On April 16, 2015, the Florida Supreme Court issued two opinions on the validity of a joint proposal for settlement: Audiffred v. Arnold, 40 Fla. L. Weekly S199 (Fla. April 16, 2015), and Pratt v. Weiss, 40 Fla. L. Weekly S201 (Fla. April 16, 2015). A proposal for settlement, also known as an offer of judgment, is a tool often used in litigation to attempt pre-trial resolution of a case, whereby a plaintiff or defendant can propose to resolve a case for a specified amount. Rejection of a proposal for settlement can trigger an award of attorney’s fees and costs in favor of the offering party if certain conditions are met. The substantive and procedural requirements for serving and enforcing a proposal for settlement or offer of judgment are contained in Section 768.79, Florida Statutes, and Rule 1.442, Florida Rules of Civil Procedure, respectively.
In Audiffred v. Arnold, the Florida Supreme Court held that a proposal for settlement from a plaintiff to a defendant attempting to resolve pending claims by a second plaintiff, who was neither an offeror nor offeree, was invalid since, as a joint proposal, it should have apportioned the settlement amount among the offerors. In Audiffred, two plaintiffs sued a single defendant for injuries sustained in an automobile accident. The first plaintiff brought claims for personal injury and property damage. The second plaintiff brought only a loss of consortium claim. The first plaintiff served a proposal for settlement attempting to resolve the claims by both plaintiffs, but the proposal did not apportion a specific amount for the second plaintiff. The defendant rejected the offer and the plaintiffs prevailed at trial. In considering the validity of the proposal, the Court noted that the apportionment requirement must be strictly construed such that an offer presented by multiple offerors must apportion the amount that is attributable to each offeror, even where one claim is for loss of consortium. The Court ultimately extended the apportionment requirement to cases in which one plaintiff attempts to resolve claims brought by other plaintiffs without apportionment.
Additionally, in Pratt v. Weiss, the Court held that a proposal for settlement served by two defendants to a single plaintiff was a joint proposal requiring apportionment of the amount attributable to each defendant. While the Court’s holding appears to be a straightforward application of Rule 1.442, the Pratt case was unique in that the defendants making the offer appeared to be the same entity and/or had only coextensive liability. In fact, both defendants were treated as a single entity during litigation, were represented by a single lawyer, filed a single answer, and were listed as one party on the verdict form at trial. It was the plaintiff who listed two different names in the Complaint. Despite that, the Court held that a strict application of the apportionment requirement was necessary even where no logical apportionment can be made because the proposal for settlement and motion for attorney’s fees treated the two defendants as separate parties.
Justice Canady wrote a dissenting opinion in both Audiffred and Pratt, in which Justice Polston concurred, arguing that the Supreme Court lacked jurisdiction to consider both cases. However, neither dissenting opinion provides a substantive argument for enforceability of the respective proposals.
Importantly, Rule 1.442 was amended in 2011 to include an exception to the attribution requirement for a joint proposal for settlement in cases of vicarious liability. The exception, contained in Rule 1.442(c)(4) states:
“Notwithstanding subdivision (c)(3), when a party is alleged to be solely vicariously, constructively, derivatively, or technically liable, whether by operation of law or by contract, a joint proposal made by or served on such a party need not state the apportionment or contribution as to that party. Acceptance by any party shall be without prejudice to rights of contribution or indemnity.”
This vicarious liability exception was not in the version of Rule 1.442 considered by the Court in Audiffred or Pratt, and it is unclear how, if at all, subsection (c)(4) would change the analysis.
These cases further illustrate the proverbial minefield of case law created by judicial review of joint proposals for settlement. It remains clear that a party must carefully consider and draft a proposal for settlement or offer of judgment involving multiple offerors or offerees to be in the best position to seek enforceability after disposition of the case.