Case Law Update
May 24, 2016
Dear Ladies and Gentlemen:
The Florida Supreme Court and the Florida District Courts of Appeal have recently issued several opinions that may be of interest to you.
In Doctors Co. v. Thomas, the Second District Court of Appeal granted a petition for writ of certiorari and quashed a discovery order which compelled disclosure of an insurance carrier’s claims and investigative files while a declaratory judgment action filed by the carrier remained pending. The Second District found that the order compelling the production of its claim files and investigative material prior to the determination of coverage departed from the essential requirements of the law and the premature disclosure of the documents would result in irreparable harm that could not be remedied on appeal.
In Pena v. Fox, the Second District Court of Appeal reversed a trial court’s order finding that there was no settlement agreement between two parties because a proposed release provided by one party released additional parties and did not mirror the offer provided by the other party. Therefore, there was no meeting of the minds to effectuate a settlement agreement.
In Jenkins v. Allstate Property and Casualty Insurance Company, the Second District Court of Appeal reversed a trial court’s order dismissing without prejudice a lawsuit based on the Plaintiffs’ counsel’s failure to appear at a case management conference pursuant to Florida Rule of Civil Procedure 1.200. The Second District held that the trial court’s failure to make required findings in the order indicating that counsel’s failure to attend the case management conference was flagrant, willful, persistent, or aggravated required reversal.
In Paton v. Geico, the Florida Supreme Court quashed a decision of the Fourth District Court of Appeal and found that the billing records of opposing counsel were relevant to the reasonableness of time expended in a claim for attorney’s fees. The court explained that when a party moved for attorney’s fees pursuant to sections 624.155 and 627.428, Florida Statutes, the billing records of the Defendant insurance company were relevant.
I. Doctors Co. v. Thomas, No. 2D15-3052, 2016 WL 455796 (Fla. 2d DCA February 5, 2016)
FACTS AND PROCEDURAL HISTORY
This matter involved an appeal from an order denying an insurer’s, The Doctors Company, motion for protective order and compelling the production of its claims file and other investigative documents prior to an insurance coverage determination. The Doctors Company had filed a declaratory judgment action seeking a declaration as to its obligations under an insurance policy issued to its insured after the insured had entered into an unauthorized settlement with a claimant in a tort case. The personal representative of the estate of the tort claimant subsequently filed suit asserting several claims against Doctors Company including both statutory and common law bad faith claims. The estate’s lawsuit and the declaratory judgment action were consolidated and the estate sought discovery of Doctors Company’s claims file while the declaratory judgment action remained pending. The trial court allowed the disclosure of Doctors Company’s claims and investigative files and Doctors Company filed a petition for writ of certiorari for review of the discovery order.
APPELLATE COURT DECISION
The Second District Court of Appeal granted the petition for writ of certiorari and quashed the discovery order. The Second District agreed with the Doctors Company that the order compelling the production of its claim files and investigative material prior to the determination of coverage departed from the essential requirements of the law and the premature disclosure of the documents would result in irreparable harm that could not be remedied on appeal.
II. Pena v. Fox, No.2D-14-3557, 2015 WL 7074652, (Fla. 2d DCA November 13, 2015)
FACTS AND PROCEDURAL HISTORY
This case arises from an automobile accident between an individual named Diana Pena and Mr. Matthew Fox where Ms. Pena had sustained injuries. Ms. Pena appealed a trial court’s order dismissing her complaint with prejudice. In the underlying matter, Ms. Pena’s counsel delivered a settlement offer to Mr. Fox’s insurance carrier, USAA Casualty Insurance Company (“USAA”) which requested the policy limits of the USAA policy in exchange for a release of all claims against Mr. Fox related to the accident. In the offer, Ms. Pena’s counsel imposed certain conditions related to the release including the condition that Ms. Pena would execute a general release, however: 1) she would only release her claims; 2) Ms. Pena would not accept a release containing indemnity and hold harmless language; 3) Ms. Pena would not release any claim other than USAA’s insured’s claim and 4) Ms. Pena would not release anyone’s claim other than her claims. Specifically, the offer stated that any attempt to provide a release which released anyone other than the insured or released any claim other than her client’s claim would serve as a rejection to the offer.
