Tuesday, December 12th, 2017
Last week, the Third District Court of Appeal dismissed a Petition for Writ of Certiorari filed by United Automobile Insurance Company in United Automobile Insurance Company v. Partners in Health Chiropractic Center, a/a/o Cecilia Yanique Gerlin (No. 3D17-666). While the Petition was dismissed on procedural grounds, the Third DCA took the opportunity to remind us all of a basic tenet regarding the validity of a Proposal for Settlement: That for a Proposal to have been offered in good faith, the offeror must have had a reasonable foundation on which to base the offer. A court may negate a Proposal for Settlement if it determines that an offer was not made in good faith. See Fla. Stat. §768.79(7)(a). The burden is on the offeree to prove that the Proposal was not made in good faith. Arce v. Wackenhut Corp., 146 So.3d 1236 (Fla. 3d DCA 2014); Ryan v. Lobo De Gonzalez, 841 So.2d 510 (Fla. 4th DCA 2003). To show good faith, all that is required is that there was a reasonable basis upon which to make the offer based upon the subjective understanding and beliefs of the offeror. Gurney v. State Farm Mut. Auto., 889 So.2d 97 (Fla. 5th DCA 2004); Wagner v. Brandberry, 761 So.2d 443 (Fla. 2d DCA 2000); Schmidt v. Fortner, 629 So.2d 1036 (Fla. 4th DCA 1993). So what does all this mean to the insurer who is considering serving a nominal Proposal for Settlement? A trial court is going to look at the facts and circumstances of the case from your viewpoint at the time that the Proposal was made. Thus, it is best for insurers and their counsel to sit down and discuss the basis for a nominal Proposal for Settlement. What facts and circumstances can be articulated at that moment that suggest that there is only a nominal or no chance of liability? Are you overstating the positive and understating the negative points of your case? Do you believe that the court will accept your assessment as being reasonable, or reject it as being unrealistic? If it is determined that there is a reasonable foundation for an assessment of nominal or no liability, write down the facts and circumstances that support your assessment as you see them at that moment. Serve your nominal Proposal for Settlement and file your notes away in your claim file. When the time comes to establish your entitlement to attorney fees, you will not have to recreate history to justify your nominal Proposal for Settlement. All you will need is your written memorialization that you created at the time that you served the Proposal. A nominal Proposal for Settlement will garner heightened scrutiny by the court. Prepare for this by articulating your reasonable basis for the Proposal at the time that it is served and save your assessment. This will help you to successfully defeat any attempt of proving that your nominal Proposal for Settlement was made in bad faith.
Tagged under: Tags: good faith , Insurance Defense , Proposal for Settlement , Third District Court of Appeal
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