39 Fla. L. Weekly D659b
Late payment of compensation — Department of Financial Services had
jurisdiction to impose workers’ compensation-related administrative penalty
against school board for late payments discovered during audit of
claims-handling practices for multiyear period without first referring case to
judge of compensation claims where matter involved no objection to means by
which penalty amount was calculated or the appropriateness of such penalty in
light of the violations found to exist through Administrative Procedure
Act-based review process — Statutory scheme makes available both a DFS audit
report-focused review process and a review process before the JCC for resolving
narrower disputes involving only the amount of penalty or interest assessment,
given the ultimate results of the audit report or the APA-based review of
v. OFFICE OF THE STATE OF FLORIDA, CHIEF FINANCIAL OFFICER FOR THE DEPARTMENT OF
FINANCIAL SERVICES, DIVISION OF WORKER’S COMPENSATION, Appellee. 1st District.
Case No. 1D13-1841. Opinion filed March 27, 2014. An appeal from Department of
Financial Services. Robert C. Kneip, Chief of Staff. Counsel: M. Kemmerly Thomas
of McConnaughhay, Duffy, Coonrod, Pope & Weaver, P.A., Tallahassee, for
Appellant. Cynthia L. Jakeman, Assistant General Counsel, Division of Legal
Services, Tallahassee, for Appellee.
a final order of the Department of Financial Services (DFS) imposing a $200
workers’ compensation-related administrative penalty. The School Board argues,
among other things, that DFS lacked jurisdiction to impose the penalty without
first referring its case to a judge of compensation claims (JCC) pursuant to
section 440.021 of the Florida Statutes. We disagree and affirm the final order.
In short, DFS audited the School Board’s workers’ compensation claims-handling
practices for a multiyear period and found 177 “late payments.” DFS issued a
final audit report and assessed penalties totaling $15,300, which the School
Board paid. But the School Board reserved the ability to challenge two of the
late payments relating to a teacher (hereafter referred to as S.L) who had
received temporary total disability (TTD) benefits related to a knee surgery.
The two disputed late payments accounted for just $200 of the total penalty paid
by the School Board ($100 per infraction).
based review in accordance with § 440.525(3). Its petition conceded that “[DFS]
has jurisdiction over the parties and subject matter of this Petition.” The
discovery process fleshed out the facts which were stipulated to by the parties.
Together they moved for and received an order relinquishing jurisdiction back to
DFS. A department hearing officer conducted an informal hearing addressing both
the School Board’s jurisdictional argument and DFS’s late-payment determination.
And later, DFS entered a final order rejecting the School Board’s arguments and
ordered it to pay the $200 penalty forthwith. DFS noticed the School Board’s
right to appeal to this court per § 120.68, which it did in a timely fashion.
late TTD benefit payments identified in DFS’s audit report. The harder issue in
this case is jurisdictional, involving the parties’ competing views of whether
the statutory scheme permits DFS to impose penalties without a referral to the
chapter 440 to audit and impose penalties on carriers and claims-handling
entities that do not comply with Florida’s workers’ compensation laws. Section
440.20(8)(b), is clear, for instance, that DFS:
shall monitor, audit, and investigate the performance of carriers.
The office shall require that all compensation benefits are timely paid in
accordance with this section. The office shall impose penalties for late
payments of compensation that are below a minimum 95 percent timely payment
disputed. According to the School Board, DFS lacked jurisdiction to issue the
Final Order in this case because § 440.021 requires matters involving disputed
penalties to be referred to the JCC.1 DFS
counters that its audits do not consist of adjudications of employee benefits
claims as would fall under the jurisdiction of a JCC. But, rather, § 440.525(2)
authorizes DFS to audit claims-handling entities like the School Board, and
impose penalties where chapter 440’s requirements are not met. DFS argues that
it followed the correct § 440.525(3)-based process here by serving a written
audit report of the violations and providing the School Board with -based
unambiguous statutes according to their plain and obvious meaning. See,
e.g., Murray v. Mariner Health, 994 So. 2d 1051, 1056-57 (Fla. 2008).
