4 Fla. L. Weekly Supp. 668a
Attorney’s fees — Insurance — Personal injury protection — Contingency risk multiplier — After assessment of pertinent factors, case merits application of risk multiplier of 1.5, despite lack of complexity of legal issues — Evidence supports plaintiff’s argument that relevant marketplace limits ability of litigants of plaintiff’s financial strata to hire competent counsel for PIP suits of this nature without incentive of risk multiplier
LUDESTE DORELUS, Plaintiff, vs. ALLSTATE INDEMNITY COMPANY, Defendant. In the County Court in and for Palm Beach County, Civil Division. Case No. MC 95-2575 RL. February 3, 1997. Sandra K. McSorley, Judge.
FINAL JUDGMENT FOR ATTORNEY FEES AND COSTS
THIS CAUSE came before the Court on January 23, 1997 for hearing on Plaintiff’s Claim for Attorney’s Fees and Costs. Both parties were well represented by counsel with Diego Asencio, Esquire and James Cooksey, Esquire appearing for the Plaintiff and Laurie J. Adams, Esquire appearing for the Defendant. The Court heard testimony, received documentary evidence, and heard the arguments of counsel, reviewed the legal authorities submitted by the parties as well as the court file. Based upon the foregoing, the Court finds as follows.
The parties have no dispute with and have therefore stipulated to the 24.3 hours claimed by attorney Diego Asencio at an hourly rate of $250.00 which results in a lodestar fee of $6,075.00. Moreover, the parties have no dispute with and have therefore stipulated to the 12.25 hours claimed by Plaintiff’s co-counsel James Cooksey at a $250.00 hourly rate which results in a lodestar fee of $3,062.50. The parties have also stipulated to the $370.00 in costs claimed by Plaintiff as well as to $800.00 for the Plaintiff’s expert, Gary Russo, Esq. The underlying claim was settled on May 15, 1996 and which thereby fixes the operative date for application of prejudgment interest for attorneys fees.
The only dispute with respect to attorneys fees centers on whether a risk multiplier should apply. Plaintiff seeks application of a multiplier of 2.50 as to both Plaintiff’s counsel. Plaintiff’s expert opined that a 2.50 multiplier is appropriate for this case and the Defendant’s expert is of the opinion that this case merits no enhancement multiplier.
The concept of a risk multiplier was addressed by the Florida Supreme Court first in Florida Patient’s Compensation Fund v. Rowe, 472 So. 2d 1145 (Fla. 1985). In Rowe, the Court held that it may be necessary to apply a multiplier to compensate an attorney for the risk of non-payment. The appropriate multiplier set in that case was 1.5 to 3, depending on the likelihood of success at the initiation of the action.
After Rowe, the United States Supreme Court handed down Pennsylvania v. Delaware Valley Citizens’ Council for Clean Air, 483 U.S. 711, 107 S. Ct. 3078 (1987), and Blanchard v. Bergeron, __ U.S. __, 109 S.Ct. 939 (1989). In a plurality decision, the Supreme Court in Delaware Valley noted the policy anomalies created by use of a multiplier: (1) the Defendant holding the most meritorious defenses — and presumably with the greatest likelihood of success at the beginning — pays the highest fees to the opponent if he loses; (2) application of a multiplier compensates a plaintiff’s counsel for other cases where he did not prevail and was therefore not paid; and (3) the virtual impossibility for a judge to determine retroactively the plaintiff’s likelihood of success at the institution of the action. (This latter problem is created because at the time that the amount of attorneys fees is being decided, the plaintiff has prevailed, and the judge is thereby being asked to determine the likelihood that the plaintiff made an incorrect decision in pursuing his suit). The Supreme Court limited the multiplier’s application to the exceptional case, and in general, to a limit of 1.33.
In Blanchard, the Supreme Court drew a distinction between fees awarded pursuant to a public policy effectuating statute and those awarded incident to a personal injury action where percentage-of-the-award contingency fees are common. The Supreme Court held that a contingency fee agreement between counsel and his client is but one factor in determining a reasonable fee.
