Florida has recognized the need for fee-shifting to keep insurance companies honest since 1893. For several years, however, the Governor and Florida legislature have been attacking the ability of insureds to successfully challenge their insurance companies when their claims are wrongfully denied or underpaid. Most recently, the legislature deleted the “fee shifting” statute that provided an insured was entitled to recover, from the insurer, prevailing-party fees and costs if the insured prevailed in a lawsuit against the insurer. If a policy was incepted after March 24, 2023, there is no more “one-way fee-shifting.” This article discusses whether insureds subject to the legislative change can still sue their insurers.

What is Fee Shifting?

A fee-shifting statute is a law that requires the losing party in a legal case to pay the prevailing party’s legal fees and costs. Fee-shifting statutes are exceptions to the “American Rule,” which states that each party in a lawsuit is responsible for their own attorney’s fee.  Fee-shifting statutes empower individuals, especially those with limited financial means, to pursue legal action against larger entities, such as employers and insurance companies. Understanding the historical context, recent legislative changes, and the underlying philosophy of fee shifting is crucial for grasping its significance in promoting access to justice. In today’s Florida, fee-shifting statutes are under heavy assault by the current Governor and legislature.

Florida has—or had—fee-shifting statutes in the following types of cases: workers’ compensation claims; suing an insurance company for wrongfully denying a claim; unpaid wages (such as minimum wage or overtime); offer of judgment/proposal for settlement; 57.105 for frivolous claims or defenses; landlord-tenant disputes; consumer protection under the Florida Deceptive and Unfair Trade Practices Act (FDUTPA); civil rights claims under the Florida Civil Rights Act; public records requests; whistleblower retaliation claims; homeowners’ association and condominium disputes; eminent domain proceedings; unlawful detainer actions; medical malpractice in cases of frivolous claims; probate and trust litigation; homeowner’s insurance disputes; civil theft claims; partition of property actions; construction lien disputes; unfair or deceptive trade practices under the Consumer Collection Practices Act; and family law matters such as divorce, child support, and alimony cases. Fee-shifting also applies to civil rights violations under Florida’s state analog to federal civil rights laws.

Fee-shifting statutes are—or have been—vital in Florida’s legal landscape, particularly in cases involving workers’ compensation, insurance disputes, and wage claims. One category of fee shifting is the 57.105 or offer of judgment/proposal for settlement type, which can impose fees on a party in any type of case for its behavior in that case—pursuing wholly frivolous claims or defenses or failing to accept a proposal for settlement and then failing to get a result within 25% of the offer at trial. This article does not address this type of fee shifting, which remains on Florida’s books.

This article addresses the type of fee-shifting statute that applies to claimants in certain types of claims, such as workers compensation, first-party property insurance, and wage claims. In other words, claims in which an individual—usually not a wealthy person—sues a large corporation or insurance company and wins. Simply put, in these types of claims, the claimant’s damages are often less than $30,000. Perhaps far less. The claim might be worth $10,000. Or $2,500. For example, in a wage claim, the employee might be owed $2,500 in unpaid wages; but those wages are, indeed, owed. In a property damages claim, the damages might be only $2,500 above the policy’s deductible; but that $2,500 is, indeed, owed.

When a person has a claim worth less than $30,000, no plaintiffs lawyer can take that case on contingency, if there is no fee-shifting statute that would make the defendant pay the claimant’s attorney fees separately if the plaintiff prevails. A lawyer cannot take a case worth $30,000 to trial under a contingency fee agreement.

It takes $15,000 in costs alone, minimum, to try any case, if one is going to have at least one expert witness. The simplest first-party property case, for example, will have at least $15,000 in costs to make it through a jury trial: approximately $420 filing fee to commence the lawsuit; $15 to $50 service of process fee; $3,000 to $5,000 for at least three depositions (court reporter hourly fee plus the cost of the transcript); $400 to $600 for a few “late cancelation” or “appearance” fees to court reporters after witnesses failed to appear for depositions; $350 to $700 for an interpreter for depositions and at trial; $4,000 court reporter fee for trial testimony; and at least $3,500 to $10,000 for an expert engineer to provide an opinion, report, depo testimony, and trial testimony. Again, this is costs. Then the lawyer has to charge 25% to 40% of any recovery as the attorney’s fee. Obviously, a lawyer simply cannot accept a case that is worth only $30,000—or even $50,000—on a pure contingency basis. A jury verdict of $30,000 would put $5,000, at most in the plaintiff’s hands—$10,000 fee and then $15,000 for costs come out, leaving the plaintiff with $5,000.

Even a jury verdict of $80,000—which would mean, by the way, that the jury found the real cost of covered repairs in a property damage case was $80,000, probably before deductible (judges have been confused about this aspect)—would put only about $39,000 in the plaintiff’s hands (and that’s if the lawyer takes only 33% as opposed to 40% for his fee). In short, arguably, it takes a claim value of over $100,000, minimum, for a lawyer to be able to take a case on pure contingency.

This analysis applies to the nature of the claim, not the wealth of the plaintiff or lack thereof. Above, I mentioned that fee-shifting statutes are needed to help individuals who are usually not wealthy, but I did not need to mention the wealth of the plaintiff. Many first-party property insurance claims involve claimants who own property and are doing just fine financially, or who are very wealthy. Their property damage claim, however, might nevertheless have a value of only $50,000 or less. The value of a claim is the cost of repairing the property minus the deductible and nonrecoverable depreciation. Even a wealthy homeowner might have a $15,000 claim. The wealth of the plaintiff is not relevant to my analysis in this article, one could argue, because even a wealthy insured is entitled to have the ability to have a lawyer take and pursue his case through trial.

Historical Overview of Fee-Shifting Statutes in Florida

Workers’ Compensation

Florida’s workers’ compensation system, established in 1935, was designed to provide injured workers with benefits without needing to prove employer negligence. This system included provisions for fee shifting, allowing injured workers to recover attorney fees under section 440.34 of the Florida Statutes when they successfully challenged a denial of benefits. This provision ensured that workers could access legal representation, especially since many claims might only be worth a few thousand dollars.

In 2009 the legislature amended the statute to severely limit the attorney’s fee that can be awarded to a lawyer representing a claimant:

440.34 Attorney’s fees; costs.—

(1) A fee, gratuity, or other consideration may not be paid for a claimant in connection with any proceedings arising under this chapter, unless approved by the judge of compensation claims or court having jurisdiction over such proceedings. Any attorney’s fee approved by a judge of compensation claims for benefits secured on behalf of a claimant must equal to 20 percent of the first $5,000 of the amount of the benefits secured, 15 percent of the next $5,000 of the amount of the benefits secured, 10 percent of the remaining amount of the benefits secured to be provided during the first 10 years after the date the claim is filed, and 5 percent of the benefits secured after 10 years. The judge of compensation claims shall not approve a compensation order, a joint stipulation for lump-sum settlement, a stipulation or agreement between a claimant and his or her attorney, or any other agreement related to benefits under this chapter which provides for an attorney’s fee in excess of the amount permitted by this section. The judge of compensation claims is not required to approve any retainer agreement between the claimant and his or her attorney. The retainer agreement as to fees and costs may not be for compensation in excess of the amount allowed under this subsection or subsection (7).

