18 Fla. L. Weekly Supp. 299c
Online Reference: FLWSUPP 1803ROJA
Insurance — Personal injury protection — Attorney’s fees — Proposal for settlement — Strict adherence to rule allowing service of proposal for settlement on plaintiff no earlier than 90 days after commencement of action is not warranted — Proposals which offered to settle “all claims” and which clearly set forth non-monetary terms were not ambiguous — Offers for nominal amounts were made in good faith, and reasonableness of offers is supported by zero dollar verdict
SIEGFRIED K. HOLZ, M.D., P.A. a/a/o ROSE ROJAS, Plaintiff, vs. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant. County Court, 10th Judicial Circuit in and for Polk County, Small Claims Division. Case No. 53-2003SC-001620-0000-00, Division M-2. August 24, 2010. Robert L. Williams, Jr., Judge. Counsel: David B. Kampf, Ramey & Kampf, P.A., Tampa, for Defendant.
ORDER GRANTING DEFENDANT’S MOTION FOR ENTITLEMENT TO ATTORNEY’S FEES AND COSTS
THIS MATTER having come before the Court for hearing on July 27, 2010, upon Defendant’s Motion for Entitlement to Attorneys’ Fees and Costs, the Court having reviewed and considered the Motion and Memorandum of Law submitted by counsel for the Plaintiff and by counsel for the Defendant, and further having heard argument and being fully informed and otherwise advised, does hereby find as follows:
Defendant is entitled to recover reasonable attorneys’ fees and costs incurred from June 25, 2003 (the date of service or filing of the Defendant’s first Proposal of Settlement) to the present.
The Court makes the following findings of fact and conclusions of law:
1. This action commenced with the filing of the Complaint initiating this lawsuit on April 14, 2003. This matter has been thoroughly litigated up to the rendering of a zero dollar jury verdict in Defendant’s favor on February 24, 2010, and Final Judgment in favor of the Defendant ordered at hearing on July 27, 2010 then signed by the Court on August 17, 2010, and thereafter to the present date. The Defendant is the prevailing or winning party in this case.
2. Defendant seeks an award of attorneys’ fees and costs relying upon §768.79, Florida Statutes, and the companion Florida Rule of Civil Procedure 1.442, together with §57.041, Florida Statutes.
3. This case is a suit for personal injury protection (PIP) benefits and as such is a civil action for damages to which the offer of judgment statute (§768.79) applies. State Farm Mut. Auto. Ins. Co.v. Nichols, 932 So.2d 1067 (Fla. 2006) [31 Fla. L. Weekly S358a]. The companion Florida Rule of Civil Procedure 1.442 applies as well.
4. While strict adherence to the requirements of Florida Rule of Civil Procedure 1.442(b) would lead to a conclusion the Defendant served the first Proposal for Settlement upon the Plaintiff prematurely because service occurred approximately within 72 days from the commencement of the action (rather than 90 days required under the Rule), to disallow Defendant the fees and costs to which it would otherwise be entitled would allow a form over substance type argument to prevail in this case. While the 90 day rule for service makes perfect sense when a plaintiff serves a defendant giving the defendant enough time to fully evaluate its position, it seems to be of no consequence where (as here) a defendant serves the plaintiff who is already familiar with his own case. Kuvin v. Keller Ladders, Inc., 797 So. 2d 611 (Fla. 3d DCA 2001) [26 Fla. L. Weekly D2356a]. As aptly noted by the Court:
Even assuming arguendo a technical departure from the terms of the rule, it seems clear that while the ninety day provision may serve a useful purpose in the case of an offer to a defendant, who presumably is in no position to respond so soon after he first gets notice of the case — it seems to have no such reason for being, or any other, when, as here, an offer by the defendant is involved.
Id. Furthermore, the Florida Supreme Court has determined that strict adherence to the procedural rules of Florida Rule of Civil Procedure 1.442 is not necessarily warranted. See Frosti v. Creel, 979 So. 2d 912 (Fla. 2008) [33 Fla. L. Weekly S199b]. There the Court accepted jurisdiction and quashed the Second District Court’s opinion in Frosti v. Creel, 943 So.2d 1023 (Fla. 2d DCA 2006) [32 Fla. L. Weekly D72a] which was in conflict with the Fifth District Court’s opinion in Mills v. Martinez, 909 So.2d 340 (Fla. 5th DCA 2005) [30 Fla. L. Weekly D1672b], thus accepting the conclusion of the court in Mills on not requiring strict adherence to procedural portions of the rule.
The logic of the court as expressed in Mills makes sense. “Procedural rules should be given a construction calculated to further justice, not to frustrate it.” Mills at 343, quoting Singletary v. State, 322 So. 2d 551 (Fla. 1975). “When it appears that rigid enforcement of procedural requirements would defeat the great object for which they were established, the trial judge should relax them, if it can be done without injustice to any of the parties.” Id. quoting In re Rutherford’s Estate, 304 So. 2d 517, 520 (Fla. 4th DCA 1974). Defendant’s first Proposal of Settlement, as well as its Second and Third Proposal(s) of Settlement were timely served or filed.
