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Say What You Mean To Say (When Serving Proposals for Settlement)

PFS’s must strictly comply with Florida Statute 768.79 and Florida Rule of Civil Procedure 1.442. In addition, the offeree must be able to independently evaluate his/her respective claim, irrespective of other parties’ decisions. An offer conditioned on an event entirely out of the offeree’s control, like the tender of a settlement check by the offeree’s insurance company, is considered an illusory offer.

Any drafting deficiencies in a PFS are construed against the drafter. For example, the injured Plaintiff in Hilton Hotels Corp. v. Anderson served a PFS on each of three defendants that stated:

(1) the PFS was being made on behalf of Troy Anderson (with no mention of his wife);

(2) the PFS was being made for the purpose of settling claims by Troy Anderson against Hilton; and

(3) in exchange for the amount demanded, “PLAINTIFF agrees to settle any and all claims against [Defendant], as identified in Case Number . . . .

So. 3d    , 40 FLW D48c (Fla. 5th DCA 12-19-14). Sounds clear and straightforward, right?  Well, the Fifth DCA didn’t think so.

The court held that this last bit about Troy agreeing to settle “any and all claims . . . as identified in Case Number . . . .” could have been fairly read to mean that Troy was offering to settle both Troy’s claims and his wife’s claims. The PFS was therefore invalid.

In a separate case involving an auto accident, the plaintiff’s PFS served on the at-fault driver included a provision requiring the vehicle’s owner to tender a settlement check. The court held that because the owner was required to tender the check, the at-fault driver was deprived the ability to evaluate and independently act to resolve the case, making that PFS invalid as well. Paduru v. Klinkenburg,    So. 3d    , 40 FLW D41a (Fla. 1st DCA 12-17-14).

As long as the PFS is clear about the fact, and doesn’t try and require conditions that a single defendant can’t independently meet, a PFS can offer to settle the claims of multiple parties – which presumably is why the Anderson court is splitting hairs over whether the PFS is intended to settle one plaintiffs’ claim or both.)

However, an “all or nothing proposal made by multiple offerors to a single offeree is an acceptable proposal for settlement.” Duong v. Ziadie,   So. 3d    , 40 FLW D23a (Fla. 4th DCA 12-17-14). All the plaintiffs in this medical malpractice case offered to settle their claims against a single defendant, and the court held that such an offer was not ambiguous. It didn’t matter that the defendant couldn’t pick and choose which plaintiffs to settle with because he had independent control over whether to settle.

The irony of all these appeals is that the PFS statutes were supposed to reduce litigation. Instead, the insurance industry seems happy to pay its own lawyers to fight attorney fee awards to successful plaintiffs. And their relative success in getting those awards thrown out in the district courts should be a wake-up call to plaintiffs’ attorneys.

Your PFS should be like a good humidor – absolutely airtight. Unless, of course, you enjoy smoking stale cigars.