Shands Teaching Hospital & Clinic, Inc. v. Mercury Insurance Co. of Florida
97 So. 3d 204
| Fla. | 2012Background
- Shands seeks to validate hospital liens under Florida Lien Law and Alachua County Hospital Lien Ordinance in a dispute arising from Krystal Price’s injuries and Shands’ medical charges.
- Mercury paid $10,000 under Mercury’s bodily injury policy and PIP; Shands recorded liens and notified Price.
- Mercury settled Price’s claim for $10,000 without joining Shands or paying the lien, then paid Shands the $10,000 after the lien was recorded.
- Trial court held damages limited to $10,000 and that the Lien Law and related Ordinance were unconstitutional and enforceable only to the extent of the Ordinance.
- First District reversed, deeming both the Lien Law and Ordinance unconstitutional; Shands cross-appealed and Mercury cross-appealed.
- Florida Supreme Court held the Lien Law unconstitutional, the Ordinance constitutional, and affirmed that damages were limited to $10,000 with attorney fees awarded to Shands.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Lien Law violates art. III, §11(a)(9) (private-contract liens). | Shands contends Lien Law is not a special law impairing private contracts. | Mercury contends Lien Law is a prohibited special law on private-contract liens. | Lien Law unconstitutional under art. III, §11(a)(9). |
| Whether the Ordinance can stand despite the Lien Law’s validity. | Ordinance should be permissible since it mirrors the Lien Law but acts independently. | Ordinance is unconstitutional as a product of an unconstitutional statute. | Ordinance constitutional and not dependent on the Lien Law. |
| Damages: cap on Shands’ recovery and relation to Mercury’s settlement. | Shands seeks full damages beyond the $10,000 settlement. | Damages should reflect only the collectible portion of Mercury’s policy; cap at $10,000. | Damages limited to $10,000; impairment does not yield greater recoveries. |
| Attorney fees: prevailing-party fees under the Ordinance and settlement offer rules. | Shands entitled to attorney fees under Ordinance even if Lien Law was invalid. | Mercury argues different fee basis per settlement offer statute. | Attorney fees awarded to Shands under the Ordinance; settlement offer analysis applied. |
Key Cases Cited
- Brooks v. Town of Orange Park, 286 So.2d 593 (Fla. 1973) (ordinances and local self-government not precluded unless preempted or in direct conflict with state law)
- Phantom of Brevard, Inc. v. Brevard Cnty., 3 So.3d 309 (Fla. 2008) (preemption and conflict analysis for local ordinances)
- Phantom of Clearwater, Inc. v. Pinellas Cnty., 894 So.2d 1011 (Fla. 2d DCA 2005) (implied preemption requires pervasive regulatory scheme)
- Tallahassee Memorial Reg'l Med. Ctr., Inc. v. Tallahassee Med. Ctr., Inc., 681 So.2d 826 (Fla. 1st DCA 1996) (preemption and local regulation principles in medical-liens context)
- Dade Cnty. Sch. Bd. v. Radio Station WQBA, 731 So.2d 638 (Fla. 1999) (constitutional interpretation and de novo review guidance)
- White v. Steak & Ale of Fla., Inc., 816 So.2d 546 (Fla. 2002) (gives definition of judgment-inclusion for settlement-offer statutes)
- Prosperi v. Code, Inc., 626 So.2d 1360 (Fla. 1993) (significant-issues test for fee awards in lien cases)
- Trytek v. Gale Indus., Inc., 3 So.3d 1194 (Fla. 2009) (significant-issues test applied to prevailing-party fees)