(2) In awarding a claimant’s attorney’s fee, the judge of compensation claims shall consider only those benefits secured by the attorney. An attorney is not entitled to attorney’s fees for representation in any issue that was ripe, due, and owing and that reasonably could have been addressed, but was not addressed, during the pendency of other issues for the same injury. The amount, statutory basis, and type of benefits obtained through legal representation shall be listed on all attorney’s fees awarded by the judge of compensation claims. For purposes of this section, the term “benefits secured” does not include future medical benefits to be provided on any date more than 5 years after the date the claim is filed. In the event an offer to settle an issue pending before a judge of compensation claims, including attorney’s fees as provided for in this section, is communicated in writing to the claimant or the claimant’s attorney at least 30 days prior to the trial date on such issue, for purposes of calculating the amount of attorney’s fees to be taxed against the employer or carrier, the term “benefits secured” shall be deemed to include only that amount awarded to the claimant above the amount specified in the offer to settle. If multiple issues are pending before the judge of compensation claims, said offer of settlement shall address each issue pending and shall state explicitly whether or not the offer on each issue is severable. The written offer shall also unequivocally state whether or not it includes medical witness fees and expenses and all other costs associated with the claim.

(3) If any party should prevail in any proceedings before a judge of compensation claims or court, there shall be taxed against the nonprevailing party the reasonable costs of such proceedings, not to include attorney’s fees. A claimant is responsible for the payment of her or his own attorney’s fees, except that a claimant is entitled to recover an attorney’s fee in an amount equal to the amount provided for in subsection (1) or subsection (7) from a carrier or employer:

(a) Against whom she or he successfully asserts a petition for medical benefits only, if the claimant has not filed or is not entitled to file at such time a claim for disability, permanent impairment, wage-loss, or death benefits, arising out of the same accident;

(b) In any case in which the employer or carrier files a response to petition denying benefits with the Office of the Judges of Compensation Claims and the injured person has employed an attorney in the successful prosecution of the petition;

(c) In a proceeding in which a carrier or employer denies that an accident occurred for which compensation benefits are payable, and the claimant prevails on the issue of compensability; or

(d) In cases where the claimant successfully prevails in proceedings filed under s. 440.24 or s. 440.28.

Regardless of the date benefits were initially requested, attorney’s fees shall not attach under this subsection until 30 days after the date the carrier or employer, if self-insured, receives the petition.

(4) In such cases in which the claimant is responsible for the payment of her or his own attorney’s fees, such fees are a lien upon compensation payable to the claimant, notwithstanding s. 440.22.

(5) If any proceedings are had for review of any claim, award, or compensation order before any court, the court may award the injured employee or dependent an attorney’s fee to be paid by the employer or carrier, in its discretion, which shall be paid as the court may direct.

(6) A judge of compensation claims may not enter an order approving the contents of a retainer agreement that permits placing any portion of the employee’s compensation into an escrow account until benefits have been secured.

(7) If an attorney’s fee is owed under paragraph (3)(a), the judge of compensation claims may approve an alternative attorney’s fee not to exceed $1,500 only once per accident, based on a maximum hourly rate of $150 per hour, if the judge of compensation claims expressly finds that the attorney’s fee amount provided for in subsection (1), based on benefits secured, fails to fairly compensate the attorney for disputed medical-only claims as provided in paragraph (3)(a) and the circumstances of the particular case warrant such action.

§  440.34, Fla. Stat. (2009). Limiting attorney’s fees to $150 per hour or $1500 or about 12% of a small-claims level recovery in a 2009 statute that is still on the books today is, in a word, ridiculous. A lot of people hate lawyers and think lawyers are greedy. But I don’t have to defend against the idea that lawyers are greedy or overpaid to say, “I challenge you to find me a plumber, electrician, carpenter, handyman, roofer, A/C repairman, or any other type of service provider who will show up for less than $300 an hour nowadays.” A cheeseburger that cost $7 in 2009 now costs $21. The average hourly rate for a lawyer in Florida handling routine family law cases—fees paid by individuals and not limited by statute—is $350. It was $150 about 45 years ago, when gas was $1.19 a gallon, a McDonald’s cheeseburger was $0.45, and the average single-family home cost $45,000.

In Castellanos v. Next Door Co., 192 So. 3d 431 (Fla. 2016), the Florida Supreme Court held that the mandatory fee schedule in section 440.34, which creates an irrebuttable presumption that precludes any consideration of whether the fee award is reasonable to compensate the attorney, is unconstitutional under both the Florida and United States Constitutions as a violation of due process.

Historically, the fee-shifting framework facilitated a more equitable playing field, enabling workers to seek justice without the fear of incurring overwhelming legal costs. The ability to recover fees encouraged attorneys to take on workers’ compensation cases, knowing they would be compensated for their efforts if their clients succeeded. However, significant changes in 2009, when the Florida legislature amended the workers’ compensation statute, dealt a major blow to the ability of workers to have a lawyer represent them on their claim. While the fee-shifting provision itself wasn’t eliminated entirely, the changes raised concerns about access to legal help, creating uncertainty about workers’ abilities to obtain fair representation.

Insurance Disputes

In the realm of insurance disputes, fee shifting has long played a crucial role, particularly in cases involving bad faith claims. Florida has recognized the need for a fee-shifting statute to keep insurance companies honest since 1893. As this author explained:

For the majority of its existence as a state, consumer protections have been a cornerstone of Florida insurance law. In 1893, as the state grew, the Florida legislature enacted the first statute which authorized the recovery of reasonable attorney fees against life and fire insurance companies. In 1982, recognizing the need for further consumer protections, Florida created the Civil Remedy statute authorizing a first-party civil action against insurers due to bad faith conduct; however, despite such consumer protections remaining necessary to “level the playing field” between corporations and consumers, Florida, from the governor’s office down, has recently crusaded to remove such safeguards.

Cassel, Michael, A., “SENATE BILL 2-A: THE LAWS IT CHANGED AND ITS IMPACT ON PAST, PRESENT, AND FUTURE CLAIMS” (St. Thomas Law Review Vol. 36, March 20, 2024).

Under section 624.155 of the Florida Statutes, the bad faith statute, policyholders have the right to sue insurance companies for failing to act in good faith when handling claims. The bad faith statute still has fee shifting:

(7) Upon adverse adjudication at trial or upon appeal, the authorized insurer shall be liable for damages, together with court costs and reasonable attorney fees incurred by the plaintiff.

§  624.155(7), Fla. Stat. (2024).

I can understand the view of those who support the new law, which is no fee shifting for a simple breach of contract by an insurance company. If the insurance company acted in bad faith, there is fee shifting. The problem, however, is that the standard for holding an insurance company liable for bad faith is very high—and an insured is looking at four to six years of litigation to get to that result. There are several intersecting philosophical questions here that I have always found interesting.

First, a first-party property insurance case is a breach of contract case for which the traditional “economic loss rule” should apply—although I just read where some state allowed a wrongful death claim based on an insured living in a home with mold for many years after the insurance company did not pay her property damages claim. Courts, as I discuss below, naturally trend towards not throwing plaintiffs’ claims out of court. Allowing such a wrongful death claim to proceed, of course, is ridiculous under the common law as taught in law school.

I have told clients in property insurance claims for years, when they complain that their elderly mother’s cancer supposedly got worse from “mold,” that they don’t have a personal injury claim or a claim for medical or punitive damages, because for one thing, as harsh as it might sound, nobody is forcing you to remain living in a house with mold. The insurance company has a right to litigate too. You, the insured—never mind the fact that your shingle roof was 25 years old on the date of loss and had been leaking for years—can move your elderly mother to a home without mold, or you can borrow or otherwise come up with the $10k it takes to remediate mold or, in any event, is the policy limit for mold. You can’t volunteer to live in a house with mold and harm your health for four years during litigation when the insurance company, whether we like it or not, has at least a colorable argument that it was legally correct to deny the claim. The law as Oliver Wendall Holmes understood it is clear that an insurance company not paying a roof claim when the roof is 25 years old and has admittedly had prior leaks—admitted through prior repair attempts or even prior insurance claims—is not committing bad faith to deny the claim when an independent expert—licensed by the State of Florida—advises the insurance company that the damages being claimed were caused by wear and tear, inadequate maintenance, or predated the alleged date of loss. The insured’s claim is for breach of contract, seeking money damages, and no claims sounding in tort or for punitive damages should be allowed.

Related to this area of thought: sometimes parties lose on summary judgment. That means the court found that there was no genuine issue of material fact such that the opposing party was entitled to judgment as a matter of law, ending the case, without asking a jury. In other words, it was very obvious the losing party should lose. That has to be the case, because judges are hesitant to kick a case out on summary judgment. Yet the law is clear that losing on summary judgment does not automatically mean that the losing party should be sanctioned under 57.105 (or rule 11, in federal court). A party can lose summary judgment but not be sanctioned under 57.105, meaning the court found that there was no genuine issue of material fact and the opposing party was entitled to judgment as a matter of law, but also that the losing party’s argument was not wholly frivolous.

The same could be said for an insurance company being found to have breached a contract because it denied or underpaid a claim. If a jury finds that the insurance company was wrong to deny the claim or paid less than it should have paid, that finding is still heavily in the realm of breach of contract, not necessarily bad faith. A party can lose, even on summary judgment, a breach of contract case without being found to have acted in bad faith. The Florida legislature has decided that bad faith by insurance companies requires a real pattern of deceptive and fraudulent behavior. If that is happening, it is very hard for a plaintiffs first-party property lawyer, representing 50 to 80 clients at any given time, to have the time, money, or approval from any one client to take a case far enough to get a decision on a bad faith claim. Bad faith is very hard to prove. When the insurance company offers—on the courthouse steps, three years after the simple breach-of-contract action was commenced—enough money that the client can make the necessary repairs, the client is going to accept that offer, should accept that offer, and the offer is going to require the client to release any bad faith claim.

In handling close to 2,000 first-party property insurance claims over the past eight years, my firm has yet to take a bad faith claim to trial. When the insurance company offers enough money to repair the property (usually “on the courthouse steps” three years after the lawsuit was filed), my clients have chosen to take the money as opposed to litigating for two more years.

But until the recent legislative change—no fee shifting if a policy was incepted after March 24, 2023—that offer on the courthouse steps would include a healthy amount of dollars for the attorney’s fee and costs, paid separately, as opposed to the lawyer taking a percentage of the benefits. As I have explained to my clients for years, the law matters, it is enforced by judges, and the insurance company knows the law. Under the old law, if the insurance company lost a case, it was liable for the insured’s attorney’s fee separately. That means if the insurance company is offering to settle, it is analogous to a confession of judgment and the offer includes an amount for the attorney’s fee and costs. For the past eight years, my average settlement for a single-family home case was approximately $30,000 in benefits and $15,000 for fees and costs. The amount of money I was able to put in my clients’ hands was usually enough to make the repairs and often more than they needed, even though there was a deductible and the public adjuster was taking a percentage of the benefits recovery. The fee-shifting statute allowed me to get a very good result for most of my clients.

The reasons the insurance companies were willing to settle for these numbers were that (1) the damages were arguably owed and likely to be found to be owed by a jury and (2) $15,000 for the fees and costs is a great deal for the insurance company—much better than the $100,000 or more for the attorney’s fee the court was likely to award after a trial. At the risk of sounding arrogant, for nearly eight years I have achieved tremendous results for my clients in large part because of the insurance companies’ fear of being on the hook for an attorney’s fee award of $100,000 or more were I to prevail at trial.

Under the new law, with no fee shifting, settlement offers will not include an amount for an attorney’s fee. That money is not included in the offer. To get a fee, I have to take 33% of the money that is paid for benefits, like in personal injury cases. It matters, and I am already seeing the difference in my newer cases. And I cannot blame the insurance companies—maybe regarding their lobbying that led to the statutory change I can, but not in any particular lawsuit—for asserting their rights under the law. Under the new law, they do not owe a prevailing-party attorney’s fee.

Without giving away any client confidences, I will give a concrete example. In one case I am handling right now, my client’s home suffered a burst pipe in a wall in a bathroom, causing about $10,000 in damages. The policy has an $8,300 deductible. The insurance company denied the claim, paying nothing. Even if I prevail on the argument that my client suffered a covered loss, the damages are $1,700. That’s a small-claims court case, and on the smaller side of even those types of cases. Small claims court is for cases where parties don’t need a lawyer. The defendant’s offer to settle the case was originally $2,500 “global” (again, there is no right to a separate attorney’s fee). Because I’m a good lawyer and I have a good relationship with my opposing counsel, I have been able to get the offer up to $7,500. My client wants to accept the offer and probably will. (There is another issue concerning a company that claims it has a “direction to pay” invoice for $6,800, but that is a matter for a different article.)

