A recent Fourth District Court of Appeals case invalidated proposals for settlement for a technical foul. The source of the otherwise inconsequential technicality was the failure of the proposals to state, as required by rule 1.442(c)(2)(F), Fla. R. Civ. P. that, “attorney’s fees are part of the legal claim.” In Deer Valley Realty, Inc. v. SB Hotel Associates, LLC, 2016 WL 1660619, *1, --- So. 3d --- (Fla. 4th DCA Apr. 27, 2016), the court refused to accept language in the proposals which stated, “This proposal for settlement is inclusive of all attorney’s fees and costs incurred by Plaintiff or Defendant,” as sufficient to comply with the requirements of rule 1.442.
Looking to the rule itself, the requirement concerning attorney’s fees is that the proposal shall “state whether the proposal includes attorneys’ fees andwhether attorneys’ fee are part of the legal claim.” (Emphasis added). Accordingly, the Fourth DCA determined the proposals only satisfied half of the rule’s requirements. Therefore, if fees are pleaded in the complaint, or asserted at any time during the litigation, a proposal must expressly state “attorney’s fees are part of the legal claim,” in addition to stating whether the proposal/offer is inclusive of attorney’s fees. Citing Florida Supreme Court case, Diamond Aircraft Indus., Inc. v. Horowitch, the Fourth DCA strictly construed section 768.79 and rule 1.442 as existing in derogation of common law to reach its decision.
The plaintiff also argued the proposals failed to specify what portion would settle a punitive damages claim, but this issue was not addressed by the court. While the additional technical violation alleged by the plaintiff was not addressed, the takeaway is this: Proposals for settlement must, at a minimum, meet all of the technical requirements of both section 768.79 and rule 1.442 in order to be valid, and proposals will be strictly scrutinized for compliance.
The technical requirements of a proposal for settlement/offer of judgment are as follows:
- Shall be served to a defendant no earlier than 90 days after service of process upon that defendant;
- Shall be served to a plaintiff no earlier than 90 days after commencement of the action;
- Shall be served no later than 45 days before the date set for trial, or the first day of the docket on which the case is set, whichever is earlier;
- Shall be in writing;
- Shall identify the applicable Florida law under which it is being made;
- Shall name the party or parties making the proposal and the party or parties to whom made;
- Shall state that the proposal resolves all damages that would otherwise be awarded in a final judgment in the action in which the proposal is served, subject to subdivision (F)[attorney’s fees language];
- Shall state with particularity any relevant conditions;
- Shall state total amount of the proposal and state with particularity all nonmonetary terms ;
- Shall state with particularity the amount proposed to settle a claim for punitive damages, if any;
- Shall state whether the proposal includes attorneys’ fees and whether attorneys’ fee are part of the legal claim;
- Shall include a certificate of service in the form required by rule 1.080; and
- Shall be served and not filed unless necessary to enforce.
- Other provisions apply to joint proposals. See rule 1.442(c)(3) and (4).
Section 768.79, Fla. Stat.
- Must be in writing and state that it is being made pursuant to this section;
- Must name the party making it and the party to whom it is being made;
- Must state with particularity the amount offered to settle a claim for punitive damages, if any;
- Must state its total amount; and
- Shall be served and not filed unless accepted or necessary to enforce.
Care should be taken when reviewing the full text of both the rule of procedure and the statute so Florida practitioners don’t find their proposal for settlement unenforceable due to a technicality. While there may be strategic reasons to deviate from some of the requirements in making a proposal for settlement/offer of judgment at different stages of your litigation, don’t expect that a proposal failing to meet these technical requirements will be upheld at the end of your case.