26 Fla. L. Weekly Supp. 973a
Online Reference: FLWSUPP 2612THOMInsurance — Attorney’s fees — Justiciable issues — Plaintiff and its counsel are liable in equal parts for defendant’s attorney’s fees pursuant section 57.105(1) where plaintiff and counsel knew before filing breach of contract claim that patient did not have a policy of insurance with defendant — Plaintiff or its counsel could have and should have verified coverage through patient prior to filing lawsuit — Argument that plaintiff had an additional 5 days to dismiss action pursuant to rule 2.514(b) because motion for sanctions was served by email is without merit — The additional 5 days set forth in rule 2.514(b) is not applicable to the 21-day safe harbor provision of section 57.105(4), as this safe harbor provision is a compliance statute for the party seeking sanctions and does not require or suggest any action on the part of the offending party
WALL HEALTHCARE, INC., (Patient: James Thomas), Plaintiff, v. TRAVELERS PROPERTY CASUALTY COMPANY OF AMERICA, Defendant. County Court, 6th Judicial Circuit in and for Pinellas County. Case No. 16-5300-SC-44. February 1, 2017. Kathleen T. Hessinger, Judge. Counsel: Tory Tombs, GED Laywers, LLP, Sarasota, for Plaintiff. Sarah M. Sorgie, Ramey & Kampf, P.A., Tampa, for Defendant.
ORDER GRANTING DEFENDANT’SENTITLEMENT TO § 57.105, FLA. STAT. FEES
This Cause came to be heard before this Court on Defendant’s Motion for Entitlement to §57.105, Fla. Stat. Attorney Fees with the Parties present, represented by counsel and this Court having heard argument, received law and being otherwise advised of the premises, it is hereby Ordered and Adjudged as follows,
1. On May 11, 2016, Plaintiff filed a breach of contract claim against Defendant claiming Plaintiff’s assignor, the patient, had a policy of insurance with Defendant and Defendant failed to pay Plaintiff’s PIP claim. However, prior to filing the claim, Defendant advised Plaintiff, on two occasions, January 18, 2016 and March 17, 2016, that the patient was not insured with Defendant at the time of the accident. The patient was insured at one point with Defendant, but the policy was cancelled effective October 28, 2012. The motor vehicle accident was June 1, 2014. After filing the lawsuit and before Defendant retained counsel, Defendant again advised Plaintiff’s counsel that the patient was not covered by insurance from Defendant. Upon Defendant retaining counsel, its counsel advised Plaintiff’s counsel, on June 3, 2016, that no coverage existed for the patient and filed a Motion to Dismiss. (The parties agreed to use the Florida Rules Civil Procedure for this small claims matter.) Plaintiff did not dismiss the lawsuit and served discovery on Defendant on June 17, 2016. Defendant responded to the discovery, on June 21, 2016, stating no policy and no coverage existed for the patient.
2. On June 23, 2016, Defendant’s counsel served a §57.105(4), Fla. Stat. Motion for Sanctions on Plaintiff. Twenty-one days after serving the Motion for Sanctions was July 14, 2016. Defendant filed the Motion for Sanctions with the Count on July18, 2016. On July 19, 2016, Plaintiff filed its Voluntary Dismissal. Defendant moved for entitlement to attorney fees and Plaintiff objects thereto.
3. As to the issue of whether Plaintiff and its counsel knew or should have known that the claim when initially presented to the Court was not supported by the material facts necessary to establish the claim, the evidence is clear that Plaintiff and its counsel are liable in equal parts for Defendant’s attorney’s fees. Plaintiff and Plaintiff’s counsel knew before filing the claim that the patient did not have a policy of insurance with Defendant nor was he covered under another policy of insurance with Defendant. If Plaintiff or its counsel questioned coverage, Plaintiff or its counsel could have and should have verified the coverage through the patient prior to filing the lawsuit, but they failed to do so.
4. However, Plaintiff argues that a Voluntary Dismissal was filed during the “safe harbor” period of §57.105(4), Fla. Stat. as it had 5 additional days pursuant to Fla. R. Civ. Proc. 2.514(b) — Additional Time after Service by Mail or E-Mail. Plaintiff argues the Voluntary Dismissal was filed on July 19, 2016, the 5th day of the additional 5 days; thus, it and its counsel are precluded from paying Defendant’s attorney’s fees. Defendant argues that the 5 additional days, pursuant to Fla. R. Civ. P. 2.514(b) are not applicable to the “safe harbor” provision of §57.105, Fla. Stat.
