Entitlement To Attorney's Fees For A Florida Case May Be Established Under Another State's Substantive Law
In Felix Lopez v. State Farm Mutual Automobile, 2014 Fla. App. LEXIS 7709; 39 Fla. L. Weekly D 1058 (Fla. 3d DCA 2014), the Florida Third District Court of Appeal recently held that an Insured could properly raise the issue of entitlement to attorney’s fees under another state’s substantive law in a motion for reconsideration of an order denying award of attorney’s fees under Florida law. State Farm provided automobile insurance coverage to Lopez through a policy issued in Texas and delivered to him while he resided in Texas. Lopez moved to Florida and was involved in a car accident in Miami which caused damage to his vehicle. State Farm paid for some of the repairs, but then denied additional repairs. As a result, Lopez filed suit alleging breach of policy and sought attorney’s fees pursuant to F.S.A. §627.428 (prevailing insured entitled to attorneys’ fees on an insurance contract claim).
State Farm answered, asserting it insured Lopez pursuant to a policy issued and delivered in Texas, and that its obligations under the policy were “subject to the terms, conditions and limitations of that policy as circumscribed by the laws of Texas.” Additionally, State Farm moved to strike Lopez’s claim for attorney’s fees, contending that because the policy was issued in Texas, Florida Statute §627.401 (Florida Statutes Chapter 627 inapplicable to policies not issued for delivery in Florida) negated his claim to attorney’s fees under §627.428.
Subsequently, Lopez served, and State Farm accepted, a proposal for settlement to resolve the underlying suit, but not the attorney’s fees issue. Then, Lopez filed his motion for attorney’s fees based upon State Farm’s acceptance of the proposal for settlement which Lopez argued served as a confession of judgment entitling him to attorney’s fees. See generally Wollard v. Lloyd’s & Cos. Of Lloyds, 439 So. 2d 217 (Fla. 1983).
The trial court granted State Farm’s Motion to Strike and Lopez filed a Motion for Reconsideration arguing: (1) State Farm was estopped by having waited more than 18 months to first contest his entitlement to attorney’s fees under §627.428; (2) despite the fact that the policy was issued and delivered in Texas, it contemplated covering risk(s) in other states, and given State Farm’s voluntary payment of amounts claimed under the policy, the insured was entitled to attorneys’ fees pursuant to §627.428; and (3) alternatively, Lopez was entitled to fees under Texas Law. The trial court denied Lopez’s Motion for Reconsideration stating the court did not have jurisdiction to apply Texas law in this case.
On appeal, the court stated that is well established in Florida, and pursuant to §627.428, that when an insurer pays an insured after the insured has sued for coverage but prior to judgment, the payment serves as a confession of judgment, entitling the insured to fees. However, §627.401 establishes that in order to qualify for fees under §627.428, the insured must obtain a judgment in his favor and hold the policy issued for delivery or delivered in Florida. East Coast Ins. Co. v. Cooper, 415 So. 2d 1323, 1325 (Fla. 3d DCA 1982). The court disagreed with Lopez’s initial argument and held that application of Florida law is not warranted under the circumstances and based on the plain language of §627.401. Furthermore, the court disagreed with State Farm’s argument that Lopez never pled in his complaint that he was entitled to attorney’s fees under Texas law and was therefore precluded from raising that ground in his Motion for Reconsideration. The court cited Caufield v. Cantele, 837 So. 2d 371 (Fla. 2002), stating that a pleading which asserts a claim for attorney’s fees is sufficient to put an opposing party on notice even if the specific statutory or contractual basis is not set forth. Thus, a claim for attorney’s fees need not be specifically pled and a failure to plead the basis of the claim will not result in a waiver of the claim. The appellate court held that the trial court erred in denying Lopez’s Motion for Reconsideration and reversed and remanded for the trial court to determine the applicability of Texas law regarding Lopez’s claim for attorneys’ fees.