CERTAIN UNDERWRITERS AT LLOYD'S LONDON,

v.

RONIEL CANDELARIA AND AMELIA PADURA,

Third District Court of Appeal State of Florida

Opinion filed May 18, 2022. Not final until disposition of timely filed motion for rehearing.

________________

No. 3D20-871 Lower Tribunal No. 18-21672 ________________

Certain Underwriters at Lloyd's London, Appellant,

vs.

Roniel Candelaria and Amelia Padura, Appellees.

An Appeal from the Circuit Court for Miami-Dade County, Martin Zilber, Judge.

Sastre Saavedra & Epstein, PLLC, and Michael Sastre, for appellant.

Alvarez, Feltman, Da Silva & Costa, P.L., and Paul B. Feltman, for appellees.

Before EMAS, GORDO and BOKOR, JJ.

EMAS, J.

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I. INTRODUCTION

Certain Underwriters at Lloyd’s London (Lloyd’s) appeals an order awarding attorney’s fees to Roniel Candelaria and Amelia Padura (“the Insureds”). Lloyd’s argues that the trial court erred in establishing the lodestar amount and in applying a multiplier because neither the lodestar amount nor application of a multiplier is supported by competent substantial evidence. We agree and, for the reasons that follow, reverse and remand the trial court’s order.

II. FACTUAL BACKGROUND

In September 2017, the Insureds’ home suffered damage from Hurricane Irma, and they submitted a claim with Lloyd’s. Following an inspection, Lloyd’s found that certain damage was not covered under the policy (e.g., wear and tear or pre-existing damage to the roof, the fence, and the shed) but that the covered damage totaled $2,033.48. Because this amount was below the deductible, Lloyd’s made no payments to the Insureds, who in turn filed suit against Lloyd’s in June 2018. The case was heavily litigated prior to the November 2019 jury trial. In addition, following a failed mediation attempt, the parties continued (albeit unsuccessfully) to pursue a settlement.

1 That subsection provides in relevant part:

Upon the rendition of a judgment or decree by any of the courts of this state against an insurer and in favor of any named or omnibus insured or the named beneficiary under a policy or contract executed by the insurer, the trial court or, in the event of an appeal in which the insured or beneficiary prevails, the appellate court shall adjudge or decree against the insurer and in favor of the insured or beneficiary a reasonable sum as fees or compensation for the insured's or beneficiary's attorney prosecuting the suit in which the recovery is had.

2 Lloyd’s does not challenge the reasonableness of any of the hourly rates used by the Insureds’ attorneys.³ We note that the instant case involved the same plaintiff’s counsel and the same plaintiff’s attorney’s fee expert as those involved in Universal Prop. & Cas. Ins. Co. v. Deshpande, 314 So. 3d 416 (Fla. 3d DCA 2020). In Deshpande (as in this case) the plaintiff’s’ expert arrived at his proposed lodestar amount by applying the same across-the-board cut we rejected in that case. However, this court had not yet issued its opinion in Deshpande at the time the evidentiary hearing was held in the instant case.

As a result of that, I cut back the hours across the board by¹⁵ percent, which is actually twice what the expert—or double the amount the [plaintiffs’] expert had advised.

(Emphasis added). The trial court found that a 1.8 multiplier was warranted, citing the difficulty of the case. On April 28, 2020, the Insureds submitted a proposed final order with a cover letter, which noted that Lloyd’s had objections to certain aspects of the proposed order. The same day, Lloyd’s submitted a letter detailing its objections to the ruling and to the Insureds’ proposed order. Later that same night, the trial court signed the Insureds’ proposed order verbatim; even the caption of the court’s order—“ORDER AWARDING ATTORNEY FEES (PLAINTIFF'S PROPOSED)”—remained unaltered.⁴ In the final order, the

4 Lloyd’s contends that the trial court violated its due process rights by adopting Appellees’ proposed order verbatim, citing Empire World Towers, LLC v. CDR Creances, S.A.S., 89 So. 3d 1034, 1045 (Fla. 3d DCA 2012) (“In Perlow v. Berg–Perlow, 875 So. 2d 383 (Fla. 2004), the Florida Supreme Court clarified the standard governing a trial court's adoption of a party's

III. DISCUSSION AND ANALYSIS

Both the fee award and application of a multiplier are reviewed for an abuse of discretion. Attorney's Title Ins. Fund, Inc. v. Landa-Posada, 984 So. 2d 641, 643 (Fla. 3d DCA 2008). See also St. Paul Mercury Ins. Co. v. Coconut Grove Bank, 106 So. 3d 452, 454 (Fla. 3d DCA 2009). As explained further below, the trial court abused its discretion in establishing the lodestar amount and in applying a contingency fee multiplier.

A. The Lodestar Amount

Lloyd’s contends that the lodestar figure is not supported by competent substantial evidence where the Insureds’ fee expert admitted during his testimony that he did not conduct a line-item analysis of the time records as proposed order. The Court made clear that a party's proposed order ‘cannot substitute for a thoughtful and independent analysis of the facts, issues, and law by the trial judge,’ and approved of cases[] holding that reversal is required based on a trial court's adoption of a proposed order: (1) when the signed judgment is inconsistent with an earlier pronouncement of the trial judge; and (2) where the appearance of impropriety so permeated the proceeding below as to justify a suspicion of unfairness.”) Although a trial court’s action in signing a party’s proposed order verbatim may not reflect best practices, the circumstances presented in the instant case do not rise to the level of a due process violation under Perlow and Empire World.

