September 1999


Primeco Personal Communications v. Commonwealth Distributors, Inc.
24 Fla. L. Weekly D1872 (Fla. 3d DCA 1999)

Where a contract provided for arbitration of “any claim, controversy or dispute between the parties”, and one party sued the other for fraud in the inducement and breach of contract and other claims, all claims had to be submitted to arbitration, even the fraud in the inducement claim. Does this mean you are not entitled to litigate the issue of whether you were fraudulently induced to enter into the agreement to arbitrate?

Collateral Estoppel

Sentry Ins. v. FCCI Mut. Life Ins. Co.,
24 Fla. L. Weekly D1910 (Fla. 4th DCA 1999)

The issue of whether the plaintiff was an employee was litigated in the underlying personal injury lawsuit, in connection with a worker’s compensation defense. The defendant’s general liability insurer brought a dec action against the defendant’s worker’s comp and employer liability insurers for a determination of duty to defend and indemnify the insured. The trial court properly held that the determination of the employment status in the underlying trial collaterally estopped the insurers from relitigating the issue in the dec action. The doctrine of collateral estoppel applies to an insurer which is in privity with its insured and whose interests were not antagonistic to the insured's in the underlying suit. The insurer was present at the underlying suit where the issue was litigated and provided argument in support of the insured’s position, so it is bound by the original determination.

Insurance — Appraisal

United States Fidelity & Guaranty Co. v. Romay
24 Fla. L. Weekly D1963 (Fla. 3d DCA 1999) (en banc)

Overruling a number of prior decisions, the court en banc holds that, where a property insurance policy contains an appraisal clause, the insured must comply with all of the policy’s post-loss obligations before the appraisal clause is triggered. Until the insured has done this, the Court may not compel appraisal.

Insurance — UM

United Services Automobile Association v. Phillips
24 Fla. L. Weekly. D1795 (Fla. 2d DCA 1999)

The insured was entitled to UM coverage where he was injured by a bus owned by the Pinellas Suncoast Transit Authority. The UM policy purported to exclude vehicles owned by government entities or by self-insurers. The court held that the UM statute does not permit exclusion of vehicles owned by government entities. Moreover, the Transit Authority was not a self insurer where it had not obtained a certificate of self insurance. The Transit authority had a policy of $2 million with a $100,000 deductible, but it was not payable unless the claimant obtained a claims bill from the legislature.

Med Mal

Ramirez v. University of Miami
24 Fla. L. Weekly D1871 (Fla. 3d DCA 1999)

After the decision in Jaar v. University of Miami, 474 So.2d 239 (Fla. 3d DCA 1985), the university and JMH modified their affiliation agreement to try to shield the university from liability for any malpractice committed by its faculty physicians at JMH. The affiliation agreement now provides that the University shall permit its faculty physicians to apply to the Trust for staff privileges and to contract with the Trust individually. Distinguishing Jaar, the court holds that the university cannot be held liable for the actions of two faculty physicians serving on a hospital committee that promulgated emergency room protocol. The court upholds summary judgment for the university.

New Trial

Brown v. Estate of Stuckey
24 Fla. L. Weekly S397 (Fla. 1999)

Once again the Supreme Court tries to bring light to the foggy issue of the standard for review of an order granting a motion for new trial based on a finding that the verdict is contrary to the manifest weight of the evidence.

The trial judge has broad discretion to grant a new trial “to avoid what, in the judge’s trained and experienced judgment, is an unjust verdict.” An order granting new trial should not be disturbed except upon a clear showing of abuse. The trial court should grant a new trial when “the jury has been deceived as to the force and credibility of the evidence or has been influenced by considerations outside the record.” When the trial judge grants the motion for a new trial, he or she must articulate the reasons for a new trial in the order. When reviewing the order, the appellate court must recognize the broad discretionary authority of the trial judge and apply the reasonableness test to determine whether the trial judge committed an abuse of discretion. The presence of substantial competent evidence in the record to support the jury verdict does not necessarily demonstrate that the trial judge abused his or her discretion.