After receiving the offer, USAA tendered a check with a proposed release which included that Ms. Pena would “release, acquit, and forever discharge Matthew R Fox his/her heirs, executors and assigns, from any liability.” Pena v. Fox, No. 2D14-3357, 2015 WL 7074652, at *1 (Fla. 2d DCA Nov. 13, 2015). The release also included a section which stated that Ms. Pena would “release all claims against Releasee(s), its agents and employees. Id. Based on this language, Ms. Pena considered her offer as rejected and proceeded to file suit against Mr. Fox. Mr. Fox filed a Motion to Enforce Settlement contending that Ms. Pena’s lawsuit should be dismissed because it was barred by a settlement. The trial court agreed with Mr. Fox that the term “Releasee” referred to Mr. Fox and there was no inclusion of Mr. Fox’s insurance carrier. The court granted the Motion to Enforce Settlement and dismissed Ms. Pena’s lawsuit with prejudice.
APPELLATE COURT DECISION
The Second District Court of Appeal reversed the trial court’s order finding that there was no settlement agreement between the parties. The court indicated that USAA’s proposed release added parties beyond what was indicated in Ms. Pena’s offer and it deviated from the offer because the release included Mr. Fox “his heirs, executors, and assigns” and in another section referenced Releasee(s). Further, the release expanded the term by including Mr. Fox’s “agents and employees” which were undefined in the release. Therefore, since Mr. Fox’s proposed release would release additional parties and Ms. Pena’s offer had not indicated release of any other parties, Mr. Fox’s acceptance did not mirror Ms. Pena’s offer and there was no meeting of the minds to effectuate a settlement agreement.
III. Jenkins v. Allstate Property and Casualty Insurance Company, 185 So.3d 675 (Fla. 2d DCA 2016)
FACTS AND PROCEDURAL HISTORY
This matter involved an appeal of an order dismissing without prejudice the complaint of Donna Marie Jenkins and Raymond Murdock based on their counsel’s failure to appear at a case management conference pursuant to Florida Rule of Civil Procedure 1.200. Dismissal of the complaint was considered to be dismissed with prejudice since a subsequent action would be barred by the statute of limitations. Ms. Jenkins and Mr. Murdock were involved in a motor vehicle accident and requested coverage under an insurance policy with Allstate Property and Casualty Insurance Company (“Allstate”). Allstate denied coverage and Ms. Jenkins and Mr. Murdock filed a lawsuit for breach of contract. The lawsuit was filed a couple of days before the five (5) year statute of limitations would have run. During the litigation proceedings, the trial court entered an order setting a case management conference which stated that failure to appear would result in the dismissal of the case. Counsel for Ms. Jenkins and Mr. Murdock failed to appear at the case management conference. As a result, the court entered a form order that contained a section for dismissal which stated “Defendant appeared; however, Plaintiff failed to appear. The above styled case is dismissed without prejudice.” The order did not contain any findings.
Counsel for Ms. Jenkins and Mr. Murdock filed a verified motion for rehearing, an unverified motion to vacate judgment and a verified motion to vacate the judgment alleging that he had not received notice of the case management conference and requested that the court enter sanctions against him rather than dismiss the case against his clients. The trial court denied all three motions. Ms. Jenkins and Mr. Murdock appealed.
APPELLATE COURT DECISION
The Second District Court of Appeal reversed and remanded the case to the trial court finding that the trial court’s failure to make required findings of fact that counsel’s failure to attend the case management conference was flagrant, willful, persistent, or aggravated required reversal. The court stated that in order to dismiss a lawsuit for failure to attend a case management conference required the order to be specific and “must contain findings that the party’s actions were flagrant, willful, persistent, or otherwise aggravated.” Jenkins v. Allstate Property and Casualty Insurance Company, 185 So.3d 675, 677 (Fla. 2d DCA 2016).
