Admissibility of Evidence of Medical Damages under F.S. §768.0427. Jurors are now trusted with more information, including greater “[a]dmissibility of evidence to prove medical expenses in personal injury or wrongful death actions; disclosures of letters of protection; [and] recovery of past and future medical expenses damages.” The Statute defines “factoring” of medical bills.3 This is a way of inflating boardable medical bills at trial and the practice has gone on for decades; this is the first time factoring is addressed in any tort statute.
“Letter of Protection” is defined as “any arrangement by which a health care provider renders treatment in exchange for a promise of payment for the claimant’s medical expenses from any judgment or settlement of a personal injury or wrongful death action. The term includes any such arrangement, regardless of whether referred to as a letter of protection.” This is significant as doctors routinely attempt to circumvent case law allowing bias evidence in cases involving letters of protection by creatively calling the document something else, such as a “forbearance agreement” or “patient financial agreement,” or “financial policy,” yet the document serves the exact same purpose as a “letter of protection” by granting a lien to the clinic on any proceeds from a settlement, verdict, or judgment.
Florida Standard Jury Instruction 501.2 requires juries to determine the “reasonable value or expense” of medical treatment in injury cases. Florida Statute Section 768.0427(2)(a) curtails excessive, grossly inflated medical bills by limiting evidence of damages at trial to “evidence of the amount actually paid, regardless of the source of payment.” In the case of unpaid medical bills, Florida Statute Section 2(b)(1)-(5) provides the jury with evidentiary tools to use as a guidepost for what is “reasonable.” This includes, but is not limited to, the amount which would have been paid by the claimant’s health insurer had the charges been submitted; 120% of Medicare (or 170% of Medicaid if there is no Medicare rate) if the plaintiff does not have health care coverage; or has coverage through Medicare or Medicaid; and evidence of the amount a third party paid or agreed to pay a provider for the bill in exchange for the right to receive payment pursuant to a letter of protection. Subsection (5) is somewhat of a catchall, and allows “[a]ny evidence of reasonable amounts billed to the claimant for medically necessary treatment or medically necessary services provided to the claimant.” Similar tools are outlined for evaluation of future medical treatment.
Section (3)(b) requires doctors and facilities engaged in the above practices under letters of protection to utilize CPT codes, which is a coding system created by the American Medical Association. All too frequently, doctors and clinics fail to code their bills in LOP cases, though they are very familiar with CPT codes and coding practices. In practice, requiring the use of CPT codes and proper coding practices will lead to more uniform billing practices (already required when submitting bills to third party payers and Medicare), and bills which more accurately reflect the reasonable value of the service(s) provided.
Under this new provision, Florida Statute Section 768.0427(3)(e) carves out an exception to the “attorney-client privilege” in referring a client to a physician or clinic. Plaintiffs are now required to disclose the use of Letters of Protection, and requires disclosure of “(e) Whether the claimant was referred for treatment under a letter of protection (LOP) and, if so, the identity of the person who made the referral. If the referral is made by the claimant’s attorney, disclosure of the referral is permitted, and evidence of such referral is admissible notwithstanding Florida Statute Section 90.502.” Subsection (e) goes on to state, “…in such situation, the financial relationship between a law firm and a medical provider, including the number of referrals, frequency, and financial benefit obtained, is relevant to the issue of the bias of a testifying medical provider.” This is significant, as defense counsel is no longer prohibited from inquiring as to this referral practice in deposition and during trial. Plaintiffs’ attorneys are no longer permitted to hide behind a privilege for these referrals under Worley.4 This change allows the defense to expose the well-known cozy relationships between plaintiffs’ personal injury attorneys and their go-to doctors and clinics, and tell the jury the truth, instead of allowing plaintiffs to hide behind a privilege for communications that clearly do not involve legal advice. As one of our defense colleagues states, “They never taught us how to refer clients to doctors in law school.”
