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January 4, 2018 by admin

Attorney’s fees — Proposal for settlement — Timeliness of service — Service of proposal of settlement on 91st day after insured’s complaint against insurer was served on Chief Financial Officer of state was valid and binding on insurer when served and was not premature under rule 1.442(b) — 90-day period during which proposal for settlement may not be served commenced when complaint was served on CFO and not, as insurer argued, when CFO forwarded complaint to insurer

43
Fla. L. Weekly D101a

Attorney’s
fees — Proposal for settlement — Timeliness of service — Service of proposal
of settlement on 91st day after insured’s complaint against insurer was served
on Chief Financial Officer of state was valid and binding on insurer when
served and was not premature under rule 1.442(b) — 90-day period during which
proposal for settlement may not be served commenced when complaint was served
on CFO and not, as insurer argued, when CFO forwarded complaint to insurer

DIANYA MARKOVITS, Appellant, v.
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Appellee. 1st District. Case
No. 1D17-1623. January 3, 2018. On appeal from the Circuit Court for Alachua
County. Monica J. Brasington, Judge. Counsel: Julie A. Fine and Cherie H. Fine
of Fine, Farkash & Parlapiano, P.A., Gainesville, for Appellant. Susan M.
Seigle of Alvarez, Winthrop, Thompson and Storey, P.A., Gainesville, for
Appellee.
(BILBREY, J.) Appellant, Dianya
Markovits, was injured in an automobile crash and brought suit against
Appellee, State Farm Mutual Automobile Insurance Company, for uninsured
motorist benefits under her insurance policy. She served a proposal for
settlement on State Farm which was not accepted.1 After trial, Markovits obtained a
final judgment in her favor which was more than 25 percent greater than the
amount demanded in the proposal for settlement, and she then moved for
attorneys’ and paralegals’ fees based on the rejected proposal.2 See § 768.79(1), Fla. Stat.
(2014). State Farm disputed her entitlement to fees contending that the
proposal was served prematurely. See Fla. R. Civ. P. 1.442(b). The trial
court agreed with State Farm and held that Markovits was not entitled to an
award of fees. Based on our case law which establishes that service on an
insurer is perfected when the Chief Financial Officer of the State of Florida
(CFO) is served as an insurer’s “attorney to receive service of all legal
process issued against it in any civil action or proceeding in this state,” we
hold that the proposal was not premature, and that Markovits is entitled to
reasonable attorneys’ and paralegals’ fees. § 624.422(1), Fla. Stat. (2014). We
therefore reverse and remand for a hearing to determine the amount of fees to
be awarded to Markovits.
As required by law, the complaint
was served on the CFO. See §§ 48.151, 624.422, 624.423, Fla. Stat.
(2014). The CFO was served on February 4, 2014, and his office forwarded the
complaint to State Farm on February 7, 2014. See § 624.423(1), Fla.
Stat. On May 6, 2014, Markovits served the proposal for settlement on State
Farm. Rule 1.442(b), Florida Rules of Civil Procedure, states in part that a
“proposal to a defendant shall be served no earlier than 90 days after service
of process on that defendant.” State Farm was served with the proposal 91 days
after service of the complaint on the CFO but 88 days after the complaint was
forwarded by the CFO to State Farm. Markovits argues that service was perfected
when the CFO was served, and therefore the proposal complied with rule
1.442(b).3 State Farm argues that service was
not perfected until the CFO forwarded the complaint to State Farm, and
therefore the proposal was premature and invalid. Both parties cite certain
statutory language in support of their positions.
Markovits points to section 624.422,
which states,
(1) Each
licensed insurer, whether domestic, foreign, or alien, shall be deemed to have
appointed the Chief Financial Officer and her or his successors in office as
its attorney to receive service of all legal process issued against it in any
civil action or proceeding in this state; and process so served shall be
valid and binding upon the insurer
.
(Emphasis added).
While State Farm points to section
624.423, which states,
(3) Process
served
upon the Chief Financial Officer and copy thereof forwarded
as in this section provided shall for all purposes constitute valid and
binding service
thereof upon the insurer.
(Emphasis added).
In Centex-Rodgers Construction
Company v. Hensel Phelps Construction Company
, 591 So. 2d 1117, 1117 (Fla.
1st DCA 1992), we discussed “whether service on a foreign corporation and its
surety is perfected through service on the Insurance Commissioner’s office, as
agent of the surety.” At the time, the Insurance Commissioner was the statutory
agent under sections 48.151, 624.422, and 624.423, but the statutes were
otherwise almost identical to the 2014 versions. Although Centex-Rodgers
involved the question of which circuit court had jurisdiction when competing lawsuits
were brought in different circuits, our holding there was broader. We stated:
The
dispute in this case is whether service of process upon the Insurance
Commissioner as agent of the surety constitutes perfected service, or whether
such service is complete only upon transmission by the Insurance Commissioner
and receipt by the surety. The general rule in this context is that service of
process upon the Insurance Commissioner constitutes actual service of process.
Id. at 1119.
In Centex-Rodgers we discussed
and distinguished Home Life Insurance Company v. Regueria, 243 So. 2d
460 (Fla. 2d DCA 1970). Regueria involved the Insurance Commissioner’s
failure, after receiving the summons and complaint, to forward them to the
insurer as required by law. Id. at 461. The insurer was defaulted for
failing to answer, and the insurer then challenged service. Id. The
court in Regueria held that “no valid or binding service of process was
effected.” Id. at 463. As in Centex-Rodgers, “[w]e conclude that
the Regueria decision is inapplicable in the circumstances of this case.”
Centex-Rodgers
, 591 So. 2d at 1119. Just as in Centex-Rodgers,
“[h]ere, proper notice and an opportunity to defend is not at issue.” Id.

