LEGAL MALPRACTICE: STANDING: A LIABILITY INSURANCE COMPANY LACKED STANDING TO BRING AN ACTION FOR LEGAL MALPRACTICE AGAINST THE LAWYER IT RETAINED TO DEFEND ITS INSURED

Arch Insurance Company v. Kubicki Draper, LLP, ___ So. 3d ___, 44 Fla. L. Weekly D269 (Fla. 4th DCA January 23, 2019)
 

A liability insurance company brought an action for legal malpractice against the law firm it retained to defend its insured.  The insurer alleged it overpaid to settle the case against its insured because the law firm waiting too long to raise the statute of limitations as an affirmative defense.  The settlement did not exceed the policy limits. The law firm moved for summary judgment, arguing that the insurer lacked standing to sue because: (1) The insuring agreement entitled the insured to retain its own lawyer to defend the case.  Although this right was subject to the insurer’s consent, consent could not be unreasonably withheld. (2) Neither the Statement of Clients’ Rights nor any other document indicated that the law firm represented both the insured and the insurer, and dual representation was impermissible without notice to the insured.  (3) The law firm was in privity of contract with the insured, and the insurer was merely a third party that paid the law firm for its services to the insured. (4) The law firm discharged its duty to the insured to obtain a settlement within the policy limits. Judge Patti Englander Henning granted the law firm’s motion for summary judgment.  Judge Henning declined to follow three federal district court decisions cited by the insurer because the federal cases were not binding authority, they merely guessed how a Florida court would rule on this issue of first impression, the lawyers in two of the federal cases “were hired to defend the carrier’s interest in effecting a settlement under liability policies,” two of the cases involved settlements in excess of the policy limits, and the insurer in one of the cases was in privity with the law firm.  The Fourth District Court of Appeal affirmed. Although the law firm was in privity with the insured, there was nothing in the record to indicate that the law firm was in privity with the insurer or that “the insurer was an intended third party beneficiary of the relationship between the law firm and the insured.” The Fourth District agreed with Judge Henning’s rationale for refusing to follow the federal district court cases relied upon by the insurer. The insurer argued that public policy and common sense supported a determination of standing because insurance defense lawyers should not be allowed to commit legal malpractice with impunity.  Although the Fourth District stated that it “underst[ood] the insurer’s public policy argument, the court held that it was “bound to follow the law as it exists, not as the insurer argue[d] that it ought to be.” The Florida Supreme Court has allowed a plaintiff, who was not in privity with a lawyer, to sue for legal malpractice if the plaintiff (1) was a beneficiary under a will drafted by the lawyer, or (2) relied upon a public placement memorandum drafted by the lawyer. Neither situation existed in the present case. The court affirmed summary judgment for the law firm because nothing in the record indicated that the insurance company was in privity with the law firm “or that the insurer was an intended third party beneficiary of the relationship between the law firm and the insured.”  The court distinguished a recent decision from the Fifth District Court of Appeal because it involved a motion to dismiss rather than a motion for summary judgment.

HOMEOWNERS INSURANCE: APPRAISAL: THE ISSUE OF CAUSATION WAS SUBJECT TO APPRAISAL BECAUSE THE INSURER DID NOT DENY COVERAGE FOR THE ENTIRE LOSS

People’s Trust Insurance Company v. Garcia, ___ So. 3d ___, 44 Fla. L. Weekly D279 (Fla. 3d DCA January 23, 2019)
 

The insured under a homeowner’s policy sustained water damage as a result of a roof leak.  The insurer acknowledged coverage for interior damage but denied coverage for roof damage and demanded appraisal when the insurer disagreed with its position.  The insured sued for breach of contract, and the trial court denied the insurer’s motion to compel appraisal. The Third District Court of Appeal reversed. The issue of causation was subject to appraisal because the insurer did not deny coverage for the entire loss.

MEDICAL MALPRACTICE: A PRESUIT AFFIDAVIT FROM A BOARD CERTIFIED PLASTIC SURGEON AND OTOLARYNGOLOGIST WAS INCOMPETENT IN A MEDICAL PRACTICE CASE AGAINST AN ORTHOPEDIC SURGEON

Riggenbach v. Rhodes, ___ So. 3d ___, 44 Fla. L. Weekly D296 (Fla. 5th DCA January 25, 2019)
 

The plaintiff sued an orthopedic surgeon for negligently performing wrist surgery.  During the presuit screening period, the plaintiff filed the corroborating affidavit of a board certified plastic surgeon and otolaryngologist.  The trial court denied the defendant’s motion to dismiss on the theory that the plaintiff’s expert did not practice the same specialty as the defendant.  The Fifth District Court of Appeal “grant[ed] the [defendant’s] petition [for certiorari], quash[ed] the trial court’s order, and remand[ed] with instructions to dismiss the complaint.”  The affidavit was incompetent because the expert and the defendant did not practice the same specialty.