The Florida Supreme Court revisited its Rowe decision in light of Delaware Valley and Blanchard in its opinion in Standard Guaranty Insurance Co. v. Quanstrom, 555 So.2d 828 (Fla.1990). In short, the Florida Court determined that a multiplier is not mandatory in a contingency fee case. Id. at page 835.
The Quanstrom Court identified three types of cases where a court may be asked to award attorneys fees. Although not all inclusive, they are: (1) public policy enforcement cases, (2) tort and contract claims, and (3) family law, eminent domain, and estate and trust matters.
According to Quanstrom, the court determining fees in a category (1) case must consider the twelve factors enumerated in Johnson v. Georgia Highway Express, 488 F. 2d 714 (5th Cir. 1974), which are:
(1) the time and labor required;
(2) the novelty and difficulty of the questions;
(3) the skill requisite to perform the legal service properly;
(4) the preclusion of other employment by the attorney due to acceptance of the case;
(5) the customary fee;
(6) whether the fee is fixed or contingent;
(7) time limitations imposed by the client or the circumstances;
(8) the amount involved and the results obtained;
(9) the experience, reputation, and ability of the attorneys;
(11) the nature and length of the professional relationship with the client; and
(12) awards in similar cases.
Quanstrom at 525-526, quoting Johnson.
The Court further stated that “[i]t is important to note that the existence of a contingency fee arrangement is but one of the factors to be considered.” Id. at 526.
For the category (2) tort and contract cases, the factors which a court must consider, and evidence of which must be presented, are:
(1) whether in the relevant market the ability to obtain competent counsel is dependent on a contingency fee multiplier;
(2) whether the risk of nonpayment has been mitigated by the attorney; and
(3) whether any Rowe factors apply, especially, the amount involved, the results obtained, and the nature of the fee arrangement in question.
Quanstrom, page 834.
The opinion goes on to establish that the permissible multiplier ranges from 1 to 2.5.
As it applies to insurance policy disputes, a contingency fee agreement includes one where fee recovery is dependent upon an award by court pursuant to statute. Accordingly, a multiplier, if otherwise appropriate, may be applied. Quanstrom page 835. [See also State Farm & Casualty v. Palma, 555 So.2d 836, 838 (1990)]. A multiplier, however, need not be applied in a “run-of-the-mill” PIP suit. See United States Security Insurance Company v. Lapour, 617 So.2d 347, 348 (Fla. 3rd DCA 1993).
The Court finds from the record evidence that the legal issues in the suit at bar were not esoteric, complex, or outside the realm of the routine PIP case. On the other hand, the evidence presented lends some credibility to Plaintiff’s argument that the relevant marketplace limits the ability of litigants of Plaintiff’s financial strata to hire competent counsel for a PIP suit of this nature without the incentive of a risk multiplier.
The parties’ experts agree that because the Defendant demanded an IME prematurely which in turn resulted in a premature cut off of benefits, that this fact mitigated the risk of success in favor of the Plaintiff. Other factual issues, on the other hand, mitigate the risk of success in favor of the Defendant. Those facts are that Plaintiff’s physical injuries were minimal, that the outward manifestation of physical injuries were absent, that the Plaintiff was able to maintain his work schedule, and that the Plaintiff did not receive treatment from a medical doctor as a product of the automobile accident at bar but, instead incurred some $4500.00 in chiropractic bills.
In assessing all of the aforementioned factors, the Court concludes that this suit merits the application of a risk multiplier of 1.5. Accordingly, it is hereby
ORDERED AND ADJUDGED that Plaintiff LUDESTE DORELUS shall recover from Defendant ALLSTATE INDEMNITY COMPANY the sum of $9,110.50 as attorneys fees for Mr. Ascencio, plus $4593.75 as attorneys fees for Mr. Cooksey, plus costs of $370.00, plus $800.00 as an expert fee for Mr. Russo, plus pre-judgment interest from May 15, 1996 in the amount of $933.75, for a final total of $15,808.00 which shall accrue interest at the prevailing statutory rate, and for all of which let execution issue.
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