FLORIDA LAW WEEKLY

VOLUME 42, NUMBER 2

CASES FROM THE WEEK OF JANUARY 13, 2017

TRIAL COURT ERRED IN DENYING INSURER’S MOTION FOR DIRECTED VERDICT ON BAD FAITH--INSURER NOTIFIED INSURED THAT THE ESTATE WANTED A STATEMENT 17 DAYS AFTER THE REQUEST WAS RECEIVED BY THE CLAIMS ADJUSTER AND THE INSURED FAILED TO PROVIDE IT--EVEN IF THE INSURER’S CONDUCT WAS DEFICIENT/NEGLIGENT, ITS ACTIONS DID NOT CAUSE THE EXCESS WRONGFUL DEATH JUDGMENT AGAINST THE INSURED.

Geico v. Harvey, 42 Fla. L. Weekly D110 (Fla. 4th DCA January 4, 2017):

The insured killed the decedent in an auto accident. He had a $100,000 liability policy on a vehicle registered both in his own name and in his business’s name.

Three days after the accident, Geico advised its insured that the claim being made by the decedent’s estate could exceed the policy limits, and the insured had a right to hire his own attorney, which he did. Several days after that, someone working for the plaintiff’s attorney contacted the adjuster and advised Geico of their representation.

According to the law firm employee’s testimony, she had asked the adjuster to arrange for a statement from the insured regarding the insured’s personal and business assets, to determine whether the insured was acting within the course and scope of his business at the time of the accident, as well as other potential coverage questions for the claim.

The employee stated that the adjuster refused to make the insured available for a statement, but the adjuster testified she would never have refused that request. At no time did the plaintiff’s attorney provide a deadline for obtaining the statement, nor was the adjuster told that the insured’s statement was a prerequisite to settling the claim.

Nine days after the accident, Geico sent the estate a release and a check for the policy limits.

A week or so after that, the insured met with his personal counsel and brought documentation showing that his business had only $85,000 in assets. The next day, the plaintiff’s attorney sent a letter to the adjuster in response to the check and release, indicating that the adjuster had declined the estate’s request to make the insured available for a statement, and renewing its request for the financial information. The adjuster received this letter and faxed it to the insured and verbally discussed the contents with him. According to the insured, that was the first time he had learned that the estate even wanted a statement.

Also, approximately three weeks after the accident, pursuant to her supervisor’s instructions, the adjuster contacted the estate’s attorney to find out what kind of statement he wanted. The attorney explained he wanted to determine what other assets or coverage the insured had available.

The plaintiff’s attorney sent a letter to the adjuster memorializing the conversation, and she forwarded it to the insured, advising him of their request. The adjuster also sent the insured a sample affidavit where he could list his assets.

The next day the insured contacted the adjuster and told her that his attorney was not available for another week and asked the adjuster to let the plaintiff’s attorney know that the insured was working on preparing the financial statement. Although the adjuster’s supervisor instructed the adjuster to relay the insured’s message to the estate, she did not do so.

Despite the insured’s attorney’s return and despite the insured knowing the estate wanted a statement, neither the insured nor his attorney took any further action to provide the estate with a statement.

The plaintiff then filed a wrongful death suit against the insured. She returned Geico’s check and ultimately received an $8.47 million judgment following a jury trial.

The insured then brought a bad faith claim against Geico. He admitted that at least 13 days before the plaintiff filed suit, he knew of the estate’s request for a statement. He also admitted that despite Geico informing him of the estate’s request for a statement, and having collected the financial documentation, he failed to provide it before the lawsuit was filed.

While the insured claimed that had he known about the estate’s request, he would have provided it, nothing in the record shows why he could not have given his statement between the time his personal attorney became available and the date suit was filed. The plaintiff’s attorney testified that had he known the insured planned on giving a statement, he would have recommended delaying the suit. Also, he would not have pursued a wrongful death suit if he had known there were only $85,000 in assets. Additionally, the estate’s personal representative and plaintiff stated she would have followed the attorney’s advice and would not have filed the suit.

The insured also introduced evidence to support his claim of bad faith, by showing that the adjuster had received some deficient performance reviews, and had demonstrated trouble managing her case load.

