Proposals for Settlement
When the Loser Pays for the Winner’s Attorney’s Fees
by Chris Reynolds
Retaining an attorney for a divorce, a criminal law matter, or a business contract can prove extremely expensive in terms of the amount of attorney’s fees needed. Further, in many cases, the client owes these fees regardless of whether you win or lose. However, there are some areas of the law where the expense of hiring an attorney isn’t prohibitive. For example, personal injury attorney’s often take cases on contingency, which simply means that the attorney takes a percentage of whatever is recovered, but the attorney is owed nothing if nothing is recovered. Florida has another interesting component to attorney’s fees in certain situations: the proposal for settlement. Essentially, a proposal for settlement is a way for the winner of a lawsuit to get the loser to pay for the winner’s attorney’s fees. For example, an injured party in a lawsuit can make an official offer (a proposal for settlement) and file that offer with the court. The other party (defendant) then has 30 days to accept that offer to settle. If the other party (defendant) does not accept the offer to settle, and if the case then goes to a jury trial and the jury awards the person who proposed the settlement more than 125% of the amount that the injured person was willing to settle
for, the court can then shift the attorney’s fees and make the defendant pay the attorney’s fees and costs for both parties. Of course, this also works for defendants. A defendant can propose a settlement to a plaintiff, and if the plaintiff does not accept it within 30 days and the jury awards 75% or less than the settlement amount proposed by the defendant, the plaintiff may have to pay for the attorney’s fees and costs for the defendant.
attorney could be many tens of thousands of dollars, so this proposal for settlement statute is extremely significant.
than 75% of the amount proposed by the defendant), then the plaintiff may have to pay the attorney’s fees for the defendant.
As a hypothetical example, consider a plaintiff who submits a proposal for settlement for $100,000.00, and a defendant files a proposal for settlement for $50,000.00. This usually happens months before the actual trial, and in this hypothetical, the plaintiff is willing to settle the case for $100,000 and the defendant is willing to settle for $50,000. Assume that neither party accepted the proposal for settlement and the case went to a jury trial. If the jury awards more than $125,000.00 (125% more than the $100,000 proposed by the plaintiff), then the defendant may have to pay for the plaintiff’s attorney’s fees. On the other hand, if the jury awards less than $37,500.00 (less
If a plaintiff loses, the plaintiff might end up owing money. In the above example, if the jury awarded $10,000, and the defense attorney fees and costs were $40,000, then the plaintiff would owe the defense attorney $30,000. On the other hand, if the jury awarded $160,000, and the plaintiff’s attorney’s fees and costs were $40,000, then the total verdict would increase by $40,000 to $200,000.
It is important to note that the attorney’s fees and costs for either the plaintiff or defense
As you can see, the amount to propose as a settlement can become very strategic because it creates the risk of having to pay for the other party’s attorney’s fees, which can be tens of thousands of dollars or more. If you or a loved one has been injured as a result of the negligence of another, please contact an experienced trial attorney.
Mr. Reynolds hails from St. Petersburg, graduated from Northside Christian High School, Eckerd College, and Stetson University College of Law. He lives in Pinellas with his wife and three boys, all of whom attend Keswick Christian School. Mr. Reynolds also has parents living in Pinellas County and a sister who recently returned from overseas as a Christian missionary.
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16 • January 2019
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