Florida Supreme Court Partially Affirms Lower Court Decision in Insurance Case, Addressing Settlement Question

In a recent case, the Florida Supreme Court issued an opinion in an appeal involving a certified question about whether a personal injury damages award must be reduced by a payment the plaintiff received to settle a bad faith claim against his uninsured motorist insurance carrier. The two laws at issue in the case were sections 768.041(2) and 768.76(1), Florida Statutes (2012).

The Respondent/plaintiff (Respondent) was badly injured in a car crash. Following the accident, he sued the Petitioner/defendant (Petitioner) bringing a vicarious liability claim based on the Petitioner’s co-ownership of the other automobile involved in the crash. Additionally, the Respondent also sued his own uninsured motorist insurance carrier to recover policy benefits for statutory bad faith damages. The Respondent and his insurer settled prior to the trial for $4 million. The subsequent trial against the Petitioner resulted in a $30 million jury verdict for the Respondent. The Petitioner then asked the trial court to set off the pre-trial $4 million insurance settlement against the damages award, but the trial court denied the motion.

On appeal, the Second District Court of Appeals affirmed the denial of the setoff request. Additionally, it certified a two part question: Is a settlement payment made by an uninsured motorist insurer to settle a first-party bad faith claim subject to setoff under section 768.041(2) or a collateral source within the meaning of section 768.76? The appeals court answered no to both parts of the question, ultimately holding that neither statute authorized a setoff in the present case. The appellate decision explained that writing on a blank slate, it would have found the Petitioner entitled to a setoff under section 768.041(2), but it decided that this Court’s case law precluded that result.

The Supreme Court of Florida found that based on the parties’ arguments and its own review of the record that the Petitioner did not ask the trial court for a setoff under section 768.041(2). As a result, that issue was not available for appellate review in the first place and the Second District should not have ruled on it, and by extension, the Supreme Court could not either, quashing the district court’s 768.041(2) portion of the decision. On the second question, the Supreme Court of Florida rephrased the certified question to more precisely state the issue. The updated question answered by the Supreme Court of Florida was: Is a settlement payment made by an uninsured motorist insurer to settle a first-party bad faith claim a collateral source within the meaning of section 768.76(2)(a)2.? Under the reframed question, the Supreme Court of Florida agreed with the Second District opinion, finding that the answer to the certified question was no. In sum, the Supreme Court of Florida declined to answer the first portion of the certified question, holding that the Petitioner did not preserve the section 768.041(2) issue for appellate review. Additionally, the Supreme Court of Florida held that the second part of the certified question, after rephrasing, was properly decided by the lower court, holding that a settlement payment made by an uninsured motorist insurer to settle a first-party bad faith claim is not a collateral source under section 768.76(2)(a)2.

Are you Dealing with a Difficult Insurance Company?

If you or someone you love has suffered harm in Florida, and the insurance company seems to be acting in bad faith, the lawyers at Friedman Rodman Frank & Estrada can help you understand your rights and the remedies available to you under Florida law. Our team of attorneys has successfully advocated for injured individuals throughout Florida for 46 years. Expenses from injuries or harm can quickly become overwhelming, and having an experienced roster of attorneys by your side can make a world of difference for your claim. Make sure that you make the most out of your claim and get the award that you deserve. Contact our team at 305-448-8585 to schedule a free and no-obligation initial consultation with a lawyer at our office.

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