FEDERATED NATIONAL INSURANCE COMPANY, APPELLANT,
v.
WILLIAM JOYCE AND JUDITH JOYCE, APPELLEES
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Federated National Insurance Company appeals an award of attorney's fees to insureds whose homeowners claim was wrongfully denied based on an alleged misrepresentation that the insureds had actually disclosed. The court affirmed the lodestar calculation but reversed the trial court's application of a 2.0 multiplier, holding that this straightforward case did not present the rare and exceptional circumstances warranting enhanced fees.
The court affirmed the lodestar calculation of over $38,000 in attorney's fees but reversed the application of the 2.0 multiplier, holding that this straightforward case lacked the rare and exceptional circumstances necessary to justify a multiplier enhancement.
[1] The lodestar figure, calculated by multiplying the number of hours worked by a reasonable hourly rate, is presumed to represent a reasonable attorney's fee.
[2] The application of a multiplier to an attorney's fee award is an exception to the general rule and is permissible only in rare and exceptional circumstances.
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Join FLexlaw to unlock all legal intelligence“The application of a multiplier is the exception, not the rule ... and this presumption is overcome only in 'rare' and 'exceptional' circumstances.”
Establishes the legal standard that multipliers on lodestar fees are exceptional and require rare circumstances
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Join FLexlaw to unlock all legal intelligenceFederated denied the Joyces' homeowners insurance claim based on alleged material misrepresentation—failure to disclose two prior insurance claims. Ho…
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Federated National Insurance Company (“Federated”) appeals the award of $76,300 in attorney’s fees to William and Judith Joyce (“the Joyces”), following settlement of the parties’ insurance disputé. The action arose from a denial of coverage based on an alleged material misrepresentation in the Joyces’ homeowners insurance application. In denying the claim, Federated argued that the Joyces had failed to disclose two previous insurance claims at..the time of their application. However, early in discovery, it came to light that the Joyces had actually disclosed the prior claims.1
Federated acknowledged the error, and the parties , executed a settlement agreement for $23,500, exclusive of attorney’s fees. The .trial court awarded the Joyces over $38,000 in attorney’s fees based on the number Of hours their attorney, worked multiplied by a reasonable hourly rate — -the “lodestar figure.” See Fla. Patient’s Comp. Fund v. Rowe, 472 So.2d 1145, 1151-52 (Fla.1985), modified by Standard Guar Ins. Co. v. Quanstrom, 555 So.2d 828, 829 (Fla.1990). We affirm this portion of the award. However,- the trial court improperly awarded a “multiplier” of 2.0, which we reverse.
In Rowe, the Florida Supreme Court adopted the federal lodestar approach, which includes “a ’strong presumption’ that the lodestar represents the ‘reasonable fee.’” Progressive Express Ins. Co. v. Schultz, 948 So.2d 1027, 1030 (Fla. 5th DCA 2007) (citing Pennsylvania v. *494 Del. Valley Citizens’ Council for Clean Air, 478 U.S. 546, 565, 106 S.Ct. 3088, 92 L.Ed.2d 439 (1986)). “The application of a multiplier is the exception, not the'.rule ... and this presumption is overcome only in ‘rare’ and ‘exceptional’ circumstances.” State Farm Fla. Ins. Co. v. Alvarez, 175 So.3d 352 (Fla. 3d DCA 2015) (citing Perdue v. Kenny A. ex rel. Winn, 559 U.S. 542, 544, 130 S.Ct. 1662, 176 L.Ed.2d 494 (2010)).
This was not a complicated case. Either the Joyces had falsified their insurance application, or Federated had made an error. There were no esoteric legal issues or complicated factual disputes to resolve. As one would anticipate given today’s legal market, there was no evidence the Joyces had any difficulty obtaining counsel to handle this matter. Indeed, it took only one phone call for the Joyces to secure counsel. While we review the trial court’s decision for an abuse of discretion, “we are not required to abandon what we learned as lawyers or our common sense in evaluating the reasonableness of an award.” Trumbull Ins. Co. v. Wolentarski, 2 So.3d 1050, 1057 (Fla. 3d DCA 2009) (citation omitted). This was not one of those rare or exceptional cases in which the award of a multiplier was appropriate.
AFFIRMED IN PART; REVERSED IN PART.
COHEN and LAMBERT, JJ., and JORDAN, J.E., Associate Judge, concur.
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Joyce v. Federated Nat'l Ins. Co., 228 So. 3d 1122 (Fla. 2017)…ert does not form a logical and reasonable foundation upon which to conclude— as the trial court did—that a multiplier was required, the Fifth District properly reversed the trial court’s use of the multiplier. See Federated Nat’l Ins. Co. v. Joyce, 179 So. 3d 492, 494 (Fla. 5th DCA 2015). The trial court’s decision to award a multiplier is seriously flawed. This Court has repeatedly emphasized the importance of proper justification for the imposition of the multiplier. Beginning in Florida Patient’s Compens…1 / 2
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Citizens Prop. Ins. Corp. v. Laguerre, 259 So. 3d 169 (Fla. 3d DCA 2018)
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Fla. Peninsula Ins. Co. v. Wagner, 196 So. 3d 419 (Fla. 2d DCA 2016)…asonable hourly rate multiplied by a reasonable number of hours for the work performed — carries “a [*422] strong presumption” that it represents a reasonable fee for legal services provided on a contingency basis. Federated Nat’l Ins. Co. v. Joyce, 179 So. 3d 492, 493 (Fla. 5th DCA 2015) (quoting Progressive Express Ins. Co. v. Schultz, 948 So. 2d 1027, 1030 (Fla. 5th DCA 2007)). Indeed, as the Third District succinctly observed, “[t]he application of a multiplier is the exception, not the rule.” State Farm…
Previewing 3 of 5 citing cases — full citator treatment, depth of discussion, and citing context are member features.
Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- Fla. Patient's Comp. Fund v. Rowe, 472 So. 2d 1145 (Fla. 1985)
- Pennsylvania v. Del. Valley Citizens' Council for Clean Air, 478 U.S. 546 (U.S. 1986)
- Standard Guar. Ins. Co. v. Quanstrom, 555 So. 2d 828 (Fla. 1990)
- Perdue v. Kenny A., 559 U.S. 542 (U.S. 2010)
- Progressive Express Ins. Co. v. Schultz, 948 So. 2d 1027 (Fla. 5th DCA 2007)
- Trumbull Ins. Co. v. Wolentarski, 2 So. 3d 1050 (Fla. 3d DCA 2009)
- State Farm Fla. Ins. Co. v. Alvarez, 175 So. 3d 352 (Fla. 3d DCA 2015)