If my client accepts the offer, the result will be something like $4,500 in benefits and $3,000 for fees and costs to my law firm (assuming I get rid of the direction-to-pay problem). Then the public adjuster will take 20% of my client’s $4,500 in benefits. In short, under the new law, this case should not have been accepted by my law firm. We cannot plausibly threaten to take a case worth $1,700 to trial. My client is lucky—if I may say so myself—to have me on this case. At least he is going to get about $3,600 in his hands. But this is a small-claims case that does not warrant hiring a lawyer under the new law.

Let me be clear: I’m not complaining about earning a fee of $2,500 (about $500 of the $3,000 is costs) in a case that takes 5 to 10 hours of work. If the opposing attorney is “nice” and gets me an offer that leads to that result, fine, but the problems are: (1) if the defendant is going to offer the full value of a case immediately after receiving a demand letter or complaint, the case probably would not be in litigation in the first place (i.e., it’s never going to be that easy); and (2) under the new law, I have no real leverage to force the insurance company’s lawyer to do that. If the defendant offers nothing, I cannot plausibly threaten to take a case worth $1,700—or even $100,000—to trial.

There is no way a lawyer can get a case through a civil trial with fewer than 150 billable hours of work for one attorney and one paralegal, and at least 200 hours is more likely. No insurance company or insurance defense law firm could contest this assertion. After all, they always have two or three lawyers and at least one paralegal billing on a file, including three lawyers and a paralegal throughout the trial (that’s about 40 billable hours per trial day), and they submit claims for over 300 billable hours when they win a three-day trial. As a small-firm lawyer, I have tried cases alone (with no second chair lawyer or paralegal) and ended up with about 230 billable hours between myself and one paralegal (who was not with me during the trial but did perform pretrial work as the case was litigated). I assert that a three-day civil trial cannot be competently done for under 150 billable hours of work.

No sane person would argue otherwise. Even the simplest case, to get through trial, requires at least four depositions, six to 10 hearings, at least one calendar call (sometimes 12 calendar calls and usually five to seven, in Broward County, before a case gets reached for trial), a mediation, a legitimate 40 to 80 hours of work in the two weeks prior to trial, and a legitimate 30 hours of work per professional for a three-day trial. Even the simplest first-party property case—one with three or four witnesses—takes at least three trial days and usually four. And then, even if one wins a trial, there is substantial work post-trial to submit motions for final judgment, for and against a new trial, and to tax fees. I have not yet mentioned that the losing party can appeal. Many cases settle even post-verdict to avoid an appeal—negotiating a settlement requires real billable work too. A lawyer cannot successfully win any civil trial with less than 150 billable hours and one could easily argue that 300 would be reasonable.

Historically, when there was fee shifting, I would have settled the sample plumbing leak case for something like $15,000 in benefits and $10,000 in fees and costs (paid separately)—my client does have a good argument on liability. Remember, it is a denial case. Under the old statute, the carrier had to fear a trial in a case like this. I could go to trial, and if I won a judgment for my client of one dollar above deductible, I might get a fee award of $120,000. And my client does have an argument that perhaps $20,000 in repairs are needed, so the carrier’s trial risk was about $140,000. So the carrier, under the old fee-shifting law, was happy to settle for $25,000 “global” and everyone “wins.” Arguably the plaintiff’s lawyer (me) was the only loser under the old system—I got a $9,500 fee when I could have earned a $120,000 fee after a trial, because “a bird in the hand is worth two in the bush” and putting the $15,000 in my clients’ hands was the best way to serve my clients. The insurance company got away with paying only (1) the damages owed and (2) $9,500 for my fee instead of $120,000.

I admit that this scenario is the thing that Governor DeSantis and the “tort reform” advocates believe was wrong. They see that result, I guess, as a “shakedown.” To hold that view, however, one has to believe that insurance companies are never wrong. Think about it. It’s only a “shakedown” if the claim was wholly frivolous and the insurance company’s denial was not wrong. But insurance companies do wrongfully and negligently deny and underpay claims. In the end, the decisions of insurance companies are being made by human beings. They do make mistakes, and many coverage determination letters sent out by insurance companies are simply nonsensical. Additionally, when you see the sloppy cut-and-paste jobs visible in many coverage determination letters, you might conclude that some insurance companies are, indeed, operating under the bad-faith practice of starting with a presumption of denying every claim, without actually doing a proper investigation. In short, the “tort reform” advocates, in my opinion, have too much love for insurance companies and too much hate for plaintiffs lawyers and public adjusters.

While I understand the concern that some public adjusters and lawyers have been, shall we say, aggressive, the problem is that insurance companies do wrongfully deny and underpay claims, and without fee-shifting, there is nothing to hold them accountable. In the plumbing leak case I discussed above, the carrier was wrong to totally deny coverage. The carrier should have paid my client $1,700 right away—over a year ago as I type this article. If I am correct—if a jury agrees with me that the denial of coverage was a breach of contract—then the insurance company should be ordered to pay something like $10,000 in damages and $100,000 in fees, after making my client litigate for three years before finally getting his day in court. Under the new law (no fee shifting), I don’t have the threat of an attorney’s fee award to use for leverage as I battle the insurance company’s lawyer.

In short, the impact of the removal of the fee-shifting statute simply cannot be overstated. I believe some lawyers practicing in this practice area have not fully accepted what has happened. Perhaps they are in denial. I am on record saying I think the entire practice area known as “first-party property” is dead. Unless and until the fee-shifting statute is put back into the insurance statute, the “tort reform” movement has won on this issue. The only claims that a lawyer can take now are “large loss” claims, and there are only so many of those to go around.

I will now address the issue of the size of plaintiffs lawyers’ attorney’s fee awards. Most lawyers representing insureds in these cases have not been awarded gigantic fees that would shock the conscience of the community. A few outlier fee awards have ruined it for the rest of us—and, more importantly, all homeowners. In my cases, I have counseled my clients wisely about the value of their claims and settled cases for reasonable amounts both for my clients and for the attorney’s fee. I’ve made a decent living, but I have not received outlandishly gigantic fees.

In my cases, I have essentially “donated” my could-have-been fees (after prevailing at trial) to my clients, and I have told them as much, at the time of settlement. Even though some of them don’t understand, most have been very appreciative of the results I have obtained for them. In other words, under the old statute, when a case settled for $30,000 in benefits and $15,000 in fees ($45,000 global), it was because the insurance company feared a trial result of $10,000 in benefits and $120,000 in fees ($130,000 global risk). Under the old law, when a case settled for $45,000 and my law firm allowed $30,000 of it to be benefits for the client, we reversed—more than reversed—the likely trial result in terms of the recovery of benefits and fees. My law firm has taken a “haircut” in the vast majority of cases we have settled, for the benefit of our clients. The new law was intended to shut down law firms helping homeowners in this way.

