, Irvin Carpenter executed a Florida Retirement System form styled "Application for Service Retirement" (Form FR-11). This form provides the retiree with information pertaining to the four options by which his retirement benefits can be paid. One full page of the form provides an explanation of each option. By use of this form, Irvin Carpenter selected Option One retirement benefit payout plan. The explanation of Option One on Form FR-11 is as follows: Option 1: A monthly benefit payable for my lifetime. Upon my death, the monthly benefit will stop and my beneficiary will receive only a refund of any contributions I have paid which are in excess of the amount I have received in benefits. This option does not provide a continuing benefit to my beneficiary. 5. The FR-11 also contained the following information in bold lettering: THIS SECTION MUST BE COMPLETED IF YOU SELECT OPTION 1 OR 2 MARRIED YES[ ] NO [ ] IF YES, YOUR SPOUSE MUST SIGN BELOW: SPOUSAL ACKNOWLEDGEMENT : I, (Signature) Susan A. Carpenter,’ being the spouse of the above named member, acknowledges that the member has elected either Option 1 or 2. (Signature Irvin Carpenter 11-27-96 Signature of Spouse Date If your spouse does not sign, you must attach a signed statement explaining why your spouse did not acknowledge your selection. 6. The "yes" or "no" blocks requesting marriage status were blank on the FR-11 submitted by the retiree to the Agency. The Spousal Acknowledgement block contained the signature of "Susan Ann Carpenter." Susan Carpenter alleged this signature to be a forgery. 7. The form FPR-11 also contained the following statement in capital letters: I UNDERSTAND I MUST TERMINATE ALL EMPLOYMENT WITH FRS EMPLOYERS TO RECEIVE A RETIREMENT BENEFIT UNDER CHAPTER 121, FLORIDA STATUTES. I ALSO UNDERSTAND THAT I CANNOT ADD ADDITIONAL SERVICE, CHANGE OPTIONS, OR CHANGE MY TYPE OF RETIREMENT (REGULAR, DISABILITY AND EARLY) ONCE MY RETIREMENT BECOMES FINAL. MY RETIREMENT BECOMES FINAL WHEN ANY BENEFIT PAYMENT IS CASHED OR DEPOSITED. 8. Between the date of his retirement and the date of his death, Irvin Carpenter received, cashed, or deposited a minimum of three retirement checks from the Florida Retirement System, pursuant to his selection of Option One benefit payout plan. 9. After the death of Mr. Carpenter, the Agency, by letter dated November 24, 1997, addressed to: FAMILY OF IRVIN M. CARPENTER, 3602 W. Tampa Circle, Tampa, Florida 33629, informed the family of the retirement benefit due beneficiaries for November and the income tax deduction therefrom. 10. By letter to the Agency dated July 13, 2000, Susan Carpenter stated: My Husband, Irvin M. Carpenter, DOB 11/16/34, SSN 263-42-0146, retired from the Tampa International Airport Police Department on 07/31/1997. At the time of his retirement, we were separated but still Married. He passed away less than three months later in November 1997. I inquired as to any benefits and informed by the Hillsborough County Aviation Authority, the parent organization of the Tampa International Airport Police Department, that he had changed his beneficiary to his daughter, Anita Carpenter. Just recently, I became aware of the Florida Retirement System provisions concerning retirement options. I ama police officer with the Tampa International Airport Police Department and these matters were covered in a pre-retirement briefing conducted by Human Resources. It is my understanding that if you are married and select option 1 or 2, the spouse must acknowledge that selection in writing. Since I had not signed any such acknowledgement, it occurred to me that my deceased husband's remaining options both provide for the joint annuitant. I posed this question to the HCAA Human Resources and was informed that my deceased husband did not retire. The Department announced his retirement, his name was added to the plaque listing retired officers and Department personnel files indicate a retirement date of 07/31/1999. I questioned my police captain and Chief of Police and both of them were emphatic that my husband retired on 07/31/1999. With my superiors providing information contrary to Human Resources, I have some doubt as to the status of my deceased husband with regards to the Florida Retirement System. Please confirm the status of Irvin M. Carpenter. Did he retire from FRS? If not, what was his status at the time he passed away? I am sure you understand the significance of my determining the correct status. Thank you for any assistance you can provide. 