FLORIDA PROPOSAL FOR SETTLEMENT INVALID WHERE IT DEPRIVED DEFENDANT DRIVER OF THE ABILITY TO EVALUATE AND INDEPENDENTLY ACT TO RESOLVE THE CASE AGAINST HER.
The Plaintiff’s offer of judgment failed to satisfy the exacting requirements of the statute and implementing rule, invalidating the proposal for settlement.
Following a traffic accident between Plaintiff and Defendant Driver, Plaintiff sought damages from negligent Driver, and from Owner, whose car she was driving. Prior to trial, Plaintiff served Driver with a proposal for settlement pursuant to section 768.79, Florida Statutes, and rule 1.442, Florida Rules of Civil Procedure. The proposal identified Plaintiff as the party making the proposal; identified Driver as the party to whom the proposal was made; offered to settle any and all of Plaintiff's claims against Driver arising out of the accident which formed the basis of Plaintiff's lawsuit; and stated $50,000 was the total amount of the proposal. Paragraph 6, entitled "Non-monetary terms of proposal," stated, "[t]he Plaintiff will dismiss with prejudice the above-styled action against Defendants, Driver and Owner after the defendant Owner (or his agents) tenders the proposed settlement amount." Driver did not respond to the proposal.
Immediately before trial, Driver and Owner conceded negligence, so the trial focused on the issues of causation and the apportionment of liability for Plaintiff's damages. Following trial, the jury returned a verdict for Plaintiff in the amount of $498,822.55. The trial court entered judgment on the verdict, which was affirmed on appeal.
Thereafter, Plaintiff moved for an award of attorney's fees and costs pursuant to section 768.79 and rule 1.442. Driver argued the proposal was invalid because it was unclear who would be released from liability as to what claims, and the proposal contained a settlement condition over which Driver had no control – that being, that the Owner (or his agents) would make the payment. The trial court granted Plaintiff's motion for attorney's fees and costs, finding that, "the offer is clear and understandable when considered in its totality in light of the issues in the case and the nature of the action." After a hearing on the reasonable number of hours and reasonable hourly rate, the trial court entered the fees and cost judgment.
An offer of judgment must be structured such that either offeree can independently evaluate and settle his or her respective claim by accepting the proposal irrespective of the other parties' decisions. Otherwise, a party's exposure to potential consequences from the litigation would be dependently interlocked with the decision of the other offerees. An offer that cannot be unilaterally accepted to create a binding settlement is an illusory offer.
Here, the trial court found that the offer was "brief, concise, and straightforward" in that "for the sum of $50,000, [Plaintiff] would settle the claim and dismiss her case, with prejudice, against both Defendants upon receipt of the payment. So what is the issue?"
The issue is that pursuant to the plain language of paragraph 6, settlement was predicated on payment of the settlement amount by Owner or his agents, presumably a reference to his insurance company. Although Plaintiff's proposal stated it was directed only to Driver, the language in paragraph 6 could reasonably lead one to believe that the offer also implicated Owner or his agents. Even though the proposal stated that the only relevant conditions of acceptance were those provided in the offer of judgment statute and implementing rule, a reasonable interpretation of the proposal could be that the claims against Driver would only be dismissed after Plaintiff had received the settlement amount. As evidenced by the trial court's interpretation, payment of the settlement amount by Owner or his agents could logically be understood to be required in order to settle the case.
Because the proposal in this case deprived Driver of the ability to evaluate and independently act to resolve the case against her, the appellate court concluded that the proposal was invalid, unenforceable, and could not form the basis of an award of attorney's fees and costs under section 768.79.