Disciplined in Sophisticated Defense and Insurance Litigation

March 31, 2016 | Blog Post| Insured is Entitled to a Determination of Liability and Damages in a UIM Case Despite the Insurer's Confession of Judgment

The Florida Supreme Court recently resolved a conflict among Florida’s lower state and federal courts regarding an insured’s right to a determination of its damages and liability in an underlying uninsured motorist (“UIM”) case prior to bringing an action for bad faith against the insurer.  In Fridman v. Safeco, the Court held that the insured is entitled to have a jury decide the full measure of his or her damages and liability for an automobile accident in the UIM case, even if the insurer confesses judgment in the amount of the policy limits before trial.  That verdict then supplies the measure of damages in a subsequent bad faith case.

Florida law is well established that in a UIM case, where the insured obtains a verdict in excess of the policy limits, the court can only enter judgment in the amount of the policy limits.  Where the law has been unclear is whether a full jury verdict in excess of the policy limits supplies the measure of damages in a subsequent bad faith case.  Previously, Florida’s lower courts were split on that question. Some held that utilizing the verdict in the bad faith case denies the insurer due process because it cannot assert errors affecting the jury verdict, while others held that the verdict supplies the measure of damages, because the insurer has the right to attack the validity of the jury verdict on appeal of the UIM case.

Relying on those propositions, the insurer in this case, Safeco, confessed judgment shortly before trial in a UIM case, then argued that the case should be concluded because the insured obtained all the relief she could obtain.  Therefore, argued Safeco, empaneling a jury to try the case would be a futile  trial conducted without jurisdiction.  The trial court disagreed and tried the case to verdict, and Safeco appealed.

Ultimately, the Supreme Court held that the trial court was correct (disagreeing with the intermediate court’s decision to the contrary).  Therefore, the law is now clear that in the UIM case, the plaintiff is free to try his or her case to a jury in order to establish his or her damages, notwithstanding the insurer’s confession of judgment in the amount of the policy limits.  More importantly, that verdict will then supply the measure of damages in the subsequent bad faith claim, because the insurer has the right to assert any errors in the trial on appeal.  This decision brings much-needed clarity to an otherwise murky area of the law.

We will continue to keep you informed of the ever-changing legal landscape in Florida.  Should you have any questions, please contact one of the partners in our extra-contractual department.

Julius "Rick" Parker, III

Julius F. “Rick” Parker, III is a Partner at Butler who joined the firm in 2004. Rick’s practice areas include appeals, casualty defense litigation, Chinese drywall, premises liability defense, construction, coverage defense, and extra-contractual matters. He has significant appellate and trial experience in both state and federal courts.

August 13, 2019 Blog PostThe Evolving Limitations on Appraisers in Florida: Analyzing State Farm Florida Ins. Co. v. Sanders

Appraisers are frequently involved in Florida property claims.  Accordingly, Florida courts continue to refine the roles and limitations with respect to appraisers and the appraisal process as a whole...

Read More »
February 26, 2019 Blog PostTHE MARKOVITS DECISION: CONSIDERATIONS AND IMPLICATIONS

Recently, Florida’s First District Court of Appeal held that for purposes of determining the timeliness of a proposal for settlement, the complaint is considered served on the insurer when process is served upon the statutory agent, Florida’s Chief Financial Officer, and not when process is forwarded by the Chief Financial Officer to the insurer.  Markovits v. State Farm Mutual Automobile Ins. Co., 235 So. 3d 1018 (Fla. 1st DCA 2018) rehr’g denied (Feb. 5, 2018).

Read More »
February 21, 2019 Blog PostNot Off the Hook...Trouble in Paradise for Puerto Rico Insurers

Recent legislative and judicial developments in Puerto Rico may very well have revived thousands of claims that insurers believed to be time-barred, per the terms of the Suit Against Us provisions of their Policies. Until the February 14, 2019, ruling issued by a San Juan court, residential property damage claims that had not escalated to suit within a year of the date of loss, had been considered time-barred. It would seem that it may not be the case anymore, and insurers should be prepared for a potential flurry of new litigation, even involving prior Hurricane Irma and Maria claims.

