October 11, 2018
Our Pensacola and Talahassee offices have reopened.
We have set up a help center for our clients to address storm related issues. For claims assistance and/or questions, please contact us at: StormHelp@KubickiDraper.com.Continue...
October 4, 2018
In the underlying matter, the plaintiff filed a lawsuit against both the driver and the owner of a vehicle that collided with his truck, claiming damages for the cost of repairs, the truck’s post-repair diminution in value, and the loss of use of the truck.
The plaintiff subsequently served proposals for settlement in the amount of $20,000.00 to each defendant. The proposals contained identical language, except for the name to whom the proposal was directed. One paragraph in each of the proposals for settlement stated it was “made for the purpose of settling all claims made in this case by Plaintiff … against [D]efendant[.]” Neither defendant accepted the plaintiff’s proposal for settlement.
After obtaining a final judgment for $29,785.97, the plaintiff sought to recover his attorney’s fees. The defendants moved to strike the plaintiff’s proposals for settlement, arguing they were ambiguous since it was unclear whether the acceptance and payment by one defendant of the $20,000.00 sum would have resolved the case against one or both of the defendants. The trial court ruled in the plaintiff’s favor. However, Florida’s Fifth District Court of Appeals found the proposals for settlement to be ambiguous and, therefore, unenforceable.
The Florida Supreme Court overruled the Fifth District, finding that the plaintiff’s proposals for settlement were unambiguous and enforceable for several reasons. Specifically, since each proposal for settlement used the singular term “Plaintiff,” and indicated the defendant to whom it was directed, the Court ruled that the only reasonable interpretation was that each proposal for settlement affected only those parties named.
In light of the Allen decision, proposals for settlement served by a plaintiff in a case involving multiple defendants should be carefully scrutinized. Unless the language of the specific proposal for settlement states otherwise, the acceptance of a proposal for settlement issued by a plaintiff to only one defendant in a case involving multiple defendants may mean that all of the plaintiff’s claimed damages against the other defendant survive. In other words, acceptance of the proposal for settlement may not resolve the entire matter.
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September 28, 2018
HARVEY V. GEICO GEN. INS. CO., NO.S17-85 (FLA. SEPT. 20, 2018)
Summary of the Proceedings
In a 4-3 decision, authored by Justice Quince, the Florida Supreme Court reinstated a judgment for 9.2 million entered in favor of GEICO’s insured, John Harvey. It was based on a special jury verdict finding GEICO acted in bad faith in handling a wrongful death claim against Harvey. Harvey was involved in an auto accident on August 8, 2006 with 51 year-old John Potts who died as a result of the accident, leaving his wife and three children as survivors.
Plaintiff’s counsel rejected GEICO’s tender of Harvey’s $100,000 liability limits. A judgment in favor of the Estate was entered against GEICO’s insured, Harvey, for 8.7 million. Harvey subsequently pursued a bad faith action against GEICO. The bad faith action went to trial, and GEICO moved for directed verdict on the ground there was insufficient evidence to support the bad faith claim. The trial court denied the motion and entered a final judgment for 9.2 million in damages. On appeal, the Fourth District sided with GEICO and reversed the judgment, finding the trial court erred in denying GEICO’s Motion for Directed Verdict as there was insufficient evidence to support the bad faith claim. GEICO Gen. Ins. Co. v. Harvey, 208 So. 3d 810,812 (Fla. 4th DCA 2017).
The Supreme Court Opinion
On “conflict” discretionary review, the supreme court quashed the Fourth District decision on the ground that it failed to properly apply the directed verdict standard and misapplied the supreme court precedent in Boston Old Colony Insurance. Co. v. Gutierrez, 386 So. 2d 783 (Fla. 1980) and Berges v. Infinity Insurance Co., 896 So. 2d 665 (Fla. 2004) on fiduciary duties of insurance companies against their insureds. The Court also concluded that the Fourth District misapplied the supreme court’s precedent when it stated that an insurer is not liable for bad faith “where the insured’s own actions or inactions …at least in part” caused the excess judgment. The supreme court also found that the Fourth District “also relied, in part, on nonbinding federal cases that cannot be reconciled with our clear precedent.”
Summary of Opinion
A comprehensive description of the facts resulting in the 9.2 million dollar bad faith verdict reinstated by the supreme court outcome are extensively addressed below. However, in case you might want to cut to the chase, the major issue in many people’s minds is whether this case created a much lower “negligence standard” applicable to evaluate claims’ handling in bad faith claims.