Under Boston Old Colony, an insurer is obligated to (1) advise the insured of settlement opportunities; (2) advise as to the probable outcome of the litigation; (3) warn of the possibility of an excess judgment; (4) advise the insured of any steps he might take to avoid same; (5) investigate the facts; (6) give fair consideration to a settlement offer that is not unreasonable under the facts; and (7) settle if possible where a reasonably prudent person faced with the prospect of paying a total recovery would do so.

Bad faith is evaluated under the totality of the circumstances, and the evidence must support the allegation that the insured acted in bad faith; not simply that the insurer was negligent in some part of handling of the claim. Negligence alone is insufficient to support a bad faith award.

The Fourth District found that Geico fulfilled every obligation under Boston Old Colony in this case. It reiterated that simply because an insurer’s handling of a claim is deficient, does not automatically amount to bad faith, and may only be mere negligence.

While Geico could have acted more efficiently in handling the insured’s claim, and could have improved its claim process, the court felt its “negligence” was insufficient to prove “bad faith.” Also, where the insured’s own actions or inactions resulted at least in part in an excess judgment, the insurer cannot be liable for bad faith.

Even assuming Geico handled the insured’s claim improperly, the insured failed to establish that Geico’s conduct caused the excess judgment or led to the filing of the suit. The handling of the claim did not amount to bad faith as a matter of law, and even if Geico’s handling of the claim were deficient, its conduct was not proven to be the cause of the excess judgment of the insured. The trial judge should have granted Geico’s motion for directed verdict.

ERROR TO ADMIT EVIDENCE OF INTOXICATION AT TIME OF ACCIDENT IN COMPENSATORY PHASE OF BIFURCATED TRIAL, WHEN LIABILITY WAS ADMITTED--INSUFFICIENT EVIDENCE TO SUPPORT AWARD OF FUTURE EXPENSES.

Geico v. Dixon, 42 Fla. L. Weekly D101 (Fla. 3rd DCA January 4, 2017):

In this automobile accident case involving an uninsured motorist, both the UM carrier, Geico, and the co-defendant uninsured driver admitted liability. The court ordered that plaintiff could seek punitive damages against the intoxicated uninsured driver.

During the compensatory damages phase of the trial, the judge allowed the plaintiff to introduce evidence of the driver’s intoxication. This was error. When a defendant admits liability regarding the cause of the accident, evidence of the defendant’s drinking is irrelevant and prejudicial.

Additionally, as a matter of law, future economic damages are only appropriate when established with reasonable certainty. A “mere possibility” that certain treatment might be obtained in the future cannot form the basis of an award for future medical expenses. Similarly, Florida law does not permit a plaintiff to recover loss of future earnings, unless the plaintiff proves with a reasonable degree of certainty, his or her future earning capacity.

The only evidence plaintiff presented to support his claim for future medical expenses consisted solely of his testimony that at the time of trial he was taking a prescription drug to detoxify himself from an opiate addiction. The evidence was not clear as to whether that addiction had any relationship to the accident.

There was also a complete absence of any testimony, either lay or expert, evincing with reasonable certainty how long into the future the plaintiff would need to take the drug. The jury simply accepted the suggestion by counsel for the plaintiff in final argument that five years was a sufficient number of years to use to calculate the award, and awarded precisely the amount suggested by counsel. The appellate court held that the trial judge should have granted Geico’s motion for directed verdict on that issue.

As to the future loss of earning capacity, the plaintiff testified to his plans for future employment, but did not present evidence from which the jury could determine with any degree of certainty that he was prevented by his injury-related limitations from obtaining suitable work in the future.

While the plaintiff had testified regarding his experience in a dive shop, and had received certification, he presented no concrete evidence demonstrating the availability of this type of job in the diving industry, nor evidence of the pay offered for such a position. The plaintiff speculated he could earn $2,000-$2,500 per month from that business and his attorney suggested he could earn that amount until he was 66 years old. Essentially, the plaintiff wanted the jury to follow his unfounded supposition that because he was trained to do a job and because his back injury prevented him from doing his work, he no longer had any capacity to earn supplementary income during his retirement years.

Without evidence of alternative employment for a man of his age, skills, education, etc., the jury was forced to engage in a future loss of earnings analysis, which is not supported by Florida law.

