Case Name: Karl NIKULA, etc., Petitioner, v. MICHIGAN MUTUAL INSURANCE, Respondent; MICHIGAN MUTUAL INSURANCE, Petitioner, v. Karl NIKULA, etc., Respondent
Court: Florida Supreme Court
Jurisdiction: Florida
Decision Date: 1988-09-22
Citations: 531 So. 2d 330
Docket Number: Nos. 70978, 70998
Parties: Karl NIKULA, etc., Petitioner, v. MICHIGAN MUTUAL INSURANCE, Respondent. MICHIGAN MUTUAL INSURANCE, Petitioner, v. Karl NIKULA, etc., Respondent.
Judges: OVERTON, MCDONALD, GRIMES and KOGAN, JJ., concur.
Reporter: Southern Reporter, Second Series
Volume: 531
Pages: 330–333

Head Matter:
Karl NIKULA, etc., Petitioner, v. MICHIGAN MUTUAL INSURANCE, Respondent. MICHIGAN MUTUAL INSURANCE, Petitioner, v. Karl NIKULA, etc., Respondent.
Nos. 70978, 70998.
Supreme Court of Florida.
Sept. 22, 1988.
Larry Klein of Klein & Beranek, P.A., West Palm Beach, and Babbitt and Ha-zouri, P.A., West Palm Beach, for petitioner/respondent.
Albert P. Massey, III of Pyszka, Kessler, Massey, Weldon, Catri, Holton & Douber-ley, P.A., Fort Lauderdale, for respondent/petitioner.

Opinion:
SHAW, Justice.
We review Michigan Mutual Insurance v. Nikula, 509 So.2d 334 (Fla. 4th DCA 1987), to answer a certified question of great public importance. We have jurisdiction. Art. V, § 3(b)(4), Fla. Const.
The district court held that under paragraph 440.39(3)(a), Florida Statutes (1981), where a comparatively negligent worker settles with a third-party tortfeasor, the employer's workers' compensation carrier is entitled to a lien against the settlement proceeds in an amount based upon the ratio of settlement to full value of damages. The district court certified the following question as one of great public importance:
WHERE, IN A WORKERS' COMPENSATION LIENHOLDER'S SUIT FOR A SHARE OF THE INJURED WORKER'S RECOVERY BY SETTLEMENT FROM A THIRD PARTY TORTFEASOR, THE TRIAL COURT HAS DETERMINED A PERCENT OF COMPARATIVE NEGLIGENCE THAT DOES NOT CORRESPOND TO THE RATIO OF THE AMOUNT OF THE SETTLEMENT TO THE TOTAL VALUE OF THE INJURED WORKER'S DAMAGES — ALSO DETERMINED BY THE COURT-HOW IS THE LIEN REDUCTION CALCULATED PURSUANT TO SECTION 440.39(3)(A) [sic], FLORIDA STATUTES?
Id. at 339. We approve the district court decision and hold that under the 1981 version of the statute the carrier's lien shall be based upon the ratio of settlement amount to full value of damages. No separate finding of the percentage of comparative negligence is required.
Gustaf Thorarinsson, now the ward of Karl Nikula, was injured in the scope of his employment in 1982 when he was struck on the head by a piece of scaffolding. Following his injury, Thorarinsson's workers' compensation benefits were paid by Michigan Mutual. Nikula sued the maker of Thorarinsson's hard hat, and the parties settled prior to trial. Nikula then asked the trial court to determine the amount of the lien under paragraph 440.39(3)(a), Florida Statutes (1981), to be placed on the settlement proceeds in favor of Michigan Mutual. The statute reads in part:
Upon suit being filed, the employer or the insurance carrier, as the case may be, may file in the suit a notice of payment of compensation and medical benefits to the employee or his dependents, which said notice shall constitute a lien upon any judgment or settlement recovered to the extent that the court may determine to be their pro rata share for compensation and medical benefits paid or to be paid under the provisions of this law. The employer or carrier shall recover from the judgment, after attorney's fees and costs incurred by the employee or dependent in that suit have been deducted, 100 percent of what it has paid and future benefits to be paid, unless the employee or dependent can demonstrate to the court that he did not recover the full value of damages sustained because of comparative negligence or because of limits of insurance coverage and collecti-bility.