The supreme court was very critical of the Fourth District’s reliance on a federal 11th Circuit Court of Appeals decision addressing Florida Bad Faith law and applied a much higher standard in proving an insurer acted in bad faith in failing to settle a claim against its insured. Specifically, the supreme court took issue with the Fourth District’s statement that “negligence alone is insufficient to prove bad faith.” In its defense of this statement the supreme court quoted from its Boston Old Colony case: “While it is true that negligence is not the standard, we made clear in Boston Old Colony that because the duty of good faith involves diligence and care in the investigation and evaluation of the claim against the insured, negligence is relevant to the question of good faith.” 386 So. 2d at 785.
Here GEICO tendered its policy limits without a demand within 9 days unconditionally. However, 4 days after the accident, an employee of the Estate, on behalf if its counsel, called the GEICO adjuster and advised that they needed a recorded statement of the insured to determine if he had any assets, if he was in the course and scope of his employment or had any other insurance. At that time, the inexperienced adjuster declined the statement without talking with the insured. After receiving the policy limits, the Estate’s attorney called the GEICO adjuster and explained what his employee already explained--that a recorded statement of the insured was needed and why. The lawyer for the Estate followed up with a letter received by the adjuster on August 31st which again contained the 3 reasons why a recorded statement was needed. The Estate’s lawyer’s letter also stated that the adjuster was unable to advise him whether the insured would give a recorded statement.
The adjuster faxed the letter that day to the insured who learned for the first time that his recorded statement had been requested. The insured was agitated because he could not meet with his accountant until August 5 and asked the adjuster how they could let the Estate’s attorney know that information. The insured wanted to make sure the Estate’s lawyer knew he was cooperating. The adjuster was instructed by his manager to let the estate’s lawyer know immediately the circumstances of the insured, but the adjuster failed to follow through. There was no additional contact with the Estate’s office. About a month after the Estate’s office first asked for a recorded statement, the Estate’s lawyer returned the check and filed the wrongful death action.
The Effect of the Opinion on Future Claims and Litigation
Technically, in our opinion, the decision did not change Florida state law on bad faith as the statements relating to negligence are quoted from the seminal Boston Old Colony case. But the opinion is definitely notice to insurers to move faster than the speed of light when they receive a serious case with low policy limits. The opinion contains significant facts showing the insurer’s failure to meet the good faith duty of handling a serious claim. In that respect the result is not surprising.
The opinion recognizes that the burden for the entry of a summary judgment in federal court is easier to meet than in state court. Nevertheless, the opinion could very well have a chilling effect and reduce the number of summary judgments entered for insurers in bad faith cases litigated in federal court. Under federal law, the federal courts apply Florida substantive law in diversity of citizenship cases. The decision makes it almost impossible to obtain a ruling as a matter of law in an insurer’s favor.
For those keenly interested in the case here is a lengthy discussion of the facts which resulted in the bad faith verdict.
- The accident and claim were reported to GEICO the day of the accident and was assigned to a claims adjuster.
- Two days later GEICO determined its insured was at fault and knew there was “significant financial exposure” to its insured because coverage was only $100,000 and Potts died with survivors. One day later the adjuster sent Harvey a letter which advised the claim could exceed his policy limits and also advised Harvey he had the right to hire his own attorney.
- Six days after the accident, Ms. Tejada, an employee of the attorney representing the Potts’ Estate, called the GEICO adjuster and requested a recorded statement from Harvey. Tejada explained the statement was necessary to determine “the extent of his assets, whether he had an insurance and whether he was in the scope of his employment at the time of the accident.” Importantly, the adjuster did not immediately convey the request to Harvey, and Tejada said the adjuster denied the request for a recorded statement.
- Nine days after the accident, GEICO tendered the full policy limits to the Estate’s attorney with a release and affidavit of coverage. The Estate’s attorney wrote the adjuster a letter in response acknowledging receipt of the check and the adjuster’s refusal to make Harvey available for a statement. The adjuster received the letter on August 31 and faxed it to Harvey who learned for the first time that his statement had been requested. The same day, the adjuster contacted the Estate’s attorney about the recorded statement. After the conversation, the Estate’s attorney confirmed the conversation and that the adjuster wanted to know why the statement was needed. The letter responded that it was for “ the same reason Ms. Tejada outlined previously as well as that referenced in my recent letter. We want to determine what other assets or coverage might be available to cover this incident.” The Estate’s attorney also noted that the adjuster was unable to confirm that Harvey would be available for at statement. The adjuster did not respond or communicate with the lawyer for the Estate about the letter.
