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News Room

Client Update – Florida’s New Property Insurance Lawsuit Statute Challenged in Class Action Suit Against Citizens

By John Bond Atkinson, Tiffany A. Bustamante, and John P. Robins

As you’re aware from our May 17, 2021, update regarding then-recent legislation moving through the Florida Legislature, Florida passed Senate Bill 76, which provided a new comprehensive framework for lawsuits initiated by insureds for residential and commercial property claims believed to be underpaid or based on some other breach of a property insurance contract. Once enacted, Senate Bill 76 formed Fla. Stat. §627.70152, which has recently been contested by a class action in Broward County against Citizens Property Insurance Corporation (“Citizens”). Below you will find our analysis of this case, its merits, and the effects our office believes this will have on your business practices regarding attorney’s fees allegedly accumulated prior to the initiation of a lawsuit against the company.

To begin, the framing of the lawsuit, especially the choice of forum, is a large strategy move all to itself. The 4th District Court of Appeals has always been more insured-friendly than those found that service the capital and Miami-Dade County, the 1st and 3rd. In keeping with that line of logic, Citizens has promptly moved to have the venue changed to Leon County, where Citizens is headquartered, to appear in front of a more sympathetic judiciary. At this time, however, the case remains in Broward County.

The lawsuit arises out of a class of Citizens’ insureds, who were not compensated for attorney’s fees, even though a law firm had drafted a “notice of intent” to initiate litigation, which the new statute requires 10 days before litigation can be filed against an insurer. Each Plaintiff listed in the class action provided the necessary 10 day notice of intent, wherein Citizens immediately settled the claim, but refused to pay attorney’s fees, indicating that there was no statutory provision that required them to pay fees unless a lawsuit has been filed. Without a lawsuit, Citizens argues, even the new statute does not require payment of fees prior to litigation. Notably, the Plaintiffs’ alleged disputes never proceeded to litigation.

The stated intent of this notice of intent portion of the statute is to allow for last minute settlement and negotiation to avoid unnecessary litigation, and to ease burdens on the courts that have been flooded with property claims, more than ever before.


The certified class of Plaintiffs argue that Fla. Stat. §627.70152 is ambiguous, due to a number of factors. First, Plaintiffs indicate that the new statute specifically creates a requirement for a notice of intent to litigate, which is not a process that would be done by a layperson, and this notice, by definition, must include a calculation of attorneys fees. Section 2(d) of the statute defines a “presuit settlement demand” as:

“Presuit settlement demand” means the demand made by the claimant in the written notice of intent to initiation litigation as required by paragraph (3)(e). The demand must include the amount of reasonable and necessary attorneys fees and costs incurred by the claimant, to be calculated by multiplying the number of hours actually worked on the claim by the claimant’s attorney as of the date of the notice by a reasonable hourly rate.

Fla. Stat. §627.70152(2)(d), emphasis added.

Second, the statute creates a framework for payment of fees not found in any other statute, specifically these portions:


(a) In a suit arising under a residential or commercial property insurance policy not brought by an assignee, the amount of reasonable attorney fees and costs under s. 626.9373(1) or s. 627.428(1) shall be calculated and awarded as follows:

1. If the difference between the amount obtained by the claimant and the presuit settlement offer, excluding reasonable attorney fees and costs, is less than 20 percent of the disputed amount, each party pays its own attorney fees and costs and a claimant may not be awarded attorney fees under s. 626.9373(1) or s. 627.428(1).

2. If the difference between the amount obtained by the claimant and the presuit settlement offer, excluding reasonable attorney fees and costs, is at least 20 percent but less than 50 percent of the disputed amount, the insurer pays the claimant’s attorney fees and costs under s. 626.9373(1) or s. 627.428(1) equal to the percentage of the disputed amount obtained times the total attorney fees and costs.

3. If the difference between the amount obtained by the claimant and the presuit settlement offer, excluding reasonable attorney fees and costs, is at least 50 percent of the disputed amount, the insurer pays the claimant’s full attorney fees and costs under s. 626.9373(1) or s. 627.428(1).

Fla. Stat. §627.70152(8)

The class’ argument is therefore relatively clear. Why would the statute not allow for fees prior to the initiation of litigation, but still require the claimants to include it in their demand? On its face, the statute does have some ambiguity: first by stating the statute only applies to suits arising out of property damage claims, but then going on to state that the demand must include attorney’s fees in the calculation of the amount demanded. According to section 2(d), a demand would not be valid without a calculation of the reasonable attorney’s fees required to complete the demand and move the claim towards resolution.


Citizens’ argument is one of pure statutory interpretation. First: the statute’s very first provision indicates that the application of the statute is limited to “suits:”

627.70152 Suits arising under a property insurance policy.—

(1) APPLICATION.—This section applies exclusively to all suits not brought by an assignee arising under a residential or commercial property insurance policy, including a residential or commercial property insurance policy issued by an eligible surplus lines insurer.

Fla. Stat. §627.70152, emphasis added.

Further, section 8 of the statute, quoted above, creates a new framework to calculate fees when owed under Fla. Stats. 626.9373(1) or s. 627.428(1). For context, both of these referenced statutes require the entry of a judgment or decree by a court, and therefore require a lawsuit to be filed before recovery.

Statute Interpretation

Our office agrees with Citizen’s interpretation of the statute, especially regarding section 8. Direct reference to other statutes that require judgment indicates that this section regarding fees was still intended to calculate the necessary fees, not change the requirements for receiving the fees.

The questionable sections, however, are the seemingly contradictory sections 1 and 2(d). Section 1 indicates that the statute only applies to claims where there is a suit involved. However, Section 2(d) seemingly creates a requirement that any valid demand for damages must include a demand for attorney’s fees as well. However, our office does not agree with the Plaintiffs’ interpretation, that this somehow necessitates a payment of attorney’s fees. Instead, it simply requires that a demand provide the specificity of fees demanded, similar to a CRN, to determine the best manner in which to resolve claims approaching a lawsuit timer. Based on the plain language of the statute, there is no requirement for payment of attorneys fees in pre-suit cases that we can identify.

Until there is clarity by the appellate courts, in practice, payment of reasonable fees is likely to be the more prudent business strategy, considering the cost of litigation, over what would likely be a relatively monetary amount. With the rising cost of defending minor suits and deflating bad faith claims, as is common with certain claims, the cheaper option might often be the payment of a few hours of attorney’s fees to dissuade lawsuits and bad faith cases.

Should you have any questions with respect to the contents of this letter we welcome your call. As necessary, we will keep you apprised on the class action suit as it progresses.

Very truly yours,