Effective Immediately – You Do Not Get Extra 5 Days for Mailing of Proposal for Settlement

Effective immediately, the Florida Supreme Court has amended Florida Rule of Civil Procedure 1.442 to clarify that you do not get an additional five days to respond to a proposal for settlement when the proposal is mailed.  The ambiguity came about following the changes to Florida Rule of Civil Procedure 1.090 and Florida Rule of Judicial Administration 2.514(b).

Florida Rule of Civil Procedure 1.442 has been edited to reflect the amendment.

IN RE: AMENDMENTS TO FLORIDA RULE OF CIVIL PROCEDURE  1.442, No. SC13-224

Offer of Judgment Not Valid in Case With Monetary and Non-monetary Claims – Horowitch v. Diamond Aircraft Indus., Inc.

In a case seeking monetary and non-monetary relief, pursuant to section 768.79, Florida Statutes (2011), Diamond Aircraft served Horowitch with an offer of judgment for $40,000. The offer of judgment stated:

 Diamond Aircraft offers to settle this case on the following terms:

1. Diamond Aircraft shall pay Plaintiff the sum of forty thousand dollars ($40,000.00).

2. This offer is intended to resolve all claims that were or could have been asserted by Plaintiff against Diamond Aircraft in the Amended Complaint filed March 15, 2007. The condition of this offer is that Plaintiff will dismiss his pending claims against Diamond Aircraft, with prejudice to re-file.

3. This offer shall remain open for thirty (30) days from the date hereof. Failure to accept this offer within thirty (30) days shall be deemed a rejection of this offer under Fla. Stat. § 768.79(1).

4. This offer shall be accepted by filing a written acceptance with the Court within 30 days after service. Fla. Stat. § 768.79(4).

The offer was not accepted and, after entry of judgment, Diamond Aircraft sought fees per 768.79.

The Florida Supreme Court determined that Diamond Aircraft was not entitled to recover its attorneys’ fees because “section 768.79 does not apply to cases that seek both equitable relief and damages.”   The court left open the door open to the use of an offer that was intended to settle only the monetary portion of the lawsuit, rather than the entire claim.

DIAMOND AIRCRAFT INDUSTRIES, INC. v. ALAN HOROWITCH, 38 Fla. L. Weekly S17a (Fla.  Jan. 10, 2013).

Rules Updates – New E-discovery and E-mail Service Rules Effective September 1st

Per the Florida Supreme Court’s Order amending the Florida Rules of Civil Procedure to implement service by email, the following rules have been updated:

Per the Florida Supreme Court’s Order amending the Florida Rules of Civil Procedure to facilitate electronic discovery, the following rules have been updated:

All of these amendments are effective as of September 1, 2012.

SOUTHEAST FLOATING DOCKS, INC v. AUTO-OWNERS INSURANCE CO., 37 Fla. L. Weekly S63a (Fla. Feb. 2, 2012) – Offer of Judgment Statute Does Not Apply in the Face of a Choice-of-Law Clause

In this Florida Supreme Court case, the Court addressed the following certified question: “Does Fla. Stat. § 768.79 apply to cases that are governed by the substantive law of another jurisdiction; and, if so, is this statute applicable even to controversies in which the parties have contractually agreed to be bound by the substantive laws of another jurisdiction?”  The Court answered the question in the negative, holding that the statute is “substantive” and therefore inapplicable when the parties have contractually agreed to be bound by the substantive laws of another state.

SOUTHEAST FLOATING DOCKS, INC v. AUTO-OWNERS INSURANCE CO., 37 Fla. L. Weekly S63a (Fla. Feb. 2, 2012)

Jones v. Publix Supermarkets, Inc. – Proposal for Settlement

My colleague, Perry Adair, writes on Becker and Poliakoff’s Business Litigation Perspectives Blog, about a recent decision from the Fourth DCA regarding Proposals for Settlement:  

The Proposal summarized the contemplated release thusly: “[Jones] will execute a full release of liability in favor of Publix Supermarket Inc., a Florida Corporation and it’s [sic] affiliated insurance company, and a Stipulation for Voluntary Dismissal.” The trial court felt that was not a sufficient summary.

. . .

The Jones opinion closes with the court acknowledging it is the preferred practice for a Proposal to set forth the terms of a release particularly either within the Proposal or by attaching the proposed release.  Nevertheless, on the Jones facts, the Proposal was found enforceable.

The time has come to amend the Proposal rule to eliminate this type of uncertainty.  Clearly, it is the best practice to attach to the Proposal all documents that are to be signed if the Proposal is accepted. So let’s put that in the rule.

Jones v. Publix Supermarkets, Inc., 36 Fla. L. Weekly D1966 (4th DCA Sept. 7, 2011)

Nationwide Mut. Fire Ins. Co. v. Lawrence Pollinger, 35 Fla. L. Wkly D1866d (Fla. 4th DCA Aug. 18, 2010)

In this auto accident case, the defendant insurer hired two law firms: one to defend a claim for personal injury protection (PIP) and another to defend a claim for uninsured motorist benefits (UM). The law firm defending the UM claim served a proposal for settlement appearing to cover all claims. The trial court declined to award fees.  It found the offer ambiguous because there were two law firms involved and it was unclear whether the proposal covered the PIP claim in addition to the UM claim. The Fourth District affirmed, agreeing with the trial court that the situation created a latent ambiguity.

