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Fee Multipliers in Florida: The Basics
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Fee Multipliers in Florida: The Basics

March 13, 2017 Professional Services Industry Legal Blog

Reading Time: 6 minutes

In a contingency case there are certain circumstances in which an attorney’s fee award can be increased through the use of a multiplier from 1.5 to 2.5.[1] Recent cases have limited the applicability of the use of a fee multiplier in Florida. However, careful navigation of the current case law gives some guidance of the types of cases in which a fee multiplier is appropriate and in which a multiplier is not appropriate.

Quanstrom and Rowe

In tort or contract cases taken on a contingency, the factors to analyze when determining the appropriateness of a multiplier are:

(1) whether the relevant market requires a contingency fee multiplier to obtain competent counsel; (2) whether the attorney was able to mitigate the risk of nonpayment in any way; and (3) whether any of the factors set forth in Rowe are applicable, especially, the amount involved, the results obtained, and the type of fee arrangement between the attorney and his client.

Standard Guaranty Ins. Co. v. Quanstrom, 555 So.2d 828 (Fla. 1990)

The factors enumerated in Rowe are as follows:

(1) The time and labor required, the novelty and difficulty of the question involved, and the skill requisite to perform the legal service properly. (2) The likelihood, if apparent to the client, that the acceptance of the particular employment will preclude other employment by the lawyer. (3) The fee customarily charged in the locality for similar legal services. (4) The amount involved and the results obtained. (5) The time limitations imposed by the client or by the circumstances. (6) The nature and length of the professional relationship with the client. (7) The experience, reputation, and ability of the lawyer or lawyers performing the services. (8) Whether the fee is fixed or contingent.

Florida Patient’s Compensation Fund v. Rowe, 472 So.2d 1145 (Fla. 1985)

These elements form the backbone of the early analysis conducted when determining the appropriateness of a fee multiplier. However, recent cases have limited the application of a fee multiplier in certain types of cases.

Fee Multipliers Not Appropriate for Fees Awarded by Offer of Judgment Statute

The biggest limitation in the application of fee multipliers in contingency cases is when attorney’s fees are authorized by the Offer of Judgment Statute, Florida Statutes, §768.79. Sarkis v. Allstate Ins. Co., 863 So.210 (Fla. 2003). The rationale in Sarkis is essentially that the purpose of a fee multiplier is to encourage litigation while the purpose of the Offer of Judgment Statute is to encourage settlement. Essentially, a fee multiplier is supposed to encourage an attorney to take a case when nobody else would. However, the Sarkis court reasoned that the offer of Judgment statute was penal in nature and that the penal nature of the statute was supposed to encourage settlement. Pursuant to Sarkis, without Florida Statute 768.79 or Fla. R. Civ. P. 1.442 expressly authorizing a fee multiplier, there is no basis for a fee multiplier when the attorney’s fees were awarded pursuant to the Offer of Judgment Statute.

The Difficulty to Obtain Competent Counsel

Many of the recent cases focus on the ability to obtain competent counsel without the possibility of a multiplier. In Garrison, the Court held that the fact that an insured was able to retain ten (10) attorneys (the first nine of which were unable to obtain resolution and apparently unwilling to litigate the dispute) was a fact that negated the insured’s claim that it could not retain competent counsel without a fee multiplier. Garrison Property and Cas. Ins., Co. v. Rohrbacher, 204 So.3d 154 (Fla. 5th DCA 2016). Some Courts have suggested that the availability of counsel is so prevalent in certain types of claims that those types of claims may never support a multiplier. Progressive Exp. Ins. Co. v. Schultz, 948 So.2d 1027 (Fla. 5th DCA 2007) (“It seems few insureds, if any, have difficulty obtaining competent counsel to represent them. To the contrary, every television station and telephone book, and many billboards and buses, call out with ads from lawyers seeking to represent the injured.”) If there is no testimony as to the difficulty or inability to obtain counsel without the prospect of a fee multiplier, then awarding a multiplier constitutes reversible error. Florida Pennisula Ins. Co. v. Wagner, 196 So.3d 419 (Fla. 2d DCA 2016) (In reversing, “[t]here was no showing or finding that without the prospect for a multiplier to an otherwise reasonable fee award, the Wagners would have had difficulty finding competent counsel to represent them in this insurance coverage dispute.”)

When a Multiplier is Appropriate

So when is a multiplier appropriate? Most cases taken on a contingency are done so because there is a high likelihood of success and collection but the client simply doesn’t have the financial ability to pay legal fees. Most contingency cases would not support a multiplier. Likewise, the current trend is that insureds in coverage disputes with their insurers are not entitled to a multiplier. However, at least some recent cases have affirmed a multiplier in an insurance coverage dispute. Citizens Property Insurance Corp. v. Pulloquinga, 183 So.3d 1134 (Fla. 3d DCA 2015) (“With respect to the other factors to be considered in applying a multiplier set forth in Quanstrum, the trial court also concluded that Pulloquinga’s counsel was unable to mitigate against her non-payment of fees because Pulloquinga had no other means by which to pay her counsel and that the time involved by counsel was substantial, the results were the maximum sought and the fee arrangement was entirely contingent. We conclude that Pulloquinga provided sufficient competent evidence to support those conclusions as well and therefore affirm the application of the 1.5 multiplier.”)

The gravamen of the cases reversing awards of fee multipliers reverse the award because there is evidence that a substantial number of attorneys are willing to take the case on a contingency. This has become the most important factor in determining whether a multiplier is appropriate. At least one court has held that a fee multiplier is appropriate when there is a large number of attorneys willing to take the case on contingency and settle for a small percentage of the amount due, the lack of willingness of attorneys to take the case to trial supports an award of a fee multiplier. TRG Columbus Dev. Venture, Ltd. v. Sifontes, 163 So.3d 548 (Fla. 3d DCA 2015). As such, when seeking a multiplier, the requesting party should inform the court of all the reasons why few attorneys would take this case to trial. The reasons could range from factual problems with the case, legal problems with the case, or simply potential challenges with collection.

[1] Some people argue this is 1.5 to 3.0 as a 3.0 multiplier is expressly authorized in Florida Patient’s Compensation Fund v. Rowe, 472 So.2d 1145 (Fla. 1985). However, the maximum multiplier seems to be limited to 2.5 in Standard Guaranty Ins. Co. v. Quanstrom, 555 So.2d 828 (Fla. 1990).

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