We did note in Centex-Rodgers
that “the sole question is whether service of process upon the Insurance
Commissioner constitutes valid and binding service upon the insurer, for
jurisdictional purposes.” Id. The trial court perceived the “for
jurisdictional purposes” clause as a limitation which made Centex-Rodgers
inapplicable. However, this overlooked the earlier statement in Centex-Rodgers
that in general serving the statutory agent — there the Insurance
Commissioner, here the CFO — “constitutes actual service of process.” Id.
We do not find this language to be dicta, and being bound by Centex-Rodgers,
hold that once service was perfected on the CFO, the running of the 90-day
period started, after which it was permissible for a proposal for settlement to
be served on State Farm.
Our holding is also based on section
48.151(1), which states that “[w]hen any law designates a public officer,
board, agency, or commission as agent for service of process” and the person or
entity so designated is served with process, then “service is valid service
for all purposes
on the person for whom the public officer, board, agency,
or commission is statutory agent for service of process.” (Emphasis added).
Since the proposal was served on the CFO on the 91st day after service of
process and was “valid for all purposes” as to State Farm when served, the
proposal was not premature under rule 1.442(b).
Therefore, the order denying
Markovits entitlement to attorneys’ and paralegals’ fees is REVERSED, and this
matter is REMANDED for a hearing to determine the amount of reasonable fees to
be awarded. (LEWIS and M.k. thomas, JJ., concur.)
__________________
1Rule 1.442, Florida Rules of Civil
Procedure, uses the term proposal for settlement while section 768.79, Florida
Statutes (2014), uses the term offer of judgment when made by a defendant or
demand for judgment when made by a plaintiff. For the sake of simplicity and
consistency the demand for judgment from Markovits is referred to as the
proposal for settlement or proposal.
2Following trial, in a separate motion
Markovits moved for and was awarded costs as a prevailing party. See §
57.041, Fla. Stat (2014). Therefore, although section 768.79 would also provide
for an award of costs, the motion at issue here sought only fees.
3Markovits also argues that we should
apply Kuhajda v. Borden Dairy Company of Alabama, LLC, 202 So. 3d 391
(Fla. 2016), so as not to give a strict reading to rule 1.442 and thereby
defeat the substantive right to fees created by section 768.79. Based on our
holding that service on State Farm was perfected when the CFO was served, we do
not reach that issue.

* * *

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