11. The Agency denied Susan Carpenter's request to void Irvin Carpenter's selection of Option One retirement pay-out. The Agency's letter of November 15, 2000, asserted the position that the selection cannot be changed since the retirement checks were cashed or deposited and cited the following portions of Section 121.091(6) (a), Florida Statutes: "The spouse of any member who elects to receive the benefit provided under subparagraph 1. or subparagraph 2. shall be notified of and shall acknowledge any such election." The law does not require the spouse to agree with the members' retirement option selection. The Form FR-11, Application for Service Retirement, submitted by Irvin Carpenter included Susan Carpenter's signature acknowledging that she was aware of the Option 1 selection. We receive numerous applications monthly and we do not investigate to determine if each signature is authentic. Although Mrs. Carpenter contends that her signature was forged, once a member cashes or deposits a check the option selection cannot be changed. The statutes do not require the spouse to agree with the members option selection, only to be made aware. Your request to void the Option 1 selection is denied. 12. Susan Carpenter denies having signed the Form FR-11, Application for Service Retirement submitted by Irvin Carpenter. Susan Carpenter alleges that the signature, "Susan Ann Carpenter," appearing on the Form FR-11 is a forgery. 13. During the final hearing and in the presence of the undersigned, Susan Carpenter signed "Susan A. Carpenter" three times, Petitioner's Exhibit F. At the request of the undersigned Susan Carpenter signed "Susan Ann Carpenter" once. A review of the four signature samples provided by Susan Carpenter, the sample signature, "Susan Ann Carpenter," proved to the satisfaction of the undersigned evidence of the genuineness of the written signature in dispute. Accordingly, and as a finding of fact, the Form FR-11 signature "Susan Ann Carpenter" is not a forgery. 14. Susan Carpenter's assertion that the Agency is under legal obligation to contact each spouse or otherwise verify the signature of each spouse on the Form FR-11ls received in the Agency's normal course of business is without foundation in law and in fact. 15. Only the circuit court has jurisdiction and authority in dissolution of marriage cases to enter final orders determining property rights of marital assets. Petitioner proffered no such order as evidence. Accordingly, all testimony and evidence based on alleged spousal rights and entitlements pursuant to Chapter 61, Florida Statutes, are not considered
Conclusions For Petitioner: Scott W. Fitzpatrick, Esquire Southeast Building, Suite 1500 St. Petersburg, Florida 33703 For Respondent: Thomas E. Wright, Esquire Department of Management Services Cedars Executive Center, Building Cc 2639 North Monroe Street Tallahassee, Florida 32399-1560
Recommendation Based on the foregoing Findings of Fact an Conclusions of Law, it is RECOMMENDED that Respondent enter a final order denying Susan Carpenter's request to change the retirement option 13 selected by Mr. Irvin Carpenter, including benefits due, and denying all such other relief. lo& DONE AND ENTERED this = day of July, 2001, in Tallahassee, Leon County, Florida. 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 J2% day of July, 2001.
