TALLAHASSEE – Florida's highest court recently ruled that insured drivers involved in accidents with uninsured motorists are entitled to a jury determination of liability and full extent of recoverable damages before a first-party bad faith case, as Florida courts continue to seek to protect drivers in insurance cases.

"The trend has been in favor of protecting policyholders and the court’s opinion here is no exception," Andrea DeField, an associate attorney for the law firm Hunton and Williams, told the Florida Record.

The ruling by the Florida Supreme Court reverses one from the Florida 5th Circuit Court of Appeal, which had ruled that those determinations had to be deferred to the bad faith case, not established before it, and deals a rebuke to Safeco Insurance, which had appealed the case. The high court also clarified that after those determinations were made, insured drivers could amend a bad faith claim to their cases.

DeField says this case mainly serves as a message to insurance companies that tend to ignore early civil summons requesting the liability and damages information beforehand.

"The decision is consistent with positions routinely taken by policyholder advocates in this state - that a belated tender of policy limits by the insurer does not extinguish the underlying action or the insurer’s exposure to extracontractual damages in the form of an excess verdict," she said.

The case will now be sent back to the 5th Circuit Court to address some of the issues that were not ruled on by the Supreme Court. 

The case stems from an accident in 2007 where Adrian Fridman suffered injuries in a crash with an uninsured motorist.  He filed a claim with Safeco, his insurance company, for the $50,000 limit of his policy. Safeco refused to pay, so Fridman filed a civil remedy notice, claiming that Safeco failed to attempt in good faith to settle his claim, offering only $5,000 instead of his full policy limit.

The civil remedy notice gave Safeco 60 days to respond, but they failed to do so, leading Fridman to file a complaint to determine liability and damages.  He also, as required by Florida Rule of Civil Procedure, offered Safeco a $50,000 settlement, but they did not respond.  

One month before the case was set for trial, March 2011, Safeco did send Fridman a $50,000 check, but stated on the check that this would be the full and final settlement of any and all claims if cashed. Fridman rejected the check with these terms and the case went to trial. Safeco later tendered another $50,000 check without the final settlement language, but also added a motion for entry of confession of judgment.  Fridman denied this because a jury verdict would be able to determine its liability if a bad faith claim was added to the case. Eventually the jury found the uninsured driver was 100 percent responsible and damages were set at $1 million.  Safeco's appeals of the case to the court of appeal led to the verdict being overturned, and thus to the Supreme Court reinstating the original verdict.

While in general, this ruling may cause insurance companies to change their behavior, DeField says it could have a significant immediate impact on the case it resulted from as well.

 "In the meantime, the court’s scathing summary of Safeco’s conduct and failure to timely tender policy limits when demanded, may very well encourage settlement," she said.

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