Neglect of nursing home residents presents an issue of statewide concern impacting a protected class of persons, namely, elderly, frail and defenseless residents.

Section 400.022, Fla. Stat. requires all licensees of nursing home facilities to assure each resident specifically identified rights including, but not limited to, the following:

  1. The right to be treated courteously, fairly, and with the fullest measure of dignity;
  2. The right to be free from mental and physical abuse;
  3. The right to receive adequate and appropriate health care and protective and support services, including therapeutic and rehabilitative services, consistent with a resident care plan and with established and recognized practice standards within the community and with rules adopted by the Agency for Health Care Administration; and
  4. The right to be adequately informed of her medical condition and proposed treatment.

Section 400.023, Fla. Stat. provides as follows:

“(1) Any resident whose rights as specified in this part are deprived or infringed upon shall have a cause of action against any licensee responsible for the violation. The action may be brought by the resident or his or her guardian, by a person or organization acting on behalf of a resident with the consent of the resident or his or her guardian, or by the personal representative of the estate of a deceased resident when the cause of death resulted from the deprivation or infringement of the decedent’s rights. The action may be brought in any court of competent jurisdiction to enforce such rights and to recover actual and punitive damages for any deprivation or infringement on the rights of a resident. Any Plaintiff who prevails in such action may be entitled to recover reasonable attorneys’ fees, costs of the action, and damages…

(5) For the purpose of this section, punitive damages may be awarded for conduct which is willful, wanton, gross, or flagrant, reckless, or consciously indifferent to the rights of the resident.”

Florida nursing homes who accept Medicare and Medicaid benefits must follow the regulations found in 42 C.F.R. Part 483. Pursuant to §59A-4.1288, Florida Administrative Code, those regulations have been incorporated by reference into the State of Florida’s regulations applicable to nursing homes in this state. Violations of any of these regulations constitute violations of the rights granted to nursing home residents pursuant to §400.022(1)(1), Fla. Stat. In other words, §400.022, Fla. Stat. grants every resident specified rights as a nursing home resident and incorporates applicable sections of the Florida Administrative Code and the Code of Federal Regulations.

Pursuant to the Interpretive Guides to Surveyors for Long Term Care Facilities, “abuse” is defined as follows:

“ ‘Abuse’ means the willful infliction of injury, unreasonable confinement, intimidation, or punishment with resulting physical harm or pain or mental anguish or deprivation by an individual, including a caretaker, of goods or services that are necessary to attain or maintain physical, mental, and psychosocial wellbeing.”1

Pursuant to 42 C.F.R. §483.25, nursing homes are required to provide each resident the necessary care and services to attain or maintain the highest practicable physical, mental, and psychosocial wellbeing, in accordance with the comprehensive assessment and plan of care regarding the following:

“(a) Activities of daily living. Based on the comprehensive assessment of a resident, the facility must ensure that –

(1) A resident’s abilities in activities of daily living do not diminish unless circumstances of the individual’s clinical condition demonstrate that diminution was unavoidable. This includes the resident’s ability to-

(i) Bathe, dress, and groom;

(ii) Transfer and ambulate;

(iii) Toilet;

(iv) Eat; and . . .

(c) Pressure sores. Based on the comprehensive assessment of a resident, the facility must ensure that-

(1) A resident who enters the facility without pressure sores does not develop pressure sores unless the individual’s clinical condition demonstrates that they were unavoidable; and

(2) A resident having pressure sores receives necessary treatment and services to promote healing, prevent infection and prevent new sores from developing.

(d) Urinary incontinence. Based on the resident’s comprehensive assessment, the facility must ensure that-

(1) A resident who enters the facility without an indwelling catheter is not catheterized unless the resident’s clinical condition demonstrates that catheterization was necessary; and

(2) A resident who is incontinent of bladder receives appropriate treatment and services to prevent urinary tract infections and to restore as much normal bladder function as possible.

(e) Range of motion.

Based on the comprehensive assessment of a resident, the facility must ensure that-

(1) A resident who enters the facility without a limited range of motion does not experience reduction in range of motion unless the resident’s clinical condition demonstrates that a reduction in range of motion is unavoidable; and

(2) A resident with a limited range of motion receives appropriate treatment and services to increase range of motion and/or to prevent further decrease in range of motion . . .

(g) Naso-gastric tubes. Based on the comprehensive assessment of a resident, the facility must ensure that-

(1) A resident who has been able to eat enough alone or with assistance is not fed by naso-gastric tube unless the resident’s clinical condition demonstrates that use of a naso-gastric tube was unavoidable; and

(2) A resident who is fed by naso-gastric or gastrostomy tube receives the appropriate treatment and services to prevent aspiration pneumonia, diarrhea, vomiting, dehydration, metabolic abnormalities, and nasal-pharyngeal ulcers and to restore, if possible, normal eating skills.

(h) Accidents. The facility must ensure that-

(1) The resident’s environment remains as free as accident hazards as is possible; and

(2) Each resident receives adequate supervision and assistance devices to prevent accidents.