The problem with the “tort reform” advocates’ position, however, is that while under the old system, some insureds were arguably able to recover a bit more than what their claim was legally worth (i.e., recovering in their hands the amount needed to do repairs as if there were no deductible and public adjuster fee—meaning the carrier essentially waived the deductible and paid the public adjuster fee separately) and their lawyers were able to get an average fee of $15,000 per claim, again, insurance companies do wrongfully deny claims. Under the new law, insureds cannot hire a lawyer unless they have a truly large loss. We, as a society, have to decide which is better: (1) letting some insureds who hire lawyers to represent them receive a slight windfall; or (2) having a system in which insurance companies can deny every claim with no way to hold them accountable?

Now, again, I understand the new law’s proponents’ argument. Why did insurance companies have to fear a trial result such as “one dollar” to the insured and over $100,000 in fees to the insured’s lawyer? Some plaintiffs lawyers—a small minority—managed to get fee awards over $1 million after getting much smaller recoveries for their clients. And they did this in cases with circumstances such as the case settling after only a few depositions and hearings happened, or something like that. Any fee award is approved, of course, by the judge. These types of extreme results made a few lawyers very rich while ruining it for the rest of us—the lawyers who are happy to simply make a decent, but not extravagant, living. How did this happen?

This gets us back to the discussion of the tendency of courts, over time, to favor plaintiffs. It is really that simple. Over time, the trend is for courts to allow plaintiffs to maintain and get results in cases that many feel are not warranted, such as in slip-and-fall cases and cases being allowed to proceed under tort theories in violation of the traditional economic loss rule.

The current first-party property debate in Florida is just one of the many debates in the ongoing battle of “courts versus the legislature,” in many different substantive areas. Simply put, liberals love courts. Conservatives believe in the right of the legislative branch of government—supposedly representing the majority of people—to make the law. Hence we have “tort reform,” of which the first-party property changes in Florida were a part. There is a constant battle between the legislature, which feels it is representing decent folks who don’t abuse the system but subsidize those who do through higher insurance premiums, and “trial lawyers.” The legislature is always trying to curtail access to courts—another part of Florida’s recent legislative changes was reducing the statute of limitations for negligence claims from four years to two years—while the tendency of courts, over time and overall, is to support plaintiffs and arguments that overrule the legislature.

Returning to the economic loss rule, which is an example of this principle, I learned in law school: (1) no recovery in tort for pure economic loss; and (2) no punitive damages for breach of contact, because “it’s only money” and it is perfectly acceptable for a party to breach a contract on purpose for financial reasons. “It’s nothing personal.” That is the real common law as Oliver Wendall Holmes knew it and as it was still taught in law school as late as the 1990s.

The Florida legislature decided, back in 1893, that fee shifting against insurance companies was necessary to level the playing field and force insurance companies to play fair, and it awarded prevailing-party attorney fees when the insurance company was found to have breached the contract—bad faith was not required. It is very hard to prove that an insurance company has a pattern and practice of bad faith—and it would be nice to think that most of them are not habitually acting in bad faith. But we need a statute that awards prevailing-party attorneys’ fees and costs to an insured who successfully sues her insurance company, even if the insurance company is guilty only of a breach of contract and not necessarily bad faith.

Wage Claims

In addition to workers’ compensation and insurance disputes, fee-shifting statutes are also vital in wage claims. Under the Fair Labor Standards Act (FLSA), employees who sue for unpaid overtime wages can recover attorney fees if they prevail in their cases. This provision is particularly important because many workers may not have the financial means to pay legal fees upfront. Without the ability to shift fees, pursuing claims for unpaid wages could become economically unfeasible, leaving many workers without a path to justice.

The FLSA, specifically 29 U.S.C. § 216(b), emphasizes the law’s intent to protect workers’ rights by ensuring they can seek legal remedies without facing insurmountable financial barriers. This safety net encourages employees to assert their rights against employers who may otherwise exploit them.

The Philosophy Behind Fee Shifting

The underlying philosophy of fee-shifting statutes is fundamentally about ensuring access to justice. Without these provisions, individuals with smaller claims—whether involving workers’ compensation, insurance disputes, or wage claims—would face significant barriers to obtaining legal representation. This creates a system that favors those with greater financial resources, undermining the principle of equal access to justice.

Leveling the Playing Field

One of the primary goals of fee shifting is to create a more equitable legal system. These statutes empower individuals to challenge powerful corporations or insurance companies without the overwhelming fear of incurring excessive legal costs. When potential claims are only worth a few thousand dollars, the prospect of facing legal fees that can easily exceed that amount can deter even the most valid cases from being pursued.

For instance, if a worker has a claim worth $10,000 but could face $15,000 in legal costs (not to mention $50,000 in fees) to take the case to trial, the financial burden is prohibitive. Fee shifting alleviates this pressure by allowing claimants to recover their legal costs if they win, encouraging them to pursue valid claims they might otherwise abandon. This not only supports individual claimants but also contributes to a more balanced legal system where all parties can seek redress.

Encouraging Legal Representation

Almost all attorneys representing individuals who are plaintiffs alleging they are owed money operate on a contingency fee basis, meaning they get paid only if they win the case. The vast majority of clients who are plaintiffs in these cases are unable or unwilling to pay by the hour. A contingency fee arrangement works for a personal injury case in which a recovery of at least $500,000 if not $5 million is expected.

Taking on a case with a small potential recovery, however, is impractical when the costs associated with litigation—such as depositions, expert witness fees, and court fees—are going to be more than the value of the claim. In a case involving unpaid wages (could be only $1500 that is owed a McDonald’s employee) or the cost of repairing a shingle roof (costs $15k to $25k for the average house), the lawyer cannot work for free (unless the lawyer is purposely taking the case pro bono) and the client cannot—or should not, even if he can—pay the lawyer a reasonable fee and cover the costs to pursue the case. In other words, if the recovery value of a meritorious case is less than $150,000, a lawyer cannot take the case on contingency and the client cannot “afford” to pay by the hour. There has to be statutory fee shifting as a matter of the public policy decision that people have to be able to hold their insurance company accountable if it wrongly refuses to pay for the covered loss.

Fee shifting addresses this issue by ensuring that attorneys can be compensated for their work when their clients succeed. This encourages lawyers to take on cases they might otherwise decline, broadening access to legal representation for individuals with smaller claims. By facilitating attorney engagement, fee shifting helps ensure that even the most vulnerable claimants have a chance at justice.