5. The “safe harbor” provision, §57.105(4), Fla. Stat. states as follows,
A motion by a party seeking sanctions under this section must be served but may not be filed with or presented to the court unless, within 21 days after service of the motion, the challenged paper, claim, defense, contention, allegation, or denial is not withdrawn or appropriately corrected.
6. Section 57.105(4), Fla. Stat. instructs the party seeking sanctions, under §57.105(1), Fla. Stat., that it must first serve the Motion for Sanctions to the offending party, but may not file the motion with the Court until 21 days later if the offending party does not correct the issue. As applied to this matter, Defendant was first required to serve the Motion for Sanctions on Plaintiff and then Defendant could file it with the Court, 21 days later, if Plaintiff did not dismiss this matter. Defendant served Plaintiff the Motion for Sanctions on June 23, 2016 and then filed the motion with the Court, on July 18, 2016, more than 21 days later. As such, Defendant complied with §57.105(4), Fla. Stat. in order to obtain its attorney’s fees from Plaintiff and its counsel pursuant to §57.105(1)(a), Fla. Stat.
7. Fla. R. Civ. P. 2.514(b) states “when a party may or must act within a specified time after service and service is made by mail or e-mail, 5 days are added after the period that would otherwise expire under subdivision (a).”
8. Plaintiff argues that it may or must act within the 21 days of the “safe harbor” provision, so 5 days are added after the 21 day expiration period as the Motion for Sanctions was served by e-mail. Plaintiff’s argument is without merit. Section 57.105(4), Fla. Stat. tells the party seeking sanctions that the Motion for Sanctions may not be filed with the Court within 21 days after service of the motion and only if the offending party does not withdraw or correct the issue. (emphasis added) This provision of §57.105, Fla. Stat. is a compliance statute for the party seeking sanctions. If the party seeking sanctions under §57.105(1)(a), Fla. Stat. does not comply with this provision, the party seeking sanctions is not entitled to its attorney’s fees if the offending act is not corrected. Section 57.105(4), Fla. Stat. does not require or suggest the offending party to do anything within 21 days of receiving the Motion for Sanctions. As it relates to a dismissal issue, the offending party can correct the issue at any time, even after 21 days, without paying attorney’s fees to the party seeking sanctions as long as the offending party makes the correction before the Motion for Sanctions is filed with the Court. See Pomeranz & Landsman, Corp. v. Miami Marlins Baseball Club, L.P., 143 So. 3d 1182 (Fla. 4th DCA 2014) [39 Fla. L. Weekly D1704b].
9. In Pomeranz, the party seeking sanctions served the motion on the offending party on July 29, 2012. On March 5, 2013, almost eight months later, the offending party, the Plaintiff, voluntarily dismissed the action. The party seeking sanctions, the Defendant, then filed its motion for sanctions with the Court on March 11, 2013. Id., 143 So. 3d at 1183. The Pomeranz Court held that once Plaintiff filed the Voluntary Dismissal, the trial court lost jurisdiction to hear the subsequently filed Motion for Sanctions. A trial court has continuing jurisdiction to consider a §57.105(4), Fla. Stat. motion for sanctions only where the motion for sanctions was filed with the Court before a voluntary dismissal. Id.
10. As such, the party seeking sanctions must file the motion for sanctions very quickly after 21 days from service if the offending action is not corrected; otherwise, the party seeking sanctions may lose its right to attorney’s fees if the offending party’s dismissal beats the motion for sanctions to the courthouse. The Pomeranz holding exemplifies that the 21 day time for action is on the party seeking sanctions not the offending party. As such, the additional 5 days set forth in Fla. R. Civ. Pro. 2514(b) is not applicable to the §57.105(4), Fla. Stat.
It is therefore Ordered and Adjudged that Defendant, Travelers Property Casualty Company of America, is entitled to attorney’s fees from Plaintiff, Wall Healthcare, Inc. (patient James Thomas) and Ellis, Ged, and Bodden, P.A., to be paid in equal amounts. This Court reserves jurisdiction to address any issues as to the amount of attorney’s fees and costs.