(i) Nutrition. Based on a resident’s comprehensive assessment, the facility must ensure that a resident-

(1) Maintains acceptable parameters of nutritional status, such as body weight and protein levels, unless the resident’s clinical condition demonstrates that this in not possible; and

(2) Receives a therapeutic diet when there is a nutritional problem.

(j) Hydration. The facility must provide each resident with sufficient fluid intake to maintain proper hydration and health.”

Pursuant to 42 C.F.R. §483.30, nursing home facilities must have sufficient nursing staff to provide nursing and related services to attain or maintain the highest practicable physical, mental, and psychosocial wellbeing of each resident, as determined by resident assessments and individual plans of care. Each nursing home facility must provide services by sufficient numbers of registered nursing and other nursing personnel on a twenty four hour basis to provide nursing care to all residents in accordance with resident care plans. Likewise, pursuant to 42 C.F.R. §483.35, nursing home facilities must provide each resident with a nourishing, palatable, well balanced diet that meets the daily nutritional and special dietary needs of each resident and must provide sufficient staff and support personnel competent to carry out the functions of that dietary service, including a qualified dietician. Moreover, each resident must receive food prepared by methods that conserve its nutritional value, flavor, and appearance, food that is palatable, attractive, and at the proper temperature, food prepared in a form designed to meet individual needs, and substitutes of similar nutritional value for those who refuse the food served.

Section 782.07(2), Fla. Stat. provides as follows:

“A person who causes death of an elderly person or disabled adult by culpable negligence under §825.102(3)(b) commits aggravated manslaughter of an elderly person or disabled adult, a felony of the first degree.”

Section 825.102, Fla. Stat. criminalizes abuse, aggravated abuse, and neglect of an elderly person or disabled adult. Section 825.102(3)(b) is directed at a person “who willfully or by culpable negligence neglects an elderly person or disabled adult and in so doing causes great bodily harm, permanent disability, or permanent disfigurement.” Section 825.102(3)(a), Fla. Stat. defines “neglect of an elderly person or disabled adult” as:

  1. A caregiver’s failure or omission to provide an elderly person or disabled adult with the care, supervision, and services necessary to maintain the elderly person’s or disabled adult’s physical and mental health, including, but not limited to, food, nutrition, clothing, shelter, supervision, medicine, and medical services that a prudent person would consider essential for the well-being of the elderly person or disabled adult; or
  2. A caregiver’s failure to make a reasonable effort to protect an elderly person or disabled adult from abuse, neglect, or exploitation by another person.

Neglect of an elderly person or disabled adult may be based on repeated conduct or on a single incident or omission that results in, or could reasonably be expected to result in, serious physical or psychological injury, or a substantial risk of death, to an elderly person or disabled adult.

What Are Punitive Damages? Punitive damages are extraordinary damages that can two to nine times the compensatory damages. Punitive damages are also referred to as punishment damages, and are utilized to deter corporate wrongdoing.

I. PROCEDURAL REQUIREMENTS TO SUPPORT A CLAIM FOR PUNITIVE DAMAGES.

Section 768.72, Fla. Stat. allows a claim for punitive damages when there is a reasonable showing by evidence in the record or proffered by a party which would provide a reasonable basis for recovery of punitive damages. Punitive damages are appropriate when a Defendant engages in conduct which is fraudulent, malicious, deliberately violent or oppressive, or committed with such gross negligence as to indicate a wanton disregard for the rights of others. W.R. Grace & Company v. Waters, 638 So.2d 502 (Fla. 1994).

An evidentiary hearing is not required by the statute before a trial court has the authority to. permit an amendment. Solis v. Calvo, 689 So.2d 366 (Fla. 3rd DCA 1997) and Strasser v. Yalamanchi, 677 So.2d 22, 23 (Fla. 3rd DCA 1996). Under §768.72, Fla. Stat. a mere proffer of evidence is sufficient to support a trial court’s determination that a reasonable basis exists for the recovery of punitive damages. See Id. It is not the function of the court to weigh or prejudge the. evidence before it, but merely to determine whether a factual predicate for punitive damages exists. See Dolphin Cove Association v. Square Co., 616 So.2d 553 (Fla. 2d DCA 1993).

Neither the statute nor the rules of procedure provide much guidance on this subject, but it has been held that a requirement to provide written proffers to be filed a reasonable time prior to any hearing would be a reasonable method to assure that such hearings satisfy the spirit of the statute and the requirements of due process. See Beverly Health and Rehabilitative Services, Inc. v. Meeks, 26 FLW D128 (Fla. 2d DCA 2001).

