09-000090CB In Re: Senate Bill 522 (Merriweather) vs. * Status: Closed DOAH Final Order on Friday, May 8, 2009.

SPECIAL MASTER’S FINAL REPORT – SB 522 (2009) T

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number of injuries in the crash, including fractured vertebrae

and a spinal cord injury. He wa s temporarily paralyzed from

the neck down.

Mr. Merriweather was air-lift ed from the accident scene to

Delray Medical Center wher e he spent four days in the

intensive care unit (ICU). Mr. Merriweather was then

transferred to St. Mary’s Hospital where he spent anothe r

five days in ICU and more than three months in the

hospital’s in-patient rehabilitat ion unit. After his discharge

from the hospital, Mr. Merriw eather underwent approximately four months of out- patient rehabilitation.

Mr. Merriweatherwas 41 years old at the time of the

accident. He worked as a firefighter for Palm Beach County,

and he also volunteered as an assistant basketball coach

and mentored student-athletes at a local high school.

Mr. Merriweatherhas not worked since the accident. He reached maximum medical improv ement in July 2006 with a

62 percent overall impairment rating. His medical condition has remained essentially the same since that time.

Mr. Merriweather has a number of significant physical limitations and neurologica l deficits. His range of motion is

extremely limited and he has stiffness in his muscles. He is

able to walk short distances, but he is unsteady on his feet

so he has to use a wheelchair. He has sensory deficiencies

and his fine motor skills are impaired. He also suffers from

depression.

Mr. Merriweather does not have any significant cognitive

deficiencies. Even though he has physical limitations, he

lives by himself and is able to perform all activities of daily living (e.g., feeding, bathing, dressing, cooking cleaning)

without any significant assistance. He is also able to drive

and manage his financial affairs.

Mr. Merriweather cannot work as a firefighter as a result o f

his physical impairments. He is also not able to do many o f

the other things that he used to enjoy doing, such as playing basketball and riding motorcycles.

Mr. Merriweather earned approxim ately $80,000 per year in

salary and benefits as a firefi ghter. After the accident, he

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was placed on “extended leave” and he continued to receive his full salary for almost 18 months. This leave ended in

April 2007, after which Mr. Merriweather “retired” due to his

post-accident medical condition.

Mr. Merriweatherlikely would ha ve worked another 10 to 15

years as a firefighter had he not been injured in the accident.

He would have been abl e to retire with full benefits after an

additional 8 years as a firefighter.

Mr. Merriweather receives al most $2,500 per month in

pension benefits from Palm Be ach County based upon his

service as a firefighter. He also receives approximately

$1,900 per month in Social Security disability payments. He

has been receiving these pay ments since approximately

October 2008.

Mr. Merriweather’s medical bills were covered by insurance

that he had through his work as a firefighter. The insure r

and the hospitals have asserted liens of in excess o f

$500,000. The liens will be paid from the proceeds of the

claim bill.

An economist’s report estimated that Mr. Merriweather’s total

economic damages (e.g., lost earnings, reduced retirement

benefits, medical bills) were ap proximately $3.6 million. In

my view, that amount is likel y overstated by atleast $1

million because, among other thi ngs, the estimated future

medical expenses in the “life care plan” (upon which the

estimate was based) include experimental surgeries, full

time aide and attendant care, and the cost of purchasing a

wheel-chair accessible home, none of which appea r

reasonably necessary based upon Mr. Merriweather’s

condition and prognosis. Also , the economist assumed that

Mr. Merriweatherhad no income after the accident even though, in fact, he continued to receive his full salary fo

r

almost 18 months after the accident. The economist also assumed that Mr. Merriweather would continue to work as a

firefighter until age 65 whereas Mr. Merriweathertestified in

his deposition that he expected to retire at or before age 60.

The damages estimated by t he economist do not include

non-economic or “human damages ,” such as pain and

suffering and Mr. Merriweather’s loss of the enjoyment o f

life. Mr. Merriweather’s atto rney indicated that the non-

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economic damages in this case would have beensignificant and that a jury verdict “would have easily been in the $15

million to $30 million range.” Like wise, the District estimated

the “jury exposure” of the claim to be between $10 million

and $13 million. The estimates are not unreasonable unde

r

the circumstances.

In September 2008, t he School Board unanimously

approved a $4 million settlement of Mr. Merriweather’s

lawsuit against the District. T he District has already paid Mr.

Merriweather$100,000. The settlement agreement requires

the District to pay the remainin g $3.9 million over aperiod o f

four years after the appr oval of a claim bill.

The School Board did not set as ide money to pay the claim

concurrent with the approval of the settlement. The District

reported that the bill will be paid from its “general fund. . .,

which would impact the School District’s ability to fund

needed educational progr am[s].” The District also pointed

out that it has lost more than $90 million in state funding

since the start of the 2007-08 school year; that additional

reductions (possibly as much as an additional $100 million)

are expected for the 2009-10 school year; and that the District’s ad valorem tax revenues will likely be negatively

impacted by recent declines in property values.

The District’s most recent audite d financial statements reflect

that as of June 30, 2008, the Dis trict had net assets of more

than $2 billion. That figure in cludes estimated claims o f

more than $23 million, which according to the notes to the financial statements, are refl ected on the District-wide

financial statements but not the fund-specific statements until they become due each year.

The financial statements also reflect that the District’s

General Fund hada balance of approximately $120.7

million. Approximat ely $48.5 million of that amount was

“undesignated” and an additional $39.4 million was

“designated for board contingency.”

