Florida Appellate Court Upholds Award of Attorneys’ Fees Against Insurer Who Denied Benefits

Dealing with insurance companies can create some of the biggest headaches when it comes to motor vehicle accidents. In the recent case of Explorer Insurance Co. v. Cajusma, a Florida driver held a liability coverage policy from an insurance carrier. During the policy period, the driver was involved in a car accident. At the time of the crash, there were multiple passengers in the plaintiff’s car and two occupants in the other vehicle. After the accident, the driver and each of the passengers in his vehicle received chiropractic care. Each occupant in the driver’s vehicle also filed a claim for personal injury protection (“PIP”) benefits.

Shortly thereafter, the driver of the other vehicle involved in the accident and his passenger filed a personal injury action against the first driver. The driver’s insurer denied all the claims, resulting in multiple individual lawsuits being filed against the driver in court. Additionally. the chiropractic clinic where the driver and his passengers sought medical care filed a legal action against the driver and one of the occupants, claiming that both parties failed to pay their chiropractic bills.

The terms of the driver’s insurance coverage stated that the insurer was required to defend the driver against any legal actions that resulted from a covered accident and to indemnify the driver. The insurer, however, requested a declaratory judgment from the court against each of the individuals who were involved in the collision. The insurer claimed that it was not required to make payments for anything tied to the accident because of alleged material misrepresentations that were made regarding the accident.

In response to the insurer’s position, the driver filed a lawsuit for breach of contract, claiming that the insurer’s refusal to defend him in the lawsuits against him and its failure to provide payment for his property damage claims were violations of the insurance policy. Some time later, the driver and the insurance company entered into a settlement agreement of roughly $10,000, which also included legal costs.

Notwithstanding this settlement, the driver and his passenger filed a motion for summary judgment in the insurance company’s action seeking a declaratory judgment, and they included a request for legal fees and costs pursuant to Florida Statutes Section 627.428. In response, the insurance company filed a motion stating that it was going to dismiss its own case voluntarily. In response to both motions, the court granted the insurance company’s request to voluntarily dismiss its own case, but it also granted the driver’s and passenger’s respective requests for the payment of legal fees under the statute.

The insurer appealed. On review, the Fifth District Court of Appeal concluded that the statute was designed to provide legal fees and expenses to parties who were required to bring a lawsuit to collect the reimbursement they are owed under their insurance policies. Since the insurance company provided the driver with a benefit while also asserting that it was not required to provide that benefit before dismissing its action seeking a declaratory judgment, the award of attorney fees was proper. In regard to the passenger, however, the court concluded that the award of attorney fees was not proper because the insurance company did not provide the passenger with representation or make any damages payments on his behalf.

If you or someone you love has been injured in a car accident, you may be entitled to compensation. At Lusk, Drasites, and Tolisano, our team of aggressive and dedicated personal injury lawyers has represented accident victims throughout Southwest Florida, including in Naples, Fort Myers, and Cape Coral. We make sure our clients receive the personal attention they deserve and fight to ensure that their rights are asserted at each step of the process. Call us now at 1-800-283-7442 or contact us online to set up your appointment.

Related Posts:

Florida Federal Court Remands Slip and Fall Case to State Court for Lack of Diversity Jurisdiction

Florida Appellate Court Upholds Ruling Making an Insurer Jointly and Severally Liable for its Insured’s Litigation Costs

Florida Appellate Court Reverses Award of PIP Benefits for Lack of Notice to Insurer

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