Old Republic Ins. Co. v. Whitworth, 442 So. 2d 1078 (Fla. Dist. Ct. App., Third District 1983)

DANIEL S. PEARSON, Judge.

Old Republic Insurance Company, a compensation carrier, petitions for a writ prohibiting the respondent judge from exercising jurisdiction over a suit brought by a workers’ compensation claimant against it for “gross negligence, outrage and punitive damages” arising out of the carrier’s alleged willful breach of its obligations to make payments due the claimant under the Workers’ Compensation Act. We grant the petition.

The claimant, one Robert Bird, filed compensation claims for work-related disabilities. Hearings before a deputy commissioner were held. The deputy commissioner found that Old Republic had acted in bad faith in delaying disability payments. He awarded Bird extensive benefits and im

posed stringent penalties on all overdue benefits, costs and attorneys’ fees, in accord with the Workers’ Compensation Act’s provisions. After unsuccessfully appealing these awards, Old Republic paid all damages and penalties due to Bird.

Thereafter, Bird filed the present Circuit Court action. Old Republic moved to dismiss the action on the ground that the Circuit Court had no jurisdiction to resolve this compensation dispute. When Old Republic’s motion to dismiss was denied and its affirmative defense (asserting that the Circuit Court had no jurisdiction and the claim was barred by Section 440.11, Florida Statutes (1981))1 was stricken, it filed its petition for writ of prohibition with this court.2

It is well established that because the Workers’ Compensation Act provides a comprehensive, exclusive and adequate administrative remedy for employees’ work-related claims, the circuit court is without jurisdiction over an employee’s action for additional damages for injuries covered by the' Act. Winn-Lovett Tampa, Inc. v. Murphree, 73 So.2d 287 (Fla.1954). Likewise, because the exclusivity and immunity provisions of the Act, § 440.11, Fla.Stat. (1981), apply to the compensation carrier as well as the employer, Sullivan v. Liberty Mutual Insurance Co., 367 So.2d 658 (Fla. 4th DCA 1979), cert. denied, 378 So.2d 350 (1979); Carroll v. Zurich Insurance Co., 286 So.2d 21 (Fla. 1st DCA 1973), dismissed, 297 So.2d 568 (Fla.1974), a circuit court is without jurisdiction over an action against the carrier for injuries covered by the Act. Our inquiry therefore turns to whether the injury for which Bird sought compensation in his Circuit Court action is an injury covered by the Act.

The injury for which Bird sought recovery in the Circuit Court was Old Republic’s alleged bad faith refusal to timely compensate him for his disabilities, an injury which is compensable under the Act, and one for which the deputy commissioner in fact imposed punitive costs and attorneys’ fees in the compensation proceedings. Plainly, then, the injury is covered by the Act, and a compensation claimant cannot avoid the exclusivity of the Act and transform a delay in payments into an actionable tort cognizable in the Circuit Court simply by calling that delay outrageous, fraudulent, deceitful, or an intentional infliction of emotional distress. See, e.g., Sullivan v. Liberty Mutual Insurance Co., 367 So.2d 658 (Fla. 4th DCA 1979).

In Sullivan, a worker brought an action in the circuit court against his employer’s compensation carrier for wrongful termination of medical treatment and intentional injury by willful withdrawal of authorization for treatment. He alleged that the result of the insurer’s intentional withdrawal of authorization was that he suffered an amputation of his foot and other injuries. The trial court dismissed the case. The Fourth District affirmed. Sullivan’s exacerbated injuries, like Bird’s, were incidental to his original injury and compen-sable by his employer’s compensation carrier.3 The court held that the relief provided under the Act “is his sole remedy against the ... carrier.” 367 So.2d at 660.

The Sullivan court reasoned that if delay in providing services could become the subject of an independent suit, the legislatively designed exclusivity of the Act would be destroyed.

could give rise to independent third party court actions, the system of workmen’s compensation could be subjected to a process of partial disintegration. In the practical operation of the plan, minor delays in getting medical service, such as for a few days or even a few hours, caused by a carrier, could become the bases of independent suits, and these could be many and manifold indeed. The uniform and exclusive application of the law would become honeycombed with independent and conflicting rulings of the courts. The objective of the Legislature and the whole pattern of workmen’s compensation could thereby be partially nullified.

Other jurisdictions agree. Everfield v. State Compensation Insurance Fund, 115 Cal.App.3d 15, 171 Cal.Rptr. 164 (1981) (allegations that compensation carrier consistently delayed payments, arbitrarily reduced amount paid, and intentionally disregarded subpoena duces tecum resulting in physical and emotional suffering and that these acts were intentional, deceitful, fraudulent, and in bad faith insufficient to warrant departure from basic rule that worker’s sole remedy lay in compensation proceedings under Act); Sandoval v. Salt River Project Agricultural Improvement & Power District, 117 Ariz. 209, 571 P.2d 706 (Ct.App.1977) (regardless of intentional or negligent manner in which insurer failed to provide worker with benefit due, compensation law provides exclusive remedy for alleged tort where essence of claim is deprivation of benefits). See generally United States v. Demko, 385 U.S. 149, 87 S.Ct. 382, 17 L.Ed.2d 258 (1966) (Federal Tort Claims Act); Gill v. United States, 641 F.2d 195 (5th Cir.1981) (same); 2A Larson, Workmen’s Compensation Law § 65 (Supp. July 1983).

