Patricia Phillips v. Leon County Public Works and Preferred Government Claims Solutions and Mary Elizabeth Cruickshank ( 2019 )

FIRST DISTRICT COURT OF APPEAL
STATE OF FLORIDA
_____________________________
No. 1D18-1776
_____________________________
PATRICIA PHILLIPS,
Appellant,
v.
LEON COUNTY PUBLIC WORKS
and PREFERRED GOVERNMENT
CLAIMS SOLUTIONS and MARY
ELIZABETH CRUICKSHANK,
Appellees.
_____________________________
On appeal from an order of the Judge of Compensations Claims.
John J. Lazzara, Judge.
Date of Accident: June 25, 2012.
July 9, 2019
PER CURIAM.
Patricia Phillips (“Claimant”) appeals on procedural grounds
the Judge of Compensation Claims’ (“JCC”) order denying, without
hearing, her motion for sanctions under section 440.32(3), Florida
Statutes (2017). Claimant alleges that the Employer/Serving
Agent’s (E/SA) attorney, Cruickshank, raised an improper and
unfounded discovery objection in a motion for protective order.
The JCC denied Claimant’s motion for sanctions, finding: (1) the
E/SA’s motion for protective order was previously denied, in part;
(2) the motion for sanctions was untimely; and (3) did not comply
with the procedural requirements of Florida Administrative Code
Rule 60Q-6.125. Because we find the JCC’s reasons for denial
contrary to the statutory language of section 440.32(3) and based
on an improper application of the administrative rule, we reverse
and remand for a hearing on the merits.
I.
The underlying dispute here involved the amount of attorney’s
fees and costs payable to Claimant’s attorney by the E/SA
pursuant to a prior order. During discovery and in preparation for
the deposition of the E/SA’s expert, the Claimant’s attorney,
Porcher, sent a subpoena duces tecum to the expert, requesting
documents related to the fee dispute. In response, attorney
Cruickshank sent a proposed motion for protective order objecting
to production of the requested documents. Porcher then sent an
email to Cruickshank asking for a contact to resolve the dispute.
Cruickshank did not respond to the email and filed the motion for
protective order with the JCC. The motion asserted work product
privilege concerning communications between herself and the
expert “to the extent that [such documents] exist.” Cruickshank
attests she had “personally conferred or used good-faith efforts to
confer with opposing counsel in an effort to resolve the issues.”
Porcher objected because, among other things, Cruickshank had
not prepared a privilege log so that he could determine what
documents existed and the specific reasons for the withholding. He
further argued that, contrary to her certification, Cruickshank had
made no good faith effort to contact him or to resolve the issue
despite his attempts to do so.
At the hearing on the motion for protective order,
Cruickshank argued that, “whether there are, or are not any
documents” responsive to the subpoena, all such documents were
privileged. The JCC denied the motion for protective order in part,
allowing Cruickshank the opportunity to file a privilege log
disclosing any documents withheld and to produce all others.
Although the E/SA’s expert witness was deposed almost
immediately following the JCC’s ruling, Cruickshank did not
provide a privilege log to Porcher. When the parties convened for
the deposition of the E/SA’s fee expert, Cruickshank produced
2
several documents in response to the subpoena including a one-
page letter between Cruickshank and the fee expert establishing a
rate of pay per hour. No documents were identified to Porcher that
were withheld as containing work product or other privileged
information.
Several weeks later, the Claimant filed the subject motion for
sanctions. The motion requested sanctions pursuant to section
440.32(3), which states:
The signature of an attorney [on a pleading, motion, or
other paper] constitutes a certificate by the signer that
the signer has read the pleading, motion, or other paper;
that to the best of the signer’s knowledge, information,
and belief formed after reasonable inquiry it is well
grounded in fact and is warranted by existing law or a
good faith argument for the extension, modification, or
reversal of existing law, and that it is not interposed for
any improper purpose, such as to harass or to cause
unnecessary delay or needless increase in the cost of
litigation. . . . If a pleading, motion, or other paper is
signed in violation of this section, the [JCC] or any court
having jurisdiction of proceedings, upon motion or upon
its own initiative, shall impose upon the person who
signed it an appropriate sanction, which may include an
order to pay to the other party or parties the amount of
the reasonable expenses incurred because of the filing of
the pleading, motion, or other paper, including a
reasonable attorney’s fee.