Findings Of Fact The Petitioner, Auburn D. Hood (hereafter Hood), began teaching in the Florida school system in 1930. From 1937 to 1938, he took a leave of absence to attend the University of Florida. In 1940, he joined the Teachers' Retirement System (hereafter TRS) with coverage under Plan A of that system. He continued to teach in the Florida school system, taking a two year military leave from 1940 to 1942, until 1945, when he became disabled. Hood secured annual health leaves of absence and continued to make retirement contributions until 1951, when the Board of Trustees decided that no further leaves of absence would be approved. At this time, Hood's retirement contributions for 1951-52 were returned. In 1947, acting on the advice of K. D. Farris, the auditor of TRS, Hood changed from Plan A to Plan B. Plan B provided for a 9.66 percent contribution rate as opposed to the 4.51 percent rate under Plan A. In May 1951, Hood applied for disability retirement on the basis of his physician's certification that his condition consisted of (1) Hypotension, (2) psycotic [sic], (3) dizziness, (4) generalized weakness, (5) occasional blackout and (6) insomnia. Hood's disability retirement was approved by the TRS medical board on September 7, 1951, and became effective August 31, 1951. In the fall of 1967, Hood obtained certification from his physician that he was capable of returning to teaching. He was subsequently removed from disability retirement by the TRS Medical Board and reenrolled in TRS under Plan A. On or about December 1, 1970, Hood signed an application to transfer from TRS to the new Florida Retirement System (hereafter FRS). Hood began receiving FRS service credit and participating in Social Security at that time. Social Security coverage is not extended to members of TRS and must be provided in conjunction with FRS membership. TRS Plan A is not a fixed benefit plan. Benefits under this plan consist of an annuity equivalent to the members' actuarial contributions plus a pension equivalent to 1/140 of the member's average final compensation multiplied by each year of membership service. On the other hand, FRS is a fixed benefit of service. Therefore, the Division of Retirement makes TRS TRS service credit compatible with FRS credit for those transferring into the new system by bringing them into FRS through TRS Plan E, which is the only fixed benefit plan in TRS. This resulted in the need to upgrade Hood's TRS Plan A credit to the more costly TRS Plan E. Hood was given until the date he chose to retire to balance his account in this respect. On June 27, 1971, Chapter 71-347, Laws of Florida, became effective and amended Section 238.07, Florida Statutes, entitled "Retirement System for School Teachers" as follows: Any person who was a member of the Teachers' Retirement System prior to December 1, 1970, and who has collected a disability retirement allowance from the Teachers' Retirement System and has returned to active teaching service, shall be deemed to have been on health leave of absence each year between the date of his disability retirement and his return to service and may elect to receive service credit for each year upon payment of the required contributions plus regular interest. Commencing July 27, 1971, Hood received communications from K. D. Farris, at that time Administrator of TRS, informing Hood of the amount he would have to contribute to TRS to take advantage of the quoted portion of Chapter 238, Florida Statutes. Hood's first payment was returned by the current Director of the Division of Retirement, Robert Kennedy, who informed Hood that the new law was inapplicable to him because he was now a member of FRS. During the 1977 session of the Florida Legislature, a claims bill was passed in favor of Hood appropriating the sum of $4,350.93 as compensation for damages incurred by him. The preamble to the bill recites among other things, that Hood had transferred from the TRS to the FRS prior to the enactment of Chapter 71-347, Laws of Florida, cited previously in this order. Hood subsequently accepted the benefits of the claims bill passed in his favor and endorsed the proceeds over to the FRS. As a condition precedent to passage of the claims bill, flood declared in a notarized statement that he would retire from the teaching profession as of June 30, 1977, and endorse the funds over to FRS to insure to his personal retirement account. The funds were subsequently endorsed over to FRS. The funds received by Hood from the claims bill equal the amount necessary to balance his account by upgrading his former TRS Plan A service to the fixed benefit Plan E service of TRS. In September, 1977, Hood attempted to purchase service credit for the sixteen (16) years he was on disability retirement pursuant to Chapter 71-347, Laws of Florida. On or about September 13, 1977, the Division of Retirement declared that Hood could not purchase such service credit at which time Hood instituted the instant proceeding.