II. SUBSTANTIVE LAW ON THE IMPOSITION OF PUNITIVE DAMAGES.

  1. The Criteria. The formalistic criteria for a punitive award have not changed in the past thirty-eight years, and in that sense the Supreme Court’s declaration in Carraway v. Revell, 116 So. 2d 16, 20 n. 12 (Fla. 1959), quoting Cannon v. State, 91 Fla. 214, 107 So. 360, 363 (1926) (citations omitted) remains good law:

The character of negligence necessary to sustain an award of punitive damages must be a “gross and flagrant character, evincing reckless disregard of human life, or of the safety of the persons exposed to its dangerous effects, or there is that entire want of care which would raise the presumption of a conscious indifference to consequences, or which shows wantonness or recklessness, or a grossly careless disregard of the safety and welfare of the public, or that reckless indifference to the rights of others which is equivalent to an intentional violation of them.

This formulation has been endorsed repeatedly by the Supreme Court over the intervening years. See e.g., W.R. Grace & Co. v. Waters, supra; Chrysler Corp. v. Wolmer, 449 So.2d 823, 824 (Fla. 1986); Como Oil Co. v. O’Loughlin, 446 So.2d 1061, 1062 (Fla. 1985)(per curiam); White Construction Co. v. Dupont, 445 So.2d 1026, 1029 (Fla. 1984).

The various criteria articulated in Carraway are written in the alternative, and thus any one of the phrases used-including the criterion of “wantonness or recklessness,” or “grossly careless disregard”–should be sufficient to support a punitive award. Therefore, punitive damages should be available even if the defendant has not intentionally caused harm. The line between intentional and reckless conduct is not any easy one, but in general, the defendant’s misconduct is intentional if he intended not only to do what he did, but also to cause injury which he caused; while a reckless actor intends the conduct but not necessarily the consequences. As the authors of the Restatement (Second) of the Law of Torts §500, Comment(f), at 590 (1965) put it: “While an act to be reckless must be intended by the actor, the actor does not intend to cause the harm which results from it.”

In the latter case, the Florida courts have consistently affirmed the availability of punitive awards. As the Supreme Court noted in Ingram v. Petit, 340 So.2d 922, 924 (Fla. 1976), a punitive award may be predicated upon either “[t]he intentional infliction of harm, or a recklessness which is the result of an intentional act…” It is in this sense that the Supreme Court declared in Carraway that punitive awards may be predicated not only upon the knowing or intentional causation of injury, but also upon a “reckless indifference to the rights of others which is the equivalent to an intentional violation of them.” This formulation is found throughout the cases.2

  1. The Criminal-Law Analogy. This concept of recklessness is not at all inconsistent with the Supreme Court’s declaration in Carraway v. Revel, 116 So.2d at 20, that there is a “real affinity between the character (or kind or degree) of negligence necessary to recover punitive damages or to sustain or warrant a conviction of manslaughter.” See Keller Industries, Inc. v. Waters, 501 So.2d 125, 125-26 (Fla. 2d DCA 1987). Of course, the Supreme Court in Carraway did not mean to imply that punitive damages are not available unless the defendant can actually be convicted of a crime. It mentioned only the “affinity” between the “character” of the wrongdoing. necessary to sustain a punitive award. As the court has noted more than once, punitive damages are a civil analog to criminal prosecution, providing for punishment in “areas not covered by the criminal law.”3

Since Florida law requires only behavior analogous to criminal misconduct, there is ample support for the minimal standard of recklessness. The manslaughter jury charge prescribes conviction for “culpable negligence,” defined as negligence of a “gross and flagrant” character, “committed with an utter disregard for the safety of others”– that is, “consciously doing an act or following a course of conduct that the defendant must have known, or reasonably should have known, was likely to cause death or great bodily injury”.4 Of course, as we have noted, recklessness requires an intentional act, and thus a defendant may not be convicted of manslaughter if he acted unintentionally with “disregard of the safety of others.” Rushton v. State, 395 So.2d 610, 613 (Fla. 5th DCA 1981), citing McCreary v. State, 371 So.2d 1024 (Fla. 1979). But as the standard jury instruction makes clear, a defendant may be convicted of manslaughter for “consciously doing an act or following a course of conduct which any reasonable person would know would likely result in death or great bodily injury to some other person, even though done without the intent to injure any person but with utter disregard for the safety of another.5 Thus, a defendant may be convicted who “set the stage for the tragedy which ultimately and inevitably followed, and he must have be held criminally responsible therefore, even though he had no intention of killing [the decedent].6 Thus, it is not surprising that the Florida courts repeatedly have sustained convictions for manslaughter based on conduct which was neither knowing nor intentional.7

  1. Reviewing Nursing Home Cases Where Punitive Damage Awards Have Been Upheld.

In Payton Health Care v. Estate of Campbell, 497 So.2d 1233 (Fla. 2d DCA 1986), the Court reviewed a jury verdict awarding punitive damages in a nursing home case. The issue was whether the testimony in that case was sufficient to support an award of punitive damages. The facts as outlined in the Payton case were as follows:

Plaintiff, a stroke victim in need of medical and nursing care, was admitted as a resident of the Defendant nursing home;

  1. While at the nursing home, Plaintiff developed several severe, necrotic, decubitus ulcers ultimately requiring hospitalization;
  2. The evidence at trial included conflicting evidence about the care received by the Plaintiff at the nursing home.
  3. The Plaintiffs expert witness examined the nursing home and hospital records and testified that there were multiple deficiencies in the care of the Plaintiff during the Plaintiff’s residency at the nursing home; and
  4. That Plaintiff’s expert witness testified that the care given was “an outrageous devialion from the acceptable standard.”