Additionally, Note 12 to the fi nancial statements states that:

The District is involved in various lawsuits

arising in the ordinary c ourse of operations. In

the opinion of management, the District’s

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estimated aggregate liability with respect to probable losses has been provided for in the

estimated liability for insurance risks and

pending claims in the accompanying financial

statements, after giving consideration to the

District’s related insur ance coverage, as well

as the Florida statut ory limitations of

governmental liability on uninsured risks. It is

the opinion of management in consultation with

legal counsel, the final settlements of these

matters will not result in a material adverse effect on the financial pos ition of the District.

The bus driver was given a ticket for careless driving fo r

causing the crash. He also received a “written reprimand” from the School Board. The bus driver continued to work fo

r

the transportation dep artment at the District until Decembe r

2007, when he resigned for personal reasons. He did not drive busses after the crash.

There were 33 students on the bus at the time of the

accident. None of the students were seriously injured. The

District paid a total of $62,000 to settle claims made by fou r

of the students on the bus.

The passenger in Mr. Merriweat her’s van -- a student that

Mr. Merriweather was taking home from basketball practice -

- was also injured in the accident. The passenger’s

negligence suit against the Distr ict is still pending, and is

expected to go to trial in June 2009. The District’s potential

exposure for that case is unknown at this time.

LEGAL PROCEEDINGS: In June 2007, Mr. Merriweat herfiled a negligence suit

against the District in circuit court in Palm Beach County.

The District admitted that its bus driver was negligent, but it

initially denied proxim ate cause and damages.

The case was settled in August 2008. The settlement was unanimously approved by the School Board on

September 17, 2008.

The terms of the settlement r equired the District to pay Mr.

Merriweathera total of $4 million. The first $100,000 was paid under the sovereign immuni ty cap in s. 768.28, F.S.

The remaining $3.9 million is to be paid upon approval of a

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claim bill, as follows: $1 million over three consecutive school years and $900,000 in the fourth school year. The

District agreed as part of the settlement not to oppose the claim bill.

A Stipulated Final Order of Dismissal was entered by the

circuit court on October 23, 2008.

Mr. Merriweather received $75, 000 of the initial $100,000

payment. The other $25,000 went to attorney’s fees. No

portion of the initial pa yment went to costs.

There are outstanding costs of approximately $120,420.17

that will be paid out of the proceeds of the claim bill. There

are also medical liens in exce ss of $500,000 that will be paid

out of the proceeds of the claim bill.

CLAIMANT’S POSITION: The negligence of the school bu s driver was the sole and

proximate cause of the signifi cant injuries and damages

sustained by Mr. Merriweather.

The amount of the settlemen t agreed to by the parties is

reasonable under the circumstanc es and should be given full

effect by the Legislature.

DISTRICT’S POSITION: The District admits liability and does not oppose the bill, but

it contends that payment of t he claim will adversely impact

its ability to fund needed e ducational programs.

CONCLUSIONS OF LAW: The school bus driver was an em ployee of the District acting

within the course andscope of hi s employment at the time o f

the accident. As a resul t, the driver’s negligence is

attributable to the District.

The bus driver had a duty to ex ercise reasonable care in the

operation of the bus. See generally s. 316.183(1), F. S. He

breached this duty by crashing into the back of Mr.

Merriweather’s stopped van. See Eppler v. Tarmac

America, Inc. , 752 So. 2d 592 (Fla. 2000) (rear driver is

presumed to be negligent in rear-end collision case absent evidence of a sudden and unex pected stop by the front

driver). The bus driver’s negligence was the sole and

proximate cause of the inju ries and damages sustained by

Mr. Merriweather.

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The amount of the settlement agreed to by the parties is

reasonable under the circumst ances. Even though the

economic damages estimated by the economist are likely

overstated to some degree, those damages reflect only a

portion of Mr. Merriweather’s total damages. His non- economic or “human damages” (e.g., pain andsuffering, reduced quality of life, etc.) are r eal and significant. And, as

both parties acknowledged, a jury award likely would have

been much higher than the am ount of the settlement.

The District’s argument that it does not have the funds to pay

this claim without adversely affe cting its operations was not

persuasive based upon the information presented in the District’s most recent audi ted financial statements.

LEGISLATIVE HISTORY: This is the first year that this claim has been presented to the

Legislature.

ATTORNEY’S FEES AND Mr. Merriweather’s attorney f iled an affidavit stating that attorney’s fees will be capped at 25 percent in accordance

LOBBYIST’S FEES: with s. 768.28(8), F.S. Lobbyist’s fees total 6 percentand are included within the 25 perce nt attorney’s fee cap. The

outstanding costs are not incl uded in these percentages.

The Legislature is free to limit these amounts as it sees fit.

See Gamble v. Wells , 450 So. 2d 850 (Fla. 1984); Noel v.

Schlesinger , 984 So. 2d 1265 (Fla. 4th DCA 2008). The bill

does so by limiting attorney’s fees, lobbyist’s fees, and costs ,

to 25 percent of the am ount of the claim bill.

Mr. Merriweather’s attorney stat ed in an affidavit that “[t]he

attorneys and lobbyists will abide by the terms of the claims

bill.” Therefore, if the bill passes in its current form, Mr.

Merriweatherwill receive $2,925,000 and the remaining $975,000 will go to attorney’s fees , lobbying fees, and costs.

If this language were not in t he bill, Mr. Merriweatherwould

receive only approximately $2. 8 million because the costs

would not be included in the 25 percent attorney’s fee cap.

OTHER ISSUES: The bill, as filed, is inconsis tent with the parties’ settlement

agreement, which requirespayment to be made over the

course of four consecutive schoo l years. The parties agree,

and I recommend that bill be amended to conform to the settlement agreement.

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RECOMMENDATION: For the reasons set forth above, I recommend that Senate Bill 522 be reported F AVORABLY, as amended.

Respectfully submitted,

T. Kent Wetherell, II

Senate Special Master

cc: Senator Christopher Smith

Philip Twogood, Secr etary of the Senate

Counsel of Record