The recent revisions to the Workers’ Compensation Act, applicable to Bird’s claim, highlight the Act’s all-encompassing nature. The primary purpose of these revisions was to make the Act self-executing and to give the Division of Workers’ Compensation additional authority to punish recalcitrant insurers and employers. Florida Erection Services, Inc. v. McDonald, 395 So.2d 203 (Fla. 1st DCA 1981). In McDonald, the court held that the Act was broad enough to provide the Workers’ Compensation Division with sufficient authority to punish a carrier for willful and intentional “bad faith” as well as negligent abuse of duty without going outside the parameters of workers’ compensation law.

Bird’s complaint seeks to evade the exclusivity of the workers’ compensation law by pleading a cause of action for intentional harm. The complaint, however, as the complaint in Sullivan, does no more than

allege intentional nonperformance of a statutory duty imposed by the Act. As the Sullivan court stated in affirming the dismissal of the complaint:

In Everfield v. State Compensation Insurance Fund, 171 Cal.Rptr. 164, the California court decided a case virtually identical to the case before us. There, a worker who had received disability payments for his injuries filed a two-count action. In Count I, he alleged consistent delay in compensation payments, arbitrary reductions in amounts paid, and intentional disregard of a subpoena duces tecum, resulting in physical and emotional suffering. In Count II, he added that these acts were intentional, fraudulent, and in bad faith with intent to injure plaintiff. The court ruled that the plaintiff had no cause of action cognizable in the court, as the remedies provided under the workers’ compensation law were both exclusive and sufficient.

Similarly, in Sandoval v. Salt River Project Agricultural Improvement & Power District, 571 P.2d 706, a worker sought relief in the courts for wrongful denial of benefits in processing his workers’ compensation claim. He described the defendant’s conduct as “intentional wrongful suspension of compensation benefits” causing “undue hardship and great mental suffering and emotional distress.” 571 P.2d at 710. He claimed “injurious falsehood, intentional breach of fiduciary duties, false representations, negligence, recklessness, wilful and wanton and outrageous conduct, and intentional infliction of mental suffering.” The Arizona court wrote:

with benefits he was or may be entitled to under the Workmen’s Compensation laws.

Accord, Young v. United States Fidelity & Guaranty Co., 588 S.W.2d 46 (Mo.App. 1979).

We conclude, therefore, that jurisdiction over Bird’s “bad faith” claims rests exclusively in the Division of Workers’ Compensation, which has already asserted that jurisdiction and assessed appropriate penalties against Old Republic. In reaching this conclusion, we have not overlooked Salkay v. Deuschle, 385 So.2d 181 (Fla. 4th DCA 1980), or Reed v. Hartford Accident and Indemnity Co., 367 F.Supp. 134 (E.D.Pa. 1973), heavily relied on by Bird.

In Salkay, an injured workman received a compensation award which determined that his corporate employer owed him benefits. The corporation was not insured. It was not properly qualified as a self-insurer. Salkay did not receive the benefits awarded. The corporation was subsequently liquidated. Salkay sued the individuals who were trustees of the dissolved corporation. He alleged in his complaint that these individuals, in their capacities as trustees, liquidated the corporation, and thereafter, in their individual capacities, converted and concealed the assets in a fraudulent attempt to deprive him of the benefits he had been awarded. The only issues tried or triable in the workers’ compensation proceeding had been Salkay’s status as an employee, the amount of his entitlement, the identity of his employer, and the methods of enforcing his award. The Fourth District held that Salkay was entitled to sue in circuit court because the suit was based on “injuries not encompassed within the expressed provisions or intendments of the Act.” 385 So.2d at 182. Salkay therefore stands for the unremarkable proposition, clearly inapposite to the case at hand, that a suit involving issues not encompassed within the provisions of the Workers’ Compensation Act against parties not insured or properly qualified as self-insurers under the statute was not barred by res judicata or estoppel by judgment arising from a prior determination in workers’ compensation proceedings that the employer owed the claimant benefits.4

In Reed v. Hartford Accident and Indemnity Co., 367 F.Supp. 134, the district court, finding nothing in the controlling state law of Pennsylvania which would prevent the bringing of the lawsuit, denied the carrier’s motion to dismiss a complaint which alleged that the carrier had wrongfully terminated workers’ compensation benefits. Reed is readily distinguishable. The Pennsylvania workers’ compensation law applicable at the time Reed made his claim for compensation benefits and brought his federal action substantially dif

fers from the Florida Workers’ Compensation Act applicable here. The Pennsylvania Workers’ Compensation Act provided no mechanism to enforce the prompt payment of legitimate claims.5,6 Florida’s compensation lav?1, in contrast, contains mechanisms to insure timely payment and provides an array of sanctions which may be imposed when a carrier wrongfully withholds payment. Because the availability of these sanctions gives to Bird an adequate remedy under the Act, the remedy under the Act is exclusive.

Accordingly, we conclude that the Circuit Court does not have jurisdiction over Bird’s action, and the petition for writ of prohibition is granted. We are confident that it is unnecessary for us to issue the writ, and we therefore remand the cause to the Circuit Court with directions to dismiss the complaint.