On those facts, the Second District Court of Appeals held the evidence “sufficient to sustain the award of punitive damages.”

The second case available for comparison in the nursing home arena is Beverly Enterprises, Inc. v. Spilman, 661 So.2d 867 (Fla. 5th DCA 1995). In that case, the jury also returned a verdict with an award of punitive damages. The Fifth District Court of Appeals reviewed the facts of the case and concluded that there was ample evidence regarding the acts and omissions of the Defendant to warrant and sustain an award of punitive damages under the standard pronounced by the Florida Supreme Court in White Construction Company v. Dupont, 455 So.2d 1026 (Fla. 1984). The opinion contains several pages outlining the testimony in that case, which included the following:

  1. Medical records which indicated that, at the time of his death, Mr. Spilman suffered from severe pressure sores;
  2. Mr. Spilman suffered from deep bedsores on his hips and buttocks;
  3. Records indicated that the care plan for Mr. Spilman was insufficient and that the nurses did not always know what they were doing;
  4. An expert witness who had. reviewed the record found numerous deprivations of his rights;
  5. An expert witness stated that she was outraged and concluded that Mr. Spilman was neglected; and
  6. In the expert’s opinion, the acts and omissions by the nursing home constituted abuse and neglect.

The third nursing home case available for review is First Healthcare Corp. v. Hamilton, 740 So.2d 1189 (Fla. 4th DCA 1999).

In that case, a case arising from a nursing home resident’s death when he wandered away from the facility, the evidence supported an award of punitive damages when:

  1. The nursing home knew that the resident had dementia and had been placed there because he needed close supervision;
  2. The nursing home knew that he had wandered off the premises on a number of occasions, that he had a visual impairment, that he had been found at nearby stores off the premises on a number of occasions, and that the staff had failed to record the incidences of wandering off the premises;
  3. The nursing home resident had sustained unexplained injuries;
  4. A sliding glass door that opened to the outside from this room was stuck sufficiently ajar to allow him to get out, that his wife repeatedly requested that the door be repaired and it never was, that his wife had repeatedly requested the nursing home to equip him with a wander guard device;
  5. The nursing home knew that due to the resident’s age and physical impairments it was dangerous for him to leave the premises unaccompanied and when his wife had consistently reminded the nursing home of the necessity of maintaining awareness of his whereabouts;
  1. The facility knew he was frequently disoriented or confused but did nothing to protect him, despite their knowledge that he regularly wandered away from the facility; and
  2. There was evidence that the administrator had created a fraudulent document to cover up the lack of care by placing blame upon the decedent’s widow.

In upholding the award of punitive damages, the court stated as follows:

“We hold that such evidence was sufficient for the jury to conclude that defendants were ‘consciously indifferent to the rights of the resident’ within the meaning of §400.023, and award punitive damages.”

Moreover, the court held that cases such as Jeep Corp. v. Walker, 528 So.2d 1203 (Fla. 4th DCA 1988) did not change the law on punitive damages and require an elevated standard for imposing punitive damages. In so noting this, the court stated that the Supreme Court of Florida wrote in Chrysler Corp. v. Wolme, 499 So.2d 823 (Fla. 1986) that “punitive damages are warranted only where the egregious wrongdoing of the defendant, although perhaps not covered by criminal law, nevertheless constitutes a public wrong.” The court also noted that, in the Hamilton case, the type of wrongdoing was precisely covered by a criminal statute, specifically §782.07(2), Fla. Stat. which provides as follows:

“A person who causes death of an elderly person or disabled adult by culpable negligence under §825.102(3)(b) commits aggravated manslaughter of an elderly person or disabled adult, a felony of the first degree.”

Section 825.102, Fla. Stat. criminalizes abuse, aggravated abuse, and neglect of an elderly person or disabled adult. Section 825.102(3)(b), Fla. Stat. is directed at a person “who willfully or by culpable negligence neglects an elderly person or disabled adult and in so doing causes great bodily harm, permanent disability, or permanent disfigurement.” Section 825.102(3)(a), Fla. Stat. defines “neglect of an elderly person or disabled adult” as:

  1. A caregiver’s failure or omission to provide an elderly person or disabled adult with the care, supervision, and services necessary to maintain the elderly person’s or disabled adult’s physical and mental health, including, but not limited to, food, nutrition, clothing, shelter, supervision, medicine, and medical services that a prudent person would consider essential for the well-being of the elderly person or disabled adult; or
  2. A caregiver’s failure to make a reasonable effort to protect an elderly person or disabled adult from abuse, neglect, or exploitation by another person.

