IN THE DISTRICT COURT OF APPEAL
FIRST DISTRICT, STATE OF FLORIDA
TECO ENERGY, INC. and TECO
SERVICES, INC., NOT FINAL UNTIL TIME EXPIRES TO
FILE MOTION FOR REHEARING AND
Appellants, DISPOSITION THEREOF IF FILED
v. CASE NO. 1D17-0233
MICHAEL K. WILLIAMS,
Appellee.
_____________________________/
Opinion filed December 19, 2017.
An appeal from an order of the Judge of Compensation Claims.
Ellen H. Lorenzen, Judge.
Date of Accident: April 25, 2013.
Gwen G. Jacobs of Bennett, Jacobs, & Adams, P.A., Tampa, for Appellants.
Laurie Thrower Miles of Miles and Parrish, P.A., Lakeland, and Wendy S. Loquasto
of Fox & Loquasto, P.A., Tallahassee, for Appellee.
M.K. THOMAS, J.
Teco Energy, Inc. and Teco Services, Inc. (“E/C”), appeal a final order
awarding compensability of a total knee replacement for Michael Williams
(“Claimant”) and related attorney fees and costs. The E/C argues the Judge of
Compensation Claims (“JCC”) erred by, 1) barring, as a matter of law, its defense
of major contributing cause (“MCC”); and 2) applying, sua sponte, the “120-Day
Rule” pursuant to section 440.20(4), Florida Statutes, as a limitation of available
defenses. We agree and reverse.
Factual & Procedural History
On April 25, 2013, Claimant, a journeyman electrician, experienced pain in
his left knee after slipping on the step of a pick-up truck at work. The E/C accepted
compensability of the left knee injury and authorized medical care with Dr. Morse,
an orthopedic surgeon. In February of 2011, Dr. Morse treated Claimant for a non-
work related injury to the right knee, which required surgery. During that treatment,
the doctor also examined the Claimant’s left knee. Dr. Morse noted Claimant’s left
knee symptoms in 2011 included significant medial compartment pain, suggestive
of either arthritis or a preexisting tear, but the doctor saw no need for treatment of
the left knee at that time.
When Dr. Morse examined Claimant after the April 25, 2013, workplace
injury to the left knee, he reported significant preexisting left knee arthritis as
confirmed by X-rays and an MRI. When compared to the 2011 examination,
Claimant demonstrated more symptoms for grinding and pain behind the left
kneecap. However, Claimant’s symptoms were concentrated in the medial joint line
which correlated with an acute injury of a medial meniscal tear. Dr. Morse
recommended left knee surgical repair, and indicated seventy percent of the need for
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surgery was related to an aggravation from Claimant’s underlying work injury, and
thirty percent was related to preexisting left knee arthritis.
The E/C authorized the left knee surgery. According to Dr. Morse, the surgery
revealed minimal arthritis in the medial joint line and moderate arthritis behind the
kneecap. Following the surgery, Dr. Morse placed Claimant at maximum medical
improvement (“MMI”) effective March 20, 2014, and assigned a three percent
permanent impairment rating. As of the MMI date, Claimant’s left knee was
asymptomatic regarding the medial joint line with minimal symptoms of mild
achiness associated with the arthritis.
At the next office visit, almost a year later, Dr. Morse administered an
injection to Claimant’s left knee due to complaints of occasional aches and pain. In
the medical record documenting the visit, Dr. Morse detailed the complaints were
associated with Claimant’s arthritis and activity level. In the Uniform Medical
Treatment/Status Reporting Form (DWC-25) completed on March 12, 2015, Dr.
Morse noted that a steroid injection was performed with no other change in status.
Subsequently, Claimant advised of pain and stiffness on the inside of the left
knee, which Dr. Morse reported as typically associated with arthritis. In an April 9,
2015 clinical note, Dr. Morse detailed:
Currently, he has signs and symptoms consistent with degenerative
arthrosis... At this period of time, we recommend that the patient
proceed with conservative management consisting of
viscosupplementation and providing medial unloader brace. The
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treatment will be for the degenerative arthrosis and is not intended to
treat the initial work injury. The patient will maintain his current
maximal medical improvement status and does not need any limitation
at work.