Conclusions Petitioner became a member of FRS and began participating in social security (which is not available to members of TRS) in December, 1970. Petitioner withdrew from TRS prior to the enactment of Section 238.07(1513) making the section inapplicable to him; Section 238.07(15B) of the Teacher's Retirement System Act applies only to members of TRS and does not extend benefits to members of other retirement systems; The $4,350.93 appropriated by HB-40 equaled the amount necessary to balance Petitioner's retirement account (without regard to Petitioner's claim for sixteen years of service credit representing the period he was drawing TRS disability retirement benefits); and HB-40 appropriated the aunt necessary to balance Petitioner's retirement account in recognition of the fact that a dispute existed over the amount necessary to accomplish the same, and the fact the Petitioner could not take advantage of Section 238.07(15B). Petitioner urged passage of the claims bill and executed a notarized statement that, if the bill passed, he would endorse the funds over to his retirement account and retire. Therefore, Petitioner is estopped from accepting the benefits of HB-40 and then renewing his claim that he owes less than $4,350.93 to balance his retirement account and that he remains eligible to take advantage of Section 238.07(15B).
The Issue Whether Respondent, Randall Lee Southerland, conducted operations in the construction industry in the State of Florida without obtaining workers’ compensation coverage, meeting the requirements of Chapter 440, Florida Statutes (2007),1 in violation of Subsection 440.107(2), Florida Statutes. If so, what penalty should be assessed by Petitioner, Department of Financial Services, Division of Workers’ Compensation, pursuant to Section 440.107, Florida Statutes (2007), and Florida Administrative Code Chapter 69L.
Findings Of Fact Petitioner is the state agency responsible for enforcing the statutory requirement that employers secure the payment of workers’ compensation for the benefit of their employees. § 440.107, Fla. Stat. Respondent is a sole proprietor, allegedly engaged in the construction industry, providing tile and grouting services and carpet removal to private residences in Florida. On November 30, 2007, Eric Duncan and Alison Pasternak, both of whom are workers’ compensation investigators for Petitioner, were conducting random compliance checks in Lee County. Investigator Duncan noticed two men working outside of a residence in Cape Coral, one using a power saw and the other mixing a substance in a bucket. Investigators Duncan and Pasternak decided to conduct a compliance check of these two men to ensure they were workers’ compensation coverage compliant. The two men identified themselves as Randall Lee Southerland and Tim Weaver. Weaver produced his Exemption Certificate for workers’ compensation coverage. No further action was taken in regards to that investigation. Southerland was observed mixing the substance, which was later determined to be tiling grout. Southerland did not have a workers’ compensation insurance policy, a coverage exemption certificate, nor was he employed via a leasing agency. After consulting with his supervisor, Investigator Duncan issued SWO No. 07-364-D7 to Respondent along with a Business Records Request for the time-period of December 1, 2004, through November 30, 2007. Respondent provided records to Petitioner shortly thereafter, and, subsequently, a penalty assessment was calculated. The calculations of Respondent’s gross payroll was necessary since it was alleged that he worked in the construction field of tiling. Respondent disputes this classification and argues that grouting is separate from the installation of tiles and is not a classification within the construction field. Therefore, neither a workers’ compensation insurance policy, nor an exception is required. The National Counsel on Compensation Insurance (NCCI) established a codification of construction employment activities; all of which have been adopted by Petitioner and are commonly referred to as “class codes.” The NCCI class code for tiling is “5348.” It is undisputed that Respondent was doing the grout- work for the newly installed tiles. It is further undisputed that the definition of tiling, per the NCCI class code “5348,” included the finishing, setting, and installation of tiles. It was also established that loose tiles, merely laying on the floor, are not finished, nor set, until the grout is laid. Pursuant to Section 440.107, Florida Statutes, the calculation of the penalty was completed on a penalty calculation worksheet. The worksheet was completed by examining the records received from Respondent and calculating the gross payroll that was paid to him. The penalty was later amended to reflect additional records provided through discovery, the evidence of the payment for the November 30, 2007, job consisting of a $500.00 check from the real estate agent. The Amended Order assessed a penalty of $1,168.68, which is the applicable amount of the premium evaded and includes the 50 percent penalty for the time period of December 1, 2004, through November 30, 2007.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Petitioner enter a final order: Finding that Respondent failed to secure the payment of workers’ compensation coverage for the sole proprietor, Randall Lee Southerland, in violation of Subsections 440.10(1)(a) and 440.38(1), Florida Statutes; and Assessing a penalty against Respondent, in the amount of $1,168.68, which is equal to 1.5 times the evaded premium based on the payroll records provided by Respondent and the applicable approved manual rate and classification code. DONE AND ENTERED this 3rd day of June, 2008, in Tallahassee, Leon County, Florida. S DANIEL M. KILBRIDE 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 3rd day of June, 2008.