Neglect of an elderly person or disabled adult may be based on repeated conduct or on a single incident or omission that results in, or could reasonably be expected to result in, serious physical or psychological injury, or a substantial risk of death, to an elderly person or disabled adult.

According to the court in Hamilton, reading those two statutes together leads to the conclusion that one version of manslaughter is committed by a person who, by culpable negligence, causes the death of an elderly person through “neglect of an elderly person or disabled adult” as defined by §825.102(3)(a), Fla. Stat. By this special manslaughter statute, the legislature has declared the conduct it describes to be a “public wrong” contemplated by Chrysler Corp. v. Wolmer.

The court held that the evidence in Hamilton supported both a finding of culpable, negligence justifying an award of punitive damages and of manslaughter under §782.07(2), Fla. Stat.

III. Arbitrtation Agreements Cannot Prevent Punitive Damages

In adopting the Nursing Home Residents’ Act, Chapter 400, the Florida legislature was responding to widespread elder abuse. Romano v. Manor Care, Inc., 861 So.2d 59, 62-63 (Fla. 4th DCA 2004). One of the primary purposes of enacting remedial legislation is to correct or remedy a problem or redress an injury. Campus Communs., Inc. v. Earnhardt, 821 So.2d 388, 396 (Fla. 5th DCA 2002). Accordingly, remedial statutes should be given their intended purposes, and as a result receive “special” treatment such as retroactive application. City of Orlando v. Desjardins, 493 So.2d 1027, 1028 (Fla. 1986). The legislature clearly and explicitly created a remedial statute under its police power in order to protect institutionalized Floridians and to discourage neglect and abuse.

This Court has demonstrated an unwillingness to allow a judicially created rule from abrogating remedies conferred under a remedial statute. Comptech International, Inc. v. Milam Commerce Park, Ltd., 753 So.2d 1219, 1222 (Fla. 1999). (“Courts do not have the right to limit and, in essence, to abrogate, as the trial court did in this case, the expanded remedies granted… under this legislatively created scheme.”) Similarly, the Court should likewise be unwilling to abrogate the remedies conferred on elderly nursing home residents under chapter 400 to enforce a contract drafted by one of the very entities for whose conduct the remedial statute was drafted to redress. As Judge Farmer wrote in his concurring opinion in Blankfeld:

It is absurd to think that a regulatory scheme can be evaded by private contracts of the very person being controlled. It is absurd that an entire industry escape regulation by simply embedding choice of governing substantive law clauses in its contracts. What other police power regulation can be side-stepped by contracts eliminating it? Common carriers evading safety laws by form contracts for passage? Restaurants avoiding health codes by contractual provisions in the bill? Cigarette dealers canceling health warnings by provisions in the sales papers? Home builders modifying building codes in contracts for construction?

Blankfeld, 902 So.2d at 303.

In Blankfeld, the Fourth District held en banc that arbitration provisions which limit the remedies available under the Act are void as contrary to public policy. Id. at 297. The arbitration agreement in Blankfeld provided that the arbitrator may not award punitive damages unless there is “clear and convincing evidence that the party against whom such damages are awarded is guilty of conduct evincing an intentional or reckless disregard for the rights of another party or fraud, actual, or presumed.” Id. at 298. In striking the provision as contrary to public policy, the Court concluded that, “the remedies provided in the legislation would be substantially affected and, for all intents and purposes, eliminated.” Id.

Similarly, in SA-PG-Ocala, LLC v. Stokes, 935 So.2d 1242 (Fla. 5th DCA 2006), the Fifth District adopted the Blankfeld rationale. The arbitration provisions in SA-PG-Ocala also raised the burden of proof needed in order for punitive damages to be awarded. Id. at 1242-1243. The Court held that such a provision was contrary to public policy. Id. at 1243. “It would be against public policy to permit a nursing home to dismantle the protections afforded patients by the Legislature through the use of an arbitration agreement.” Id.

In two more decisions, the Fourth and Fifth Districts reaffirmed the reasoning of Blankfeld and SA-PG-Ocala. In Fletcher v. Huntington Place, L.P., 952 So.2d 1225 (Fla. 5th DCA 2007) and in The Place at Vero Beach, Inc. v. Hanson, 953 So.2d 773 (Fla. 4th DCA 2007), the Courts expressly held that an arbitration agreement which required that the arbitration be administered by the AHLA rendered it unenforceable. In particular, the Courts found that “the inclusion of certain provisions in the [AHLA Rules] were void as against public policy because they had the effect of superseding or dismantling the protections afforded patients by the legislature in the Nursing Home Resident’s Act, Chapter 400.” Fletcher, 952 So.2d at 1226.

