Two Proposal for Settlement Considerations
A proposal for settlement is a vehicle used to create an argument for the recovery of attorney’s fees from the date the proposal is served on forward if the opposing party does not accept the proposal within 30 days. In certain circumstances, such as when there is there is no basis to recover attorney’s fees, it can be a useful vehicle to create an argument to recover attorney’s fees. There are also strategic reasons to serve a proposal for settlement at a certain point in time in the litigation. There are definitely strategic issues that must be considered when serving a proposal for settlement.
Two things to note when serving a proposal for settlement:
- The proposal for settlement cannot be served right off the bat. A proposal for settlement to a plaintiff cannot be served until 90 days after the action has been commenced. A proposal for settlement to a defendant cannot be served until 90 days after the defendant was served with the lawsuit.
- A trial court’s stay of the lawsuit does not stay the proposal for settlement requirements. For instance, in Old Dominion Ins. Co. v. Tipton, 44 Fla. L. Weekly D1102a (Fla. 2d DCA 2019), a lawsuit was stayed and as soon as the stay was lifted the defendant served the plaintiff a proposal for settlement. The plaintiff argued that the prior stay precluded the defendant from serving the proposal because, when factoring in the stay, the proposal was served prematurely before the expiration of the 90-day period. The appellate court disagreed finding that the stay, itself, did not toll the proposal for settlement requirements.
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