14 Fla. L. Weekly Supp. 25a

Attorney’s fees — Insurance — Personal injury protection — Contingency risk multiplier — Although there was conclusory testimony from medical provider’s expert that expert would not have taken case but for prospect of multiplier and that market requires multiplier, in absence of testimony from provider regarding difficulty in obtaining competent counsel, Quanstrom requirement that relevant market requires multiplier to obtain competent counsel is not met — Further, fact that provider had long-standing relationship with counsel tends to negate notion that provider had difficulty obtaining competent counsel in case — Trial court’s ruling that provider’s counsel attempted to mitigate risk of nonpayment but was unable to do so is not supported by record where counsel did not provide meaningful evidence that provider was unable to pay hourly fee, counsel did not even attempt to obtain hourly fee from provider, and long-standing relationship between provider and counsel would justify long-standing retainer agreement — In absence of express holding that multipliers cannot be applied in PIP cases, court declines to conclude that supreme court’s decision in Sarkis case removes ability to seek multiplier in all PIP cases — Hours — Where provider prevailed on claim for only one of two dates of service at issue, trial court erred in deducting hours spent after entry of final summary judgment from fee award but failing to make further deduction for provider’s losing claim — No merit to argument that insurer waived issue by failing to seek rehearing of judgment awarding fees where court did not reserve jurisdiction on any issue and, therefore, neither objection nor motion for rehearing was necessary to challenge sufficiency of evidence

PROGRESSIVE EXPRESS INS. CO. Appellant, vs CHIROPRACTIC CLINICS, INC., (a/a/o Barbara Barriga), Appellee. Circuit Court, 13th Judicial Circuit (Appellate) for Hillsborough County. August 30, 2006. Review of a final order of the County Court, Hillsborough County. Case No. 05-8540, Division X. L.C. Case No. 03-00079-SC. Counsel: Douglas H. Stein, Miami, for Appellant. V. Rand Saltsgaver, Orlando; Joseph E. Nicholas, Tampa, for Appellee.

[County court order published at 12 Fla. L. Weekly Supp. 1088a.]

(JAMES D. ARNOLD, J.) Appellant appeals the trial court’s application of a contingency risk multiplier (multiplier) to an award of attorney’s fees in favor of Appellee (plaintiff below) Chiropractic Clinics (the provider) in this personal injury protection (“PIP”) case. That attorney’s fees are due is not contested. Nor is the amount of the multiplier contested if this Court determines that a multiplier is applicable. Specifically, Progressive challenges the application of a contingency risk multiplier and the award of fees for services performed by the provider’s counsel on issues upon which it did not prevail.

In this appeal Progressive contends that the lack of competent substantial evidence fails to support the award of a multiplier and the number of hours compensated. With respect to the multiplier, Progressive also argues that the Supreme Court’s decision in Sarkis v. Allstate Ins. Co., 863 So.2d 210 (Fla. 2003) does not allow the application of a multiplier in PIP cases generally. Finally, Progressive maintains that the deduction to which the trial court’s order refers does not comport with the evidence in the record. Although we do not agree that the Sarkis decision has the significant impact on multipliers in PIP cases that Progressive contends it has, we agree and reverse as to the remaining issues. The facts are as follows.

On January 2, 2003, the provider filed its complaint alleging that it is a health care provider to whom Progressive failed to pay the full amount of charges for medical services rendered to its assignee, a patient insured under PIP coverage issued by Progressive. The complaint concerned two (2) dates of service: March 2, 2001 and October 28, 2002. On July 15, 2003, the trial court entered summary judgment for Progressive asto the March 2, 2001 date of service. Thus, the only remaining issue was the October 28, 2002, date of service. Subsequently, on December 15, 2004, the trial court entered final summary judgment, disposing of that remaining claim in favor of the provider.

On December 9, 2004, the provider filed a Motion to Tax Attorneys Fees and Costs and Apply Contingency Risk Multiplier. The trial court conducted an evidentiary hearing. Prior to taking evidence, the trial court granted Progressive’s Motion in Limine to preclude the award of attorney’s fees subsequent to December 15, 2004: the date that it had entered the Order Granting Summary Judgment which gave rise to the provider’s entitlement to fees. In his affidavit, the provider’s counsel claimed that he had spent 69.1 hours on the case. Pursuant to the affidavit, the clinic’s counsel expended 17.7 of those hours after December 15, 2004.