The Issue The issues are whether Respondent violated Chapter 440, Florida Statutes (2009), by failing to secure the payment of workers' compensation, and if so, what penalty should be imposed.
Findings Of Fact Petitioner is the state agency responsible for enforcing the statutory requirement that Florida employers secure the payment of workers' compensation for the benefit of their employees. See § 440.107(3), Fla. Stat. Respondent is a Florida for-profit corporation providing pharmacy services. Respondent has business locations at 842 West Plymouth Avenue, Deland, Florida, and 112 East First Avenue, Pierson, Florida. Respondent's Pierson business site sells a small amount of food like bubble gum and other sundries. Activities at the Pierson location include filling prescriptions, compounding and blending drugs, and dispensing drugs or medicine to walk-in customers and patients. The patients are referred from a health care clinic known as Northeast Florida Health Services (NEFHS). The patients are federally qualified as indigent pursuant to a federal poverty calculation. Respondent's Deland location deals solely with prescription drug transactions to indigent patients who are referred by NEFHS. The Deland business site is very small and has no walk-in customers or food or other sundries for sale. At the end of the month, Respondent sends a bill to NEFHS for the prescriptions dispensed by Respondent at both locations. NEFHS than reimburses Respondent for its services. Respondent pays its employees at both locations out of a single checking account. Only one tax identification number is used for both business locations. On October 27, 2009, Hector Beauchamp, one of Petitioner's workers' compensation compliance investigators, received a referral, indicating that Respondent was operating without workers' compensation insurance coverage for its employees. After receiving the referral, Mr. Beauchamp used the website of the Department of State, Division of Corporations, to obtain Respondent's federal employer identification number. The Department of State website showed that Respondent became Pierson Community Pharmacy, Inc., on March 3, 2005. The website also indicated that Respondent had two corporate officers, John Eidt and Hanan Francis. Next, Mr. Beauchamp contacted Samantha Nixon, one of Petitioner’s penalty calculators, to research Respondent's unemployment compensation tax information on the Department of Revenue's website. Ms. Nixon's research revealed that Respondent employed in excess of four employees for each quarter in the past three years. Mr. Beauchamp also consulted Petitioner's Coverage and Compliance Automated System (CCAS) database. The CCAS database lists the workers' compensation insurance policy information for Florida employers together with any workers' compensation exemptions for corporate officers. The CCAS database accurately revealed that Respondent had no workers' compensation insurance policy in place for its employees and no workers' compensation exemptions for either Mr. Eidt or Ms. Francis as corporate officers. This was true from October 29, 2006, through October 28, 2009. Additionally, the CCAS database did not reveal any utilization of employee leasing by Respondent. Mr. Beauchamp also researched the National Council on Compensation Insurance, Inc. (NCCI) on-line database. Using Respondent's name and federal employer identification number, the database showed no record of a Florida workers' compensation insurance policy for Respondent. On October 28, 2009, Mr. Beauchamp visited both of Respondent's business locations. At the Pierson location, Mr. Beauchamp observed five individuals working behind a Plexiglas partition filling