Luks & Santaniello’s Surgical Abuse Team. While HB 837 / SB 236 has only recently undertaken significant measures to address “Transparency in Damages,” for years Luks and Santaniello has been advocating for our clients and ensuring “Transparency in Damages” by attacking unscrupulous doctors and clinics involved in questionable practices under letters of protection. Despite the roadblocks previously in place, we have been, for lack of a better phrase, “bringing it” to the doctors, clinics, and facilities engaged in the behind the scenes practices aimed at unnecessarily and improperly inflating medical expenses in personal injury cases. Our Surgical LOP Abuse Team fights to expose the truth, to allow the jury to take a look behind the curtain and see what is really going on. This new Legislation provides additional tools to combat excessively inflated alleged damages.
Bringing it to the Docs, and Bringing Results. Our aggressive discovery efforts expose what is actually going on behind the scenes, and the back door agreements and deals between doctors, referring attorneys, clinics, and facilities. This discovery shines a light on the grossly inflated billing and what the providers actually accept at the end of the day - in full satisfaction of the gross charges. We have also been able to expose the fact that surgical recommendations, whether needed or not, related or not, result in more money in the pockets of those involved, yet (interestingly) not necessarily the plaintiff. Indeed, many clinics concede in deposition what is well-known by the Plaintiffs’ Bar-- the grossly inflated charges are more often than not reduced to 10-50% of the gross charge.
Many cases settle after the clinic and facility representatives testify as to their reduction practices. In some cases, our attorneys have exposed fraudulent and/or improper billing/coding practices during depositions, resulting in line items and portions of bills being cut during the deposition. More recently, after being confronted with lack of adequate supporting documentation for certain charges, a clinic cut multiple line items during the deposition. In a case involving factoring and improper referral practices, where the Plaintiff’s surgeon/clinic purchased the medical bills of a surgical facility and anesthesia provider, the surgeon/clinic mid-deposition agreed to reduce the amount it sought to collect from Plaintiff by more than $75,000. This was obviously devastating to the Plaintiff’s excessive, inflated damages claim in that case.
In a case we recently tried in Brevard County, Florida, Plaintiff’s surgeon admitted to ownership interests in his own clinic, the MRI facility where Plaintiff was referred, as well as the surgery center where surgery was performed, though the latter was not disclosed to the patient. This information was confirmed during the surgeon’s 30(b)(6) deposition prior to trial. Clearly, the jury was offended since all of the surgeon’s (a/k/a the “triple dipper”) bills were omitted from the Plaintiff’s verdict, where Plaintiff asked for $750,000.00, but received a mere $48k.
Luks & Santaniello's Surgical LOP Abuse Team continues to fight to expose the truth in inflated medical expenses in personal injury cases and “bring it” the doctors, clinics, and facilities engaged excessively inflated alleged damages. For questions or further assistance, please contact our Surgical LOP Abuse Practice Chairs, Managing Partner Daniel Santaniello and Senior Partner Laurette Balinsky and visit our Surgical LOP Abuse Practice Area for more information and resources.
Mixed Comparative Fault – Modified Negligence Standard under F.S. §768.81. In present form, HB 837 / SB 236 amends Florida Statute Section 768.81 to modify Florida’s damages apportionment standard from a pure comparative negligence approach to a modified comparative negligence approach, except for causes of action for personal injury or wrongful death arising out of medical malpractice pursuant to Florida Statutes Chapter 766. Under HB 837 / SB 236 any party to a negligence action found to be more than 50 percent at fault for his or her own harm may not recover any damages.
