26 Fla. L. Weekly Supp. 141a
Online Reference: FLWSUPP 2602SMIKInsurance — Personal injury protection — Attorney’s fees — Proposal for settlement — Insurer’s renewed motion for entitlement to attorney’s fees and to tax costs granted — Facts and circumstances surrounding insurer’s nominal offer demonstrate that, at time offer was made, insurer had reasonable basis to conclude that its exposure was nominal
SLOSSBERG FAMILY CHIROPRACTIC CENTER, INC. (a/a/o Laurel Smikle), Plaintiff, vs. ALLSTATE FIRE AND CASUALTY INSURANCE COMPANY, Defendant. County Court, 15th Judicial Circuit in and for Palm Beach County. Case No. 502015SC008881XXXXSB. April 13, 2018. Reginald Corlew, Judge. Counsel: Michelle J. Kane, Kane Lawyers, for Plaintiff. Gladys Perez Villanueva, Shutts & Bowen LLP, Miami, for Defendant.
ORDER GRANTING ALLSTATE’S RENEWEDMOTION FOR ENTITLEMENT TOATTORNEY’S FEES AND TO TAX COSTS
THIS CAUSE came before the Court upon Allstate’s Renewed Motion for Entitlement to Attorney’s Fees and to Tax Costs. Plaintiff, Slossberg Family Chiropractic Center, Inc. (a/a/o Laurel Smikle), was represented by Michelle J. Kane, Esq., of Kane Lawyers, PLLC; Defendant, Allstate Fire and Casualty Insurance Company, was represented by Gladys Perez Villanueva of Shutts & Bowen. The Court having heard argument of the Parties on the 10th day of April, 2018 and being otherwise duly advised in the matter, GRANTS Defendant’s Motion for the following reasons and finds Defendant is entitled to an award of attorney’s fees, reserving jurisdiction to determine amount.Facts
Plaintiff filed its complaint on September 25, 2015, seeking damages for breach of contract and asserting that Allstate’s policy language did not properly elect to limit reimbursement pursuant to section 627.736(5)(a)2., Florida Statutes (“Serridge issue”). Allstate served its proposal for settlement upon Plaintiff’s counsel on June 1, 2016.1 Plaintiff failed to respond to Allstate’s Proposal for Settlement within thirty (30) days of having been served with the proposal. Accordingly, the proposal was deemed rejected. On August 25, 2016, the Court granted Plaintiff’s Motion for Summary Judgment and denied Defendant’s Cross Motion for Summary Judgment, based upon Orthopedic Specialists v. Allstate Insurance Company, 177 So. 3d 19 (Fla. 4th DCA 2015) [40 Fla. L. Weekly D1918a]. While Allstate’s Motion for Rehearing was pending, on January 26, 2017, the Florida Supreme Court decided Orthopedic Specialists v. Allstate Insurance Company 212 So.3d 973 [42 Fla. L. Weekly S38a], in favor of Allstate, upholding the decisions of the First, Second, and Third District Courts of Appeal, and holding that “Allstate’s policy provided legally sufficient notice of Allstate’s election to use the permissive Medicare fee schedules identified in section 627.736(5)(a)2. to limit reimbursements.” On March 29, 2017, the Plaintiff attempted to dismiss the case and filed a voluntary dismissal. Given that the filing of a voluntary dismissal after the case has been adjudicated on the merits is a legal nullity, the Court granted Allstate’s Motion to Strike Plaintiff’s Notice of Voluntary Dismissal Without Prejudice and Renewed Motion for Rehearing on this Court’s Final Judgment in favor of Plaintiff. On September 5, 2017, this Court entered a lengthy order and a final judgment in favor of Allstate. Shortly thereafter, Allstate filed its Renewed Motion for Entitlement to Attorney’s Fees and Costs.