In the DWC-25 form for that visit, Dr. Morse again documented no change with
regard to the prior responses to causation questions, but commented that the
complaints for which Claimant sought treatment were not work-related and that
Claimant remained at MMI with the same impairment rating. After office visits in
May and June, Dr. Morse confirmed no change in status on the DWC-25 forms, and
the carrier approved an injection to the left knee.
By October 1, 2015, Claimant was complaining of constant aching pain in the
left knee with occasional feelings of instability. Dr. Morse diagnosed tri-
compartmental primary osteoarthritis of the left knee and left knee medial meniscus
tear, post-surgery. Dr. Morse recommended a left total knee replacement. At
deposition, he opined that Claimant’s preexisting condition, not the workplace
injury, was the MCC of the need for the recommended surgery.
Claimant filed a Petition for Benefits requesting authorization of the left total
knee replacement. The E/C filed a timely response denying compensability and
asserting that the work place accident was not the MCC of the need for the surgery.
In the Pre-Trial Stipulations, the E/C stipulated to the compensability of the left knee
meniscus tear only “so long as it is and remains MCC,” and denied responsibility for
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the preexisting arthritis, among other defenses. Claimant nor the E/C asserted any
“affirmative claims or defenses” in the Pre-Trial Stipulation.1
Claimant obtained an IME with Dr. Fiore, who opined that the MCC of the
need for the left total knee replacement was the work accident even though Claimant
had pre-existing degenerative arthritis, as the continued pain was the factor
necessitating surgery. Due to the conflict in medical experts, the E/C requested, and
the JCC appointed, an expert medical advisor (“EMA”) pursuant to section
440.13(9), Florida Statutes. The EMA, Dr. Horan, noted Claimant’s similar history
of knee problems on the right side and indicated it was “very likely that his left knee
and right knee are following the exact same progression of osteoarthritis,” but that
the recent exacerbation, which was accepted as an acute meniscal tear, “just
accelerated his [left] knee for the total knee arthroplasty [replacement].” The EMA
concluded that he would “place the majority of the causation... on the pre-existing
osteoarthritis.” In his deposition, Dr. Horan testified that the viscosupplementation
injection performed by Dr. Morse, as well as the recommended use of a brace, were
treatments for degenerative joint disease, not a meniscal tear. Dr. Horan predicted
Claimant would also require a right total knee replacement in the future, due to the
osteoarthritic condition.
1
The Uniform Pre-Trial Stipulation form provides a specific section for the listing
of “Affirmative Claims and Defenses.”
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Prior to the merits hearing, pre-trial memoranda were filed by the parties
setting out the claims and defenses. Claimant’s memorandum did not raise the “120-
Day Rule” under section 440.20(4) or attach case law concerning its application or
any mention of waiver. At the merits hearing, Claimant introduced the deposition
of the claims adjuster. The adjuster testified that the E/C authorized Dr. Morse to
treat Claimant “for his left knee injury.” When asked whether there was “any
determination made as to what specific condition was compensable,” she responded
“[w]e authorized his left knee to get treated.” She stated further that all treatment
provided by Dr. Morse had been authorized, and that all submitted bills had been
paid. The adjuster testified that Dr. Morse’s October 1, 2015, report was the first
information she received indicating some percentage of Claimant’s left knee
problem was related to a preexisting condition. She later confirmed she received the
April 9, 2015, medical report and that she subsequently authorized the
viscosupplementation injection recommended in that report.
In closing argument at the final hearing, Claimant specifically argued that the
E/C accepted his left knee condition, including the preexisting arthritis, as a
compensable workplace injury pursuant to section 440.13(1)(b), Florida Statutes.
Citing the definition of “compensable” under this subsection, Claimant relied, in
part, on the evidence that the E/C authorized the treatment expressly recommended
by Dr. Morse to treat the degenerative arthritis, not the workplace injury of a medial
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meniscal tear. Based on the E/C’s authorization for treatment of the arthritis,
Claimant asserted that the E/C had accepted compensability of the arthritis and had
the burden of showing a break in causation, which they failed to do. In the
alternative, Claimant argued the arthritis could not be considered a contributing
cause in any MCC analysis because the condition did not qualify as a “preexisting
condition” under section 440.09(1)(b), Florida Statutes.