Prior to the enactment of HB 837 / SB 236, under Florida Statute Section 768.81(2), Florida was a pure comparative negligence jurisdiction without the doctrine of joint and several liability. Pursuant to the previous version of Florida Statute 768.81(3), “in a negligence action, the court shall enter judgment against each party liable on the basis of such party’s percentage of fault and not on the basis of the doctrine of joint and several liability.” Previously, when a plaintiff sought to recover damages for a personal injury and alleged that the injury was caused by the defendant’s negligence, the plaintiff bore the legal burden of proving that the defendant’s alleged action was a breach of the duty that the defendant owed to the plaintiff. Previously, a jury in a typical Florida negligence action decided each party’s percentage of fault; and the court, in its final judgment, apportions damages based on the jury’s fault determination.5
The new version of the statute makes Florida a mixed comparative fault state. New subsection 6 provides that where a plaintiff is found to be 51% or more at fault for their own harm, they will not recover any damages. No longer will a plaintiff be allowed to recover any damages where they are the primary cause of their own injuries.
The statute should ameliorate the filing of cases with questionable liability, and cause the plaintiff’s bar to more carefully select and take up cases. Coupling this new version of the statute with proposals for settlement could potentially force a plaintiff’s attorney to abandon or dismiss cases where the discovery shows a high degree of fault on the part of the Plaintiff.
Two (2) Year Statute of Limitations under F.S. §95.11. Statutes of limitations are “designed to promote justice by preventing surprises through the revival of claims that have been allowed to slumber until evidence has been lost, memories have faded, and witnesses have disappeared.”6 Under Florida Statute Section 95.031(1)(a), a statute of limitations begins to run when the cause of action accrues and a cause of action accrues when the last element constituting the cause of action occurs. In a personal injury action based on the negligent act of another, the last element occurs when the plaintiff is injured. In Florida, case law is clear that “statutes of limitations are designed to protect defendants from unusually long delays in the filing of lawsuits and to prevent prejudice to defendants from the unexpected enforcement of stale claims.”7
Prior to the enactment of HB 837 / SB 236, Florida Statute Section 95.11(3)(a) previously provided that general actions founded on negligence are subject to a four (4) year statute of limitations. HB 837 / SB 236 amended Florida Statute Section 95.11 to reduce the statute of limitations for general negligence actions from four (4) years to two (2) years, while providing protections under the Servicemembers Civil Relief Act to servicemembers during terms of active duty which materially affect the servicemember's ability to appear. This generally means that a plaintiff who fails to file a lawsuit within two (2) years, rather than within four (4) years, of the occurrence of negligence will be barred from filing the suit. Further, HB 837 / SB 236 amended Florida Statute Section 95.11 to provide that the amendment to the statute of limitations for negligence actions applies prospectively to causes of action accruing after the effective date of the bill, that the remainder of the bill applies to causes of action filed after the effective date, and that the bill shall not be construed to impair any right under an existing insurance contract.
Whether the reduction of the limitations period curtails the filing of negligence actions is an open question. While it may certainly reduce the filing of some negligence claims, it could also have the opposite effect by forcing the plaintiff’s bar to investigate their cases far quicker, or by eschewing this process altogether in order to beat the expiration of the limitations period. Overall, this is a positive development, and the hope is that it will decrease the amount of negligence cases filed in Florida, especially those with questionable damages.
Civil Remedy & Bad Faith under F.S. §624.155. HB 837 / SB 236 amends Florida Statute Section 624.155(4)(a) to provide a safe harbor within which an insurer may correct alleged bad faith acts and attempt to settle a claim in good faith. Specifically, under Florida Statute Section 624.155(4)(b), the insurer is not liable for bad faith with respect to a liability insurance claim, whether the bad faith claim is brought under statute or the common law, if the insurer tenders the lesser of the policy limits or the amount demanded by the claimant within 90 days after receiving actual notice of a claim which is accompanied by sufficient evidence to support the amount of the claim. HB 837 / SB 236 further amends Florida Statute Section 624.155(4)(c) to provide that failure of an insurer to tender within the 90-day period is not bad faith and is inadmissible in a bad faith action. If the insurer fails to tender within 90 days, any applicable statute of limitations is extended for an additional 90 days.