§ 440.39(3)(a), Fla.Stat. (1981).
The trial court made the following findings: full value of damages, $15,000,000; settlement amount, $3,600,000; and comparative negligence by Thorarinsson, 90%. The court then determined that the lien must be reduced by the 90% comparative negligence figure. Michigan Mutual appealed and the district court reversed, ordering that because Nikula received $3,600,000, or 24% of total damages, the lien should have been for 24% of benefits rather than for 10%. In the present proceeding, Nikula asserts that the lien reduction should be based on the actual percentage of comparative negligence as determined in the lien proceedings, while Michigan Mutual claims that the ratio of settlement amount to full value should be controlling.
Initially, we dismiss as without merit Michigan Mutual's additional claim that the $15,000,000 figure representing full value of damages should be reduced to present value before being used as a basis for lien reduction. Nothing in the record here indicates that the trial court, prior to making its findings, failed to reduce all figures to present value.
Florida courts have not dealt with the particular issue presented here in which the ratio of settlement amount to full value of damages differs from the percentage of comparative negligence. In similar cases, however, in which this ratio and percentage were the same, it is clear that the ratio and not the percentage generally was viewed as controlling. See C & T Erectors, Inc. v. Case, 481 So.2d 499 (Fla. 2d DCA 1985); American States Insurance v. See-Wai, 472 So.2d 838 (Fla. 5th DCA 1985); Sentry Insurance Co. v. Keefe, 427 So.2d 236 (Fla. 3d DCA 1983), superseded by, Cooper Transportation, Inc. v. Mincey, 459 So.2d 339 (Fla. 3d DCA 1984). This same conclusion was reached by at least one federal court dealing with this precise issue. Miceli v. Litton Systems, Inc., 566 F.Supp. 875 (S.D.Fla.1983). But see Brandt v. Phillips Petroleum Co., 511 So.2d 1070, 1073 n. 3 (Fla. 3d DCA 1987) (degree of negligence should be controlling).
We agree with the district court in the instant case because any other rule would produce irrational results which would be inconsistent with the statutory language and legislative intent. If the percentage of comparative negligence and not the ratio of settlement to full value were controlling, a number of problems would be unnecessarily created. First, attempting to determine the actual percentage of comparative negligence after settlement or judgment introduces an artificial issue which need not be litigated. In the lien proceedings, it is only necessary to determine the presence of comparative negligence and, if present, the full value of damages. The actual amount of the settlement or judgment speaks for itself. Second, in suing the tortfeasor, the worker and compensation carrier share a common interest in obtaining the full value of damages by minimizing comparative negligence. This common interest will be seriously undermined if they anticipate that the worker will later benefit from adopting the contradictory position of asserting maximum comparative negligence. Third, if the settlement amount is above or below the reduced value attributable to the percentage of comparative negligence, one or the other of the parties would receive an undeserved windfall.
In summary, we answer the certified question by holding that, under paragraph 440.39(3)(a), where settlements involving comparative negligence are concerned, the lienholder should be reimbursed in the same ratio as the injured worker. The district court in the instant case correctly applied the 1981 version of the statute to the facts here.
It is so ordered.
OVERTON, MCDONALD, GRIMES and KOGAN, JJ., concur.
EHRLICH, C.J., dissents with an opinion, in which BARKETT, J., concurs.
The statute was amended in 1983 to take into consideration the worker's expenses in pursuing the third-party claim. The controlling factor for settlements involving comparative negligence under the amended version is the ratio of net recovery to full value of damages.