prescriptions. Mr. Beauchamp spoke with Mr. and Mrs. Francis. They confirmed that Respondent did not have workers' compensation insurance in place. Mr. Beauchamp then issued and served a Stop-Work Order. He also issued and served a records request. On October 29, 2010, Respondent provided Petitioner with the following records: (a) corporate tax records for 2007 and 2008; (b) a workers' compensation insurance application submitted after the issuance of the Stop-Work Order; and (c) payroll summaries for October 2006 through October 2009. The records confirmed that Respondent had employed more than four employees for the prior three years. On October 30, 2009, Petitioner issued and served the Amended Order of Penalty Assessment. That order was followed by the Second Amended Order of Penalty Assessment on March 15, 2010. Ms. Nixon calculated the gross payroll for Respondent's employees for the relevant time period. The gross payroll amounts for Ms. Francis from January 1, 2008, through December 31, 2008, and April 1, 2009, through June 30, 2009, were limited to the average weekly wage in effect at the time the Stop-Work Order was issued, multiplied by 1.5 for those periods pursuant to Florida Administrative Code Rule 69L- 6.035(2). As a corporate officer, Ms. Francis' actual earnings were in excess of these amounts. However, Florida Administrative Code Rule 69L-6.035(2) limits the amount of a corporate officer's income upon which workers' compensation penalties may be assessed to 1.5 times the average weekly wage in effect at the time a Stop-Work Order is issued or actual earnings, whichever is less. Using the classification codes in the NCCI Scopes® Manual, Petitioner accurately assigned the occupation classification code 8045, which corresponds to "Store: Drug Retail." Classification code 8045 is "applicable to store locations where the employer's books of accounts reflect at least 40 percent gross receipts in prescription sales and less than 50 percent gross receipts in the service of food." Prescription sales intended for the patients of health care facilities are included even though the facility is billed instead of the individual patient. Ms. Nixon then divided the payroll for each year by 100 and multiplied that figure by the approved manual rates adopted by the Florida Office of Insurance Regulation for 2006, 2007, 2008, and 2009 for classification code 8045. That product was then multiplied by 1.5 to find the penalty for the period for the three-year period. The total penalty is $13,996.60.
Recommendation Based on the foregoing Findings of Facts and Conclusion of Law, it is RECOMMENDED: That the Department of Financial Services, Division of Workers' Compensation, issue a final order affirming the Stop- Work Order and Second Amended order of Penalty Assessment in the amount of $13,996.60. DONE AND ENTERED this 26th day of April, 2010, in Tallahassee, Leon County, Florida. S SUZANNE F. HOOD Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 26th day of April, 2010. COPIES FURNISHED: John C. Eidt Pierson Community Pharmacy Inc. 112 East 1st Avenue Pierson, Florida 32180 Justin H. Faulkner, Esquire Department of Financial Services Division of Legal Services 200 East Gaines Street Tallahassee, Florida 32399 Julie Jones, CRP, FP Agency Clerk Department of Financial Services Division of Legal Services 200 East Gaines Street Tallahassee, Florida 32399-0390 Benjamin Diamond, General Counsel Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0307 Honorable Alex Sink Chief Financial Officer Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300
The Issue The central issue is whether the Petitioner is entitled to modify her deceased husband's retirement benefit option.