Additionally, if the insurer does not tender within the above timeframe, the fact that they did not and could have avoided any bad faith action by doing so is not admissible in a later action attempting to establish a bad faith claim. This is critical in preventing the Plaintiff’s Bar from weaponizing the amendment by telling a jury that the insurer could have avoided the bad faith litigation but chose not to. If an insurer fails to tender pursuant to the amendment, the Statute of Limitations is automatically extended by 90 days. This will prevent an insurer from also weaponizing the amendment to its advantage by using the 90 day decision-making window to blow the claimant’s statute of limitations deadline to file suit.
HB 837 / SB 236 also amends Florida Statute Section 624.155(5) to make the following provisions applicable to all bad faith claims: (1) Mere negligence alone is insufficient to constitute bad faith in both statutory and common-law actions. (2) The insured, the third-party claimant, and any representative of the insured or the claimant have a duty to act in good faith in furnishing information about the claim, making demands of the insurer, setting deadlines, and attempting to settle the claim. Note, this duty does not create a separate cause of action. Finally, (3) the trier of fact may consider whether the insured, the third-party claimant, or his or her representative did not act in good faith and, if so, reasonably reduce the damages awarded against the insurer.
In Harvey v. Geico Gen. Ins. Co., the Florida Supreme Court cited prior rulings that the damages claimed by an insured in a bad faith case "must be caused by the insurer's bad faith” 8 and "the focus in a bad faith case is not on the actions of the claimant but rather on those of the insurer in fulfilling its obligations to the insured."9 The above opinions keep the focus solely on the insurer, however, Florida Statute Section 624.155 amendments (5)(b)(1),(2) states that the claimant and/or their representatives’ actions or inactions should be part of the analysis in a bad faith action; not just the actions of the insurer.
Additionally, in a dissenting opinion (in Harvey), Justice Canady stated that the majority opinion “muddies the waters between negligence and bad faith and bolsters ‘contrived bad faith claims.’”10 He also stated that the majority opinion adopts a negligence standard “in all but name.”11 However, Section (5) of the amendment now states that “mere negligence alone is insufficient to constitute bad faith”. The amendment appears to elevate the standard necessary to prove bad faith, as well as include the claimant and/or the claimant’s representative’s actions or inaction in the determination of bad faith. The amendment further imposes a duty on the claimant and the claimant’s attorney to act in good faith when furnishing information regarding the claim, issuing demands, setting deadlines, and attempting to settle. In this regard, the language aims to rein in claimants and their attorneys who seek to fabricate bad faith claims by withholding information or imposing unrealistic deadlines.
HB 837 / SB 236 amends Florida Statute Section 624.155(6) to provide that if two or more third-party claimants have competing claims arising out of a single occurrence, which in total may exceed the insured’s available policy limits, the bill provides that the insurer does not commit bad faith by failing to pay all or any portion of the available limits to one or more of the third-party claimants if, within 90 days after receiving notice of the competing claims, the insurer either:
(1) Files an interpleader action under the Florida Rules of Civil Procedure. If the trier of fact finds that the claims of the competing third-party claimants exceed the policy limits, the third party claimants are entitled to a prorated share of the policy limits as determined by the trier of fact. This does not alter or limit the insurer’s duty to defend the insured. It is worth noting that this interpleader provision lessens the likelihood that an insurer will be liable for bad faith in a case with multiple claimants if the insurer pays the full amount of the policy limits at the outset; or
(2) Pursuant to binding arbitration agreed to by the parties, makes the entire amount of the policy limits available for payment to the competing third-party claimants before a qualified arbitrator selected by the insurer and the third-party claimants at the insurer’s expense. The third-party claimants are entitled to a prorated share of the policy limits as determined by the arbitrator, who must consider the comparative fault, if any, of each third-party claimant, and the total likely outcome at trial based upon the total of the economic and non-economic damages submitted to the arbitrator for consideration. Further, a third-party claimant whose claim is resolved by the arbitrator must execute and deliver a general release to the insured party whose claim is resolved by the proceeding.