The Second District’s Judge Altenbernd, in a lengthy and well reasoned concurrence in Steihl, expressed his frustration at the proliferation of nursing home arbitration appeals in recent years, and the resultant disparate impact of an ever-changing body of law on the remedial rights of Florida’s nursing home residents. Judge Altenbernd noted that as of the August, 2009, with the issuance of the Steihl opinion, there were 35 reported decisions in these matters. At present, only four (4) months after Steihl, there are 50 and counting. Instead of the professed reason for promoting the use of arbitration-streamlining dispute resolution and reducing litigation expenses, nursing home arbitrations have had quite the opposite effect, causing Judge Altenbernd to agree with the majority in Steihl based solely on the existence of binding precedent, but changing his mind about the wisdom of allowing arbitrators to dictate or alter the public policy of this state.

I have come to the conclusion, however, that it is both bad policy and bad law to allow an arbitrator to make case-specific, non-precedential, confidential decisions about the enforceability of clauses in an arbitration agreement when those clauses limit or eliminate rights specially created by the legislature to protect nursing home residents.(emphasis added).

Slip Op. at 5.

[I]n the context of a dispute between a corporation that essentially has physical custody of an elderly person and that person’s guardian, when the dispute arises not from contract law, but from special rights created by the legislature for the protection of the elderly, and when the contract is not a unique contract negotiated on a level playing field, but a form contract applicable to a large group of senior citizens, I think it is a mistake to delegate these legal decisions to the arbitrator.(footnote deleted) (emphasis added).

Slip Op. At 6.

Judge Altenbernd noted the confidentiality requirements of such agreements, explaining the unfairness to residents of the same nursing home experiencing similar injuries where certain arbitrators enforce the limitations, others strike them as void and violative of public policy, and still others might determine the entire agreement to be void and allow the parties to return to court, with only the nursing home chain knowing the outcomes.

Not only does this procedure prevent the creation of binding precedent, it creates nothing approaching the rule of law…. Only the nursing home corporation will know that the results were so different and resulted in vastly different awards. None of the rulings will bind any future claims. No one will have a right to appeal or challenge the different rules of law applied to the same circumstances under the same statutory and contractual law. In passing the bill of rights for nursing home residents, the Legislature cannot conceivably have envisioned such a result. (emphasis added).

Slip Op. at 7.

IV. Punitive Damages Against Corporate Nursing Home Owners

Florida law is clear that officers of a Defendant corporation are individually liable for their own torts, even if they are acting within the scope of their employment. Individual owner defendants seek to insulate their actions from liability of Florida Statutes Chapter 400 merely by choosing one entity to hold the “paper license” while they continue to operate, conduct, and/or manage the facility.

Defendants argue that they were not the paper “licensees” under Florida Statutes Chapter 400. Essentially, Defendants seek to evade liability under Florida Statutes Chapter 400 because they allegedly were not paper “Licensees” while it is undisputed that they were establishing, operating, conducting and/or managing the facility unlawfully and in direct violation of the specific statutory provisions of Florida Statutes Chapter 400. Florida Statutes § 400.062(1) states: “It is unlawful to operate or maintain a facility without first obtaining from the agency a license authorizing such operation.” In addition, Florida Statutes § 400.241(1) provides: “It is unlawful for any person or public body to establish, conduct, manage or operate a home as defined in this part without obtaining a valid current license. Violation of this statute constitutes a misdemeanor of the second degree and each day of a continuing violation is considered a separate offense.”

An argument similar to that of the Defendants was made in the case of State Department of Public Welfare v. Bland, 66 So. 2d 59 (Fla.1953). In Bland, the State Welfare Board sought to enjoin a nursery home operator from operating the facility in violation of the statute governing such homes. Specifically, the applicable statutes provided that it was unlawful to operate nursery homes for children without first having obtained a license. In her defense, the operator of the nursery home argued that the court had no authority to enjoin her operation of the nursery home since the statute only provided a cause of action against a “Licensee”. In holding that the court did have authority to enjoin the operation of the nursery home despite the fact that the operator did not have a license, the Supreme Court reasoned that “to give effect to this argument would be tantamount to saying that a person plainly covered by and included in the statute could by the simple expedient of ignoring the statute, defeat legislative will. Such result would both be absurd and do great violence to the plain legislative intent, which was obviously to provide competent supervision under a qualified agency of these homes that have charge of our most precious possessions — our young people.” Id. at 61.

In providing a cause of action to residents and allowing them to recover damages from a licensee who infringes upon the residents rights, the legislature clearly intended that nursing homes would be operated, established, conducted and/or managed only by entities that had obtained a valid current license pursuant to the provisions of Florida Statutes subsection 400.0262 and subsections 400.241. Any other interpretation would defeat the explicitly expressed legislative intent of providing a mechanism for the enforcement of basic standards for the treatment of persons in nursing homes. It is clear that the elderly are no less “precious” than our young people and deserve such protection. Plaintiff submits that pursuant to the very statutes Defendants rely upon to avoid liability, that either they are the licensees in fact or they have committed numerous, repeated, and ongoing criminal acts.