The E/SA argue that the motion for sanctions was untimely
because the motion for protective order— the underlying basis for
sanctions — had previously been ruled upon by the JCC. More
specifically, because rule 60Q-6.125(4)(a) creates a 21-day “safe
harbor” period to allow for the withdrawal or correction of a
sanctionable pleading, the Claimant’s motion for sanctions, to be
timely, had to be filed while the motion for protective order was
pending. The JCC denied the Claimant’s motion for sanctions
finding that the E/SA’s motion for protective order was denied, in
part, and the motion for sanctions was untimely and noncompliant
with rule 60Q-6.125. In a motion for rehearing, the Claimant
3
asserted, among other points, that section 440.32(3) is not a
prevailing party provision and that the JCC’s description of the
ruling on the motion for protective order “did not tell the whole
story” as Cruickshank was instructed by the JCC to prepare a
privilege log which she did not do. The Claimant also reiterated
that the motion for sanctions was not untimely under section
440.32(3), and an evidentiary hearing was necessary so that the
claim for sanctions could be heard on its merits. Finally, the
Claimant argued that if rule 60Q-6.125(4)(a) applied, Cruickshank
was required to take some type of corrective action under the 21-
day safe harbor provision despite the non-pendency of her motion
for protective order. The JCC entered an order which denied the
Claimant’s motion for rehearing and instructed counsel for the
parties to re-read The Florida Bar Workers’ Compensation Section
Guidelines for Professional Conduct. This appeal followed.
II.
Under the unambiguous language of section 440.32(3),
sanctions are both mandatory and not subject to any specific time
limitation other than the pendency of ongoing litigation. In sum,
the plain language of the statute does not support the JCC’s ruling
that the motion for sanctions here was either (1) untimely or (2)
unwarranted because the E/SA’s motion for protective order was
denied, only in part.
In making his determination, the JCC, however, also
improperly applied the procedural requirements of rule 60Q-
6.125(4)(a), which provides:
A motion for sanctions under this rule shall be made
separately from other motions or requests and shall
describe the specific conduct alleged to violate subsection
(2). It shall be served but shall not be filed unless the
challenged paper, claim, defense, allegation, or denial is
not withdrawn or appropriately corrected within 21 days
after service of the motion. If warranted, the judge may
award to the party prevailing on the motion the costs of
the proceeding and attorney’s fees incurred in presenting
or opposing the motion.
4
The language of the rule not only makes sanctions discretionary,
but also creates a 21-day safe harbor period within which an
offending party or attorney may withdraw a pleading to avoid
sanctions. See Soca v. Advance Auto Parts, 185 So. 3d 1258, 1259-
60 (Fla. 1st DCA 2016).
The E/SA argues that, given the safe harbor provision, the
order denying sanctions should be affirmed because neither
withdrawal nor any other corrective action made sense after the
motion to compel was adjudicated and was no longer pending. The
Claimant responds that withdrawal was not unreasonable at the
time the motion for sanctions was served because the order on the
motion to compel was a non-final, interlocutory ruling;
furthermore, other appropriate correction could include something
as simple as an acknowledgement of a violation. While that may
be true, we reverse because the safe harbor provision of the rule
does not apply here.
Section (1) of rule 60Q-6.125 generally provides for the
imposition of sanctions for violation of the rules or of any order of
the JCC. Section (2) refers to representations to the JCC and sets
forth a detailed description of specific conduct which reiterates and
expands on some of the provisions of section 440.32(3). In fact, the
rule is identified as an implementation of section 440.32 along with
other statutory provisions. But, the rule clearly goes beyond the
plain language of the statute because section (3) of the rule states
that the JCC may impose sanctions upon a determination of a
subsection (2) violation, and section (4) creates a safe harbor period
allowing sanctions to be avoided completely.
“It is axiomatic that an administrative rule cannot enlarge,
modify or contravene the provisions of a statute.” Campus
Commc’ns, Inc. v. Dep’t of Revenue, 473 So. 2d 1290, 1291 n.1 (Fla.
1985) (quoting State, Dep’t of Bus. Regulation v. Salvation Ltd.,
Inc., 452 So. 2d 65, 66 (Fla. 1st DCA 1984)); see also State Farm
Fla. Ins. Co. v. Unlimited Restoration Specialists, Inc., 84 So. 3d
390, 394 (Fla. 5th DCA 2012). As a result, when an administrative
rule conflicts with the enabling statute, the statute will control.
See, e.g., Fla. Dep’t of Revenue v. A. Duda & Sons, Inc., 608 So. 2d
881, 884 (Fla. 5th DCA 1992) (“In the event of a conflict between a
statute and an administrative regulation on the same subject, the
5
statute governs.”); Campus Commc’ns, Inc., 473 So. 2d at 1291 n.1
(citing Nicholas v. Wainwright, 152 So. 2d 458, 460 (Fla. 1963)).