MEDICAL MALPRACTICE: PRESUIT AFFIDAVITS FROM AN EMERGENCY ROOM PHYSICIAN, A RADIOLOGIST, AND A NURSE WERE INCOMPETENT IN A MEDICAL MALPRACTICE CASE AGAINST AN ORTHOPEDIC SURGEON

Davis v. Karr, ___ So. 3d ___, 44 Fla. L. Weekly D298 (Fla. 5th DCA January 25, 2019)
 

The plaintiff sued her orthopedic surgeon for medical malpractice.  During the presuit screening period, the plaintiff filed corroborating affidavits from an emergency room physician, a radiologist, and a nurse.  The trial court granted the defendant’s motion to dismiss because the plaintiff’s experts did not practice the same specialty as the defendant. The Fifth District Court of Appeal affirmed.  The court refused to consider the plaintiff’s contention that the same specialty requirement was unconstitutional because it was made for the first time on appeal, and the plaintiff did serve notice of her constitutional challenge on “the Attorney General or the state attorney of the judicial circuit in which the action [was] pending.”  The Florida Supreme Court’s refusal to adopt as a rule of procedure the legislature’s same specialty requirement did not invalidate the statue, which “remain[ed] in effect” because the plaintiff’s constitutional challenge “[was] not properly before [the court].”

TRIP AND FALL: THE OBVIOUSNESS OF AN UNEVEN SIDEWALK DID NOT ELIMINATE THE DEFENDANTS’ DUTY TO REPAIR IT

Middleton v. Don Asher & Associates, Inc., ___ So. 3d ___, 44 Fla. L. Weekly D301 (Fla. 5th DCA January 25, 2019)
 

The plaintiff tripped on an uneven sidewalk in the condominium community in which she had lived for fifteen years.  Before the accident occurred, the plaintiff had “frequently passed the area where she fell.” The trial court entered summary judgment for the condominium association and its property manager because the unevenness of the sidewalk was open and obvious.  The Fifth District Court of Appeal reversed.  The defendants knew about the condition for at least eighteen months before the accident occurred and had placed blue dots on the sidewalk to mark it as an area “most in need of repair.” Although the defendants did not have a duty to warn about the condition of the sidewalk, “the obviousness of the condition [did not] relieve[] [the defendants] of the duty to repair it.”

FIRST PARTY BAD FAITH: THE FAILURE TO PAY STATUTORY ATTORNEY’S FEES AFTER CONFESSING JUDGMENT BY PAYING THE INSURED’S CLAIM FOR BENEFITS UNDER THE POLICY DID NOT CREATE AN ACTIONABLE CLAIM FOR BAD FAITH

Do v. Geico General Insurance Company, Case No. 1:17-CV-23041-JLK (S.D. Fla. January 25, 2019)
 

The plaintiff sued Geico for failing to make payment under his comprehensive coverage for the theft of his leased automobile.  After the lawsuit was filed, Geico paid $44,262.18 to the lienholder. The plaintiff filed a motion for attorney’s fees and costs based on the theory that the payment of his claim was a confession of judgment.  The trial court denied the motion, but the Third District Court of Appeal reversed. On remand, the trial court awarded $187,475 in fees and costs to the plaintiff. The plaintiff then sued Geico for first party bad faith, and the action was removed to federal district court.  The plaintiff filed four Civil Remedy Notices of Insurer Violation (CRN’s) before suing Geico for bad faith. The first notice was filed before the breach of contract case. The second notice was filed after the plaintiff filed his motion for attorney’s fees and costs in the breach of contract case.  The third notice was filed after the plaintiff’s first notice of appeal from the denial of his motion for attorney’s fees and costs was dismissed as premature. The fourth notice was filed after Geico delayed the adjudication of the plaintiff’s claim for attorney’s fees and costs after the plaintiff prevailed in the Third District Court of Appeal.  Geico moved for partial summary judgment to establish that the plaintiff’s second, third, and fourth CRN’s were invalid. Judge James Lawrence King of the United States District Court for the Southern District of Florida granted Geico’s motion. The purpose of a CRN is to provide an insurer with the opportunity to cure a violation of Section 624.155, Florida Statutes.  An insurer cures by paying the benefits due under the policy. The insurer is not required to pay extracontractual damages to effect a cure. In this case, Geico cured its violation by paying the $44,262.18 due under the policy. Liability for statutory attorney’s fees after payment of the claim under the insurance policy is a form of extracontractual damages. The second, third, and fourth CRN’s were invalid because “they were used to compel payment of extra-contractual damages,” which may not be required to cure a violation of Section 624.155, Florida Statutes.  Judge King agreed with Geico that “an insurer is not obligated to ‘pay [all] amount[s] purportedly owed under any statute or other authority to fulfill its contractual obligations.” Judge King ruled that Geico’s “payment of the claim owed under the policy extinguished Plaintiff’s right to . . . file a [subsequent] CRN based on the policy.”

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