12 Fla. L. Weekly Supp. 330a
Attorney’s fees — Insurance — Personal injury protection — Contingency risk multiplier — Abuse of discretion to grant contingency risk multiplier where there is no evidence in record to support trial court’s finding that relevant market conditions require multiplier to obtain competent counsel — No abuse of discretion in using “blended rate” for all work when different attorneys who earn different rates worked on case where insurer did not object to using blended rate below but simply disputed appropriate amount of blended rate, and amount awarded did not exceed amount actually agreed to between attorney and client
STAR CASUALTY INS. CO., Appellant, v. HEALTH CARE MEDICAL GROUP AND ELECTRO DIAGNOSTIC, Appellee. Circuit Court, 11th Judicial Circuit (Appellate) in and for Miami-Dade County. Case No. 03-657 AP. L.C. Case No. 2000009128CC25. January 11, 2005. An Appeal from the County Court for Miami-Dade County, Wendell M. Graham, Judge. Counsel: Mark A. Gatica, for Appellant. Bernard H. Butts Jr., for Appellee.
(BEFORE JEFFREY ROSINEK, ISRAEL REYES, and DARYL E. TRAWICK, JJ.)
(DARYL E. TRAWICK, J.) Star Casualty Insurance Company (Star) appeals an award of attorneys fees entered against it, arguing that the trial court abused its discretion by applying a multiplier and utilizing an hourly rate of $325.00 per hour when different attorneys who earn different rates worked on the file.
The Florida Supreme Court set forth the factors to be considered in determining the appropriateness of a modifier in Standard Guaranty Insurance Co. v. Quanstrom, 555 So. 2d 828 (Fla. 1990). It stated that “the trial court should consider the following factors in determining whether a multiplier is necessary: (1) whether the relevant market requires a contingency fee multiplier to obtain competent counsel; (2) whether the attorney was able to mitigate the risk of nonpayment in any way; and (3) whether any of the factors set forth in Rowe are applicable, especially, the amount involved, the results obtained, and the type of fee arrangement between the attorney and his client.” Id. at 834. Rowe is aprior case discussing factors that should be used to determine whether a multiplier is appropriate, and another factor it sets forth other than the ones specifically noted in Quanstrom, is “the experience, reputation, and ability of the lawyer or lawyers performing the services.” Florida Patient’s Compensation Fund v. Rowe, 472 So. 2d 1145, 1150 (Fla. 1985). Rowe itself seems to suggest that this factor should be a consideration only in determining a reasonable hourly rate, rather than the appropriateness of a multiplier, but Quanstrom seems to suggest that all of the Rowe factors, including the ability of counsel factor, should be given some consideration in determining whether to apply a multiplier.
However, the most important factor appears to be the necessity of a multiplier to obtain competent counsel. In fact, it appears that the existence of this factor is a prerequisite to obtaining a multiplier. In Sun Bank of Ocala v. Ford, 564 So. 2d 1078 (Fla. 1990), the Florida Supreme Court stated that “ ‘Before adjusting for risk assumption, there should be evidence in the record, and the trial court should so find, that without risk-enhancement plaintiff would have faced substantial difficulties in finding counsel in the local or other relevant market.’ ” Id. at 1079, quoting Pennsylvania v. Delaware Valley Citizens’ Council for Clean Air, 483 U.S. 711, 107 S.Ct. 3078, 3089, 97 L.Ed.2d 585 (1987). Thus, it appears that, although the ability of counsel can affect the determination of whether to apply a multiplier, before the multiplier is even considered there must first be evidence in the record that the relevant market requires a multiplier in order to obtain competent counsel. This is because the primary rationale for the contingency risk multiplier is to provide access to competent counsel for those who cannot afford it. See Bell v. U.S.B. Acquisition Co., 734 So. 2d 403, 411 (Fla. 1999).
In the instant case, the Final Judgment Taxing Attorneys Fees & Costs states that “relevant market conditions require a multiplier to obtain competent counsel” Record on Appeal at 76. However, under Sun Bank, in addition to the court finding that the market requires a multiplier, there must be evidence of such in the record. During the hearing on attorneys fees, the testimony focused on the difficulty and likelihood of success of the case, and on the abilities of the medical provider’s counsel, Bernard Butts. The trial judge attempted to inquire about whether the market required a multiplier by asking “What about the availability of lawyers to take this sort of case?” However, the answer was that the attorney was “one of the best PIP lawyers” and focused on his abilities. Without any evidence in the record concerning the relevant market, the trial court abused its discretion in granting a multiplier.
Star also argues that the trial court abused its discretion by applying an hourly rate of $325 per hour when different attorneys who earn different rates worked on the file. At the hearing below, Star objected to paying a $350 rate for all of the hours, which is the rate that Mr. Butts is paid. However, Mr. Butts testified that, even though a number of attorneys did some work on the case, he did most of the work himself. Therefore, the trial court applied a “blended rate” of $325 an hour. On appeal, Star argues that a party seeking attorneys fees must specifically set forth who performed each of the services provided. However, at the hearing below, Star did not object to using a “blended rate.” It simply disputed the appropriate amount of the “blended rate.” Furthermore, it appears that it is appropriate to use a “blended rate” as long as the amount awarded does not exceed the amount actually agreed to between the attorney and his client. See, Nelson v. Marine Group of West Palm Beach, 677 So. 2d 998 (Fla. 4th DCA 1996). Star cites to Florida Patients Compensation Fund v. Johnson, 538 So. 2d 875 (Fla. 4th DCA 1998) for its argument that details of who performed what work must be provided. However, that case did not use a “blended rate” and no cases have been found suggesting that the use of a “blended rate” is an improper substitute for detailing exactly which attorney performed exactly which service, although it would seem that providing such detail would be preferable. The trial court did not abuse its discretion by applying a blended rate of $325 an hour.
Therefore, the trial court’s Final Judgment Taxing Attorneys Fees & Costs is REVERSED in part, and AFFIRMED in part. The award of a multiplier is REVERSED and the award of a $325 blended rate is AFFIRMED.
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