Sweeping Changes to Florida Tort Laws Are Now in Effect
On March 24, 2023, Florida Governor Ron DeSantis signed House Bill (HB) 837 into law, effecting sweeping reform of Florida’s tort laws. Some of the most notable changes are to Florida’s frameworks for negligence, insurance, premises liability, personal injury litigation, and attorneys’ fees recovery.
Negligence: The statute of limitations for general negligence claims is reduced from four years to two. In most negligence cases, plaintiffs who are more than 50% at fault for their own injuries are barred from recovering any damages.
In other words, Florida has long been a rare hold out in the pure comparative negligence world. Under pure comparative negligence, a Plaintiff recovers whatever percentage of fault remains after subtracting plaintiff's own comparative fault from the fault of the defendant(s). So, under pure comparative fault, if a plaintiff was deemed 90% at fault, and the defendant only 10%, that plaintiff would still enjoy a recovery of 10% of damages awarded. In the modified comparative fault world, if a plaintiff is deemed any percentage over 50.1%, the defendant(s) prevails and a defense verdict on comparative fault results.
Critically, in a last second concession to the plaintiff's bar, Florida's Medical Malpractice Act (Fla. Stat. § 766) is exempted from modified comparative fault, so pure comparative fault will still be available in medical negligence actions.
Recovery of Attorneys’ Fees Against Insurance Companies: One-way attorneys’ fees in favor of policyholders who prevailed in lawsuits against their insurance carriers are all but eliminated, except in limited circumstances. One-way attorneys’ fees in suits involving residential and commercial property insurance had been eliminated earlier this year. Now, the ban has been expanded to nearly all other types of insurance.
Bad Faith Claims Against Insurance Companies: Negligence on the part of an insurance company is insufficient to constitute bad faith. Moreover, policyholders must now act in good faith in dealing with their insurance carrier or risk reduction of their damages award. Liability insurers are immune from bad faith lawsuits if they tender the lesser of the policy limits or the amount demanded by the claimant within 90 days after receiving actual notice of a claim, so long as the notice is accompanied by sufficient evidence to support the claim amount.
Premises Liability: In a lawsuit against a property owner, lessor, operator, or manager brought by someone who was lawfully on the property for injuries caused by a criminal, the fault of all parties, including the criminal, must be considered by the trier of fact. Owners and operators of apartment buildings and other multi-family housing enjoy a presumption against liability for criminal acts committed by third parties on their property if they implement certain security measures.
Recovery of Damages in Personal Injury and Wrongful Death Actions: A new statute limiting the recovery of past and future medical expenses in personal injury and wrongful death actions is enacted. The new statute also includes limitations on admissible evidence to prove medical expenses, as well as disclosure requirements for so-called “letters of protection,” which provide for the payment of medical expenses from the amounts recovered in litigation and that supporters of HB 837 claim are often used to increase the damages sought for medical treatment.
Recovery of Attorneys’ Fees Generally: Contingency fee multipliers, which reward attorneys who agree to take cases on a contingency fee basis by multiplying the amount of attorneys’ fees awarded when fee-shifting is permitted, are all but eliminated. A multiplier is now only appropriate in rare and exceptional circumstances and requires evidence that competent counsel could not otherwise be retained.
The legislation went into effect immediately upon the Governor’s signature and applies to all new causes of action. The new negligence statute of limitations applies to all causes of action that accrue after the effective date. To the extent rights under insurance contracts are impacted by the new legislation, it applies to insurance contracts that are issued or renewed after the effective date.
The effects on tort litigation in Florida are wide-reaching. The legislation provides new, vast protections for insurers and businesses operating in Florida. On the flipside, the litigation will make it harder for Floridians to sue their insurance carriers, leaving consumers exposed to the whims of insurance companies without much recourse. The new legislation will also make it more difficult for Floridians to recover damages when they are hurt, whether in a car accident or as a result of the criminal acts of a third party. The true effect of the legislation remains to be seen as cases work their way through the court system.
Crucially, this legislation takes an initial sweeping change at future damages in tort cases. This will impact the life care planning that so often inflates tort cases by, sometimes, ten-fold relative to prospective, alleged future medical needs. If a party is privately insured, evidence of what their health insurer would pay for treatment is admissible. If a party has Medicare or Medicaid, they may be limited to prevailing Medicare or Medicaid reimbursement rates. Alternatively, if a party has no insurance, their future damages award could be limited to 120% of Medicare allowable rates of reimbursement for the alleged future medical care needed.
This alert describes only some of the changes effected by the new legislation. The full text of the bill can be found here.
For more information regarding Florida’s new tort laws and their impact on your business, please contact your Quarles attorney or: