Summary
The Supreme Court of Florida held that using a contingency risk multiplier to calculate attorney fees awarded under Florida's offer-of-judgment statute, section 768.79, is error. The Court approved the Fifth District Court of Appeal's decision and reasoned that such fee awards are sanctions that must be strictly construed, and that neither the statute nor Florida Rule of Civil Procedure 1.442 authorizes a multiplier.
Topics
Practice areas
Questions Presented
- Whether section 768.79, Florida Statutes, and Florida Rule of Civil Procedure 1.442 authorize a contingency-risk multiplier when calculating attorney fees imposed as a sanction for rejecting an offer of judgment.
- Whether the fee award should be recalculated under the factors in Rule 1.442 without applying a multiplier.
Holdings
- The use of a contingency-risk multiplier in awarding attorney fees authorized by section 768.79 and Rule 1.442 is error because neither the statute nor the rule authorizes such a multiplier.
- Attorney fees awarded under the offer-of-judgment statute and rule are sanctions against the party that unreasonably rejects the offer.
- The fee award must be recalculated using the factors in Rule 1.442(h)(2), together with the reasonable hourly rate and time, but without a multiplier.
Key quotations
“We hold that the use of a multiplier in awarding attorney fees authorized by section 768.79, Florida Statutes, is error.” (222-223)
“Applying a strict construction of the statute and rule, a multiplier therefore cannot be applied under section 768.79 or rule 1.442, and the trial court's application of a multiplier in this case was error.” (223)
Factual background
Sally Sarkis was injured in an automobile accident and sued Allstate for compensation under uninsured-motorist coverage. Before trial, she served Allstate with a $10,000 offer of judgment under section 768.79 and Rule 1.442, which Allstate rejected. Sarkis obtained a net judgment of $87,700, exceeding the offer by more than twenty-five percent, and the trial court awarded $58,450 in lodestar fees plus a 1.5 contingency-risk multiplier.
Procedural history
After Sarkis obtained a net judgment of $87,700 following rejection of her $10,000 offer of judgment, the trial court awarded attorney fees under section 768.79 and Florida Rule of Civil Procedure 1.442 and applied a 1.5 contingency-risk multiplier. The Fifth District, sitting en banc, reversed, holding that a multiplier could not be used under the offer-of-judgment statute. The Florida Supreme Court approved the Fifth District's decision and remanded for recalculation of the fee award without a multiplier.
Remand instructions
The trial court must recalculate the attorney-fee award using the factors in Florida Rule of Civil Procedure 1.442(h)(2), along with the reasonable hourly rate and time already determined. No contingency-risk multiplier may be applied.