Florida Statute Section 624.155(6)(a) and (b) of the amendment also appears to allow an insurer additional options to avoid a Farinas scenario.12 Should an insurer file an interpleader pursuant to the Florida Rules of Civil Procedure, the trier of fact will award the competing claimants a prorated share of the available policy limits. Should an insurer and competing claimants agree to binding arbitration, the arbitrator will assign the prorated share each claimant is deemed owed. An insurer can avoid the difficult decisions imposed by Farinas13 given the duty of the insurer to attempt to settle all claims within the available policy limits, but if unable, then the insurer has a duty to attempt to settle the claims that present the greatest exposure to the insured while leaving other presented claims unresolved.
While this amendment provides language that safeguards liability insurance carriers from bad faith actions and a definite timeframe for the insurer to act and avoid a tender rejection scenario as the precursor to a bad faith action, we anticipate future case law to be divided as to what constitutes “sufficient evidence” to support the amount of the claim. If an insurer receives notice of a claim, but no supporting evidence, the 90 day window would not start to run. We hope this amendment will incentivize claimants’ counsel to provide sufficient evidence instead of ignoring the insurer’s, or retained defense counsel’s, request for claim support documents after submitting a policy limit demand.
Luks & Santaniello's Tender Watch Team continues to advocate for and safeguard our clients by helping carriers and their insured’s navigate Time Limit and Policy limit Demands. For questions or further assistance, please contact Managing Partner Daniel Santaniello and view our Time and Policy Limit Demands and Tenders Practice Group.
Attorney Fees Eliminated & the Effect on Litigation Driven by Attorney’s Fees – “One-Way Attorney Fee” under F.S. §626.9373, F.S. §627.428, F.S. §631.70, and F.S. §631.926. The “one-way attorney fee” refers to attorney fees recovered from an insurer by a prevailing insured in a lawsuit to enforce the insurance policy. This version of attorney fee has been eliminated in all lines of insurance and will no longer be recoverable upon the effective date. The statutes that correspond to the one way attorney fee are: Florida Statute Section 626.9373 (suits against surplus lines insurers), Florida Statute Section 627.428 (suits against the insurer to enforce an insurance policy), Florida Statute Section 631.70 (suits against the insurer of life insurance policies or annuity contracts), and Florida Statute Section 631.926 (suits against the insurer of a residential or commercial property insurance policy). These statutes are repealed and are no longer valid law as it relates to property damage insurance cases. The lodestar fees in such cases have also been removed. HB 837 / SB 236’s elimination of prevailing party attorney’s fees also eliminates plaintiff’s attorneys from clogging the Florida court system with frivolous litigation whose sole purpose is to collect as much attorney’s fees as possible.
HB 837 / SB 236 eliminates attorney’s fees in auto-glass litigation cases. The removal of these attorney’s fees provisions addresses the multitude of problems caused by some auto-glass vendors and their attorneys that exploit Florida law and insurance consumers by filing frivolous and unnecessary lawsuits.
Further, HB 837 / SB 236 also eliminates attorney’s fees in cases where doctors are attempting to collect their medical bills against insurance companies. Under Florida Statute Section 627.736, each person is entitled to $10,000 in personal injury protection benefits (“PIP”) paid for by the individuals’ auto insurance carrier. Prior to the enactment of HB 837 / SB 236, if a carrier doesn’t pay the bill or underpays, the medical provider could sue the company and recover the full amount of the bill and attorney’s fees. The attorney’s payment consisted entirely of the attorney’s fee awarded and the payment of the underlying medical bill went directly to the doctor. There are thousands of PIP law suits in Florida every year with an amount in controversy ranging from a few hundred dollars up to a maximum of $10,000. These cases are driven by attorney’s fees. HB 837 / SB 236 eliminates the rewards for “garbage” litigation, according to the bill drafter, Representative Tommy Gregory.
Furthermore, HB 837 / SB 236 removes attorney’s fees in cases where healthcare providers and facilities sue, on behalf of their patients, the out-of-network carrier to recover the “usual and customary reimbursement” where the physician or hospital had no choice whether to treat the patient.
