12 Fla. L. Weekly Supp. 747a
Attorney’s fees — Insurance — Personal injury protection — Contingency risk multiplier — Grant of contingency risk multiplier would be unjust where attorney for insured increased risk that insured would not receive coverage and, consequently would not be entitled to award of attorney’s fees, by refusing to identify insured at examination under oath and advising insured not to comply with insurer’s request that insured bring driver’s license to EUO — Likelihood of success is measured at time attorney was retained, not later time complaint was filed — If multiplier were appropriate, multiplier would be 1.0 where insurer had not even denied coverage at time insured retained attorney — Costs, expert witness fee and prejudgment interest awarded
PIERRE DORVIL, Plaintiff, v. EXPLORER INSURANCE COMPANY, Defendant. Circuit Court, 9th Judicial Circuit in and for Orange County. Case No. 2004-CA-004205. May 13, 2005. Cynthia Z. MacKinnon, Judge. Counsel: Robert D. Melton, Robert D. Melton, P.A., Orlando. Donald J. Masten and Tammy B. Denbo, Rissman, Weisberg, Barrett, Hurt, Donahue & McLain, P.A., Tampa.
FINAL JUDGMENT AWARDING ATTORNEY’S FEES AND COSTS
THIS CAUSE came before the Court on “Plaintiff’s Amended Motion for Attorney’s Fees and Costs to be Awarded in Favor of Plaintiff’s Attorney and Against the Defendant, Explorer Insurance Company,” heard on March 31, 2005, and April 7, 2005. The Court, having reviewed the motion, considered the evidence, heard the argument of counsel, and being otherwise fully advised in the premises, hereby finds as follows:
Findings of Fact
Defendant Explorer Insurance Company’s insured, Plaintiff Pierre Dorvil, was involved in an automobile accident on April 2, 2004. Dorvil retained counsel to represent him in the bodily injury case that arose from that accident. On May 4, 2004, Dorvil executed a contingency fee agreement with counsel to represent him by filing a declaratory judgment action against Explorer.
Eight days later, on May 12, 2004, at Explorer’s request, Dorvil appeared at his attorney’s office for an examination under oath (“EUO”). In Explorer’s written request for the EUO, Explorer asked Dorvil to bring certain documents to the examination, including his driver’s license. However, based upon the advice of counsel, Dorvil did not bring any identification to the examination, and Dorvil’s attorney refused to identify Dorvil. Dorvil’s attorney stated that the examination under oath could proceed; however, the examination under oath was not completed because Explorer’s representative could not identify Dorvil.
Later that same day, Dorvil filed a declaratory judgment action against Explorer, which asked the Court to construe the rights of the parties under these circumstances. Dorvil also claimed that he was entitled to attorney’s fees under sections 627.428 and 627.736(8), Florida Statutes. On November 1, 2004, at 12:30 p.m., Explorer faxed Dorvil a written confession of judgment in which it acknowledged that Dorvil was entitled to reasonable attorney’s fees and costs.
Calculation of Attorney’s Fees and Costs
Courts must use the lodestar method when awarding reasonable attorney’s fees pursuant to a statute. Fla. Patient’s Comp. Fund v. Rowe, 472 So.2d 1145, 1150 (Fla. 1986). In the first step of the lodestar method, the court must determine the number of hours reasonably expended on the litigation. Rowe, 472 So. 2d at 1150. The burden of proving the reasonableness of the number of hours spent on a case is on the party seeking attorney’s fees. Fraser v. Sec. & Inv. Corp., 615 So. 2d 841, 842 (Fla. 4th DCA 1993). To accurately assess the labor involved, the attorney’s fees applicant must present evidence detailing the amount of work performed on a case, and inadequate documentation may result in a reduction of the number of hours claimed. Rowe, 472 So. 2d at 1151. The trial court considers the following factors in determining an appropriate fee amount:
(1) The time and labor required, the novelty and difficulty of the question involved, and the skill requisite to perform the legal service properly.
(2) The likelihood, if apparent to the client, that the acceptance of the particular employment will preclude other employment by the lawyer.
(3) The fee customarily charged in the locality for similar legal services.
(4) The amount involved and the results obtained.
(5) The time limitations imposed by the client or by the circumstances.
(6) The nature and length of the professional relationship with the client.
(7) The experience, reputation, and ability of the lawyer or lawyers performing the services.
(8) Whether the fee is fixed or contingent.
Id. at 1150.
The next step in establishing the amount of attorney’s fees under Rowe is to multiply the reasonable number of hours spent by the attorney by the reasonable hourly rate for the attorney’s services. Id. at 1150. The parties do not dispute that a reasonable hourly rate for Robert D. Melton, Esquire’s, services is three hundred dollars, and the expert testimony presented at the attorney’s fees hearing supports this assertion. Thus, the Court finds that the rate of three hundred dollars per hour for Melton’s services is reasonable.
After considering the Rowe factorsand thoroughly reviewing the evidence, the Court finds that ten hours is a reasonable number of hours expanded in this matter. Thus, the Court finds that appropriate lodestar figure in this matter is three thousand dollars.
Lastly, as is required by Rowe and Standard Guaranty Insurance Co. v. Quanstrom, 555 So. 2d 828, 834 (Fla. 1990), the Court considers whether a contingency risk multiplier is appropriate in this matter. Evidence of a contingency risk factor must be present to justify the application of a multiplier. Quanstrom, 555 So. 2d at 831. A court must consider whether to award a multiplier when awarding statutory attorney’s fees, but it is not under an obligation to award a multiplier. Id.