The fee shifting for which I’m advocating here—which the State of Florida has supported since 1893—is not based on “punishing” the insurance company. As discussed above, I am advocating for fee shifting when an insurance company is found to be liable for breach of contract. (A breach of contract is not necessarily “evil” or an act that would allow for punitive damages.) The second rationale for fee shifting against insurance companies—explained very well by this author—is the very nature of the claim or the reason the money is owed to the plaintiff in the first place: the insured needs the money to pay for repairs to real property, such as a leaking roof. If a jury finds that a plaintiff is entitled to recover $50,000, it means it takes $50,000 to do repairs that are necessary to return real property to its pre-loss condition. If attorney’s fees and costs take half of that money, the insured is left with only $25,000, which is not enough to perform the necessary repairs. As this author points out, the State of Florida has, until very recently, understood that in an insurance benefits claim, the nature of the claim means that the insured should get all of the money without his attorney having to take fees and costs out of it:

The Florida Supreme Court said it best more than seventy years ago when it stated as follows:

The business of insurance has become one of the dominating businesses of the world. In the United States millions of policies are issued to residents of all the states. These people move from state to state. This is particularly true with reference to Florida. It is one of the fastest growing states in the Union. Its population is largely made up of people who have come from other states, and they naturally bring with them a great deal of their property, including insurance policies, or contracts. The business of insurance is affected with a public interest as much as any other business conducted in the United States. Such business is subject to reasonable regulation in the public interest. It is an undue hardship upon beneficiaries of policies to be compelled to reduce the amount of their insurance by paying attorney fees when suits are necessary in order to collect that to which they are entitled. The police power within reason may be exercised by the Legislature regulating such a business affected with a public interest.

It was for this reason that the legislature sought to protect insureds throughout the State of Florida by creating such a fee statute more than a century ago.

Cassel, Michael, A., “SENATE BILL 2-A: THE LAWS IT CHANGED AND ITS IMPACT ON PAST, PRESENT, AND FUTURE CLAIMS” (St. Thomas Law Review Vol. 36, March 20, 2024) (quoting Feller v. Equitable Life Assur. Soc. of U.S., 57 So. 2d 581, 586 (Fla. 1952)).

Promoting Accountability

Another essential aspect of fee shifting is that it promotes accountability among corporations and insurers. When companies know they may be held responsible for attorney fees if they unjustly deny claims, they are more likely to handle those claims fairly and promptly. This protects individual consumers and workers and helps maintain the integrity of the insurance, employment, and workers’ compensation systems.

By fostering an environment where insurers and employers must act in good faith, fee shifting plays a critical role in enhancing consumer protections. This can ultimately lead to better outcomes for policyholders and workers, as companies are incentivized to resolve claims fairly rather than engage in lengthy disputes. Additionally, this accountability fosters a culture of compliance within industries that have historically been prone to exploitative practices.

The Insurance Companies’ Argument

I get it. Many people—the Governor and the majority of the Florida legislature included, obviously—are concerned that some public adjusters and plaintiffs lawyers—and insureds—have abused the judicial system in recent years by bringing too many claims with inflated or over-scoped estimates, or even clearly frivolous claims, such as claims in which the insured is claiming pre-existing damages that existed five years earlier, for which the insured made a claim and got paid but did not use the money to make the repairs and is now making a new claim for the same damages. The Governor thinks that this type of thing has been so prevalent that it is the reason many insurance companies have gone bankrupt and everyone’s premiums have tripled.

The problem, however, is that insurance companies can be bad actors too. An insurance company is a for-profit business. Its goal is to make a profit for its shareholders. Insurance companies do wrongfully deny and underpay claims. They did this routinely even during the years when a fee-shifting statute was on the books. People have to have a right to be able to sue their insurance company. They cannot do that if their claim is worth perhaps $10,000 to $40,000 and their lawyer would have to charge by the hour or on a contingency basis.

Does Our Judicial System Work? Do Insureds Lose When they File Frivolous Claims?

The solution to the alleged problem concerning frivolous claims is having a judicial branch that works. If there are so many frivolous cases, the court system should work properly and get rid of those cases on summary judgment or even dismissal. A properly working court system would allow a decision on these frivolous cases to occur quickly. There is always some level of the following problem: some judges and lawyers seem to feel a “tug” or a “feeling” that “justice” is usually on the side of plaintiffs who are individuals (“the little guy”) when they are suing a large corporation. The law, when it is judge-made, has tended to lean towards creating ways to let individuals who are plaintiffs keep their cases in court and get to a jury. For example, judges are very hesitant to grant summary judgment, and Florida caselaw does make it clear that Florida prefers sending cases to the jury. Another example is the hundreds (it seems) of exceptions to the “economic loss rule,” even though not one such exception should have ever been created.

The real, original economic loss rule is nothing more than the application of contract law and common sense: there is no recovery in tort for pure economic loss. That’s all we need; we don’t need any exceptions. Think about it. If the only damages a plaintiff has suffered are economic, there had to have been a contract. If there was a contract, then it has terms that govern the consequence of a breach. If not, then principles of damages for breach of contract—again, missing money is the only damages—should control. Torts, on the other hand, are for physical injuries, when the defendant was not in privity with the plaintiff (e.g., car crash due to negligence; piano falling out of a window onto the plaintiff’s head; defendant punched the plaintiff in the face). Caselaw in the old days pointed this out. Although many modern lawyers would be shocked to hear this, an argument can be made that no tort exists in the absence of physical injury to a human being. If the only damages are the loss of money, then there was a contract, somewhere, that governs the situation. Nowadays there are so many exceptions—including statutory exceptions—that the exceptions have swallowed the rule and most lawyers do not even think in this manner today. But historically, there was simply no recovery in tort, and no punitive damages, for pure economic loss.

But in the past 25 years, courts have found reason after reason to let plaintiffs maintain causes of action sounding in tort even though they have suffered only economic damages.

I personally was a part of using creative arguments to make this happen when I represented class action and MDL plaintiffs in the “Chinese Drywall MDL” between 2009 and 2016 while working for the prestigious Podhurst Orseck. All of these plaintiffs had suffered only economic (money) damages: their house was not as valuable as it should have been because the Chinese-made drywall in their house had an unpleasant sulfur smell. (Many of these homeowners claimed they had suffered physical and medical problems from this sulfur, but those cases were not personal injury cases.) I did not see a case in which a homeowner had a doctor’s opinion that the sulfur had cause or exacerbated a health condition.