- On Sept. 1, Harvey called the adjuster to discuss the letter and advised him he planned to meet with the attorney he had hired at the adjuster’s suggestion to discuss his financial affairs, but his attorney was not available until September 5. The adjuster documented the call which expressed the insured’s concern that the attorney for the Estate would not think they were acting fast enough and asked what we can do to let the claimant’s lawyer know we are working on this. The adjuster noted that he told the insured the matter would be discussed with management and he would get back to him. The insured requested that he be faxed any a copy of any response before it was sent by GEICO. The adjuster’s supervisor instructed the adjuster to relay Harvey’s message to the Estate’s counsel immediately, but the adjuster never did. The adjuster never got back to the insured.
- Approximately one month after Tejada’s first request for a statement, the Estate returned GEICO’s check and filed the wrongful death suit. After the final judgment was entered, the bad faith suit was pursued. The Estate’s lawyer testified he never received any communication from GEICO after his August 31st letter. GEICO’s adjuster testified that the request for the information was reasonable, and plaintiffs’ attorneys asked for that information “all the time.” GEICO’s expert testified the information was needed by the Estate’s attorney to properly advise the estate regarding the settlement. The Estate’s lawyer testified that if he knew that Harvey’s only asset was a business account worth about $85,000, he would have advised the Estate to accept the policy limits. The wife of Mr. Potts testified she would have accepted the policy limits if the Estate’s counsel recommended that she settle.
- A bad faith expert testified that a serious claim such as this one requires “a sense of urgency” by the insurer. He also testified the adjuster should have relayed to the estate’s counsel that Harvey had retained counsel, as this would have facilitated the recorded statement. Because GEICO was handling the claim Harvey could not contact the estate’s attorney directly.
- In addition, the evidence showed the adjuster had a history of struggling to manage her files, and, among other things, her personnel file also showed she had “communication failures.” Her performance review from the year before the accident stated that her “productivity numbers fell below average…there is now exposure to our insured and to GEICO for extra contractual damage…[and she ] could use help with her organizational skills, filtering her emails, along with organizing her desk.”
Additional Discussion by the Court in the Opinion
The supreme court stated GEICO knew “this was a case of catastrophic damages” but “failed to act as if the financial exposure to Harvey was a ‘ticking financial time bomb.’” Relying on Boston Old Colony, the Court stated the evidence shows “GEICO completely dropped the ball” in failing to fulfill its obligation to Harvey to “use the same degree of care and diligence as a person of ordinary care and prudence should exercise in management of his own business.” “[H]ad GEICO acted ‘with due regard’ for Harvey’s interests, the excess judgment could have been prevented.” The supreme court was critical of and rejected the Fourth District’s reliance on a federal 11th Circuit Court of Appeals opinion addressing Florida bad faith law which applied a much higher standard in proving an insurer acted in bad faith in failing to settle a claim against its insured. While reaffirming its Berges decision--“there must be a causal connection between the damages claimed and the insurer’s bad faith, the supreme court rejected the Fourth District’s statement that an insurer cannot be found liable for bad faith where the excess judgment was caused in part by the insured. In contrast, Berges held “the focus in a bad faith case is not on the actions of the claimant but rather on those of the insurer in fulfilling its obligations to the insured.”
Justice Pariente, Lewis and Labarga concurred (joined in with) Justice Quince’s opinion. Two dissenting opinions were authored by Chief Judge Chief Judge Canady and Judge Polston. Judge Lawson concurred with the two dissenting opinions. Justice Quince Pariente and Lewis retire from the supreme court in January.Continue...
September 11, 2018
With three storms churning out in the Atlantic Ocean, the Atlantic Hurricane Season’s “peak period” is definitely living up to its reputation. In light of the activity, we’ve gathered some information that may be helpful to Florida insurance professionals during this time.
When was the last time you checked your license status?
The Florida Department of Financial Services Bureau of Licensing recommends All Lines adjusters ask themselves the following questions to ensure they are ready before a storm is upon us:
- Is your license active?
