Standard Guar. Ins. Co. v. Quanstrom

555 So. 2d 828, 1990 WL 3840
CourtSupreme Court of Florida
DecidedJanuary 11, 1990
Docket72100
StatusPublished
Cited by280 cases

This text of 555 So. 2d 828 (Standard Guar. Ins. Co. v. Quanstrom) is published on Counsel Stack Legal Research, covering Supreme Court of Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Standard Guar. Ins. Co. v. Quanstrom, 555 So. 2d 828, 1990 WL 3840 (Fla. 1990).

Opinion

555 So.2d 828 (1990)

STANDARD GUARANTY INSURANCE CO., Petitioner,
v.
Brenda L. QUANSTROM, Respondent.

No. 72100.

Supreme Court of Florida.

January 11, 1990.

*829 Lora A. Dunlap of Fisher, Rushmer, Werrenrath, Keiner, Wack & Dickson, P.A., Orlando, for petitioner.

Stephan W. Carter of Martinez, Dalton & Provencher, P.A., Orlando, for respondent.

Sharon Lee Stedman of Rumberger, Kirk, Caldwell, Cabaniss, Burke & Wechsler, Orlando, amicus curiae for Reliance Ins. Co.

OVERTON, Justice.

We have for review Quanstrom v. Standard Guaranty Insurance Co., 519 So.2d 1135 (Fla. 5th DCA 1988), in which the Fifth District Court of Appeal acknowledged conflict with the Third District Court of Appeal's decision in Travelers Indemnity Co. v. Sotolongo, 513 So.2d 1384 (Fla. 3d DCA 1987). We agree that there is conflict.[1] The question in this cause concerns the setting of a reasonable attorney's fee under the lodestar approach and requires a determination of whether a contingency fee multiplier must be utilized when determining the appropriate attorney's fee to be paid to a prevailing insured pursuant to section 627.428, Florida Statutes (1987).[2] We find it necessary to reexamine our decision in Florida Patient's Compensation Fund v. Rowe, 472 So.2d 1145 (Fla. 1985), in view of the recent decisions by the United States Supreme Court in Blanchard v. Bergeron, ___ U.S. ___, 109 S.Ct. 939, 103 L.Ed.2d 67 (1989), and Pennsylvania v. Delaware Valley Citizens' Council for Clean Air, 483 U.S. 711, 107 S.Ct. 3078, 97 L.Ed.2d 585 (1987), which effectively eliminated the use of contingency fee multipliers in computing fees under the lodestar approach. Further, we find it necessary to clarify our opinion in Rowe concerning its application under the various types of fee-authorizing statutes. We find that this cause should be remanded to the trial court for consideration of whether a multiplier is applicable. We disapprove the district court's decision but approve the result.

The material facts are not in dispute. In its prior decision on the merits, reported as Quanstrom v. Standard Guaranty Insurance Co., 504 So.2d 1295 (Fla. 5th DCA 1987), the Fifth District Court of Appeal set forth the following relevant facts:

[Quanstrom] owned a 1976 Chevrolet Vega motor vehicle on which PIP insurance expired in July of 1984 but which she continued to drive until January, 1985, when the clutch cable broke and the vehicle became incapable of functioning. The vehicle's registration expired on February 17, 1985, and the vehicle was not operated or driven on the roads of this state until it was repaired on March 25, 1985, and [Quanstrom] reregistered and reinsured it on April 25, 1985. However, on March 9, 1985, [Quanstrom] sustained bodily injuries while riding as a passenger in a vehicle owned by [Terry Nelson] and insured by [Standard Guaranty Insurance Company] for personal injury protection (PIP) benefits under section 627.736(4)(d)4., Florida Statutes.

Id. at 1296. Quanstrom sought to recover $2,066.04 in PIP benefits from Nelson's insurer, Standard Guaranty Insurance Company. Standard Guaranty rejected her claim, asserting that Quanstrom was required to carry PIP coverage on her own vehicle and that her failure to do so resulted in her having no coverage under the *830 policy covering the vehicle in which she was a passenger.

After both parties moved for summary judgment, the trial court granted Standard Guaranty's motion, finding that Quanstrom was not entitled to coverage. The Fifth District Court of Appeal identified the issue as follows:

[W]hether a person injured while occupying a motor vehicle covered by personal injury protection (PIP) insurance is barred by section 627.736(4)(a), Florida Statutes (1985), from recovering PIP benefits from the insurer of the owner of that vehicle because the insured person is the owner of an uninsured motor vehicle which is not in fact being driven or operated on the roads of this state because of needed repairs.

Id. The district court reversed, finding that Quanstrom was entitled to PIP coverage under the insurance policy covering the vehicle in which she was a passenger and concluding that she was not required to carry PIP coverage on her inoperable car. The district court then directed the trial court to enter a final judgment in favor of Quanstrom. On remand, the sole issue was attorney's fees. Standard Guaranty and Quanstrom stipulated to a reasonable number of hours and a reasonable hourly rate, resulting in an agreed-upon lodestar fee of $8,100. On the merits in this cause, Quanstrom's counsel filed a complaint, filed and argued a motion for summary judgment, took one deposition, and filed and presented the issue on appeal. On remand, the only contested issue before the trial court was whether a contingency fee multiplier should be applied to the agreed-upon lodestar fee. Quanstrom's counsel contended that a multiplier must be applied and sought a multiplier of 3, which would result in a fee exceeding $24,000. The trial court rejected the application of a multiplier, finding that the fee arrangement between Quanstrom and her attorney was not a contingency fee arrangement, and found that $8,100 was a reasonable fee in this matter. The Fifth District Court of Appeal reversed the trial court, finding that this was a contingency fee agreement and that "the application of a multiplier factor is mandatory on the trial judge when the prevailing party's counsel is employed on a contingency fee basis and a reasonable attorney's fee is being calculated as directed in Rowe." 519 So.2d at 1136. We disagree with the holding that a multiplier must be applied under these circumstances.

Initially, it is necessary that we re-examine the principles adopted in Rowe. In Rowe, we found that, in setting a reasonable attorney's fee, the federal lodestar approach "provide[d] a suitable foundation for an objective structure," 472 So.2d at 1150 (citations omitted). In so holding, we recognized that, in determining the fee, courts should apply those factors enunciated in the Florida Bar Code of Professional Responsibility.[3] We explained how the lodestar amount is determined and noted how some of the code factors were integrated into this calculation. With regard *831 to contingency fee matters, we also emphasized that "[o]nce the court arrives at the lodestar figure, it may add or subtract from the fee based upon a `contingency risk' factor and the `results obtained.'" 472 So.2d at 1151 (emphasis added). We also explained that, in personal injury cases, "[w]hen the prevailing party's counsel is employed on a contingent fee basis, the trial court must consider a contingency risk factor when awarding a statutorily-directed reasonable attorney fee." Id. (emphasis added). In view of the Fifth District Court of Appeal's holding in the instant case, we emphasize that the words "must consider" do not mean "must apply," but mean "must consider whether or not to apply" the contingency fee multiplier.

The federal courts developed the lodestar method of determining attorney's fees to apply to a special class of cases, in which Congress had enacted fee-authorizing statutes to pay fees to prevailing plaintiffs for the purpose of obtaining public enforcement of Congressional acts.

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Bluebook (online)
555 So. 2d 828, 1990 WL 3840, Counsel Stack Legal Research, https://law.counselstack.com/opinion/standard-guar-ins-co-v-quanstrom-fla-1990.