IV. Paton v. Geico, No. SC14-282, 2016 WL 1163372 (Fla. March 24, 2016)
FACTS AND PROCEDURAL HISTORY
This case involved review of a decision of the Fourth District Court of Appeal in Geico General insurance Company v. Paton, 133 So.3d 1071 (Fla. 4th DCA 2014). In Paton, the Fourth District Court of Appeal granted a petition for writ of certiorari and quashed a circuit court’s orders relating to the discovery and production of the billing records of an insurance carrier’s attorney’s time records. The underlying case arose from a motor vehicle accident and a subsequent lawsuit filed by Kelly Paton against her mother’s underinsured motorist carrier, Geico General Insurance Company (“Geico”). The case proceeded to trial and the jury awarded Ms. Paton $469,247 which the court reduced to $100,000, the UM policy limits. Thereafter, Ms. Paton amended her complaint to include a count for bad faith against Geico under Florida Statute section 624.155. She obtained a jury verdict in the amount of $369,247, the excess verdict amount. Ms. Paton then moved for attorney’s fees and costs. Since the amount of attorney’s fees was highly contested, Ms. Paton sought discovery of the opposing attorney’s time records including request for production of time keeping slips and billing records from the law firm defending Geico in the bad faith case. Ms. Paton also propounded an interrogatory which inquired as to the amount of time Geico’s attorney’s spent in defending the lawsuit.
Geico objected to the discovery requests relying on Estilien v. Dyda, 93 So.3d 1186 (Fla 4th DCA 2012) which stood for the proposition that in order to obtain billing records of an opposing counsel to support a claim of attorney’s fees, the party must establish that the documents are relevant to the disputed issue, are necessary and its substantial equivalent cannot be obtained from another source. Id. at 1188-89. With respect to Ms. Paton’s request for production, the trial court overruled the objection but provided that Geico could redact privileged information from the records. With respect to Ms. Paton’s interrogatory, the trial court only overruled the objection.
Geico filed a petition for writ of certiorari to the Fourth District requesting the court to quash the orders. The Fourth District granted the petition and quashed the trial court orders holding that Estilien was controlling and that based on that case opposing counsel’s billing records were “at best, only marginally relevant to the determination of reasonable attorney’s fees.” Paton, 133 So.3d 1071. Further, the district court determined that Ms. Paton did not make the requisite showing that the substantial equivalent of the records could not be obtained elsewhere. Ms. Paton sought review of the district court’s decision.
SUPREME COURT DECISION
The Florida Supreme Court quashed the decision of the Fourth District Court of Appeal holding that the billing records of opposing counsel were relevant to the reasonableness of time expended in a claim for attorney’s fees. The court noted that when a party moved for attorney’s fees pursuant to sections 624.155 and 627.428, Florida Statutes, the billing records of the insurance company were relevant. Additionally, the court noted that the entirety of the billing records was not privileged. Therefore, if the court allowed privileged information to be redacted from the records, the Plaintiff should not have been required to make a showing to obtain the non-privileged information. Irrespective of same, these records would only be available from the defendant insurance company and the information or its substantial equivalent could not be obtained by any other means without undue hardship. The Florida Supreme Court concluded that the compliance with the trial court’s discovery orders did not depart from the essential requirements of the law and would not result in irreparable harm to Geico and the Fourth District did not properly exercise certiorari review.
We hope you find the above-referenced cases helpful and insightful. Should you have any questions with respect to the foregoing, please do not hesitate to contact the undersigned at your earliest convenience.
Very truly yours,
 Ms. Paton requested any and all time keeping slips and records, bills, invoices and or other correspondence for payment of attorney’s fees for defending Geico in the bad faith action and retainer agreements for the firm defending Geico in the bad faith case. Paton v. Geico, No.SC14-282, 2016 WL 1163372 (Fla. March 24, 2016).