The Serridge issue was pending in the Florida Supreme Court at the time this Court heard the parties’ summary judgment on August 25, 2016. Moreover, on February 13, 2015, in South Florida Wellness, Inc.(a/a/o Florencio Sanchez) v. Allstate Insurance Company, 89 F. Supp. 3d 1338 (S.D. Feb. 13, 2015), the federal court had dismissed with prejudice the plaintiff’s “Serridge issue” complaint, finding that Allstate’s language unambiguously provides notice of Allstate’s election to use subsection (5)(a)(2) fee schedules. The following month, in March of 2015, the First District Court of Appeal had decided Allstate Fire & Casualty Insurance Company v. Stand-Up MRI of Tallahassee, 188 So. 3d 1 (Fla. 1st DCA 2015) [40 Fla. L. Weekly D693b], agreeing with Allstate that its policy provided sufficient notice of its election to limit reimbursements by use of the fee schedules. On May 22, 2015, jurisdiction of the Florida Supreme Court had been invoked by the providers in Stand-Up MRI. On August 19, 2015, the Fourth District Court of Appeal issued a split opinion in Serridge and certified conflict with the First District Court of Appeal. Orthopedic Specialists (a/a/o Kelli Serridge) v. Allstate Insurance Company, 177 So. 3d 19 (Fla. 4th DCA 2015) [40 Fla. L. Weekly D1918a], reversed 212 So. 3d 973 (Fla. 2017) [42 Fla. L. Weekly S38a]. The next day, on August 20, 2015, the provider in Stand-Up filed a Notice of Supplemental Authority (Related Case) and Motion to Stay Jurisdiction Pending Finality in Related case, which the Florida Supreme Court denied. See Florida Supreme Court Case Docket, Case No. SC15-962. By the time Plaintiff filed its motion for summary judgment in this case, Allstate had already prevailed on its motion for entitlement to fees and costs, and successfully enforced its proposal for settlement in Med Manage Group, Inc. (Mario Palacios) v. Allstate Property & Casualty Insurance Company, 23 Fla. L. Weekly Supp. 365a (Cty. Ct. 11th Cir. Sept. 2, 2015), and seven other cases.
This Court now addresses Allstate’s Renewed Motion for Entitlement to Attorney’s Fees and to Tax Costs.Law and Analysis
Plaintiff challenged Allstate’s proposal for settlement, arguing that it was a nominal offer, not made in good faith because, at the time the offer was made, the Fourth District Court of Appeal’s decision in Serride was binding. While there is no dispute that under the doctrine in Pardo v. State, 596 So. 2d 665 (Fla. 1992), this Court was bound to enter a final judgment in favor of Plaintiff, that does not answer the question herein. This Court must apply the specific law pertaining to nominal offers of proposals for settlement.
The legislature “created a mandatory right to attorney’s fees, if the statutory prerequisites [of section 768.79] have been met.” TGI Friday’s Inc. v. Dvorak, 663 So. 2d 606, 611 (Fla. 1992). The “sole basis on which the court can disallow an entitlement to fees” is only if it determines that a qualifying offer ‘was not made in good faith.’ ” Id. at 612. “The rule is that a minimal offer can be made in good faith if the evidence demonstrates that, at the time the offer was made, the offeror had a reasonable basis to conclude that its exposure was nominal.” Citizens Property Ins. Corp. v. Perez, 164 So. 3d 1 (Fla. 4th DCA 2014) [39 Fla. L. Weekly D1271c].
Once a defendant shows entitlement to costs and attorney’s fees, the offeree has the burden to show that the offer was not made in good faith. The determination of whether an offer was served in good faith turns entirely on whether the offeror had a reasonable foundation upon which to make the offer.
Hall v. Lexington Ins. Co., 895 So. 2d 1161, 1166 (Fla. 4th DCA 2005) [30 Fla. L. Weekly D466a] (citations omitted). Offers are not suspect because they are nominal, as long as the offer bears a “realistic assessment of liability.” Land & Sea Petroleum, Inc. v. Business Specialists, Inc., 53 So. 3d 348 (Fla. 4th DCA 2011) [36 Fla. L. Weekly D136d].
The question of good faith is answered by analyzing the facts and circumstances surrounding the offer from Allstate’s viewpoint. See Levine v. Harris, 791 So. 2d 1175 (Fla. 4th DCA 2001) [26 Fla. L. Weekly D1824a]. That is, “ ‘good faith,’ is, by its very nature, determined by the subjective motivations and beliefs of the pertinent actor. As is true in this case, so long as the offeror has a basis in known or reasonably believed fact to conclude that the offer is justifiable, the ‘good faith’ requirement has been satisfied.” Dep’t of Highway Safety & Motor Vehicles, Florida Highway Patrol v. Weinstein, 747 So. 2d 1019, 1021 (Fla. 3d DCA 1999) [24 Fla. L. Weekly D2799b] (emphasis added).
