State Farm Florida Insurance Co. v. Alvarez
175 So. 3d 352
| Fla. Dist. Ct. App. | 2015Background
- Insureds (Jose and Martha Alvarez) sued State Farm after Hurricane Wilma damage; insurer initially paid $13,700, insureds sought an additional $80,000 based on a public adjuster report and demanded appraisal which insurer denied.
- Suit filed in 2010 for breach of the policy’s appraisal provision; the public adjuster’s report and sworn proof of loss formed the core of plaintiffs’ claim and discovery responses.
- Litigation involved extensive discovery motions and depositions; eleven different lawyers billed on the matter and counsel logged about 225 hours.
- Case settled at mediation for $10,000 after insurer’s last offer was $175.
- Trial court awarded attorneys’ fees: $400 blended hourly rate, 200 compensable hours, and a 1.5 contingency multiplier (total $120,000).
- State Farm appealed the hourly rate, number of hours, and multiplier; appellate court affirmed the hourly rate, reversed the hours and multiplier, and remanded to determine reasonable hours.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Hourly rate | $400 blended rate is reasonable | $400 is excessive | Affirmed: $400 was reasonable based on record and expert testimony favoring similar rates |
| Reasonable hours | ~200 hours reasonable (insurer’s expert agreed) | 200 hours excessive; duplicative billing and many attorneys | Reversed: 200 hours excessive; remanded to determine reasonable hours considering duplication and ministerial tasks |
| Multiplier (contingency enhancement) | 1.5 multiplier needed to obtain specialized counsel and compensate risk | No evidence market required multiplier; result not extraordinary | Reversed: multiplier improper—plaintiffs failed Quanstrom prong 1 and result/novelty did not justify enhancement |
| Remand scope | Award stands as entered | Trial court should reassess hours consistent with guidance | Remanded to trial judge to fix reasonable hours; hourly rate affirmed, no multiplier allowed |
Key Cases Cited
- Sunshine State Ins. Co. v. Davide, 117 So. 3d 1142 (Fla. 3d DCA 2013) (standard of appellate review and fee-award context)
- Centex- Rooney Const. Co. v. Martin Cnty., 725 So. 2d 1255 (Fla. 4th DCA 1999) (deference to trial court’s fee determinations)
- Universal Underwriters Ins. Co. v. Gorgei Enters., Inc., 345 So. 2d 412 (Fla. 2d DCA 1977) (reasonableness of fee is not precise and judges may differ)
- Trumbull Ins. Co. v. Wolentarski, 2 So. 3d 1050 (Fla. 3d DCA 2009) (appellate court may apply common sense in reviewing fee awards)
- Dalia v. Alvarez, 605 So. 2d 1282 (Fla. 3d DCA 1992) (appellate reduction of excessive hours appropriate)
- USAA Cas. Ins. Co. v. Prime Care Chiropractic Enters., P.A., 93 So. 3d 345 (Fla. 2d DCA 2012) (insufficient evidence to support multiplier when market need not shown)
- TRG Columbus Dev. Venture, Ltd. v. Sifontes, 163 So. 3d 548 (Fla. 3d DCA 2015) (affirming $400 hourly rate)
- Canakaris v. Canakaris, 382 So. 2d 1197 (Fla. 1980) (reasonableness test requires logic and justification)
- N. Dade Church of God, Inc. v. JM Statewide, Inc., 851 So. 2d 194 (Fla. 3d DCA 2003) (duplicative attorney billing and ministerial tasks not compensable)
- Perdue v. Kenny A. ex rel. Winn, 559 U.S. 542 (2010) (lodestar presumptively reasonable; multiplier is exceptional)
- Fla. Patient’s Comp. Fund v. Rowe, 472 So. 2d 1145 (Fla. 1985) (novelty and difficulty usually reflected in hours)
- Standard Guar. Ins. Co. v. Quanstrom, 555 So. 2d 828 (Fla. 1990) (three-factor test for contingency multipliers in contract cases)
- Sun Bank of Ocala v. Ford, 564 So. 2d 1078 (Fla. 1990) (market evidence required to justify multiplier)
- Norman v. Housing Authority of City of Montgomery, 836 F.2d 1292 (11th Cir. 1988) (measure of reasonable hours is profession’s judgment, not least possible time)