Nationwide Mutual Fire Ins. Co. v. Lawrence Pollinger, 35 Fla. L. Wkly D1866d (Fla. 4th DCA Aug. 18, 2010)

Attorneys’ Title Insurance Fund, Inc. v. Gorka, 35 Fla. L. Weekly S196 (Fla. April 1, 2010)

The Florida Supreme Court found that a joint offer of settlement cannot be conditioned on the mutual consent of all joint offerees.  The case came before the Court after Attorneys’ Title served an offer of judgment on Plaintiffs Gorka and Larson.  The offer was conditioned on the Plaintiffs mutual acceptance and neither party could independently accept the offer.  The Fla. Sup. Ct.concluded that such mutual proposals are invalid since neither party can exercise independent control over the decision to end litigation.

The case discusses the requirements for a proposal or offer of judgment pursuant to Fla. R. Civ. Pro. 1.442 and Section 768.79, Fla. Stat. and has an interesting discussion about the effect of the OJ statute:

The expected result of the attorneys’ fee sanction was
to reduce litigation costs and conserve judicial resources by encouraging the
settlement of legal actions.
See Sarkis v. Allstate Ins. Co., 863 So. 2d 210,
218 (Fla. 2003). The effect, however, has been in
sharp contrast to the
intended outcome because the statute and rule have seemingly increased
litigation as parties dispute the respective validity and enforceability of
these offers. See, e.g., Security Professionals, Inc. v. Segall, 685 So.
2d 1381, 1384 (Fla. 4th DCA 1997) (“We regret that this case is just one more
example of the offer of judgment statute causing a proliferation of litigation,
rather than fostering its primary goal to “terminate all claims, end disputes,
and obviate the need for further intervention of the judicial process.””)

Attorneys’ Title Insurance Fund, Inc. v. Gorka, 35 Fla. L. Weekly S196 (Fla. April 1, 2010)

Palm Beach Polo Holdings, Inc. v. Equestrian Club Estates Property Owners Assoc., Inc. (Fla. 4th DCA Nov. 18, 2009)

In this case, a property owner sued a homeowner’s association for injunctive and declaratory relief seeking access to a landlocked lot of land, as well as for damages for an alleged tortious interference of the owner’s attempt to sell the lot.  The association successfully defended the case, and the trial court awarded attorneys’ fees based upon offers of judgment covering “all claims” – including non-economic claims – in the litigation.

The appellate court reversed, holding that the damages claim did not convert the case into “an action for damages” that would permit an attorneys’ fee award under s. 768.79:

each offer of settlement filed was general, such that it applied to all claims contained within the complaint which, of course, included both a claim for damages and non-economic claims. Strict construction of the statute leads to the conclusion that when an action seeks non-monetary relief, such as a pure declaration of rights or injunctive relief, then the fact that it also seeks damages does not bring it within the offer of judgment statute.

 

Palm Beach Polo Holdings, Inc. v. Equestrian Club Estates Property Owners Assoc., Inc. (Fla. 4th DCA Nov. 18, 2009)

Jose Milton vs. John Reyes, 34 Fla. L. Wkly D2050a (Fla 3d DCA Oct. 7, 2009)

In this personal injury case, the trial court denied plaintiff’s motion for attorneys’ fees pursuant to an offer of judgment because it did not include a certificate of service, although it was accompanied by a “Notice of Service of Proposal for Settlement” that did in fact include a proper certificate of service.  Citing Campbell v. Goldman, 959 So. 2d 223 (Fla. 2007), the appellate court held that proposals for settlement are in derogation of the common law and therefore must be strictly construed.  Because Rule 1.442 requires that the proposal itself contain a certificate of service, the order denying the fee award was affirmed.

Jose Milton vs. John Reyes, 34 Fla. L. Wkly D2050a (Fla 3d DCA Oct. 7, 2009)

Gloria Alioto-Alexander v. Toll Bros., Inc., and John Barr, 34 Fla. L. Wkly D1383a (Fla. 4th DCA July 8, 2009)

In this case, there were two defendants.  One defendant served an offer of judgment requesting a dismissal of both defendants in return for $5,000.  The offer did not apportion the $5,000 offer between the two defendants.  Defendants prevailed, and the trial court awarded attorneys’ fees.  The Fourth District affirmed the fee award, holding that the offer was not a “joint offer” because it was an offer by only one defendant that simply requested that both defendants be dismissed.  Therefore, no apportionment was required.

Gloria Alioto-Alexander v. Toll Bros., Inc., and John Barr, 34 Fla. L. Wkly D1383a (Fla. 4th DCA July 8, 2009)

1.442 Proposals for Settlement