Read More »
January 14, 2019 Blog PostChecking the Vitals of Hospital Liens

Claims adjusters, plaintiffs’ attorneys and defense attorneys all deal with the headaches of hospital liens.  And recent case law and inconsistent recording of liens by clerks in different counties makes matters worse.

Read More »
August 16, 2018 Blog PostNot so Fast! The Confession of Judgment Doctrine in Dispute-Over-Amount Cases

Florida law allows an insured to recover attorney’s fees if the insured prevails in a lawsuit against the insurer for insurance benefits.  See § 627.428, Florida Statutes.  The plain text of the statute requires a “judgment” against the insurer.  In Wollard v. Lloyd's & Companies of Lloyd's, 439 So. 2d 217 (Fla. 1983), however, the Florida Supreme Court held that an insurer’s post-suit payment of a claim may be the “functional equivalent of a confession of judgment or a verdict in favor of the insured”, thus, triggering the fee-shifting statute.

Read More »
January 22, 2018 Blog PostButler Wins Dismissal of a First-Party Bad Faith Claim Involving a Civil Remedy Notice That Listed a Different Household Policy

In Florida, an insured cannot bring a first-party bad faith claim based on a claim for UM coverage unless the insured first files a Civil Remedy Notice (CRN) with the Florida Department of Financial Services. In Mathurin v. State Farm, Butler recently vindicated the importance of this step by winning a dismissal of a first-party bad faith action where the CRN did not match up with the Complaint.  

Read More »
March 07, 2017 Blog PostFederal Diversity Jurisdiction: Proving Citizenship of Limited Liability Companies

Jurisdiction gives a federal court the power to hear a case. Jurisdiction matters at the outset of a lawsuit. It matters during discovery. It even matters after summary judgment. Jurisdiction matters because federal courts are courts of limited jurisdiction.

Read More »
April 01, 2016 Blog PostSouthern District Applies Fridman v. Safeco to Preclude Bifurcation

However, the Levesque case points out the down-side of GEICO’s strategy to preclude the jury in the UIM case from determining the insured’s full damages.  If the insured is precluded from proving its damages in the UIM case, it must necessarily be entitled to prove them in the subsequent bad faith case.

Read More »
June 02, 2015 Blog PostThe Florida Supreme Court Endorses Citizens' Immunity

The high court declared that Citizens is shielded from statutory bad-faith suits, and that bad faith is not a “willful tort,” which is a statutory exception to the immunity granted by the Florida Legislature.  The vindication was a long time coming for Citizens.  The Legislature created Citizens with a broad immunity that seemed clearly intended to shield it from bad-faith actions...

Read More »
February 10, 2015 Blog PostDoes Florida's statutory duty to disclose insurance information apply to out-of-state policies?

One of the most common questions I get from insurers of out-of-state policyholders is whether they are required to honor a Florida claimant’s request for disclosure of insurance information under Florida Statute 627.4137. If the applicable policy was not delivered in Florida or issued for delivery in Florida, the short answer is “No.” Nonetheless, sometimes an insurer can best protect both its insured and itself by voluntarily providing at least some of the information outlined in the statute.

Read More »
January 20, 2015 Blog PostThe Season of Giving: Pennsylvania Supreme Court Finds Bad Faith Claims to be Assignable

Rejecting the holdings of two recent decisions by the Eastern District of Pennsylvania, the Supreme Court of Pennsylvania held in a 5-to-1 ruling that claims under Pennsylvania’s Bad Faith Statute (42 Pa.C.S. § 8371) are assignable to injured third parties. The decision, Allstate Prop. & Cas. Ins. Co. v. Wolfe, 2014 Pa. LEXIS 3309 (Pa. Dec. 15, 2014), considered the case of Jared Wolfe, who was injured in a car accident after being struck by Karl Zierle’s vehicle. 

Read More »
August 26, 2014 Blog PostBad Faith: Turns Out, Abnormal in Alabama Really Is Normal

A few years ago, I published an article that questioned whether Alabama’s tort of bad faith was becoming more prevalent on a theory referred to by Alabama courts as an “abnormal bad faith” action. See, “Is Abnormal Becoming the New Normal in Alabama?” Mealey’s Litigation Report: Insurance Bad Faith, Vol. 22, #20 (February 26, 2009).

Read More »
Key Points
Author Practice Area CASE TYPE
  • Extracontractual Claims