Each Chinese Drywall plaintiff had formed a contract with the company that built their new house. The contracts had provisions governing what would happen if the builder did not build the house correctly. Each claimant had different facts, such that—under a proper view of the law the way Oliver Wendall Holmes understood it—the cases did not qualify either for class action treatment or stating causes of action that sounded in tort. Oliver Wendall Holmes and virtually any other judge prior to the year 2000 would have held that each Chinese Drywall plaintiff had enough of an individual breach-of-contract claim that he needed to file his own individual lawsuit, alleging breach of contract (the builder breached the duty to build a properly constructed house that did not smell like sulfur). If the builder was a victim of third parties, such as Chinese drywall manufacturers and intermediate supply companies (which, indeed, was true in the Chinese Drywall litigation), well that is what third-party practice is for.

A related aspect that I have noticed: the “third-party practice” (formerly known as “impleader”) about which we learned in law school is used much less frequently than I was led to believe it would be when I attended law school and took “civil procedure” class in the 1990s. The reason is what I have been discussing above: nowadays plaintiffs are allowed to assert tort claims against everyone in a supply chain—the manufacturer, supplier, transporter, booker, scheduler, and builder. They are all named as defendants by the plaintiffs when they file the lawsuit. The old “privity” rule has been decimated. The very reason the tort claims have been allowed by courts was to get around the requirement that a plaintiff be in privity with a defendant when asserting pure economic loss. The classic common law required a plaintiff to sue only the party with whom he was in privity (e.g., the builder of his house), and the defendant would then “implead” (file a third-party complaint against) the entities that were actually at fault (e.g., the manufacturer of the defective drywall or the supplier that allowed it to get wet). And then those third-party defendants might implead additional defendants alleged to be the real bad guys.

In short, the modern view, collectively, of all judge-made case-law the past 25 years has trended towards helping individual plaintiffs survive dismissal and summary judgment and get to a jury or favorable settlement, as opposed to having their claims—which would have been thrown out of court 25 years ago—thrown out of court.

Can the “Contingency Risk Multiplier” Save the Day For Insureds Who Want a Lawyer To Represent Them?

Another key aspect—or controversy—concerning recent “tort reform” laws passed in Florida concerns whether an attorney taking a case on contingency can get a fee “multiplier.” The Florida legislature has clearly tried to make it almost impossible for a judge to award a multiplier. (Explaining the law of fee multipliers is beyond the scope of this article. If you are a layperson or potential client reading this article, google “fee multipliers in Florida in contingency cases.”) The test has always been whether the client would have been able to obtain legal counsel in a way other than on contingency. The recent changes to the Florida Statutes merely emphasize this test and require judges to only award a multiplier in extreme and rare circumstances.

What’s the problem with that? Contrary to the way some lawyers and judges think about it in their own minds, the test is not “whether the plaintiff is too poor to hire a lawyer on an hourly rate or flat fee basis.” The financial condition of the plaintiff is not the test. The test, when understood and applied properly, is whether the plaintiff could have hired a lawyer to pursue the matter on an hourly rate or flat fee basis. If a claim is worth less than $100,000, the answer is no, even if the plaintiff is a billionaire. Why? Because the total fees and costs for any competent lawyer taking any insurance coverage case against an insurance company all the way through a jury trial is going to be at least $50,000 if not $150,000. Even a billionaire is not going to spend $100,000 to recover $50,000. Again, the purpose of fee-shifting statutes—and the test as to whether one should exist for a type of case, and the test for awarding a contingency fee risk multiplier—should be to look at the nature of the case and what the potential recovery is compared with the reasonable value of the legal services necessary to properly represent the plaintiff.

Indeed, the Florida legislature’s recent deletion of the former fee-shifting statute in residential and commercial first-party property insurance cases is sure to nearly destroy Florida property owners’ ability to sue their insurance company for wrongfully denying or underpaying small-value claims. A client—even a wealthy one—will never pay a reasonable hourly rate plus costs to pursue a first-party property claim.

Any judge who properly applies the test when considering a contingency fee multiplier request should conclude that there are very few, if any, residential first-party property insurance claims that do not qualify for the multiplier. I’ve never seen a first-party property case in which the plaintiff paid by the hour. I’ve represented numerous very wealthy clients who could afford to pay by the hour, but they did not and will not do that. It is expected that this type of claim is handled by plaintiffs lawyers on a contingency basis.

In short, if a lawyer does manage to take one of these claims through trial and win, the court should award a 2.0 contingency fee multiplier. In the case of a $10,000 verdict, that could result in a lawyer being awarded a fee of about $8,000. If the jury awards $50,000, the fee would be $40,000 with a 2.0 multiplier applied. Still not enough to take a case through trial, especially when it is likely that judges will not award a multiplier, even though these cases easily qualify for the conclusion that not many lawyers would agree to take them.

I fear, however, that the majority of judges will be influenced by the clear message from the legislature, which has the goal of ending this practice area.

Can the Proposal for Settlement Statute Save the Day For Insureds Who Want a Lawyer To Represent Them?

Some people argue that plaintiffs can still use the proposal-for-settlement statute to get attorneys fees in first-party property cases. Under the PFS statute, if a party serves a PFS, the opposing party does not accept it, and then the opposing party fails to get at least 75% of the offer at trial, the non-accepting party can be liable for the opposing party’s attorney’s fee. The problem with this argument, however, is that to serve a PFS that truly threatens the insurance company with the consequences of failing to accept, the offer would have to be so low that the plaintiff would not want to settle for that amount. Why? For the same reason I have been discussing above: the insurance company is no longer liable for a separate attorney’s fee, so nothing for that amount would be in the offer. The value of the case no longer includes a separate attorney’s fee, not even a small one.

Returning to my example of a small pluming case with a $2,000 to $10,000 damages value, the PFS would have to be something like $5,000 to make the insurance company nervous, but the plaintiff and his lawyer would not want to settle the case for $5,000 when the lawyer is not going to be paid a separate fee, just as they would not want to win a $5,000 verdict at trial. Under the old law, with fee shifting, the insured’s PFS in this sample case would be either $5,000 exclusive of the attorney’s fee, which would be owed and awarded by the Court were the plaintiff to win at trial, or $20,000 inclusive of the attorney’s fee. Such a PFS would (1) make the insurance company nervous and (2) actually satisfy the plaintiff and his lawyer under the old law. Under the new law, simply put, the value of a case does not include a separate sum for a reasonable attorney’s fee. That does not change whether a case is resolved by jury verdict or settlement.