- Are you self-appointed or appointed by an insurer or other firm?
- Are you compliant with your continuing education requirements? (General, Personal and All Lines Adjusters must have: 5 hours of Law & Ethics Update & 19 hours of Elective credits)
- Has a primary adjuster been designated for your organization?
- Is your contact information up-to-date?
- Are any apprentices licensed and appointed?
- Do you have your Department issued license with you?
What do you do to keep up with the many storm advisories and updates?
Claims Pages, an online reference source for insurance claim professionals, provides helpful tracking information for various storms and weather advisories all in one place. They pull information every 10 minutes from sources like the National Weather Service, the National Oceanic and Atmospheric Administration (NOAA), the United States Geological Survey, and the National Hurricane Center. To view the information gathered, visit: https://www.claimspages.com/stormwatch/.
If a storm affects Florida, do you know what one of the most important things to do is when assessing a claim?
Document, document, document. As you assess the damages left behind, it is important to sufficiently document your file in the event a claim turns into a lawsuit. We can provide an Initial Claims Investigation Checklist you may find valuable in ensuring you have properly documented your file.
We hope the information provided is helpful. If you are interested in a copy of the Initial Investigation Checklist, need assistance with storm related issues and/or wish to coordinate a complimentary continuing education seminar to ensure you are up to speed with your requirements, please do not hesitate to contact our team at StormHelp@KubickiDraper.com. We are here if you need us and welcome the opportunity to be of service.Continue...
September 6, 2018
In this case, the Fourth District Court of Appeal affirmed the decision of the trial court to dismiss a restoration company’s complaint for breach of contract and declaratory relief for an unpaid mitigation invoice. The insurance policy in this case, was issued to Mr. and Mrs. Squitieri and listed PNC Bank as a mortgagee. The policy contained a provision which stated, "[n]o assignment of claim benefits, regardless of whether made before a loss or after a loss, shall be valid without the written consent of all ‘insureds,’ all additional insureds, and all mortgagee(s) named in this policy." After a water damage loss, Mrs. Squitieri hired a restoration company to provide cleanup services and signed an assignment of benefits agreement without the consent of her husband or the mortgage company. The restoration company completed the clean-up and submitted a claim to the insurer who refused to pay the full amount because the assignment did not contain the required signatures. After the restoration company filed suit, the insurer moved for and was granted dismissal on the basis that the assignment failed to comply with policy’s signature requirement.
The Fourth District Court of Appeal upheld the dismissal and found that the policy provision, which requires consent of all insureds and their mortgage company, does not violate common law or public policy and is enforceable under Florida law. The Fourth District Court of Appeal also distinguished a long line of cases beginning with the West Florida Grocery Co. v. Teutomina Fire Insurance Co., 77 So. 2d 209 (Fla. 1917), which have been interpreted to mean an insurance company cannot require the insurer’s consent for a post-loss assignment. The Fourth District Court of Appeal clarified that the policy provision at issue did not prohibit assignment but merely imposed a condition requiring the approval of all insureds and the mortgagee. It reasoned that such a provision is not superfluous and that all insureds and the mortgage company have a vested interest in making sure that repairs to a home are performed by a reputable company.
The Fourth certified conflict with a recent decision issued by the Fifth District Court of Appeal in Security First Insurance Co. v. Florida Office of Insurance Regulation, 232 So 3d 1157 (Fla. 5th DCA 2017) to the extent it held that any restriction on an assignment of benefits was unenforceable. This issue will now be sent to the Florida Supreme Court for consideration. For more information on this or any other first party property issues, please do not hesitate to contact us at firstname.lastname@example.org.
August 17, 2018
Debbie had been with the firm for over 10 years. Throughout her time at Kubicki Draper, Debbie fiercely and zealously advocated for her clients, recognizing that every person is entitled to a strong defense. Like with everything she did, when Debbie had a client, she gave them her all. When defending clients in wrongful death cases, it was not unusual for Debbie to spend hours not just discussing the case, but helping her clients deal with and process the stress of litigation.
