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June 21st, 2013

Bad Decision on Arbitration from Florida Supreme Court May Rate a ‘Dishonorable Mention’

In stark contrast to a U.S. Supreme Court decision on the same day upholding an arbitration agreement, Florida’s notoriously trial lawyer-friendly Supreme Court yesterday overturned a lower court and threw out such an agreement freely entered into by a hernia patient and his surgeon — a decision that immediately qualified among possible Dishonorable Mentions in the next edition of ATRA’s annual Judicial Hellholes report due out in December.

According to the Paradise News-Press, doctor and patient agreed to settle any possible medical liability claims in arbitration, without personal injury lawyers and their high fees.  But because the agreement limited non-economic damages to $250,000, significantly less than the high-end limit of $1 million specified in state law, the court majority of justices James E.C. PerryJorge Labarga, R. Fred Lewis, Barbara Pariente and Peggy Quince deemed it unlawful.

In a strong dissent, however, Justice Charles Canady discounted the notion that state law is “thwarted” by voluntary agreements designed to limit costs connected to medical litigation, incredulously noting that the law is supposed to control such costs.

“There is an astonishing irony in the line of judicial reasoning that condemns as invalid a voluntary agreement designed to limit the expense of medical malpractice litigation and grounds that condemnation on the purpose of a statute expressly designed to limit the expense of medical malpractice litigation,” wrote Canady, joined in his dissent by Chief Justice Ricky Polston. “The public policy that animates the court’s decision here is an unprecedented judicial policy that contravenes the declared objective of the Legislature.”

Hear, hear!

Meanwhile, the much more evenhanded U.S. Supreme Court upheld an arbitration agreement that precludes class actions with a decision in American Express v. Italian Colors Restaurant.  Writing for the 5-3 majority (Justice Sonia Sotomayor recused herself since she’d heard the case as an appellate judge), Justice Antonin Scalia essentially argued that courts must uphold the sanctity of contracts freely entered into.  Imagine that.

Personal injury lawyers hate arbitration, of course, because it’s generally quick and easy, and it leaves them out of the picture with no way to charge audacious fees.  Needless to say, they love the Florida decision and loathe the SCOTUS decision.

 

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