A new trial may be ordered on the grounds that the verdict is excessive or inadequate when (1) the verdict shocks the judicial conscience or (2) the jury has been unduly influenced by passion or prejudice. The procedure under 768.74 for remittitur and additur apply only upon the proper motion of a party.

Nursing Home

Beverly Enterprises, Inc. v. McVey
24 Fla. L. Weekly D1840 (Fla. 2d DCA 1999)

The nursing home statute is upheld here against a challenge that it is unconstitutionally vague and an improper delegation of legislative authority to the Agency for Health Care Administration. (How vague is “don’t abuse old people”?)

The court also holds that it was error to include on the verdict form the V.A. hospital at which the decedent was treated after the nursing home abuse, because the hospital was not a joint tortfeasor, but a successor tortfeasor. Therefore, the plaintiff was entitled to recover his entire damages from the nursing home, the initial tortfeasor. See Stuart v. Hertz Corp., 351 So.2d 703 (Fla. 1977).

Offer of Judgment / Proposal for Settlement

Abbott & Purdy Group, Inc. v. Bell
24 Fla. L. Weekly D1914 (Fla. 4th DCA 1999)

I guess this is why they now call it a “proposal for settlement” instead of an offer of judgment. The court holds that, where the defendant made a proposal for settlement under Rule 1.442 and 768.79, and the offer did not specifically provide for entry of judgment against the offeror, and the offeror is willing to proceed with payment and conclusion of the settlement, the trial court has no jurisdiction to enter final judgment against the offeror. The court notes that rule 1.442 has been amended so that it no longer mandates entry of judgment upon acceptance of an offer of settlement, and that it is different in this respect from Federal Rule of Civil Procedure 68.

Flight Express, Inc. v. Robinson
24 Fla. L. Weekly D1628 (Fla. 3d DCA 1999)

The court interprets Fla. R. Civ. P. 1.442(c)(3) which requires a joint proposal to “state the amount and terms attributable to each party.” The court interprets this to require a specification of the amounts to be paid to different offerees, but not the amounts payable by each of several offerors.

Punitive Damages

Owens-Corning Fiberglass Corp. v. Ballard
24 Fla. L. Weekly S401 (Fla. 1999)

The statutory presumption as to excessive punitive damages, in 768.73(1), Fla. Stat. is overcome where the punitive damages award is almost 18 times the compensatory damages awarded, but the punitive damages are based on clear and convincing evidence that the defendant’s conduct was more egregious than the standard of wanton and wilful disregard for the safety of the plaintiff. The Supreme Court affirms the award of $31 million in punitive damages.

The court states that punitive damages “are appropriate when a defendant engages in conduct which is fraudulent, malicious, deliberately violent or oppressive, or committed with such gross negligence as to indicate a wanton disregard for the rights and safety of others.

The Court approves the trial judge’s instruction to the jury to consider the following factors on punitive damages: (1) an amount reasonable in relation to the harm likely to result from defendant’s conduct and the harm that actually occurred; (2) the “degree of reprehensibility” [ya gotta love this profession] of the defendant’s conduct, its duration and frequency, the defendant’s awareness and any concealment; (3) profitability and the desirability of removing that profit and having the defendant sustain a loss; (4) the defendant’s financial condition and the probable effect on it; (5) all the costs of litigation to both parties; (6) the total punishment the defendant has or will probably receive from other sources, (“as a mitigating factor”); (7) the seriousness of the hazard to the public and the defendant’s attitude and conduct on discovery of the misconduct; (8) degree of the defenant’s awareness of the hazard and of its excessiveness; (9) the number and level of employees involved in causing or covering up the marketing misconduct; (10) the duration of both the improper marketing and its cover-up; (11) existence of other civil awards against the defendant for the same conduct.

The Court also approves the trial court’s “well-reasoned and detailed order” setting out its reasons for finding clear and convincing evidence justifying the award based on those factors. And the Court holds that the appellate court correctly “carefully considered the statutory scheme and reviewed the evidence in relation to the trial court’s legal analysis and findings ...”.