As pointed out below in the Orlovski case, there are compelling policy reasons for not allowing corporate officers to injure persons and escape liability behind the shield of an insolvent or shell corporation.

It should be emphasized that affirmative acts of misconduct are not required to maintain a cause of action for negligence; rather, failing to act when there is a duty to act can constitute negligence and can constitute recklessness. See Estate of Patrick Canavan v. Natl. Healthcare Corp., 889 So.2d 825 (Fla. 2d DCA 2004), certiorari dismissed, 898 So.2d 938 (Fla. 2004); Beverly Enterprises-Florida v. Spilman, 661 So.2d 867, 873-874 (Fla. 5th DCA 1995). Defendants have argued, as the defendants in Spilman did, that they did not personally inflict abuses on the Plaintiff. However, Defendants fail to recognize that the passive conduct of repeatedly “ignoring the documented problems” at their facility can constitute negligence, as well as recklessness. See Id. In rejecting the very same argument asserted by Defendants, the Spilman court affirmed an award of punitive damages based on the acts and omissions of the defendants. The court explained that it makes no difference whether liability is based upon passive ignorance or managerial neglect because “[e]ither situation exhibits a reckless disregard of human life or of the safety of persons exposed to its dangerous effects.” Spilman, 661 So.2d at 873.

In the Estate of Patrick Canavan v. Natl. Healthcare Corp., 889 So.2d 825 (Fla. 2d DCA 2004), certiorari dismissed, 898 So.2d 938 (Fla. 2004), Florida’s Second District reversed a directed verdict that was entered in favor of an individual defendant, Roger Friedbauer. Friedbauer was an officer of a corporation that was the managing member of an LLC used to purchase a Florida nursing home. Friedbauer moved for directed verdict arguing that there was no basis to hold him liable unless the Plaintiff was able to pierce the corporate veil. The trial court granted the motion. The Second District reversed, holding:

This was not a case in which the plaintiffs were required to pierce the corporate veil in order to establish individual liability because Friedbauer’s alleged negligence constituted tortious conduct, which is not shielded from individual liability. Fla. Specialty, Inc. v. H 2 Ology, Inc., 742 So.2d 523, 527 (Fla. 1st DCA 1999) (stating that officers of a corporation may be liable for their own torts even if such acts are performed as corporate officers).

889 So.2d at 827. The Second District rejected the Defendant’s argument that there was no basis upon which Friedbauer could be held personally liable and reversed and granted a new trial against Friedbauer, stating:

We conclude that the trial court erred in granting the directed verdict because there was evidence by which the jury could have found that Friedbauer’s negligence in ignoring the documented problems at the facility contributed to the harm suffered by Canavan.

Id. The Canavan Panel reasoned that “officers of a corporation may be held liable for their own torts even if such acts are performed as corporate officers.” Id. (citing Fla. Specialty, Inc. v. H 2 Ology, Inc., 742 So.2d 523, 527 (Fla. 1st DCA 1999)). Relying on this authority, the District Court made clear that a manager or managing member of an LLC could be subject to personal liability in Florida for the operation of a nursing home.

Defendants erroneously imply in their motion that the Canavan decision represents a narrow exception carved out in Florida law. To the contrary, the law cited in Canavan represents well-settled law in Florida. It simply takes this well-settled law and applies it to the nursing home context.

As succinctly stated by the court in Florida Specialty, “[t]he existence of a corporation does not shield an individual tortfeasor from potential personal liability… Individual officers and agents of a corporation are personally liable where a tort has been committed.” Florida Specialty, 742 So.2d at 527. The “concept of piercing the corporate veil does not apply in the case of a tort, even where an intentional tort has not been alleged.” Id.

In Orlovsky v. Solid Surf Inc., 405 So.2d 1363 (Fla. 4th DCA 1981), the plaintiff sued a corporation and a corporate officer for negligence in the operation of a skateboard park. The negligent conduct alleged against the individual officer was that he “operated the skateboard park by renting defective equipment and failing to take precaution against injuries.” Id. at 1364. Thus, the opinion does not indicate that the officer was involved in the actual occurrence of the plaintiff’s injury. The individual officer moved to dismiss the complaint against him, alleging that it failed to state a cause of action based on his contention that he could not, as a mere officer, be held liable for the plaintiff’s injuries. Id. at 1364. The trial court dismissed all counts against the officer individually. Id. at 1363-64. On appeal, the Fourth District reversed, and held:

A corporate officer is potentially individually liable for his tortious acts even though such acts were committed in the scope of his employment by the corporation…

A contrary rule would enable a director or officer of a corporation to perpetrate flagrant injuries and escape liability behind the shield of his representative character, even though the corporation might be insolvent or irresponsible.

