The Ability of Local Ordinances to Support Causes of Action and the Recovery of Attorneys’ Fees in Litigation

By Donald J. Lunny, Jr.

Donad J. Lunny, Jr.This case is a reminder to practitioners of the importance of local ordinance review when evaluating potential causes of action.  Too often, practitioners focus only on Federal and State law as a basis for substantive recovery.  Counties and cities have the power to adopt local ordinances that cover a variety of topics.

Recently, the Florida Supreme Court tentatively released an Opinion confirming the ability of local ordinances to create causes of action, create liens, and support an award of attorney’s fees in litigation.  One interesting aspect of this Opinion is that the Court also determined unconstitutional a similar state law.  As of October 3, 2012, the Court’s Opinion has not been released for publication in the permanent law reports and is subject to revision or withdrawal.

In Shands Teaching Hospital and Clinics, Inc. v. Mercury Insurance Company of Florida _______ So.3d. ____, 2012 WL 2035832 (Fla.), 37 Fla. L. Weekly S407, the Court evaluated the constitutionality of a special law of the Florida Legislature creating a lien for not for profit hospitals to secure reasonable hospital charges, creating a cause of action if the lien is impaired by conduct, and providing for attorneys for recovery if the lien holder prevailed in litigation.  The Court determined that the special act violated a State constitutional provision that provides,

[t]here shall be no special law or local law of general application pertaining to… creation, enforcement, extension, or impairment of liens based on private contracts or fixing of interest rates based on private contracts.” Art. III, §11(a) 9, Fla. Const.  In so ruling, the Court refused to evaluate the hospital’s argument that the constitutional provision was inapplicable because the hospital’s legal relationship with its patient was based on quasi contract legal principles, since this argument was not properly presented to the Appellate Court below.

The Court then evaluated a County Ordinance that was very similar to the special law in that it created a lien in favor of a not for profit hospital for reasonable hospital charges, created a cause of action in favor of the hospital for impairment of the lien, and provided for an award of attorneys’ fees to the lien holder in the event it prevailed in litigation. In determining the Ordinance valid, the Court concluded:

1. The local ordinance did not directly conflict with any State statute;

2. The Ordinance did not occupy a field pre-empted by the Legislature;

3. Article III, Section 11(a)(9), Florida Constitution only limited the powers of the Legislature to adopt certain kinds of law (special law or general law of local application) and did not apply to local ordinances; and

4. The Ordinance did not violate the substantive due process clause of the Florida and United States Constitutions because it bore a rational relationship to a permissible objective.

The Court in this case allowed a non-profit corporation to maintain a cause of action against an insurer for impairment of an ordained lien and to recover attorneys fees based solely on ordinance provisions.  It should be interesting to see if the Court modifies or withdraws its tentatively released Opinion.

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By |2017-03-13T13:31:16-04:00October 10th, 2012|Blog, Local Government Law and Relations, Uncategorized|