5. Defendant’s proposals of settlement complied with the requirements of Rule 1.442 (c) (2) (F) by making clear that each offer was “the total Proposal being made, inclusive of fees and costs. . .” There is no other reasonable interpretation of this quoted clause contained in the proposals other than it was the intention of the Defendant that the sums being offered included attorneys’ fees and that those fees, as well as costs, were part of the claim attempting to be settled. Furthermore, the last sentence of the first paragraph in each proposal clearly informed the Plaintiff that the Defendant intended to resolve “any and all claims” at issue in the subject litigation. There can be no other reasonable conclusion except the Defendant meant what it said — that ALL claims (including claims for attorneys’ fees) were attempting to be settled. Additionally, the “all claims” language used was not ambiguous as to the intent of the Defendant to resolve any possible claims relating back to the pending (at bar) litigation. The subject litigation involved only three bills or charges. There were no other possible future damages that could have been claimed. There could be no waiver of future medical treatment as there was no other future treatment even contemplated. Here there was no possible separate claim to be pending as there simply was no other separate claim.
6. Rule 1.442 further requires that proposals for settlement state with particularity any relevant conditions and that all nonmonetary terms of the proposal also be stated with particularity. The Florida Supreme Court has recognized that releases referenced in proposals are to be treated as conditions or nonmonetary terms that must meet this particularity test. Nichols at 1078. The proposal of settlement need not contain all terms of the contemplated general release but rather may summarize the substance of the release so long as it “eliminates any reasonable ambiguity about its scope.” Id.
The proposals in this case were not ambiguous — each contained nearly identical language relative to the conditions and nonmonetary terms of settlement, all of which were clearly understandable and comprehendible by the Plaintiff. The Plaintiff could not reasonably fail to understand what was necessary to effectuate settlement. Nor can the Plaintiff be heard to complain about the offered alternative methods by which this case could have been dismissed had settlement been reached under the proposal(s) involved here. Nearly identical language to the two alternative methods described by Defendant here was approved by the Federal Court applying Florida law, in finding a similar offer of settlement to be valid. McMahan v. Toto, 311 F.3d 1077 [16 Fla. L. Weekly Fed. C8b].
7. Once, as here, it has been determined the requirements of §768.79(1)-(6) have been met, “[t]he sole basis on which a court can disallow an entitlement to an award of fees is if it determines that a qualifying offer was not made in good faith.” Levine v. Harris, 791 So.2d 1175, 1177 (Fla. 4th DCA 2001) [26 Fla. L. Weekly D1824a]. Offers to settle are to be considered as being made in good faith unless the offeree meets its burden of demonstrating the offers were not made in good faith. Id. at 1178. While nominal offers of judgment can be suspect and give rise to the issue of whether they have been made in good faith, [See Fox v McCaw Cellular Communications of Florida, Inc., 745 So 2d 330 (Fla. 4th DCA 1998)] [23 Fla. L. Weekly D2687a], they (nominal offers) are not necessarily determinative of bad faith. State Farm Mut. Auto. Ins. Co. v. Marko, 695 So. 2d 874 (Fla. 2d DCA 1997) [22 Fla. L. Weekly D1505c]. Nor is a nominal proposal for settlement automatically deemed to be filed in bad faith, and nominal offers may well 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 its exposure was nominal. State Farm Mut. Auto. Ins. Co. v. Sharkey, 928 So.2d 1263 (Fla. 4th DCA 2006) [31 Fla. L. Weekly D1445a].
Plaintiff has not offered sufficient evidence to meet its burden of demonstrating bad faith in the settlement proposal(s) made by Defendant. Other than the argument by Plaintiff that the offers to settle were a small fraction or percentage of the total claimed amounts owed, which gives rise to the issue of possible bad faith, the Court has not been presented with any evidence whatsoever by the Plaintiff to demonstrate Defendant’s proposal(s) to settle were in bad faith. On the contrary, Defendant obviously concluded it had a reasonable basis to believe its exposure was nominal each time it made its separate proposals for settlement. §768.79(7)(a) does not “demand that an offeror necessarily possess, at the time he makes an offer or demand under the statute, the kind or quantum of evidence needed to support a judgment. The obligation of good faith merely insists that an offeror have some reasonable foundation on which to base an offer.” Schmidt v. Fortner, 629 So.2d 1036, 1039 (Fla. 4th DCA 1993). Here the jury arrived at a zero dollar verdict in favor of the Defendant thereby lending significant support to the conclusion that Defendant’s willingness to resolve the matter multiple times for the nominal amounts offered here were reasonable. As was appropriately observed by the court in McMahan, 311 F.3d at 1084:
The argument of MBM and McMahon that Toto lacked any reasonable basis for believing that he would prevail against them ignores the inconvenient fact that he did prevail against them. 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 on a scale that we are unwilling to consider.
This Court is not willing to accept that type of self-contradiction here — Defendant’s Proposal(s) were in good faith.
8. As the Court has concluded that Defendant is entitled to attorneys’ fees, so too is Defendant entitled to recover its reasonable costs pursuant to §768.79(1). Defendant is also entitled to recover its reasonable costs as the prevailing party in this case pursuant to §57.041(1), Florida Statutes.