Id. at 1364 (citing 19 Am.Jur.2d, Corporations, s 1382). A corporation can act only through its agents. Schropp v. Crown Eurocars, Inc., 654 So.2d 1158, 1161 (Fla. 1995). Thus, the actions of an officer or managing agent “are indistinguishable from the acts of the corporation itself.” Kent Ins. Co. v.Schroeder, 469.So.2d 209, 210 (Fla. 5th DCA 1985). We must look at the corporate owner’s conduct and control over the specific facility to determine if there is punitive liability on that individual or company.

V. Florida Nursing Home Abuse Punitive Damage Award

Florida’s punitive damages statutes did not alter the longstanding principles governing a trial court’s deference to a jury’s assessment of damages. Aurbach v. Gallina, 721 So.2d 756, 758 (Fla. 4th DCA 1998) (quotation marks omitted). “[T]he trial judge does not sit as a seventh juror with veto power.” Laskey v. Smith, 239 So.2d 13, 14 (Fla. 1970). The question is whether the jury’s award is “so inordinately large as obviously to exceed the maximum limit of a reasonable range within which the jury may properly operate.” Bould, 349 So.2d at 1184-85. This test was designed to prevent interference with large damage awards with which a judge might personally disagree; an award is not “excessive” unless it is “flagrantly outrageous” and “beyond all measure.” Pierard v. Aero.Helicopter Co., 689 So.2d 1099, 1101 (Fla. 3d DCA 1997).

The size of a verdict alone – no matter how large – is not sufficient to justify remittitur: “[S]imply because a damage award is large does not alone render it excessive, nor does it indicate that the jury was motivated by improper considerations. Where the record supports the award, a court’s conclusion that the amount is indicative of prejudice or passion or shocking to its judicial conscience constitutes an abuse of discretion.” Simmonds v. Lowery, 563 So.2d 183, 184 (Fla. 4th DCA 1990). Even if the court believes that the amount awarded was “surprisingly high or even a fluke,” that cannot justify remittitur. Kaine v. Gov’t Employees Ins. Co., 735 So.2d 599, 601-2 (Fla. 3d DCA 1999); Laskey, 239 So.2d at 14 (“Not every verdict which raises a judicial eyebrow should shock the judicial conscience”).

In order to impose punitive damages against an employer, there must be evidence that the employer knowingly participated or ratified the employee’s conduct, and that the employee’s conduct was sufficient to impose punitive damages. In Payton Health Care v. Estate of Campbell, 497 So.2d 1233 (Fla. 2d DCA 1986), the court affirmed a punitive damage award based on expert testimony that the nursing care was “an outrageous deviation from the acceptable standard.” Evidence of a cover-up would prove that management was participating in the abuse, or was ratifying the bad conduct by trying to protect the employee from an investigation. General Motors Corp. v. McGee, 837 So. 2d 1010, 1035 (Fla. 4th DCA 2002) (“Evidence of concealment of offensive conduct after it initially occurred is indicative of malice or evil intent sufficient to support punitive damages”).

Although §429.297, Fla. Stat., contains a definition of “gross negligence,” the definition has no factual context. §429.297(b), Fla. Stat. (“Gross negligence” means that the defendant’s conduct was so reckless or wanting in care that it constituted a conscious disregard or indifference to the life, safety, or rights of persons exposed to such conduct.” Gross negligence has been described as follows (Carraway v. Revell, 116 So.2d 16, 22-23 (Fla. 1959)):

…simple negligence is that course of conduct which a reasonable and prudent man would know might possibly result in injury to persons or property whereas gross negligence is that course of conduct which a reasonable and prudent man would know would probably and most likely result in injury to persons or property. To put it another way, if the course of conduct is such that the likelihood of injury to other persons or property is known by the actor to be imminent or ‘clear and present’ that negligence is gross, whereas other negligence would be simple negligence.

Generally, a combination of negligence qualifies as gross negligence. Richardson v. Sams, 166 So.2d 468 (Fla. 1st DCA 1964) (Whether driving at a high rate of speed in fog, drizzling rain and on narrow road was for the jury). Driving at excessive speed through fog has been specifically cited as a basis to find a defendant acted with gross negligence (Myers v. Korbly, 103 So.2d 215, 220 (Fla. 2d DCA 1958):

While excessive speed alone or the mere violation of the statutory speed limits does not of itself constitute willful and wanton misconduct or gross negligence within the meaning of the guest statute, excessive or unlawful speed coupled with other facts, such for example as driving at high speed through patches of fog in thick traffic just prior to a collision on a curve, failure to heed warning signs, or attempting to negotiate dangerous curves at high speed with full warning of their existence, driving while under the influence of intoxicants, driving an automobile equipped with smooth tires at a rapid rate of speed on slippery highway, failing to notice a parked car ahead, or approaching at high speed a busy intersection where vision was obstructed, may be sufficient to establish such conduct or negligence.

These cases demonstrate that a combination of negligent acts, which are each only simple negligence, can be gross negligence when they occur simultaneously. Stated differently, since gross negligence is conduct which makes it likely that injury or death will occur, the more acts of negligence which occur simultaneously the more likely injury will be.

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