In response, the E/C asserted that Claimant failed to satisfy his burden
regarding MCC with respect to ongoing medical care. Further, regarding section
440.13(1)(b), a break in the causal chain occurred when the E/C’s liability fell below
fifty percent. In the final order, the JCC unequivocally accepted the EMA’s medical
opinion that Claimant’s preexisting arthritis — not the accidental compensable
injury of a meniscal tear — was the MCC of the need for the requested left total knee
replacement. Nevertheless, the JCC ultimately concluded that, as a matter of law,
the E/C was precluded from raising MCC related defenses because: 1) Claimant’s
prior arthritic knee condition could not be considered a contributing cause, as it did
not qualify as a “preexisting condition” in accordance with case law; and 2) pursuant
to “120-Day Rule” of section 440.20(4), the E/C waived the right to deny
compensability of the preexisting arthritic condition. This appeal followed.
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Legal Analysis
To the extent an issue turns on resolution of the facts, the standard of review
is competent substantial evidence (“CSE”); to the extent it involves an interpretation
of law, the standard is de novo. Benniefield v. City of Lakeland, 109 So. 3d 1288,
1290 (Fla. 1st DCA 2013).
Qualifying Preexisting Conditions
Once compensability of a work accident is established, an E/C may no longer
contest that the accident is the MCC of the injuries. However, an E/C may thereafter
challenge the connection between a claimant’s need for specific treatment or benefits
and the industrial accident. Engler v. Am. Friends of Hebrew Univ., 18 So. 3d 613,
614 (Fla. 1st DCA 2009); see also City of Pembroke Pines v. Ortagus, 50 So. 3d 31
(Fla. 1st DCA 2010) (holding E/C must pay for treatment as long as compensable
condition remains MCC of need for treatment). When a work related injury
combines with a preexisting disease or condition to cause or prolong disability or
the need for treatment, the E/C must pay benefits “only to the extent that the injury
arising out of and in the course of employment is and remains more than 50 percent
responsible for the injury as compared to all other causes combined and thereafter
remains the [MCC] of the disability or need for treatment.” § 440.09(1), Fla. Stat.
(emphasis added).
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Section 440.09(1) does not enumerate “all other causes” for MCC analysis,
but subsections (a) and (b) provide some distinct limitations – to qualify the causes
must be (1) subsequent injuries, or (2) preexisting injuries and
conditions. See Cespedes v. Yellow Transp., Inc, 130 So. 3d 243 (Fla. 1st DCA
2013). As this Court summarized in Cespedes, “under the text of section
440.09(1)(a)-(b), MCC analysis cannot be performed in a vacuum or, particularly,
in the absence of competing causes.” Id. Thus, MCC has no application unless there
is evidence of a competing cause qualifying under one of the designated categories.
Here, no evidence was presented regarding subsequent injury. Accordingly, as the
JCC correctly noted, the question remaining was whether evidence existed of a
qualifying “preexisting injury or condition.” 2
The JCC assumed that, for purposes of 440.09(1)(b), a preexisting condition
“must have produced the need for medical care before the accident or caused
claimant to have some disability or impairment.” The JCC further concluded
Claimant’s preexisting knee arthritis, while symptomatic as early as 2011, was not a
qualifying preexisting condition, because it required no medical treatment or caused
disability or impairment before the 2013 workplace injury.
2
If the preexisting condition is due to an industrial accident, it does not qualify
under section 440.09(1)(b). See Pearson v. Paradise Ford, 951 So. 2d 12 (Fla. 1st
DCA 2007); Pizza Hut v. Proctor, 955 So. 2d 637 (Fla. 1st DCA 2007).
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This Court previously announced the test to determine whether a preexisting
condition qualifies for MCC analysis. See Osceola Cty. Sch. Bd. v. Pabellon-Nieves,
152 So. 3d 733, 734 (Fla. 1st DCA 2014) (clarifying Bysczynski v. United Parcel
Servs., Inc., 53 So. 3d 328 (Fla. 1st DCA 2010)). The inquiry is whether the
condition independently required treatment either before or after the compensable
accident. Pabellon-Nieves, 152 So. 3d at 734; Certistaff, Inc. v. Owen, 181 So. 3d
1218, 1221-22 (Fla. 1st DCA 2015) (finding that JCC erred in focusing on whether
claimant received physician-provided treatment for shoulder “to the exclusion of
other evidence that Claimant was in fact experiencing shoulder pain before the
workplace accident and the objective medical evidence of pre-existing shoulder
conditions contributing to, if not causing his symptoms”). The test is not limited to
whether a claimant was, or recently had been, undergoing physician-provided
medical treatment for the preexisting condition before the compensable accident. “It
does not matter whether a preexisting condition is ‘age-appropriate;’ what matters is
whether there is medical evidence that it is the major contributing cause of the need
for the requested treatment.” Pabellon-Nieves, 152 So. 3d at 734.
