Considerations when Multiple Proposals for Settlement are Served on Separate Defendants
I have previously discussed proposals for settlement / offers of judgment (“proposals for settlement”). A proposal for settlement is a statutory vehicle pursuant to both Florida Statute s. 768.79 and Florida Rule of Civil Procedure 1.442 to create an argument to recover attorney’s fees based on the judgment amount. (See this article for more on proposals for settlement).
For a plaintiff (party seeking affirmative relief), the plaintiff must obtain a judgment 25% greater than the proposal for settlement amount. When there are multiple defendants, the plaintiff needs to serve a proposal for settlement on each defendant.
In Cassedy, Jr. v. Wood,44 Fla.L.Weekly D422a (Fla. 1st DCA 2019), a landlord sued his tenants for breach of a lease when the tenants vacated the property and stopped paying rent. The lease agreement provided that if collection was required by the landlord, the tenant was required to pay 10% of the judgment amount to cover attorney’s fees. I have no clue why the attorney’s provision in the lease included this language versus the standard prevailing party attorney’s fees language.
The landlord, obviously knowing the lease would not make him whole for purposes of recovering his attorney’s fees based on that interesting attorney’s fees language, also served a proposal for settlement on each of his tenants. The proposal for settlement required each tenant, independent of the other tenants, to pay the landlord $25,000. If the landlord recovered a judgment 25% greater than any proposal for settlement amount, the landlord would now have an argument to recover his attorney’s fees from the date he served the proposal for settlement on forward.
The landlord recovered a judgment of $83,657.60 against the tenants. The tenants were jointly and severally liable for this amount, meaning they were ALL on the hook for this total amount and the landlord could collect this judgment amount from any one or a combination of the tenants. This makes sense since likely all of the tenants were on the lease and signed the lease.
The trial court denied attorney’s fees pursuant to the proposal for settlements, which was subject to a de novo standard of appellate review. The appellate court reversed.
The tenants argued the separate $25,000 proposal for settlement amounts should be aggregated (totaling $75,000) for purposes of determining whether the judgment amount was 25% greater than the proposals for settlement amount for purposes of determining whether attorney’s fees from should be awarded. This was shot down on appeal. There is no requirement that separate proposals for settlement be aggregated and there was no dispute that the landlord recovered a judgment against all the defendants ($83,657.6) 25% greater than the $25,000 proposal for settlement amounts, especially since all of the tenants were jointly and severally liable for the judgment.
The tenants also argued that the landlord could not recover attorney’s fees pursuant to the lease and also through a proposal for settlement. This was shot down on appeal. “Based on the imposition of a penalty pursuant to section 768.79 [Florida Statutes] and its mandatory application if all requirements are met, we find a party is not precluded from receipt of attorney’s fees under a contract and the [proposal for settlement] statute simultaneously.” Cassedy, Jr., supra.
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