Id. at 419 (emphasis added). In the instant case—as in Deshpande—the lodestar amount is not supported by competent substantial evidence because the trial court did not make “specific findings” as to its determination

5 We do not foreclose the possibility of a scenario in which the trial court may properly apply an across-the-board reduction following an examination of all the timesheets and disputed entries, where such a reduction is explained, is not arbitrary, and is supported by competent substantial evidence.

B. The Contingency Risk Multiplier

Lloyd’s contends that the Insureds’ counsel failed to sustain its burden of presenting competent substantial evidence to support the application of a contingency risk multiplier. Though Lloyd’s makes a variety of arguments, we find merit in its position that insufficient competent and substantial evidence was presented on the ability of the Insureds’ counsel to mitigate the risk of nonpayment in any way. In determining whether to apply a multiplier to a contingency fee, a trial court must consider the factors set forth in Standard Guaranty Insurance Co. v. Quanstrom, 555 So. 2d 828, 834 (Fla. 1990): (1) whether the relevant market requires a contingency fee multiplier to obtain competent counsel; (2) whether the attorney was able to mitigate the risk of nonpayment in any way; and (3) whether any of the factors set forth in Rowe are applicable, especially the amount involved, the results obtained, and the type of fee arrangement between the attorney and his client.

(Emphasis added). See also Joyce v. Federated Nat'l Ins. Co., 228 So. 3d 1122, 1128 (Fla. 2017) (reaffirming the three-prong analysis established in Quanstrom). Importantly, “evidence of each of these factors must be

Bell v. U.S.B. Acquisition Co., 734 So. 2d 403, 411 (Fla. 1999) (citing Rowe, 472 So. 2d at 1151). “Generally, the controlling consideration in determining

6 In addition, “the existence of a contingent-fee agreement between attorney and client does not automatically require application of a multiplier.” Sun Bank of Ocala v. Ford, 564 So. 2d 1078, 1079 (Fla. 1990). See also Bell v. U.S.B. Acquisition Co., 734 So. 2d 403, 411 (Fla. 1999).

7 The expert’s opinion—that there was “no way” the firm could have mitigated the risk of nonpayment— is conclusory, and fails to fully address the second Quanstrom factor, which requires the court to consider “whether the attorney was able to mitigate the risk of nonpayment in any way,” including whether the plaintiffs could afford a retainer or hourly fees. Wesson v. Fla. Peninsula

Ins. Co., 296 So. 3d 572, 573 (Fla. 1st DCA 2020). Because no evidence was presented on the clients’ ability to afford a retainer or hourly fee, the expert’s opinion in this regard was not based on facts or inferences supported by evidence presented at the hearing:

It is elementary that the conclusion or opinion of an expert witness based on facts or inferences not supported by the evidence in a cause has no evidential value. It is equally well settled that the basis for a conclusion cannot be deduced or inferred from the conclusion itself. The opinion of the expert cannot constitute proof of the existence of the facts necessary to the support of the opinion.

Mount Sinai Med. Ctr. of Greater Miami, Inc. v. Gonzalez, 98 So. 3d 1198, 1202 (Fla. 3d DCA 2012) (quoting Arkin Constr. Co. v. Simpkins, 99 So. 2d 557, 561 (Fla. 1957)).

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IV. CONCLUSION

The trial court erred in its determination of the lodestar amount, as such an award was not supported by competent substantial evidence and involved an arbitrary, across-the-board cut, indistinguishable in all relevant respects from this court’s recent decisions in Deshpande and Casanas. The trial court further erred in applying a contingency risk multiplier in the absence of competent substantial evidence to address whether the attorney was able to mitigate the risk of nonpayment in any way—specifically, whether the client could afford to pay a retainer or hourly fees. We reverse the lodestar amount and application of a multiplier, with instructions for the trial court to reduce the number of hours billed to 480.5— “the only number for which there is competent, substantial evidence adduced by the defendant's fee expert following a line-by-line accounting of the compensable hours.” Casanas, 46 Fla. L. Weekly D2324 at *1.8 See also Deshpande, 314 So. 3d at 420 (“Generally, when an attorney's fee or cost order is appealed and the record on appeal is devoid of competent

8 Because Lloyd’s did not contest the reasonableness of the hourly billing rates for each of the Insureds’ attorneys, the trial court shall apply the attorneys’ respective hourly rates set forth in the order on appeal.

9 By contrast, in Wesson v. Fla. Peninsula Ins. Co, 296 So. 3d 572 (Fla. 1st DCA 2020), our sister court reversed and remanded for the trial court’s proper consideration of the second Quanstrom prong because it was the result of the trial court’s error in relying on improper considerations in determining whether plaintiffs could afford to pay a retainer or hourly fee. Wesson, 296 So. 3d at 573. However, where the reversal is the result not of trial court error, but a party’s failure to meet its evidentiary burden, a remand to allow for a “second bite of the apple” is generally not permitted. See, e.g., Levy v. Ben Shmuel, 255 So. 3d 493, 497 n. 4 (Fla. 3d DCA 2018) (en banc) (noting that, as a general rule, a party’s failure to meet its evidentiary burden will not be afforded a “second bite of the apple” on remand following appeal, and recognizing an exception where the party's failure to meet its burden was the result of judicial error), and cases cited.