In Pabellon-Nieves, the JCC appropriately considered, “the nature of the
preexisting condition-including the level of treatment necessitated by the preexisting
condition prior to the date of the accident, as compared to Claimant’s current
condition and need for the treatment” after the compensable accident. 152 So. 3d at
10
734. Here, the JCC expressly held that Dr. Morse’s treatment on April 9, 2015, was
“necessitated solely by Claimant’s osteoarthritis and [was] not necessary because of
Claimant’s accident.” As a result, the osteoarthritis qualifies as a preexisting
condition for purposes of an MCC analysis under paragraph 440.09(1)(b), and per
the EMA, independently required the medical treatment at issue.
For the above reasons, we find that Claimant’s osteoarthritis qualified as a
preexisting condition under section 440.09(1)(b), and its consideration in the MCC
analysis appropriate.
“The 120-Day Rule”
Section 440.20(4), commonly referred to as the “120-Day Rule,” allows a
carrier the option of paying and investigating a claim for up to 120 days. Further, a
carrier who fails to deny compensability within that 120 days after the initial
provision of benefits waives the right to deny compensability, unless material
relevant facts could not have been discovered during the 120 day period. § 440.20(4).
Once aware of the need for medical benefits for a particular condition or injury, the
carrier has three options: pay, pay and investigate within 120 days, or deny. Bynum
Transp., Inc. v. Snyder, 765 So. 2d 752 (Fla. 1st DCA 2000); see also Kestel v. City
of Cocoa, 840 So. 2d 1141, 1142 (Fla. 1st DCA 2003). A condition or injury may be
deemed compensable if the carrier begins payment for that condition or injury and
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fails to investigate within the 120 days, or fails to deny compensability within that
time period. Kestel, 840 So. 2d at 1142.
The “120-Day Rule” is not necessarily rendered obsolete on the 121st day
after the first report of accident and initial installment of benefits. The rule remains
viable and is again triggered when, and if, a new condition or injury arises. Snyder,
765 So. 2d at 754; Boyle v. JA Cummings, Inc., 212 So. 3d 1060, 1062-63 (Fla. 1st
DCA 2017) (holding JCC erred by excluding adjuster’s testimony concerning
specific identity of condition accepted as compensable as it related to application of
subsection 440.20(4) to preexisting condition); McIntosh v. CVS Pharmacy, 135 So.
3d at 1157, 1159 (Fla. 1st DCA 2014) (“It was of no consequence that
compensability [of the claimant’s PTSD] was sought long after the date of the
accident; the relevant inquiry is whether the E/C denied compensability within 120
days of first providing treatment for the PTSD.”).
Here, the EMA’s uncontroverted opinions established Claimant’s preexisting
arthritic condition as the primary — if not the sole — cause of the need for the left
knee surgery. Accordingly, Claimant was unable to satisfy his burden of proof
regarding the MCC requirements of section 440.09(1). Regardless, the JCC
ultimately barred the E/C from raising the MCC defense citing waiver pursuant to
the “120-Day Rule.” In the order, the JCC applied the analysis discussed in Sierra
v. Metropolitan Protective Services, 188 So. 3d 863, 867 (Fla. 1st DCA 2015), to
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find: (1) the date the E/C first provided the benefits; (2) the specific identity of the
injury for which benefits were provided; and (3) whether the E/C timely denied
compensability of that injury within the 120 day period immediately following the
provision of benefits for that injury. Id. at 867. CSE supports the JCC’s subsequent
findings that the E/C provided medical treatment in April of 2015, that the treatment
was necessitated solely by the osteoarthritis (not the accident), and that the E/C failed
to deny the compensability of the osteoarthritis within the 120 days following the
initial provision of treatment for that condition. However, as Claimant never raised
the “120-Day Rule” as a “defense,” the JCC’s unilateral initiative to apply analysis
under Sierra was flawed.
