County Court Denies Motion for Leave to File Amended Complaint, Alleging Bad Faith Handling, Based on Insurer’s Confession of Judgment and Failure to Cure Civil Remedy Notice Within 60 Days.

The instant suit involved a dispute for personal injury protection (PIP) benefits, extended medical payment benefits, penalty, postage, interest, costs and attorney’s fees. After suit was filed, the court issued a General Differentiated Case Management Order, establishing the deadlines in the suit and setting a projected trial date of May 2023. 

Once suit was filed, defense counsel attempted to confer with plaintiff’s counsel. These attempts were ignored, and approximately eight days after defense counsel’s attempts to confer, the plaintiff filed a Civil Remedy Notice (CRN) with the Florida Department of Financial Services. A response to the CRN was timely filed by Allstate. 

Throughout the life of the case, Allstate made more attempts to confer with the plaintiff, all of which were ignored. Finally, Allstate filed a confession of judgment for $1,549.64, stipulating to the plaintiff’s entitlement to attorney’s fees and costs. Following the confession of judgment, the plaintiff filed a motion for leave to supplement and/or amend the complaint for statutory bad faith pursuant to Section 625.155, Florida Statutes. The proposed amended complaint alleged bad faith claims handling, alleging that Allstate did not attempt to cure the CRN within 60 days, after which it filed a confession. 

In deciding whether to grant the amendment, the court analyzed Florida Rule of Civil Procedure 1.190 as well as the standards established by case law in which an amendment may be granted if the court finds that: (1) granting the amendment does not prejudice the opposing party; (2) the privilege to amend has not been abused; and (3) the amendment is not futile. 

With regard to prejudice, the court found that the amendment would prejudice the defendant as the suit had been pending for 19 months and every deadline in the Case Management Order had elapsed. The court also noted that the plaintiff was not precluded from filing a separate cause of action for bad faith should it choose to do so. 

In analyzing whether the privilege to amend had been abused, the court found that the plaintiff’s actions demonstrated “the precise abuse that is intended to be prevented.” The court also took issue with the fact that the plaintiff filed its CRN after litigation had commenced, as opposed to before. The court also took issue with the plaintiff’s actions in ignoring all of Allstate’s attempts to amicably settle the suit, thus, forcing the confession of judgment. 

In analyzing futility, the court noted that the proposed amended complaint would be subject to dismissal as it was legally insufficient, thus, making the amendment futile. This was because the plaintiff did not comply with Fla. Stat. 624.155, which requires a CRN to state with specificity the facts giving rise to the violation, along with the specific policy language relevant to the violation and the specific statutory language that has allegedly been violated. In analyzing the CRN, the court found that it did not satisfy the requirements of Section 624.155, thus, barring the plaintiff from being able to bring a bad faith claim against Allstate. Accordingly, the court denied the plaintiff’s motion. 

This order should prove to be a boon for carriers defending against PIP suits in which plaintiffs attempt to use boilerplate Civil Remedy Notices as further leverage to force settlement. As this is a common strategy utilized by certain plaintiff firms in Florida, this order should give carriers a useful tool to defend themselves against these sort of scorched-earth litigation tactics. 

_{Case Law Alerts, 1st Quarter, January 2024 is prepared by Marshall Dennehey to provide information on recent developments of interest to our readers. This publication is not intended to provide legal advice for a specific situation or to create an attorney-client relationship. Copyright © 2024 Marshall Dennehey, all rights reserved. This article may not be reprinted without the express written permission of our firm.}