William Joyce v. Federated National Insurance Company
228 So. 3d 1122
| Fla. | 2017Background
- William and Judith Joyce sued their homeowners insurer, Federated National, after coverage for water damage was denied; they prevailed and were entitled to attorney’s fees under Fla. Stat. § 627.428.
- The Joyces’ counsel was retained on a contingency-fee basis and the trial court calculated a lodestar of $38,150 (109 hours at $350/hr).
- The trial court applied a 2.0 contingency-fee multiplier (awarding $76,300) after weighing Quanstrom factors: relevant market, mitigation of nonpayment risk, and Rowe factors (amount, results, fee arrangement).
- The Fifth District affirmed the lodestar but reversed the multiplier, adopting a rule (via federal cases) that multipliers are allowed only in "rare" and "exceptional" circumstances and finding the evidence insufficient.
- The Florida Supreme Court granted review and held that state precedent (Rowe, Quanstrom, Bell) does not require a "rare and exceptional" showing before applying a contingency multiplier; it reinstated the trial court’s multiplier award.
Issues
| Issue | Plaintiff's Argument (Joyce) | Defendant's Argument (Federated) | Held |
|---|---|---|---|
| Whether a trial court may apply a contingency-fee multiplier only in "rare and exceptional" cases | Rowe/Quanstrom/Bell permit multipliers when Quanstrom factors are met; no categorical "rare/exceptional" prerequisite | Multipliers should be cabined by federal precedent (Perdue/Dague) limiting lodestar enhancements to rare cases | Florida Supreme Court: no "rare and exceptional" requirement; follow state precedent allowing multipliers when justified by Rowe/Quanstrom/Bell |
| Whether the trial court properly applied Quanstrom/Rowe factors (relevant market, mitigation, Rowe factors) | Evidence showed scarcity of competent local counsel, inability to mitigate risk, complexity—supporting 2.0 multiplier | Record does not support relevant-market showing; availability of counsel (one phone call) undermines necessity of multiplier | Court held trial court’s findings were supported and Fifth DCA improperly substituted its view for trial court factfindings; multiplier reinstated |
| Whether U.S. Supreme Court federal decisions (Dague/Perdue) prohibit or limit multipliers under state statutes/contracts | State courts need not follow federal rulings on federal fee-shifting statutes; Florida precedent sustains multipliers to preserve access to counsel | Federal authority disfavors contingency enhancements as duplicative and administratively problematic | Florida Supreme Court declined to adopt Perdue/Dague reasoning for state statutory/contract fee awards and reaffirmed state line of cases permitting multipliers when supported |
Key Cases Cited
- Florida Patient’s Compensation Fund v. Rowe, 472 So.2d 1146 (Fla. 1985) (adopts lodestar approach and recognizes contingency-risk multiplier with required findings)
- Standard Guaranty Ins. Co. v. Quanstrom, 555 So.2d 828 (Fla. 1990) (refines Rowe—identifies three-factor test for multipliers in tort/contract cases)
- Bell v. U.S.B. Acquisition Co., 734 So.2d 403 (Fla. 1999) (reaffirms multiplier utility to secure counsel and applies Quanstrom factors)
- State Farm Fire & Cas. Co. v. Palma, 555 So.2d 836 (Fla. 1990) (upholds high multiplier where unique/complex case justified flexibility)
- Burlington v. Dague, 505 U.S. 557 (U.S. 1992) (federal rule rejecting contingency enhancements under certain federal fee statutes)
- Perdue v. Kenny A. ex rel. Winn, 559 U.S. 542 (U.S. 2010) (emphasizes strong presumption that lodestar is sufficient; limits enhancements under federal law)