Given the facts and circumstances surrounding Allstate’s offer, this Court finds that its offer satisfied the good faith requirement of Florida law. Initially, Allstate has never wavered from its position that the same policy language and statute at issue here permitted it to limit reimbursements pursuant to the fee schedules in Florida’s No-Fault Statute; it maintained said position in exhaustive litigation through all but one of the Florida’s appellate courts2 and, ultimately, the Florida Supreme Court. See Land & Sea Petroleum, Inc. v. Business Specialists, Inc., 53 So. 3d 348 (Fla. 4th DCA 2011) [36 Fla. L. Weekly D136d]. Importantly, on June 1, 2016, when Allstate made its proposal for settlement: 1) the issue had been pending in four appellate courts, evidencing Allstate’s conviction in the correctness of its position; 2) the sole case pending in the Florida Supreme Court, Stand-Up MRI, was in Allstate’s favor and the motion to stay pending Serridge had been denied; 3) the Federal District Court had dismissed with prejudice the class action, ruling in favor of Allstate; 4) the First District Court of Appeal had sided with Allstate; 5) Allstate had already prevailed in enforcement of its proposal for settlement in other cases; and 6) the Fourth District’s opinion in Serridge certified the question to the Florida Supreme Court, supporting Allstate’s position that there was yet much more before “it was over.”
The certification of the Serridge issue by the Fourth District Court of Appeal significantly undermines the notion that the binding nature of that decision within the jurisdiction of that court precluded Allstate’s good faith offer of settlement. The “Serridge issue” legal battle that was raging in all of Florida’s courts highlights Allstate’s conviction and reasonable belief that its exposure was nominal; as Allstate always maintained it had properly paid pursuant to the fee schedules and it owed nothing more, making its exposure zero. Allstate’s assessment of its liability when making the proposal for settlement was, not only realistic, but supported by its consistent victories. The argument that Allstate lacked any reasonable basis for believing that it would prevail ignores the inconvenient fact that it did prevail.3 “To accept in the same case in which a party did prevail the notion that there was no reasonable basis for that party prevailing would require self-contradiction” that this Court does not accept under these circumstances. See McMahan v. Toto, 311 F. 3d 1077 (11th Cir. Ct. App. 2002) [16 Fla. L. Weekly Fed. C8b].
Accordingly, the facts and circumstances surrounding Allstate’s offer demonstrate that, at the time the offer was made, Allstate had a reasonable basis to conclude that exposure was nominal. Defendant’s Renewed Motion for Entitlement to Attorney’s Fees is hereby GRANTED and this Court reserves jurisdiction to determine the amount.
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1The Court finds that Allstate properly served the Proposal for Settlement.
2It is noteworthy that the precise issue herein had been appealed by Allstate throughout the State of Florida at the time this case was filed, evidencing its commitment to the propriety of its policy language. See First District Court of Appeal Docket, Allstate Fire and Casualty v. Stand-Up MRI of Tallahassee, Case No. 1D14-1213 (Notice of Appeal filed March 19, 2014); Second District Court of Appeal Docket, Allstate Indemnity Company v. Markley Chiropractic & Acupuncture, LLC, Case No. 2D14-3818 (Notice of Appeal filed August 13, 2014); Third District Court of Appeal Docket, Florida Wellness & Rehabilitation v. Allstate Fire & Casualty Ins. Co., Case No. 3D15-151 (Notice of Appeal filed January 15, 2015); Fourth District Court of Appeal Court Docket, Orthopedic Specialists v. Allstate Ins. Co., Case No. 4D14-287 (Notice of Appeal filed January 28, 2014).
3By the time “it was all said and done,” when the Florida Supreme Court issued Serridge, Allstate had prevailed in the First, Second, and Third District Courts of Appeal. See Florida Wellness & Rehab. Center v. Allstate Fire & Casualty Ins. Co., 201 So. 3d 169 (Fla. 3d DCA 2016) [41 Fla. L. Weekly D1619c]; Allstate Indemnity Company v. Markley, Case No. 2D143818, 2016 WL 123853 (Fla. 2d DCA Mar. 30, 2016) [41 Fla. L. Weekly D793b]; and Allstate Fire and Casualty Insurance, Etc., v. Stand-Up MRI of Tallahassee, P.A., 188 So. 3d 1 (Fla. 1st DCA 2015) [40 Fla. L. Weekly D693b].