Subsequently, the trial court entered an order finding that the provider’s counsel had reasonably expended 51.4 hours — 17.7 hours less than the total 69.1 hours claimed. Based on this, Progressive contends that the trial court did not take into account and deduct the hours counsel spent on the issue on which Progressive prevailed. The trial court also found that a reasonable hourly rate for the provider’s counsel was $175, and applied a 1.5 contingency risk multiplier. The trial court awarded $13,492.50 in attorney’s fees. This appeal ensued.

Progressive contends that the trial court erred on several grounds that require this Court to reverse the trial court’s application of the multiplier. They are that the provider presented no competent evidence that (1) the relevant market requires a contingency fee multiplier to obtain competent counsel; and (2) that its attorney was unable to mitigate the risk of nonpayment. Absent that required evidence, the application of the 1.5 contingency fee risk multiplier must he reversed. Appellant also contends that the trial court awarded fees for time spent on issues upon which the provider did not prevail.

The provider counters that Progressive waived its argument with respect to the lack of competent substantial evidence because it never objected to the opinions of the fee expert, and that, even if the issue were not waived, there was competent substantial evidence to support the trial court judge’s decision. The provider disputes Progressive’s contention that the expert testimony was insufficient because it was conclusory in nature; it suggests that the expert testimony was sufficient to meet its burden of proof because §90.705, Florida Statutes, affords the expert the “absolute right” to give opinions in a conclusory fashion without providing underlying facts, and nothing more was required. The provider also urges that Progressive’s contention that only a plaintiff can provide competent evidence as to its ability or inability to obtain counsel is not consistent with current status of the law; the law requires only “some evidence,” and a plaintiff is not the sole source of such evidence. Finally, the provider suggests that the ongoing business relationship argument has already been rejected by at least two appellate courts; therefore, Progressive’s assertion that this issue has no support from the appellate courts is unfounded.

The multiplier. Whether to apply a contingency fee risk multiplier (“multiplier”) is subject to the court’s discretion. State Farm Fire & Cas. Co. v. Palma, 629 So. 2d 830, 833 (Fla. 1993). Nonetheless, competent substantial evidence must exist to support the application of a contingency risk multiplier. State Farm Mut. Auto. Ins. Co. v. Cedolia, 571 So.2d 1386, 1387 (Fla. 4th DCA 1990). The application of a multiplier is the exception, not the rule. See Bell v. U.S.B. Aquisition Co., 734 So. 2d 403, 413 (Fla. 1999) (Overton, S.J., specially concurring.) If the order is not supported with competent, substantial evidence, this Court must reverse as to the multiplier. The provider’s contention that the issue was not preserved is without merit. Rule 1.530(e), Florida Rules of Civil Procedure.

With respect to the substantive issue, a court must consider whether a movant for attorney’s fees has presented substantial competent evidence asto three (3) factors when determining whether to apply a contingency risk multiplier:

(1) whether the relevant market requires acontingency 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. Evidence of these factors must he presented to justify the utilization of a multiplier.

Standard Guaranty Insurance Co. v. Quanstrom, 555 So. 2d 828, 834 (Fla. 1990) (footnote added). See also Cedolia, 571 So. 2d at 1387. All must be present to justify the application of a multiplier; however, the Supreme Court of Florida has held that the first factor stated in Quanstrom, i.e. “whether the relevant market requires a contingency fee multiplier to obtain competent counsel,” is the most prominent factor for a court to consider:

“[T]he justification for a contingency fee multiplier is that without providing an added incentive for lawyers to obtain higher fees, clients with legitimate causes of action (or defenses) may not be able to obtain legal services. The importance of this policy consideration is highlighted by the fact that the very first factor listed in Quanstrum for courts to consider in determining if a multiplier should be utilized in tort and contract cases is “whether the relevant market requires a contingency fee multiplier to obtain competent counsel.”