Just like she lent her support to her clients, Debbie was also a pillar of support not only in the Orlando office, but throughout the firm. Debbie was always there to help her friends and coworkers who were dealing with cancer, deaths in their families, or just the everyday stress of life. Debbie filled the office with laughter and joy, and her passion for living life to the fullest spread to her coworkers. Debbie was also a mentor, who took time out of her day to pass along her knowledge and to encourage the professional growth of young associates. She likewise offered her sound advice and strategies to her partners, colleagues, and peers. Debbie was always ready to debate the merits of any case or defense to achieve a better overall evaluation of the claim.
Most importantly, Debbie set a great example of balancing her career with her love of her family. Debbie is survived by her two children, Alexandra and Nicholas, and her husband, Andrew. Debbie made sure that she was actively involved in her family’s lives.
Debbie loved traveling with her family, being outdoors, boating, skiing, going to the beach, camping, going to concerts and sporting events. For Debbie, life was meant to be lived to the fullest, and she made sure that she led by example.
Although Debbie can never be replaced, her work family will continue to live as she did: fighting fiercely, laughing loudly, and loving deeply.
August 15, 2018
Brad J. McCormick in Personal Injury Litigation - Defendants and Commercial Litigation
Laurie Adams in Personal Injury Litigation - Defendants
Jane Carlene Rankin in Real Estate Law
August 9, 2018
Our Seattle office is managed by Steven Rich. Steven is an AV rated litigator and trial attorney with experience in complex and multi-party civil litigation. He has successfully defended his clients against lawsuits on a variety of different issues, including construction defects, catastrophic injury, wrongful death, product liability, toxic torts, and environmental accidents.
Seattle Office Contact Information:Kubicki Draper
800 5th Avenue, Suite 4100
Seattle, WA 98104
E-mail: email@example.com Continue...
August 1, 2018
With all respect to Mark Twain and his quip that “People who love sausage and respect the law should never watch either one being made,” Michael’s experience in the legislative process was different. He decided to attend Stetson University School of Law as a change in scenery after a lifetime in Upstate New York was a necessity.
While at Stetson, Michael’s interest and admiration for the organic process by which the law evolves continued. During law school, he began to focus on the appellate process and a court’s role in establishing the law. As effective (and concise) legal writing is a large part of any successful appellate practitioner, Michael “wrote on” to the Stetson Law Review and in 1993 graduated cum laude. He appreciates the law as a living entity believing in the ability to forecast the future based upon precedent and observable history. The same holds true in life.
Upon graduation, after a thankfully short period of searching for what was then an elusive first job, Michael began his practice on the plaintiffs’ side. In addition to writing briefs from day one, he gained immediate trial practice exposure and experience in a civil courtroom setting.
Participating in trials ranging from premises liability to complex medical malpractice actions, it became apparent that evaluating how “six people in a box” would communally decide a case presented a challenge to every professional with a stake in determining the likelihood of success of their positions and arguments. He also learned the only effective way to help control the ultimate outcome results from proper evaluation, preparation, and preservation. Objectivity is always key. Taking a long game approach developed Michael into a lawyer who appreciates all aspects of claims evaluation, pre-trial practice, trial and appeals, keeping him grounded outside of the Ivory Tower and firmly within the realities produced by the legal marketplace and a client’s bottom line.
Now, with a focus on defense and appellate practice, Michael’s interests include helping his clients coordinate statewide litigation and appellate strategies, providing trial support and trying a case as required. Of particular interest is the pursuit or the defense of attorney’s fees claims both for his clients and as an expert witness. He intends to continue his practice well into the future as his engagement and enthusiasm in becoming the best lawyer possible has not waned.
Michael resides in St. Petersburg spending his free time enjoying everything Florida has to offer – particularly in the Tampa Bay area – and is excited about the opportunities that the growing region presents. His current goal is to create or recognize one near-perfect thing each day. Whether a grill-marked steak prepared to his guest’s exact taste or an artistic recognition of the Steadicam work of Stanley Kubrick, he derives his primary satisfaction from a job well done. If you appreciate his approach to practice with professionalism, feel free to give him a call.
June 25, 2018
Every year, Florida Legal Elite™ presents a prestigious list of attorneys chosen for recognition by their peers. We are pleased to announce Betsy E. Gallagher and Kimberly A. Beckwith, of our Tampa office, were selected for inclusion in this year’s Florida Legal Elite™ list published in Florida Trend Magazine. Betsy was recognized for Appellate Practice and Kimberly for Civil Trial. We are very proud of these ladies and congratulate them on their accomplishment.
The entire Legal Elite report can be viewed at Florida Trend.