Attorney Fees Still Recoverable & the Effect on Litigation Driven by Attorney’s Fees: The following sections provide in great detail the attorney fees that may still be recoverable in a given action. Succinctly stated, attorney fees may be recovered in declaratory actions to determine insurance coverage after a total denial of a claim, and civil actions involving an insurance contract in which an offer of judgment (Proposal for Settlement) has been made and rejected. In regards to declaratory actions, the court must award attorney fees to the prevailing party if the denial was improper (the denial cannot be based on a reservation of rights). In any event, only the named insured, omnibus insured, or named beneficiary may file the case and the right to attorney fees is not assignable. Finally, Florida Statute Section 627.756 allows an award of attorney fees to an owner, contractor, subcontractor, laborer, or materialman that prevails in a claim against a construction surety bond. This award is not subject to the general repeal of attorney fees.
The new law, as outlined below, significantly impacts cases where attorney’s fees are sought as it limits the ability to recover fees. No longer will glass shops be permitted to file declaratory actions under the guise of an assignment. Any declaratory action must be filed by the named insured, omnibus insured, or named beneficiary and fees recovered, if any, are intended to make the insured whole due to an improper denial of a claim. Rather than plaintiff attorney’s seeking to bombard the system with frivolous litigation while racking up fees, HB 837 / SB 236 restricts lawsuits to those deserving to be heard while minimizing exposure for the insurers.
Contingency Fee Multiplier – Computation of Attorneys’ Fees under F.S. §57.104. In its original form, this statute permitted the courts to consider a plethora of multipliers when determining whether to award attorney’s fees in a civil action. HB 837 / SB 236 amends Florida Statute Section 57.104 to incorporate an additional section regarding lodestar amounts, leaving the current language virtually unchanged. HB 837 / SB 236 now limits the awarding of attorney fee multipliers to rare and unusual circumstances.
The lodestar amount refers to the trial court’s determination of the number of attorney hours reasonably expended multiplied by a reasonable hourly rate. The court has discretion to increase the lodestar amount by applying a contingency fee multiplier. There are three different types of cases in which a contingency fee multiplier should be applied: Public Policy Enforcement cases, Family law, eminent domain, estate and trusts cases, and Tort and contract claims including insurance cases. In order for a contingency fee multiplier to be considered, the plaintiff must prove: (1) Whether the relevant market requires a contingency fee multiplier to obtain counsel; (2) Whether the attorney can mitigate the risk of nonpayment; and (3) Whether any other factors established in Rowe14 support the use of the multiplier.
HB 837 / SB 236’s amends Florida Statute Section 57.104(2) to create a strong presumption that a lodestar amount is sufficient and reasonable in a case in which attorney fees are determined or awarded by the court. The presumption may only be overcome in a rare and exceptional circumstance in which evidence is presented that competent counsel could not otherwise be reasonably retained. This newly incorporated section allows the courts to award attorney fees in an objective manner along with a strong presumption that the award is reasonable and sufficient. Any deviation must comport to a rare and exceptional circumstance. This amendment also brings the Florida contingency fee multiplier law in line with the current federal standard.
Florida state courts were freely applying the contingency fee multiplier with no limitation as to how greatly it could increase the awarded fees. New legislation incorporates the rare and exceptional circumstance exception which requires the plaintiff to rebut a strong presumption in order to apply a contingency fee multiplier. This will limit the amount of fees a plaintiff can recover in an insurance action. Plaintiffs may seek to quickly file outstanding lawsuits prior to the effective date of this law in order to have the opportunity to recover fees using the unlimited contingency fee multiplier. In regards to PIP cases, physicians and the like are now discouraged from bringing lawsuits to recover small fees and plaintiff attorneys will now begin rejecting these types of cases as they will no longer be able to recover exorbitant fees from carriers.