Bell v. U.S.B. Acquisition Co., Inc., 734 So. 2d 403, 411 (Fla. 1999). A multiplier cannot be applied where there is no evidence that the relevant market requires a contingency fee multiplier to obtain competent counsel. Sun Bank of Ocala v. Ford, 564 So. 2d 1078, 1079 (Fla. 1990); Pennsylvania v. Delaware Valley Citizens’ Council for Clean Air, 483 U.S. 711 (1987). See also, Strahan v. Gauldin, 756 So. 2d 158, 161 (Fla. 5th DCA 2000) reversed on other grounds by Sarkis v. Allstate Ins. Co., 809 So.2d 6 (Fla. 5th DCA 2001). Here, although there was testimony that the provider’s expert would not have taken the case but for the prospect of a multiplier, and that the market requires it, such conclusory testimony, while admissible and, therefore not objectionable, does not prove the ultimate conclusion that the provider actually had any difficulty obtaining counsel. “The opinion of an expert witness does not constitute proof that the facts necessary to support the conclusion exist.” Miller v. First Am. Bank and Trust, 607 So. 2d 483, 485 (Fla. 4th DCA 1992) (citing Mercy Hosp. Inc., v. Johnson, 431 So. 2d 687, 688 (Fla. 3d DCA), pet. for rev. denied, 441 So. 2d 632 (Fla. 1983)). Notwithstanding circuit appellate decisions to the contrary in the Ninth Judicial Circuit, which decisions do not bind this Court, the best way to present the difficulty in obtaining competent counsel is through direct testimony of the plaintiff. Here, and in many, if not all cases this Court has reviewed in recent years, such testimony is conspicuously absent. In a concurring opinion in Tetrault v. Fairchild, 799 So. 2d 226 (Fla. 5th DCA 2001), Judge Charles M. Harris wrote that, absent testimony from the plaintiff itself, testimony from an expert cannot satisfy the Quanstrom requirement that the relevant market requires a contingency fee multiplier to obtain competent counsel:

Since the test is whether plaintiff would have had substantial difficulty in obtaining competent counsel within the area to take the case without the multiplier, whether plaintiff’s counsel would have taken the case only on that basis is immaterial. The question is whether other competent counsel would have done so. Plaintiff attempted to answer this question by putting on another member of the plaintiff’s bar to testify that based on his conversation with several of his friends who do this type practice, his “expert” opinion is that plaintiff could not have obtained competent counsel in the area to sue a defendant insured by the insurance company involved in this action without the multiplier. Was this sufficient to satisfy the Quanstrom requirement? . . . Is this really the kind of testimony which canbe offered by “experts?” . . . Section 90.703, Florida Statutes, provides that expert testimony may be received only if it can be applied to evidence at trial. Plaintiff never testified that he had any difficulty in obtaining a lawyer.

Id. at 234 (Harris, J. concurring; emphasis in original). Although this concurring opinion is not the law of Tetrault, we find it to be persuasive. Even if there exists another way to prove this point, the provider did not do so. We are aware that at least one court has stated in dicta that an expert’s testimony as to the market conditions vis a vis amultiplier may sometimes be helpful. Island Hoppers, Ltd. v. Keith, 820 So. 2d 967 (Fla. 4th DCA 2002) reversed on other grounds by Sarkis v. Allstate Ins. Co., 863 So.2d 210 (Fla. 2003). The court went on to say that this does not require a court to abandon its independent judgment with respect to the reasonableness of a fee. Indeed, the Island Hoppers court stated that it failed to see what, if any, guidance fees experts actually provide to experienced trial judges of this state. And this does not alter the fact that the opinion of an expert witness does not constitute proof that the facts necessary to support the conclusion exist. Mercy Hosp., Inc. v. Johnson, 431 So. 2d 687, 688 (Fla. 3d DCA), pet. for rev. denied, 441 So. 2d 632 (Fla. 1983). Additionally, “our appellate courts have been quick to reverse patently outrageous fee awards, inherently disregarding the corroborative testimony of the “fees experts” for all intents and purposes, worthless,” Island Hoppers, at 972, citing Ziontz v. Ocean Trail Unit Owners Ass’n, Inc., 663 So.2d 1334 (Fla. 4th DCA 1993) (finding $60,000 in fees awarded in connection with litigation regarding an outstanding one hundred ($100) dollar assessment was manifestly unjust). Here, the fee was $13,492.50, over an amount of less than $15.

A representative of the provider did not testify as to whether it had any difficulty finding competent counsel to represent it in this case. The testimony amounted to assertions that, without a multiplier, the clinic’s expert would not want the case and neither did its own attorney. The expert made statements that the market required the application of a multiplier to enable the provider to obtain competent counsel, but did not support those statements with any relevant facts. Additionally, that the provider had a long-standing relationship with its counsel tends to negate the notion that it had difficulty obtaining competent counsel for this case.

The provider’s assertion that its expert had the “absolute right,” pursuant to §90.705, Florida Statutes, to testify without presenting underlying facts, is incorrect. Section 90.705 allows the testimony without disclosure of underlying facts to he presented on direct examination. It also requires such facts to be disclosed on cross examination. Again, an opinion does not prove facts necessary to support the conclusion. Mercy Hosp., Inc. v. Johnson, 431 So. 2d 687.

The second factor which Quanstrom requires a trial court to consider before awarding a multiplier, is whether the attorney was able to mitigate the risk of nonpayment in any way. Quanstrom, 555So. 2d at 834. Absent substantial and competent evidence that there was a risk of nonpayment, a multiplier cannot be applied. Pompano Ledger, Inc. v. Greater Pompano Beach Chamber of Commerce, Inc., 802 So. 2d 438 (Fla. 4th DCA 2001).

