In anticipation of a special session, sides form over the need for ‘tort reform’
Florida business leaders are renewing a call to fight “lawsuit abuse” as Gov. Ron DeSantis prepares to call a special session to address Hurricane Ian relief and property insurance reforms.
At the Florida Chamber of Commerce’s annual convention in Orlando, Tallahassee attorney Jason Gonzalez announced the group has formed a “council of general counsels.”
“It brings together corporate general counsels, association counsels, and litigation directors with legal experts that are on the forefront of working to solve some of the most difficult problems that we have in our civil justice system,” Gonzalez said.
The council will look for potential cases that could eventually persuade Florida’s appellate courts to “do away with some harmful precedents,” Gonzalez said.
The Florida Justice Association, however, says calls for “tort reform” are just an effort by the insurance industry avoid financial responsibility to policyholders and accident victims.
Gonzalez acknowledged the “legal climate” has improved since the American Tort Reform Association ranked Florida the nation’s No. 1 “judicial hellhole” in 2017. DeSantis, who has since appointed more than three dozen appellate judges and Supreme Court justices, deserves the credit, Gonzalez said.
“Today, many believe it is the best appellate judiciary in the nation for improving the business climate and making Florida a better place for people to bring their families, and have good jobs, and a good stable legal environment,” Gonzalez said.
California is the new leading “judicial hellhole,” but Florida still ranks in the bottom five, and more reforms are necessary, ATRA President Sherman “Tiger” Joyce told the chamber audience.
“Despite all the work done by the Florida Supreme Court and Gov. Ron DeSantis to mitigate lawsuit abuse, much-needed reforms continue to stall in the Florida Legislature,” Joyce said.
He cited figures that show “frivolous lawsuits” cost the South Florida economy 170,000 jobs and $5.4 billion in lost personal income.
Between 2010 and 2019, there were 213 “nuclear verdicts” — ones exceeding $10 million — in Florida, Joyce said.
“It is real, and it effects not just those of you in business, but all of us as consumers,” he said.
The Insurance Information Institute, an industry trade group, warns that Florida’s property insurance market “is on the verge of collapse,” Joyce said.
Florida’s one-way attorney fee provision that favors plaintiffs in property insurance disputes creates an adverse incentive to litigate, Joyce insisted.
“Think about that,” Joyce said. “If you’re trying to settle a case, you run the risk of all these fee shifts, and you run the risk of all these bad-faith claims. It’s something this Legislature needs to tackle.”
Not everyone is convinced that “lawsuit abuse” is a problem, or that more reforms are necessary.
Jacksonville attorney Curry Pajcic, president of the Florida Justice Association, notes that the Florida Chamber of Commerce is backed by major corporations.
When it calls for “tort reform,” the insurance industry is merely trying to avoid its financial responsibility to policyholders and accident victims, Pajcic said.
“The corporate elites and the insurance industry want to take your arm and your leg, and in exchange, give you a crutch,” he said. “They don’t want to make it right; they don’t want to make it even.”
In a property insurance special session earlier this year, lawmakers approved SB 2D. The reforms created a $2 billion “Reinsurance to Assist Policyholders,” or RAP fund, to bolster the insurance market.
Other reforms limited attorney fees in insurance disputes and made it harder for plaintiffs to claim fee multipliers, although critics say they are rarely awarded.
Pajcic and other critics note that the Office of Insurance Regulation, in a recent Tweet, claimed that property insurance litigation is decreasing.
“SB 2-D implemented legal reforms to help stabilize Florida’s property insurance market against excessive & costly litigation,” the Office of Insurance Regulation posted. “While reform does take time, there’s already been an approx. 30% year-over-year decrease in litigation.”
Lawmakers approved a one-way attorney fee provision decades ago to level the playing field for consumers like “Joe Smith, living in a cinder block, two-bedroom, one bath house,” Pajcic says.
“Who has more resources?” Pajcic said. “Joe Smith or State Farm?”
Restricting a consumer’s access to the courts risks pushing Florida closer to “vigilante justice,” Pajcic said.
“One of the enumerated reasons our forefathers revolted was because King George III took away our right to trial by a jury, and we became a country,” he said.