Denial of Coverage of Attorneys’ Fees – Attorney fees; actions for declaratory relief to determine insurance coverage after total coverage denial of claim under F.S. §86.121. HB 837 / SB 236 creates Florida Statute Section 86.121 to provide a limited ability to recover attorney fees from an insurance company after a total coverage denial and such fees may only be awarded in a declaratory judgment action. This Section only applies to declaratory actions regarding validity of insurance coverage. When an action is brought for declaratory relief to determine insurance coverage after an insurer has made a total denial of a claim, either party is entitled to advance the action pursuant to the summary procedure outlined in Florida Statute Section 51.011. By allowing declaratory actions to proceed under the provisions of the summary procedure statute, it expedites the litigation process and may ultimately reduce the amount of attorney fees awarded to plaintiff.
Additionally, in regards to attorney’s fees, in the event of a declaratory judgment in favor of the named insured, omnibus insured, or named beneficiary, the court must award reasonable attorney fees to the aforementioned parties with a finding that the total coverage denial was incorrect and thus the claim is a covered event. Most notably, this right may not be assigned, transferred, or acquired by anyone in any manner other than by the named insured, omnibus insured, or named beneficiary. The non-assignable attorney fees are limited to those incurred in the declaratory judgment action brought under this newly implemented statute for the purpose of determining insurance coverage under the Florida Insurance Code. Additionally, it should be noted that under this new law, a reservation of rights letter sent to an insured, by itself, is not sufficient to reserve or assert a denial of coverage defense.
Attorney Fees Arising from Offers of Judgment – Civil actions involving an insurance contract; applicability of offer of judgment provisions under F.S. §624.1552. HB 837 / SB 236 created and codified Florida Statute Section 624.1552 regulating civil actions involving an insurance contract and the applicability of offer of judgment provisions (proposals for settlement). Under the new law, the provisions and applicability of Florida Statute Section 768.79 (which governs offers and demands for judgment in any civil action for damages filed in Florida courts) is broadened and now applies to any civil action involving an insurance contract. In order to fully understand this newly created statute, we must reference Florida Statute Section 768.79.
Pursuant to Florida Statute Section 768.79, an offer of settlement allows either party to a lawsuit to offer a settlement to the other party before trial. Florida’s “offer of judgment” statute provides attorney fee incentives to encourage swift settlement and decrease litigation. A valid proposal can serve to create an opportunity for a party to recover his or her fees incurred in prosecuting or defending a claim where otherwise no contractual or statutory fee claim exists. Specifically, under Florida Statute Section 768.79, if a defendant in a civil action for damages makes an offer of judgment and the plaintiff does not accept such offer within 30 days, the plaintiff must pay the defendant’s reasonable costs and attorney fees incurred from the date the defendant made the offer if the judgment is one of no liability or the judgment obtained by the plaintiff is at least 25 percent less than the offer. On the other hand, under Florida Statute Section 768.79, if the plaintiff files a demand for judgment and the defendant does not accept such demand within 30 days, the defendant must pay the plaintiff’s reasonable costs and attorney fees incurred from the date the plaintiff made the demand if the plaintiff recovers a judgment in an amount at least 25 percent greater than the demand. The remainder of the statute delves into the award to plaintiff in the form of attorney fees and costs if a demand is rejected within a percentage, offers and non-preclusion of subsequent offers, requirements of an offer, and the procedural requirements relating to filing and serving a written offer.
Now that attorney’s fees arising from offers of judgment under the offer of judgment statute apply to any civil action involving an insurance contract under Florida Statute Section 624.1552, both making and contemplating offers of judgments in these cases will be an essential part of the litigation strategy development process as they will be effective in creating settlement and fee shifting opportunities, as well as in applying pressure and creating risk for an opposing party.
Complete Version of HB 837 / SB 236. Click here for the full text of bill HB 837 / SB 236 signed by Governor Ron DeSantis on March 24, 2023 reforming Florida’s tort laws.