The E/SA does not directly dispute the substantive nature of
the safe harbor period created by the rule. Instead, it argues that
the Claimant’s proper remedy is a rule challenge under Chapter
120, and thus, the validity of the rule is not before this court. But,
we previously rejected this argument in a similar situation
explaining:
Just as a court cannot give effect to a statute (or
administrative rule) in any manner repugnant to a
constitutional provision, so a duly promulgated
administrative rule, although “presumptively valid until
invalidated in a section 120.56 rule challenge,” City of
Palm Bay v. State, Dep’t of Transp., 588 So. 2d 624, 628
(Fla. 1st DCA 1991), must give way in judicial
proceedings to any contradictory statute that applied.
Willette v. Air Prods., 700 So. 2d 397, 398 (Fla. 1st DCA 1997)
(rejecting argument that court lacked jurisdiction, in absence of
rule challenge, to address validity of rule changing time deadline
for providing workers’ compensation benefits).
The statute also does not exempt from violation a person who
is the prevailing party. The JCC assumed there can be no violation
of section 440.32(3) if the offending party should prevail in any
aspect of the pleading or motion. But, this is not evident from the
statute. In fact, the statute would appear to include sanctions for
pleadings, motions, or other papers that are interposed “for any
improper purpose, such as to harass or to cause unnecessary delay
or needless increase in the cost of litigation,” without regard to the
actual merits or outcome. § 440.32(3), Fla. Stat. (2017) (emphasis
added). Furthermore, in the event of a violation, sanctions are
statutorily mandated. Id. (“If a pleading, motion, or other paper is
signed in violation of this section, the [JCC] and any court having
jurisdiction of proceedings, upon motion or upon its own initiative,
shall impose . . . an appropriate sanction. . . .”) (emphasis added).
In some instances, the true extent of a violation may not be known
until after a ruling on the pleading or motion. Here, the JCC
permitted Cruickshank the additional opportunity to file a
6
privilege log in support of the objections. However, no privilege log
was produced identifying any documents claimed to be protected.
Cruickshank couched her objection in terms of possibility (“to the
extent that [such privileged] documents exist”). But, this
qualification would appear to go more to the merits of the alleged
violation— not to the procedural requirements of rule 60Q-
6.125(4)(a).
At the heart of the issue here is the tension between the
statutory mandate to sanction all violations of section 440.32 and
the 21-day safe harbor period created by rule 60Q-6.125(4)(a). The
Claimant maintains that there is no conflict between the statute
and rule if we reject the E/SA’s pendency argument. However,
reconciling the rule with the statute remains problematic if we do
so because, the implication is that any offending party can violate
the provisions of section 440.32(3) without the risk of sanctions,
or— in the Claimant’s words— “with impunity,” if the pleading or
motion is dispensed with quickly enough (e.g., adjudicated or
withdrawn). To accept the E/SA’s application of the rule, the
mandatory sanctions for violations of section 440.32(3) become not
only discretionary, but also completely avoidable.
We recognize that this Court in Soca addressed the correct
interpretation of the safe harbor requirement under the rule and
in the context of alleged violations of section 440.32. See Soca, 185
So. 3d at 1259. But, the parties there assumed that the
administrative rule applied. As a result, the court’s reference to
rule 60Q-6.125(4)(a) as an implementation of section 440.32(3) is
dicta. We now clarify that this rule does not apply to the extent its
provisions contradict the plain language of the statute.
The sanction in 440.32(3) is a stand-alone statutory sanction
by its text and history without regard to the rule. The statute itself
contains no safe-harbor provision or forgiveness clause. There is
no reasonable way to read the statute as imposing merely
discretionary sanctions to violations or as allowing a skilled
violator a 21-day grace period. The safe harbor of the rule cannot
be viewed as a procedural amendment to the statute. Either
section 440.32(3) provides a stand-alone basis for sanctions, not
subject to the administrative rule, or the administrative rule
should be interpreted harmoniously with the statutory language
7
of section 440.32(3). Should the JCC’s denial be viewed as a true
procedural denial, then the Claimant should have been allowed to
correct the procedural deficiency. Thus, rule 60Q-6.125(4)(a)
should not apply to the extent it precludes filing a motion for
sanctions under the plain language of section 440.32(3).
We, therefore, REVERSE the JCC’s denial of Claimant’s motion
for sanctions and REMAND for a hearing on the merits.
MAKAR, WINOKUR, and M.K. THOMAS, JJ., concur.
_____________________________
Not final until disposition of any timely and
authorized motion under Fla. R. App. P. 9.330 or
9.331.
_____________________________
Randall T. Porcher of Morgan & Morgan, Tallahassee, for
Appellant.
Mary E. Cruickshank of DuBois & Cruickshank, P.A., Tallahassee,
for Appellees.
8