The provider is correct that this Court does not sit as a “second trier of fact.” However, we are required to determine whether evidence supports the trial court’s conclusions. In the instant case, the trial court made no factual findings supporting its ruling that “Plaintiff’s counsel attempted to mitigate the risk ofnonpayment, but was unable to do so,” and the record does not support this conclusion. Counsel did not provide meaningful evidence that his client was unable to pay the hourly fee; indeed, counsel did not attempt to obtain an hourly fee in this case.

Additionally, the provider is involved in several cases involving PIP issues, and his attorney in the instant case indicated that he represents this client in more cases than just the one before this Court. This ongoing relationship between the provider and its attorney is precisely the type of relationship which courts have held does not necessitate the application of a multiplier. In Craig Lichtblau, M.D., P.A. v. Nationwide Mutual Fire Insurance Co., 11. Fla. L. Weekly Supp. 466, 469 (Fla. 15th Jud. Cir. Feb. 23, 2004), the plaintiff had enough assigned PIP cases “to justify a longstanding retainer agreement” with its attorneys. In ruling that no multiplier applied, the court held that:

Moreover, Plaintiff’s retainer agreement shows that Plaintiff’s counsel is able to mitigate the risk of nonpayment in any one case by being retained on a volume of cases with this client alone. Id. at 470.

Indeed, the foregoing reflects the general principle, as held by the Supreme Court of Florida, that a multiplier is not applicable when the attorney, by accepting just one case from the plaintiff, has the potential of receiving more cases from that plaintiff. In finding that it was proper for the trial court to refuse to apply a multiplier of any amount, the Supreme Court held:

There might be a preference not to accept certain individual cases, but any reluctance generally yields to the reward of gaining other cases . . .

Sun Bank of Ocala v. Ford, 564 So. 2d 1078, 1079-80 (Fla. 1990).¹ Here, unlike the situation in Sun Bank, this case does not represent unrealized potential. The provider and its counsel have an on-going relationship. On its own, the absence of evidence showing an attempt to mitigate the risk of nonpayment — a mandatory factor the trial court must consider — requires us to reverse the trial court’s decision to apply a multiplier. Pompano Ledger, Inc., 802 So.2d at 439.

Applicability of Sarkis v. Allstate:Appellant’s argument that the Florida Supreme Court’s decision in Sarkis v. Allstate Insurance Co., 863 So. 2d 210 (Fla. 2003), acts as alegal impediment to the imposition of a multiplier in PIP cases, is persuasive. However, in the absence of an express holding that multipliers cannot be applied in PIP cases, we cannot conclude that Sarkis removes the ability to seek a multiplier in all PIP cases.

Number of Hours: Progressive contends that the trial court awarded the provider attorney’s fees for issues upon which it did not prevail. Whether multiple claims within a lawsuit are separate and distinct for purposes of an award of attorney’s fees is reviewed de novo. Rosen Bldg. Supplies, Inc. v. Krupa, 927 So.2d 899 (Fla. 4th DCA 2005). We agree with the trial court that the dates of service are separate for purposes of attorney’s fees. Although the order states that it includes a deduction for the issue on which Progressive prevailed, the final figure reflects that the trial court simply deducted the hours spent after December 15, 2004, as set forth on counsel’s affidavit of attorney’s fees, without any further deduction for the provider’s losing claim.

The provider’s contention that Progressive waived the issue because it failed to seek rehearing of the judgment awarding attorney’s fees, citing Emerald Coast Communications, Inc. v. Carter, 780 So. 2d 968 (Fla. 1st DCA 2001), is incorrect. Emerald Coast does not apply to the instant situation because this court did not improperly reserve jurisdiction on any issue. Its holding is limited to its facts. Neither an objection nor a motion for rehearing is necessary to challenge the sufficiency of the evidence under these circumstances. Rule 1.530(e), Florida Rule of Civil Procedure.

It is therefore ORDERED that the decision of the trial court is REVERSED as to the application of a contingency fee risk multiplier, and the cause is REMANDED for further proceedings, including to determine the correct deduction of hours for the losing claim.

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¹We recognize that the propriety of refusing to apply a multiplier does not mean that the application of a multiplier is incorrect. Here, the long-standing relationship, together with the lack of any attempt to otherwise mitigate the risk of nonpayment, supports our determination that the record does not support the trial court’s conclusion that counsel attempted, but was unable, to mitigate the risk of nonpayment.