On March 24, 2023, Gov. Ron DeSantis signed House Bill 837 into law. Among its many changes were adjustments to the calculation and availability of attorneys’ fees in certain contexts and case types. These changes have left many clients and potential clients confused. The changes are not good news for Plaintiffs in Florida. Let’s take a closer look at what changed in terms of attorney fees and costs in Florida as a result of the change in the law.
Changes to Tampa Injury Lawyer Fees in HB 837
While HB 837 modified many elements of current Florida statutes, it made four big changes to attorney fees. Let’s break them down one by one.
Removal of “One-Way Attorneys’ Fees”
Firstly, HB 837 eliminated so-called “one-way” attorneys’ fees that correspond with Florida Statutes Sections 626.9373, 627.428, 631.70, and 631.96. These statutes affect lawsuits against surplus lines insurers, life insurers of insurance policies, and other groups.
For each of the affected groups, one-way attorneys’ fees are no longer leviable. On top of that, HB 837 removed attorneys’ fees from any personal injury protection (PIP) and auto-glass cases.
The removal of these attorneys’ fees means that law firms may look for different ways to recoup their costs and investments. However, average clients and consumers are not guaranteed to see many major changes in terms of their overall payments or bills.
The biggest and most harmful impact to consumers is that now many attorneys will not be willing to take on certain types of cases. Without the prospect of recovering attorneys fees from an insurer, many cases won’t be worth pursuing. This will allow insurance companies to selectively prey on small businesses and consumers.
Limits to Attorneys’ Fees Multipliers
Attorneys’ fees multipliers are contingencies that bestow additional monetary rewards on risk-taking attorneys. In essence, attorneys who take on cases that have a lower chance of succeeding may sometimes apply multipliers to their fees so they receive higher payouts at the conclusion of a case.
HB 837 has also changed this tendency. Under Florida Statute Section 57.104, attorneys’ fees multipliers are now only limited to cases that involve “rare and unusual circumstances.” Once again, this is bad for the small businesses and individuals in Florida because it means that attorneys are less likely to take a complicated or complex case if the potential recovery or award doesn’t justify the risk, time, and costs involved.
Recovery of Attorney Fees After a Total Denial of Coverage
In conjunction with the removal of many one-way attorneys’ fees, HB 837 adjusted when these fees could be levied against insurance companies. Now, one-way attorneys’ fees in insurance cases may only apply when there are declaratory judgment actions against an insurer after an insurance company totally denies coverage for a claim.
For example, if an insurance company denies coverage for a legitimate claim (such as an injured worker seeking workers’ compensation), the insured party can sue the insurance company. If the plaintiff’s case is successful, attorneys may recover one-way fees from the court. The attorney fees will be limited to any incurred in the legal action.
Unfortunately, this may be bad for individuals as it means many personal injury attorneys and other legal experts will be unwilling to take on insurance cases if they don’t believe they have airtight cases against insurance companies. Injured workers and vulnerable insured individuals are now more at the mercy of insurance companies that don’t want to pay what they owe.
Read more in our blog: The Personal Injury Law Changes in Florida 2023
Attorneys’ Fees Apply to New Civil Actions
On the plus side, HB 837 didn’t completely eliminate plaintiff rights to attorneys’ fees in a lawsuit. Florida Statute 768.79 still applies, and now it applies to any civil action that involves an insurance contract, not just certain ones.
That said, there is a condition. According to Statute 768.79, if a plaintiff filed a demand for judgment and it’s not accepted by the defendant within 30 days, AND the plaintiff recovers a judgment in an amount of 25% or greater than the offer, the plaintiff is entitled to recover reasonable costs and attorney’s fees incurred.
Put more simply, the defendant can’t accept a demand for judgment and the plaintiff has to recover damages/judgment of 25% or more than the original settlement offer they made. Furthermore, plaintiffs can’t serve proposals for settlements earlier than 90 days from the date of serving the defendant with their complaint.
What does this mean? Insurance carriers will try to aggressively resolve new cases as early as possible. It may be too tempting for lawsuit plaintiffs in need of cash to carry out effective suits with this rule. On top of that, insurance carriers can use the same statute to get their attorney’s fees covered if they successfully defend their case. This could put additional harmful financial burden on case plaintiffs.
Read more in our blog: Personal Injury Lawyers’ Insights: Are Personal Injury Settlements Taxable in Florida?
Will These Changes Affect Your Tampa Lawyer Fees?
As the above changes demonstrate, HB 837 is a net negative for Florida plaintiffs, attorneys, and anyone looking to see justice against predatory insurance companies.
Because HB 837 removes many ways for law firms to acquire compensation for their efforts, legal representation could become more expensive and some law firms may stop offering contingency fee policies. In addition, some lawyers may stop taking on challenging complex, or risky cases – even when their plaintiffs are morally in the right – because the risk of walking away with no reward is too high.
HB 837 makes it easier for insurance companies to bully case plaintiffs and insulate themselves from legal challenges. Meanwhile, many legal fees and expenses may be unfairly shifted onto the shoulders of those in most need of help.
Contact Personal Injury Lawyers in Tampa Today
Even with the above breakdown, you may still have questions about attorney fees and costs in Florida, especially in terms of what you’ll have to pay as a legal client. To get more information, feel free to contact knowledgeable personal injury lawyers in Tampa, Florida at Hunter Law, P.A. today.