In School District of Hillsborough County v. Dickson, 67 So. 3d 1080 (Fla.
1st DCA 2011), nearly identical issues were addressed. This Court determined that
the JCC violated the due process rights of the E/C by sua sponte raising waiver under
subsection 440.20(4); specifically, by “mischaracterizing section 440.20(4) as
‘mandatory’ and ‘not in the nature of an affirmative defense,’ the JCC improperly
denied the E/C the opportunity to establish material facts that could be used to prove
it did timely deny benefits.” Id. at 1083. A claimant’s “defense” of waiver to an
E/C’s ability to deny compensability of an accident or specific injury/condition
pursuant to the “120-Day Rule,” is an affirmative pleading which must be timely
raised and specifically plead.
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Waiver and estoppel are affirmative defenses which must be plead carefully
or forever waived. McKenzie Tank Lines, Inc. v. McCauley, 418 So. 2d 1177, 1180
(Fla. 1st DCA 1982). The party raising affirmative defenses has the burden of
pleading and proving them. Id. at 1180. A JCC is not permitted to raise, sua sponte,
waiver under the “120-Day Rule.” Dickson, 67 So. 3d at 1083; see also Fla. Admin.
Code R. 60Q-6.113(2)(a),(h).3 We find no merit to Claimant’s argument that waiver
was tried by consent due to inferences during closing arguments.
Claimant argues the pretrial stipulation contained the “substance” of the
waiver defense under section 440.20(4) and, as such, was properly raised. This Court
recently rejected an argument that an issue was “implicitly” raised in a pretrial
stipulation. See McFarlane v. Miami-Dade Transit Auth., 42 Fla. L. Weekly D808
3
Fla. Admin. Code R. 60Q-6.113(2)(a), states:
In pretrial stipulations and at any pretrial hearing, the parties shall:
(a) State the claims, defenses, and the date of filing of each petition for
benefits to be adjudicated at the final hearing. Any claims that are ripe,
due, and owing, and all available defenses not raised in the pretrial
stipulation are waived unless thereafter amended by the judge for good
cause shown...
Fla. Admin. Code R. 60Q-6.113(2)(h) requires, “[a]ny defense raised pursuant
to Sections 440.09(4)(a) and 440.105, F.S., and any affirmative defense, must be
raised with specificity, detailing the conduct giving rise to the defense, with leave to
amend within 10 days. Failure to plead with specificity shall result in the striking of
the defense. Any objections/responses to the affirmative defenses must be pled with
specificity.”
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(Fla. 1st DCA April 11, 2017). But, even assuming in light of McFarlane that Florida
Administrative Code Rule 60Q-6.113(2)(h) permits an affirmative defense to be
raised “in substance,” there is no such evidence in this case. The E/C specified in the
pretrial stipulation that the preexisting arthritic condition was denied; yet, Claimant
made no reference to the condition. Instead, Claimant plead that he was pursuing the
claim “as both a specific accident and injury as well as a repetitive and cumulative
trauma to Claimant’s left knee.” The JCC noted that Claimant subsequently
abandoned any argument based on repetitive and cumulative trauma. It was not until
the trial memorandum that Claimant suggested, for the first time, that he was relying
on the compensability of the preexisting condition itself. But, as in McFarlane, the
trial memorandum was filed very shortly before the final hearing. Moreover, in the
instant case, Claimant never expressly argued at any point that the preexisting
condition was compensable pursuant to section 440.20(4).
Conclusion
We reverse the JCC’s determination that the E/C was barred, as a matter of
law, from asserting a MCC defense regarding the left total knee replacement.
Claimant’s preexisting osteoarthritis is a qualifying preexisting condition under
section 440.09(1)(b). As an affirmative defense, the “120-Day Rule” pursuant to
section 440.20(4), must be timely and specifically plead by a claimant and may not
be raised, sua sponte, by the JCC. Accordingly, based on the opinions of the EMA
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that the preexisting osteoarthritis, and not the effects of the work accident, is the
MCC of the need for the left total knee replacement, the surgery is not compensable.
The final order on appeal is REVERSED.
B.L. THOMAS, C.J., and WETHERELL, J., CONCUR.
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