Florida Supreme Court: Medical Malpractice Arbitration Agreement Void As Against Public Policy
In Franks v. Bowers, a landmark decision involving medical malpractice arbitration provisions, the Florida Supreme Court yesterday (June 20, 2013) struck down a medical malpractice arbitration provision that differed substantially from Florida’s statutory arbitration provision and violated public policy. The case involved the wrongful death of Joseph Franks, a patient of Gary Bowers, M.D. at North Florida Surgeons, P.A. in Jacksonville. The physicians at North Florida required their patients to sign arbitration provisions before the physicians would agree to provide health care. The doctors required their patients sign away the right to a jury trial in the event the doctor commits medical malpractice, agree to damage caps of $250,000, and agree to waive their rights to the statutory provisions that require an admission of liability in order for a doctor to receive a $250,000 non-economic damages cap in a medical malpractice case. The arbitration agreement eliminated the alternative right to a jury trial delineated in Florida Statutes section 766.209 (patients who refuse a health care provider’s offer to arbitrate may proceed to jury trial, but they then have a $350,000 non-economic cap and have to prove liability).
The Court, in an opinion authored by Justice Perry, found that the trial court and the First District Court of Appeal erred in failing to strike down the doctors’ arbitration provision. Because the arbitration agreement failed to include the same rights and remedies that are included in Florida Statutes Chapter 766, the arbitration agreement offended public policy and was void. The opinion is significant because it nips in the bud what was a growing trend among Florida doctors to seek to contractually strip their patients of civil justice rights and access to courts with arbitration provisions. Hopefully, for purposes of patient protection, access to courts, and the right to a jury trial, the Franks opinion will be the death knell for the cynical use of arbitration contracts in the health care setting.
The majority included Justices Quince, Lewis, Labarga, and Pariente. Justice Pariente also wrote a strong concurrence in which she emphasized the public policy concerns with the arbitration contract’s failure to provide any of the statutory benefits of Chapter 766’s arbitration provisions, benefits that make the statutory scheme survive constitutional scrutiny as set forth in University of Miami v. Echarte, 618 So.2d 189 (Fla. 1993).
Justice Canady wrote a dissent in which Chief Justice Polston joined. They disagreed on the jurisdictional question with the majority, arguing that the First District’s opinion was not in conflict with Echarte so that the Court lacked conflict jurisdiction. The dissent also asserted that the arbitration agreement was in line with their view of Florida’s public policy. For Justice Canady, the public policy of Chapter 766 (Florida’s Medical Malpractice Act) is to discourage the “mischief” that inheres in and arises from medical malpractice lawsuits. The mischief he is referring to? Expensive medical malpractice insurance premiums and large claims payouts. (Of course, the accuracy of the charge that medical malpractice lawsuits are the cause of high insurance premiums or whether, in fact, the causes are cyclical financial markets and insurance company avarice are entirely different topics beyond the scope of this article.) In any event, as Justice Canady points out, “‘public policy’ is a ‘very unruly horse.'”
For a copy of the opinion, click here.