When faced with two different, but applicable statutes, “courts must favor a
construction that gives effect to both statutes rather than construe one statute
as being meaningless or repealed by implication.” Butler v. State, 838
So. 2d 554, 555-56 (Fla. 2003) (citations omitted). “ ‘The rule of construction
. . . is that if the courts can by any fair, strict or liberal construction find
for the two provisions a reasonable field of operation, without destroying their
evident intent and meaning, preserving the force of both, and construing them
together in harmony with the whole course of legislation, it is their duty to do
so.’ ” Fuller v. Dep’t of Educ., 927 So. 2d 28, 32 (Fla. 1st DCA 2006)
(quoting City of St. Petersburg v. Pinellas County Power Co., 100 So.
509, 510 (Fla. 1924)).3
together to make available both a DFS audit report-focused review process as
contemplated in § 440.525(3) (an APA-based process) and a § 440.021
review process before the JCC for resolving narrower disputes involving only the
amount of the penalty or interest assessment, given the ultimate results of the
audit report or the APA-based review of same. Parsing the statutes, the
Legislature in § 440.525, subsection 3, allows for an APA-based review of
“the results of [DFS’s] examination or investigation.” The process described in
subsection 3 certainly encompasses challenges to the findings in an audit
report, whereas this subsection wholly omits any reference to penalties per
se, or avenues by which a carrier or claims handling entity can challenge
penalty amounts ultimately assessed by DFS.
together, provide for a different review process related to penalty assessments.
See n. 1, 2 supra. When an audited entity challenges the penalty
assessment itself — the amount of the penalty — referral is required to a JCC.
Different from the audit report merits phase prescribed by § 440.525(3) (an
APA-based process), penalty phase review before a JCC narrowly concerns the
issue of whether DFS’s “penalty or interest” assessment calculation comports
with legal requirements. See §§ 440.525(4), 440.021, Fla. Stat.
called for by the statutes insofar as, besides its jurisdictional argument, it
challenged only the underlying merits of DFS’s findings. The School Board asked
for and received review of DFS’s late-payment determination under chapter 120 in
accordance with § 440.525(3). And DFS later issued a final appealable order to
the School Board with notice of its right to appeal, which has occurred here.
The School Board has never specifically challenged the penalty assessment per
se — the $200 penalty calculated by DFS. Rather the School Board stipulated
that it “does not dispute the calculation of the total penalty amount assuming
that the Department is determined to have subject matter jurisdiction over the
issues presented and has accurately identified the alleged late payments to
amount was calculated or the appropriateness of such penalty in light of the
violations found to exist through the APA-based review, referral to the JCC was
not required. (Whereas if the $200 penalty assessment was itself disputed,
arguably miscalculated, etc., then referral to the JCC would have been called
for pursuant to §440.021.)
jurisdiction to enter the final order. The final order is AFFIRMED. (CLARK and
MAKAR, JJ., CONCUR.
In all instances in which the department institutes action to
collect a penalty or interest which may be due pursuant to this chapter, the
penalty or interest shall be assessed without hearing, and the party against
which such penalty or interest is assessed shall be given written notice of such
assessment and shall have the right to protest within 20 days of such notice.
Upon receipt of a timely notice of protest and after such investigation as may
be necessary, the department shall, if it agrees with such protest, notify the
protesting party that the assessment has been revoked. If the department does
not agree with the protest, it shall refer the matter to the judge of
compensation claims for determination pursuant to s. 440.25(2)-(5). Such
action of the department is exempt from the provisions of chapter
(3) . . . The results of an examination or investigation [by DFS]
shall be provided to the carrier, third-party administrator, servicing agent, or
other claims-handling entity in a written report setting forth the basis for any
violations that are asserted. Such report is agency action for purposes of
chapter 120, and the aggrieved party may request a proceeding under s.
120.57 with regard to the findings and conclusion of the
(4) If [DFS] finds that violations of this chapter have occurred,
[it] may impose an administrative penalty upon the offending entity or entities.
For each offending entity, such penalties shall not exceed . . . . [DFS] shall
adopt penalty guidelines by rule to set penalties under this
adopt an interpretation that “harmonizes two related, if conflicting, statutes
while giving effect to both.” Fuller, 927 So. 2d at 32. And where one
statute is passed sooner in time, “the legislature is presumed to pass
subsequent enactments with full awareness of all prior enactments and an intent
that they remain in force.” Id. (citing Palm Harbor Special Fire
Control Dist. v. Kelly, 516 So. 2d 249, 250 (Fla. 1987)).
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