Findings Of Fact Based upon my observation of the witnesses and their demeanor while testifying, the documentary evidence received and the entire record compiled herein, I make the following findings of fact. Petitioner is the surviving spouse of Lamar W. Whaley, Jr., deceased. From 1972 to 1990, Mr. Whaley was employed by the Hillsborough County Board of County Commissioners (Board) and as such was a member of the Florida Retirement System. Mr. Whaley retired from his position as a minibus driver with the Board on June 29, 1990. In anticipation of his retirement, Mr. Whaley filed an FR-9 Form with the Division of Retirement (Division). The FR-9 Form, entitled "Request for Audit," was signed by Mr. Whaley and dated November 6, 1989. The FR-9 Form is used by members of the Florida Retirement System who want estimates of the monthly payments which they will receive after they retire. The FR-9 Form provided a space where Mr. Whaley could list the name and birthdate of a joint annuitant. On the FR-9 Form, Mr. Whaley named the Petitioner and the Petitioner's birthdate in these spaces. On the line immediately after the spaces provided for name and birthdate of the joint annuitant, the FR-9 expressly states that "This is not an official beneficiary designation." By listing a joint annuitant and that individual's birthday on the FR-9 Form, the Division is able to calculate the monthly benefits that would be payable to a member under each of the four retirement options available. In response to Mr. Whaley's audit request, the Division calculated the amount of the monthly payments he and/or his survivor would receive under the four retirement options available. On or about November 22, 1989, the Division sent Mr. Whaley information which reflected an estimate of the monthly benefits he and/or his survivor would receive under each of the four retirement options from which he was eligible to select. Included with the estimate of retirement benefits sent to Mr. Whaley, was a document entitled, "What Retirement Option Should I Choose?". This information sheet listed sent to Mr. Whaley listed and described the four different options. In 1990, members of the Retirement System contemplating retirement were provided a Division Form FR-11, Florida Retirement System Application for Service Retirement (Application). The application listed the four different options and provided a brief description of each. Next to Option 1 was the following: "Benefit for the Member Only." A further notation on the application read, "SEE THE REVERSE SIDE FOR AN EXPLANATION OF THESE OPTIONS." The Application adequately described the consequences of the election of each option. The explanation read as follows: Option 1: A monthly benefit payable to you for your lifetime. This option does not provide continuing benefit to a beneficiary. Upon your death, the monthly benefit will stop and you beneficiary will receive only a refund of any contributions you paid which are in excess of the amount you received in benefits. If you wish to provide a beneficiary with a continued monthly benefit after your death, you should consider selecting one of the other three options. The option 1 benefit is the maximum form of lifetime payment and all other optional payments are derived by applying actuarial factors to the option 1 benefit. Option 2: A reduced monthly benefit payable to you for your lifetime. If you die before receiving 120 monthly benefit payments, your designated beneficiary will receive a monthly benefit payment in the same amount as you were receiving until the total monthly benefit payments to both you and your beneficiary equal 120 monthly payments. No further benefits are then payable. Option 3: A reduced monthly benefit payable to you for your lifetime. Upon your death, your joint annuitant (spouse or financial dependent), if living, will receive a lifetime monthly benefit payment in the same amount as you were receiving. No further benefits are payable after both you and your joint annuitant are deceased. Option 4: An adjusted monthly benefit payable to you while both you and your joint annuitant (spouse or financial dependent) are living. Upon the death of either you or your joint annuitant, the monthly benefit payable to the survivor is reduced to two- thirds of the monthly benefit you were receiving when both were living. No further benefits are payable after both you and your joint annuitant are deceased. (Emphasis in original text.) On January 12, 1990, Mr. Whaley executed an Application. The Application listed the Petitioner as beneficiary and indicated that the retirement option selected was Option 1. In selecting Option 1, Mr. Whaley rejected all other options. The fact that Petitioner was listed on the application as a beneficiary is of no consequence given that Mr. Whaley chose Option 1. An explanation on the back of the retirement application expressly states, "This option does not provide continuing benefit to a beneficiary." Because Mr. Whaley chose Option 1, Petitioner, as his beneficiary, would have been entitled only to a refund of Mr. Whaley's contributions in the event that Mr. Whaley's contribution exceeded the amount of monthly benefits paid to him before prior to his death. Petitioner did not assert, nor did the