Congratulations to Michael Clarke and Jennifer Emerson of the Tampa office for their recent victory in Progressive Select Insurance Company v. Kagan Jugan & Associates, P.A., No. 2D21-274 (Fla. 2d DCA Mar. 2, 2022), where the Second District reversed a trial court order finding that a PIP insurer’s nominal proposal for settlement (“PFS”) was not made in good faith. The court reaffirmed the well-established rule that a trial court is governed by binding precedent, including district court opinions that have previously decided the relevant issue in dispute. The Second District had previously established that a PIP insurer’s notice and election of the fee schedule reimbursement methodology was valid and, therefore, no longer unsettled, despite the Florida Supreme Court’s recent acceptance of discretionary jurisdiction to review the case.  See State Farm Mut. Auto. Ins. Co. v. MRI Assocs. of Tampa, Inc., 252 So. 3d 773 (Fla. 2d DCA 2018).

Applying this rule, the court held that a PFS is made in good faith when the offeror had a reasonable foundation to make the offer with an intent to settle. Progressive had relied on a nearly factually-identical case from the Second District to make the nominal offer in its evaluation of its contractual exposure and, therefore, acted in good faith, As a result, the court held Progressive’s PFS should be enforced.

The takeaway: Binding precedent from district courts is just that: BINDING! And, whether the Florida Supreme Court or another court of appeal may eventually weigh in on the issue, it does not make the existing binding law any less binding. Read more here.