In determining whether a multiplier for an award of attorney’s fees in a tort or contract case is warranted, the court must consider the following factors:
(1) whether the relevant market requires a contingency fee multiplier to obtain competent counsel;
(2) whether the attorney was able to mitigate the risk of nonpayment in any way; and
(3) whether any of the factors set forth in Rowe are applicable, especially, the amount involved, the results obtained, and the type of fee arrangement between the attorney and his client.
Quanstrom, 555 So. 2d at 834. Evidence of these factors must be presented to justify a multiplier. Id.
In this case, Dorvil’s counsel actually increased the risk of nonpayment of his fees. Dorvil’s counsel refused to identify Dorvil at the EUO so that the EUO could be conducted. In addition, Dorvil’s counsel advised Dorvil not to bring Dorvil’s driver’s license to the EUO, despite Explorer’s specific request that Dorvil bring this documentation to the examination. This behavior could reasonably be construed as constituting a refusal to comply with Explorer’s demand for an EUO, which would be a material breach of the insurance contract that would have permitted Explorer to deny coverage. Goldman v. State Farm Gen. Ins. Co., 660 So. 2d 300, 303 (Fla. 4th DCA 1995) (“An insured’s refusal to comply with a demand for an examination under oath is a willful and material breach of an insurance contract which precludes the insured from recovery under the policy.”); Stringer v. Fireman’s Fund Ins. Co., 622 So. 2d 145, 146 (Fla. 3d DCA 1993) (same).
As it was Dorvil’s counsel’s behavior that increased the risk that Dorvil would not receive coverage for the automobile accident from Explorer, and thus would not be entitled to an award of attorney’s fees under section 627.428, Florida Statutes, the Court refuses to reward that behavior by granting a multiplier. Thus, the Court finds that a multiplier is not only inappropriate in this situation, but would also be unjust.
Under Rowe as modified by Quanstrom, if a multiplier is warranted, then the Court must determine the amount of the multiplier. Quanstrom, 555 So. 2d at 834. The amount of the multiplier is determined by looking at the client’s likelihood of success at the outset of the case. Id.
Dorvil argues that whether success was more likely than not should be measured at the time the complaint was filed, rather than when the attorney was retained. The Court rejects this argument. One of the purposes of a multiplier is to ensure that clients will be able to retain competent attorneys for particular cases. See id. at 834 (factor in determining whether to apply multiplier is “whether the relevant market requires a contingency fee multiplier to obtain competent counsel . . . .”). This purpose does not mesh with measuring the likelihood of success at the time the complaint is filed, which may occur long after the client meets with the attorney and the attorney decides to take the case. Instead, a more appropriate time period is when the client retains the attorney.
In this case, the Court finds that Dorvil retained his counsel for this litigation on May 4, 2004, before the EUO. Dorvil did not present any evidence that on May 4, 2004, the likelihood of success was even or unlikely. In fact, from the evidence at the hearing, it appears that Explorer had not even denied coverage at that point. Therefore, the Court finds that if a multiplier is appropriate in this case, then that multiplier would be one.
The Court further finds that Dorvil may recover his costs of $156.75, and that pursuant to Quality Engineered Installation, Inc. v. Higley South, Inc., 670 So. 2d 929, 931 (Fla. 1996), Dorvil is entitled to prejudgment interest on the award of attorney’s fees and costs at an interest rate of seven percent per annum or .0001918 per day, accruing from November 1, 2004, the date that Explorer confessed judgment and agreed that Dorvil is entitled to an award of attorney’s fees. A reasonable hourly rate for Dorvil’s expert witness is $350, and a reasonable number of hours expended is eight. Therefore, Dorvil’s expert witness is entitled to receive an expert witness fee in the amount of $2,800.00.
THEREFORE, it is hereby ORDERED AND ADJUDGED that:
1. “Plaintiff’s Amended Motion for Attorney’s Fees and Costs to be Awarded in Favor of Plaintiff’s Attorney and Against the Defendant, Explorer Insurance Company” is GRANTED.
2. A reasonable number of hours incurred by Dorvil’s attorney in this litigation is ten hours.
3. The reasonable hourly rate for Robert D. Melton, Esquire, Dorvil’s attorney, is three hundred dollars.
4. Dorvil is entitled to recover three thousand dollars as attorney’s fees incurred in this action.
5. Dorvil is not entitled to a multiplier.
6. Dorvil is entitled to reasonable costs in the amount of $156.75.
7. Dorvil’s expert witness is entitled to $2,800.00, which represents eight hours of time at an hourly rate of $350.
8. The total amount of attorney’s fees and costs awarded to Dorvil is $5,956.75.
9. Dorvil is entitled to prejudgment interest at the rate of 7% per annum or .0001918 per day ($1.14 per day) from November 1, 2004, through May 13, 2005, (194 days), the date of this judgment, in the amount of $221.16.
10. Dorvil shall recover from Explorer, the sum of $5,956.75, plus prejudgment interest in the amount of $221.16, for a total of $6177.91, which shall bear interest at the rate of seven percent per annum until payment in full of the judgment, pursuant to section 55.03(1), Florida Statutes, for which sum let execution issue.
11. Defendant Explorer Insurance Company shall, within twenty days of the date of the entry of this Order, issue a check in the amount of $6177.91, made payable to Robert D. Melton, Esquire, P.A., and transmit this check to Robert D. Melton, Esquire, P.A., Post Office Drawer 1032, 1000 E. Robinson Street, Suite H, Orlando, FL 32802.
12. Upon receipt of this check, Robert D. Melton, Esquire, is directed to file a satisfaction of judgment of this Final Judgment with the Clerk of this Court within thirty days.
13. The Court reserves jurisdiction to enforce this Final Judgment and to do any and all other acts necessary in this action.
* * *