evidence establish that the refund provision in Option 1 applies in the instant case. Petitioner stated that Mr. Whaley could read and was not mentally impaired at the time he completed the retirement application, yet Petitioner testified that the agency did not explain to Mr. Whaley the benefits of the plan which he selected. According to the testimony of Stanley Colvin, administrator and supervisor of the Division's Survivor Benefits Section, staff members are available to provide counseling to members who come in or call with questions relative to their retirement. There is no record that Mr. Whaley ever contacted the Division with questions regarding the various options. The pastor of the church which Petitioner is a member testified that Mr. Whaley may have needed help to understand the ramifications of legal documents. Mr. Whaley's daughter also testified that her father may not have understood the retirement option he chose. Both the pastor and Mr. Whaley's daughter testified further that in conversations with Mr. Whaley, he had indicated to them that he had taken care of the legal work necessary to ensure that his was family was taken care of in the event of his death. Notwithstanding the testimony of Petitioner and others, there is no evidence that at the time Mr. Whaley selected Option 1 he did not fully understand the nature and effect of his selection. Neither does the evidence support the claim that the selection of Option 1 by Mr. Whaley was inconsistent with his desire or intention at the time the choice was made. At the time of Mr. Whaley's retirement, he was in good health. Given this fact it is not unusual that he selected the option that would provide him with the maximum monthly benefit. Statements by Mr. Whaley that he had taken care of matters and that "things were in order" do not provide substantial evidence that the selection of Option 1 by Mr. Whaley was made only because he did not fully understand the consequences of his choice. The testimony revealed that upon Mr. Whaley's death, the Petitioner was the beneficiary of his life insurance policy and also the recipient of benefits under his social security. Under these circumstances, Mr. Whaley's selection of Option 1 was not necessarily inconsistent with his statement that things "were in order" or his listing Petitioner as beneficiary on the Application. On several documents provided to and/or completed by Mr. Whaley, it was clearly stated that once a member begins to receive his benefit, the option selection cannot be changed. The information sheet, "What Retirement Option Should You Choose?," mailed to Mr. Whaley on or about November 22, 1989, contained the following provision: Option Choice Cannot Be Changed Once you begin to receive your benefit your option selection cannot be changed. Therefore, it is important to carefully study your personal circumstances before making your decision . . . . The Application submitted to the Division by Mr. Whaley on or about January 25, 1990, contained a statement that "[o]nce you retire, you cannot add additional service nor change options." Finally, the Acknowledgment of Retirement Application sent to Mr. Whaley by the Division on or about February 8, 1990, provided in relevant part the following: ONCE YOU RETIRE, YOU CANNOT ADD ADDITIONAL SERVICE OR CHANGE OPTIONS. RETIREMENT BECOMES FINAL WHEN ANY BENEFIT CHECK IS CASHED OR DEPOSITED! Mr. Whaley received his first retirement check on or about the last working day in July 1990. Petitioner testified that Mr. Whaley cashed this check in July or August of that same year. By cashing that check, Mr. Whaley was precluded from thereafter changing his retirement option. By selecting Option 1, Mr. Whaley received the maximum benefits payable to him during his lifetime. However, under the provisions of retirement Option 1, upon Mr. Whaley's death, his beneficiary, the Petitioner is not entitled to receive any benefits.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Division of Retirement enter a final order denying the request of Petitioner to modify the retirement benefits elected by Mr. Whaley, the deceased husband of Petitioner. RECOMMENDED this 1st day of August, 1995, in Tallahassee, Florida. CAROLYN S. HOLIFIELD Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 1st day of August, 1995. APPENDIX TO RECOMMENDED ORDER, CASE NO. 95-0059 To comply with the requirements of Section 120.59(2), Fla. Stat. (1993), the following rulings are made on the parties' proposed findings of fact: Petitioner's Proposed Findings of Fact. 1a-1c. Rejected as not being supported by competent and substantial evidence. Respondent's Proposed Findings of Fact. 1-6. Accepted and incorporated herein. 7-8. Accepted. 9-11. Accepted and incorporated herein. COPIES FURNISHED: Gladys Whaley 3807 East Norfolk Street Tampa, Florida 33604 Robert B.Button, Esquire Division of Retirement Legal Office Cedars Executive Center-Building C 2639 North Monroe Street Tallahassee Florida 32399-1560 A. J. McMullian, III, Director Division of Retirement Cedars Executive Center, Building C 2639 North Monroe Street Tallahassee, Florida 32399-1560 Paul A. Rowell, Esquire General Counsel Department of Management Services 4050 Esplanade Way, Suite 265 Tallahassee, Florida 32399-0950