The Legislature Must Reenact Fee Shifting in First-Party Property Insurance Cases

Let’s dive further into the problem with the recent removal of fee shifting in first-party property cases. Here is a summary of my main complaints:

1. Insurance companies are often bad actors that wrongfully deny or underpay claims. At the very least, they fight as hard as they can to enforce the one-sided terms (terms so unfair that, as applied, insurance companies get away with illusory promises) that are in their adhesion contracts. The problem with insurance in Florida is caused by many things, not only over-aggressive public adjusters, roofers, and plaintiffs lawyers.
2. The court system has worked well enough. Insurance companies can and do win cases—both after a jury verdict and on summary judgment—routinely. Just do a simple search on google scholar or Westlaw. Insurance companies routinely win, and they have done so for years, before the legislature changed the statutes to adopt the federal Daubert and summary judgment standard (two other recent legislative changes designed to help insurance companies win).
3. Related to number 2, Florida has always had tools to punish lawyers and parties who file frivolous claims, such as 57.105, the court’s inherent authority, and the fact that costs, if not fees, are awardable to the prevailing party even in the absence of a fee-shifting statute or frivolous claims or arguments advanced by the losing party.
4. Even if some property owners, public adjusters, and lawyers have behaved badly by advancing frivolous claims—even if many of them have—they are in the minority. People have to be able to sue their insurance company for wrongfully denying or underpaying a claim.
5. Under the new situation—no fee-shifting statute—what is to stop insurance companies from denying every claim or finding every claim under deductible? Let’s imagine there is a case in which the insured clearly suffered a covered loss, but the cost of doing all covered repairs is only $25,000 and there is a $10,000 deductible. What is to stop the insurance company from purposely, wrongfully denying that claim, forcing the insured to attempt to find a lawyer to file and prosecute a lawsuit, forcing that lawyer to fight for three years, including attending at least four depositions, 10 court hearings, and a mediation, plus answering written discovery, etc., and then offering the $15,000 that clearly should have been paid three years earlier “on the courthouse steps” three years later, right before a jury trial is (finally) about to begin, but without any penalty of having to pay the plaintiff’s attorney’s fee and costs separately. Trust me: that scenario will occur. The new system (no fee shifting) decimates the ability of insureds to sue their own insurance company.
6. One’s reply to my question in number 5 above might be, “Well, you still have the bad faith claim, and there is still fee shifting if the plaintiff proves the insurance company is guilty of bad faith. That example shows the insurance company acting in bad faith.” My reply to that is that while, indeed, that example is clear bad faith, the legislature has already expended a lot of energy making it impossible—in the real world—for a lawyer to pursue a bad faith case against an insurance company in Florida. We already had the terrible law—in extreme derogation of the common law rule that, of course, every contract includes the implied obligation of good faith—that requires an insured to first win a breach-of-contract case before he can file a bad-faith claim as a separate lawsuit. (Nobody can do that, because that would require six years of litigation, and by the end of three year, the poor insured is ready to accept a settlement offer that, of course, requires the insured to release all bad faith claims.) There has never been a real ability to sue an insurance company for bad faith in Florida, yet the legislature recently tightened up the bad faith statute to make it even harder.

In short, under the current new situation in Florida, with no fear of being penalized for a wrongful denial or underpayment by having to pay $120,000 for the plaintiff’s attorney’s fee and costs, an insurance company has no incentive to pay any claim any sooner than three years after the date of loss, on the courthouse steps, right before the jury trial is about to begin.

The Path Forward

Understanding the historical context, recent legislative changes, and the underlying philosophy of fee shifting is crucial for grasping its significance in promoting access to justice. The elimination of fee shifting for claims against one’s own insurance company raises serious concerns about access to justice. Advocates worry that this shift disproportionately affects vulnerable individuals who may already face economic hardships. The rationale behind these legislative changes often revolves around reducing costs for businesses and insurers, but the broader implications for consumer rights and protections are significant.

Critics of the 2023 legislative changes argue that they will discourage individuals from pursuing legitimate claims, leading to greater injustices. With smaller claims becoming less economically viable to pursue, many individuals may choose to forgo legal action altogether, leaving them without recourse for legitimate grievances. This erosion of consumer rights may lead to a chilling effect, where individuals feel dissuaded from asserting their rights due to the daunting prospect of legal fees.

As Florida navigates these changes, it is essential for stakeholders—lawmakers, legal professionals, and advocates—to engage in ongoing discussions about the future of fee shifting. Restoring or enhancing fee-shifting provisions could be vital to ensuring that the legal system remains accessible to all individuals, regardless of their financial circumstances. Advocacy for consumer rights and protections will be critical in maintaining balance in the legal system.

The ongoing debate surrounding fee shifting laws highlights the need for transparency and public engagement in legislative processes. By involving a broad range of stakeholders, including advocacy groups and the public, Florida can work toward a legal framework that balances the needs of businesses while protecting the rights of individuals.

The fee-shifting statute that was recently deleted by the legislature was a “one-way” fee-shifting statute. In other words, if the insurance company lost, it owed the insured’s attorneys fees, but the reverse was not true. If the insured sued his insurance company and lost, the insured was not automatically liable for the insurance company’s attorneys fees. (The insured would still be liable for the prevailing party’s costs and could be liable for fees under a variety of scenarios involving sanctions for bad conduct. But there was no automatic fee shifting against the insured.)

One proposal I’ve seen is to enact a fee-shifting statute that goes both ways. In other words, the plaintiff would also face the risk of owing the insurance company’s attorney fees if the plaintiff loses at trial. I would support such a law and I’ve read that other lawyers who represent insureds in these cases would too. Although it can be argued that such a law would be unfair to individuals, because during the litigation the large and powerful insurance company would still have advantages (perhaps an individual should be able to sue his insurance company and lose without owing the insurance company’s attorney fees), it would be better than the current law that does not allow an insured to recover his reasonable attorney’s fees after winning at trial.

The reason, again, is access to justice. The insurance companies—which pay their CEOs between $7 million and $27 million a year—have all the money. They can afford to pay their lawyers between $150 and $195 an hour to litigate a case for four years. The insureds, regular people, cannot. Nevertheless, even a two-way fee-shifting statute would be better than no fee-shifting statute and would have a chance at saving the ability of insureds to sue their insurers for wrongful denial of small-value claims.

Conclusion

Fee-shifting statutes are a cornerstone of access to justice in Florida, playing a crucial role in enabling individuals to pursue legitimate small-value claims without the burden of exorbitant legal costs. The historical evolution of these statutes, particularly in the realms of workers’ compensation, insurance disputes, and wage claims, underscores their importance in creating a more equitable legal landscape.

As Florida faces significant changes to these laws, it is essential to recognize the potential consequences for consumers seeking justice. Advocating for the reinstatement of fee-shifting provisions could help ensure that all Floridians have the opportunity to seek redress when wronged, ultimately upholding the principle that justice should be accessible to everyone.