ERROR TO DENY PLAINTIFF’S MOTION TO VACATE AN ORDER OF DISMISSAL FOR LACK OF PROSECUTION, WHERE A STAY ORDER WAS IN EFFECT AT THE TIME THE ORDER OF DISMISSAL WAS ENTERED.

Gomez v. State Farm, 42 Fla. L. Weekly D104 (Fla. 3rd DCA January 4, 2017).

NO ERROR IN REFUSING TO RESTART THE PEREMPTORY PROCESS AFTER STRIKING JURORS FOR CAUSE--NON-ECONOMIC DAMAGE AWARD TO DECEDENT’S MINOR CHILDREN NOT EXCESSIVE.

RJ Reynolds v. Grossman, 42 Fla. L. Weekly D106 (Fla. 4th DCA January 4, 2017):

In this tobacco case, the court, over RJR’s objection, considered and granted two cause challenges made by the plaintiff after RJR used two of its peremptory strikes. RJR conceded that the trial court has no discretion to infringe upon a party’s right to challenge any juror, either peremptorily or for cause, prior to the time the jury is sworn.

It argued, however, that once the plaintiff gave a new cause challenge, that the trial judge was required to restart the peremptory process. The Fourth District held that was not the case. Trial courts are afforded wide discretion in determining the time and manner of challenging or swearing jurors, and there is nothing in the rules of civil procedure governing the use of challenges during jury selection.

In this tobacco case, the surviving children happen to have been only 11 and almost 3 years old when their mother died of lung cancer at age 38. The jury awarded the daughter $7.5 million and the son $4 million, and the defendant challenged those awards by remittitur, which the trial judge denied.

Finding that the daughter was only 9 years old when her mother was diagnosed with lung cancer and the son an infant, the evidence presented showed that the decedent’s illness and death had a devastating effect on her children.

The daughter had retained vivid memories of her mother’s illness and decline, and she testified that she remembered wanting to do nothing more than hug and cuddle with her mother, but that her mother was in so much pain that the daughter could not even lie next to her. The daughter testified that she felt robbed by her mother’s death, and often thinks about the relationship she would have had and what her mother’s role would have been in it.

The decedent’s son testified that his only true memory of his mother was watching the paramedics take her dead body out of the home in a body bag. He lamented not having more time with his mother and testified it negatively affected his entire life, suffering from abandonment anxiety as a small child, and experiencing behavioral problems. Under those circumstances, the court found the jury’s awards did not shock the judicial conscience, and there was no error in denying the motion for remittitur.

PROPOSAL FOR SETTLEMENT NOT AMBIGUOUS.

American Home Assurance v. D’Agostino, 42 Fla. L. Weekly D113 (Fla. 4th DCA January 4, 2017):

When a proposal for settlement used the word “claims” instead of the word “damages,” the court found that did not render the proposal ambiguous, because the proposal was still sufficiently clear and definite to allow an informed decision by the offeree. In this case, there were no other claimed benefits that were at issue, and thus claim and damages were one in the same.

It was also unnecessary for the proposal to state whether attorney’s fees were part of the legal claim because the plaintiff’s complaint did not request attorney’s fees (as recently decided by the supreme court in Kuhajda).

AN ENGINEER “INTERN” COULD NOT BE HELD LIABLE FOR PROFESSIONAL NEGLIGENCE.

Sunset Beach Investments v. Kimley-Horn, 42 Fla. L. Weekly D130 (Fla. 4th DCA January 4, 2017):

Because an engineer intern did not satisfy the requirements of being a “licensed engineer,” the intern was not subject to the standards for professional negligence, and thus entitled to summary judgment in the lawsuit against him.

TWO PARAGRAPHS IN THE MIDDLE OF A RELEASE THAT DID NOT INCLUDE THE DEFENDANT’S NAME DID NOT RENDER THE ENTIRE PROPOSAL FOR SETTLEMENT AMBIGUOUS.

Kiefer v. Sunset Beach Investments, 42 Fla. L. Weekly D132 (Fla. 4th DCA January 4, 2017):

In the middle of the release attached to the proposal, there were two paragraphs that did not specifically refer to the plaintiff and the defendant. Yet, all of the other paragraphs did. The Fourth held that this in and of itself did not render the proposal ambiguous.