Unfortunately, the court also notes that the legislature recently amended the statute, effective October 1, 1999, limiting punitive damages to 3 times the compensatory damages or $500,000 unless the defendant’s conduct was motivated by unreasonable financial gain or where the defendant intended to harm the plaintiff. The court holds that these amendments do not affect the present case.

CSX Transp, Inc. v. Palank
24 Fla. L. Weekly D1966 (Fla. 4th DCA 1999)

This case contains an excellent discussion of punitive damages. The court upholds an award of punitive damages of $50 million against CSX based on evidence that, among other things, CSX systematically cut back its maintenance workers over a period of years to save money, resulting in a benefit to its bottom line of $2.4 billion; filed false safety reports; and had actual notice that the broken switch that caused the accident was defective.

The court holds that the standard for punitive damages is the standard for culpable negligence set out in the standard jury instructions. The requirements in that instruction are listed in the disjunctive: “a course of conduct showing reckless disregard for human life or for the safety of persons exposed to its dangerous effects, or such an entire want of care as to raise a presumption of conscious indifference to consequences, or which shows wantonness or recklessness, or a grossly careless disregard of the safety and welfare of the public, or such an indifference to the rights of others as is equivalent to an intentional violation of such rights.” The standard does not require proof of a crime beyond a reasonable doubt.

The court also holds that it was not error to admit the widow’s testimony about the loss of her husband during the trial on liability for punitive damages, because it was necessary for the jury to understand the underlying compensatory damages claim.

First Healthcare Corp. v. Hamilton
24 Fla. L. Weekly D1926 (Fla. 4th DCA 1999)

The standard necessary for culpable negligence for punitive damages was met in this nursing home case by evidence that the defendant violated 782.07(2) and 825.102, Florida statutes. Section 782.07(2) provides that a person who causes the death of an elderly person or disabled adult by culpable negligence under 825.102(3) commits manslaughter ... a felony of the first degree.

Section 825.102 defines neglect of an elderly person or disabled adult in a lengthydefinition that basically applies a standard of reasonable care to the acts of a caregiver. The opinion contains a lengthy recitation of the defendant’s egregious misconduct, repeatedly allowing the deceased to wander away, leaving his door broken in the open position for a year and a half, and manufacturing a fraudulent document and false testimony to cover up its conduct.

The court emphasizes the different burden of proof between a criminal and civil case, and notes that “a close civil case for punitive damages will not usually yield a criminal prosecution.”


Thurman v. Mistovich
24 Fla. L. Weekly D1670 (Fla. 1st DCA 1999)

The parties entered into a “high-low” settlement agreement whereby the plaintiff would get not less than $20,000 if the jury’s verdict was for the defendant, and not more than $70,000 if the plaintiff won. The court held that, after a verdict in favor of the defendant, the defendant was not entitled to an award of costs. Because of the high-low, the plaintiff was the prevailing party entitled to costs.

Sovereign Immunity

Morhaim v. State
24 Fla. L. Weekly D1809 (Fla. 3d DCA 1999)

The Third District continues its sensible interpretation of the notice requirements of the sovereign immunity statute. Section 768.28(6)(a) requires presuit notice not only to the government entity being sued but also in most cases to the Florida Department of Insurance. In this case, the plaintiff served notice on the county and the department of insurance. Later, when the plaintiff learned that the road in question was the responsibility of the Department of Transportation, plaintiff’s counsel sent a new notice to the DOT but not to the Department of Insurance. The DOT did send a copy of the notice to the DOI before the statute of limitations ran. The court held that this was adequate. However, because no notice of the plaintiff’s husband’s derivative claim was ever sent to the DOT, the husband’s claim was barred. See Metropolitan Dade County v. Reyes, 688 So.2d 311 (Fla. 1996).

Please remember how important it is to give notice to the government entity and to the department of insurance of the claims of the plaintiff and anyone with a derivative claim.

Wall v. Palm Beach County
24 Fla. L. Weekly D1825 (Fla. 4th DCA 1999)

In a similar vein, even though the government entity may waive the required notice to itself, it cannot waive notice to the Department of Insurance.