The Florida Legislature has changed the tort law in an effort to reduce frivolous lawsuits by limiting personal injury cases, insurance litigation, and attorney fees. These sweeping changes are uprooting the landscape of Florida’s civil litigation and, among other things, will make it more difficult and expensive to sue insurance companies.

In short, the tort reform:

• Decreases the statute of limitations from four to two years in general negligence claims.
• Modifies Florida’s comparative negligence system from a “pure” comparative negligence system to a “modified” system (with the exception of medical negligence cases). As such, plaintiffs over 50 percent at fault for their own damages aren’t generally entitled to damages.
• Establishes standards to assist in jury calculations of the actual amount of medical damages in both personal injury and wrongful death cases.
• In negligent security cases, the business’s insurance company may be able to make the criminal entirely liable and not on the business that failed to protect customers.

The new law also does the following regarding bad faith claims:

• Provides that negligence in and of itself is insufficient to support a bad faith claim. Instead, the insurer must not act solely based on their own interests in settlement.
• Allows the bad faith or unfair actions of the claimant and their legal counsel to be considered when examining the insurer’s actions.
• Makes insurance companies immune to bad faith actions if they tender either the amount demanded by the claimant or the policy limits, whichever is lesser, within 90 days of receiving actual notice of a claim, provided there is adequate evidence to justify the disputed amount.
• When multiple claimants and limited policy limits exist in a single claim, the insurer can now file an interpleader action or use binding arbitration to determine how the limited policy limits are split up among the claimants to prevent bad faith claims.

Tort Reform Fast-Tracked in Florida

Governor Ron DeSantis proposed the tort reform changes in February before the new legislative session began. Florida’s new tort reform law was then presented at the beginning of Florida’s current legislative session, and, as expected, DeSantis swiftly signed it into law. 

In the Florida House, the bill passed with an 80-31 vote. The only member to cross party lines was Rep. Paula Stark, a Republican from St. Cloud who voted against the bill.

The Florida Senate voted 23-15 in favor of the bill. These Republicans voted no: 

• Jennifer Bradley of Northeast Florida
• Jason Brodeur, representing Seminole and part of Orange counties
• Erin Grall of East Central Florida
• Joe Gruters, representing Sarasota and part of Manatee County
• Jonathan Martin, representing part of Lee County

The single Democrat to vote in favor of the bill was Linda Stewart of Orange County.

Opponents of the new tort reform argue that it won’t help lower insurance premiums. Instead, they will hurt people seeking compensation from businesses that have harmed them. DeSantis said the tort reform was essential “to protect Floridians, safeguard our economy and attract more investment in our state.”

Now effective, the law “returns Florida’s tort system to fundamental American judicial principles that the most responsible pay for the damages they caused,” Representative Tommy Gregory said.

Leaders from both Florida Legislature’s chambers supported the reform effort, which was similar to the strategy used for property insurance reforms from the legislative December special session. Leaders predict the bill’s impacts as a boon to the state’s economy. However, many opponents to Florida’s new tort reform are concerned about consumer and plaintiff rights. 

Changes Under House Bill (HB) 837

House Bill (HB) 837, titled Civil Remedies, according to Gov. Desantis’ office, modifies the “bad faith framework, eliminates one-way attorney’s fees and fee multipliers, and ensures that Floridians can’t be held liable for damages if the person suing is more at fault.” The hope is that insurance rates will decrease, although there is no mandate providing for this in the bill.

“Florida has been considered a judicial hellhole for far too long, and we are desperately in need of legal reform that brings us more in line with the rest of the country,” DeSantis said. “I am proud to sign this legislation to protect Floridians, safeguard our economy, and attract more investment in our state.”

Changes under the legislation will apply to causes of action accruing after the effective date of March 24, 2023. The significant changes include:

Decreased Statute of Limitations

HB 837 also amends section 95.11, Florida Statutes, regarding the statutes of limitations for various civil causes of action. The statute of limitations for general negligence has decreased from four to two years. 

As a result, plaintiffs and their attorneys will prepare their cases and assess the validity of their claims at an earlier point in the case. The change may also increase the ability to gather evidence closer to the date of the alleged incident in many cases.

Additionally, plaintiffs may be deterred from filing suit sooner in contested liability cases. The new two-year statute of limitations could also help leverage earlier settlements and resolutions of claims, especially during the pre-suit phase.

A Modified Comparative Negligence Standard

This law changes Florida’s comparative negligence standard from “pure” comparative negligence to “modified” comparative negligence. Florida joins the majority of the other states that already subscribe to a “modified” comparative negligence standard. However, this doesn’t apply in medical negligence cases.

Before this round of tort reform, plaintiffs could recover a percentage of their damages proportionate to the defendant’s degree of fault. Now under “modified” comparative negligence, if a plaintiff is more negligent than the defendant, they can’t recover anything. So, for instance, if someone is 51 percent at fault for causing a car accident, they can’t recover damages from it. Previously, if they had been 99 percent at fault, they were still entitled to recovery for the other one percent of their damages. 

Evidence Admissibility for Medical Expenses

HB 837 also modifies evidence plaintiffs rely on to establish their past and future medical expenses in a civil injury claim. Under the previous law, plaintiffs were allowed to claim the total amount of medical bills charged for services rendered outside of services paid by Medicare or Medicaid. They didn’t need to show evidence of adjustments or reductions made by their insurance company. Plaintiffs covered under Medicare or Medicaid could only use the amounts actually paid by Medicare or Medicaid as evidence of past medical expenses. 

Under the new tort reform, the evidence proving the amount of damages for past medical bills that have been paid is limited to the evidence of the amount actually paid, no matter the source of payment. Admissible evidence for unpaid past medical bills will depend on if the party bringing the legal action has health care coverage, Medicare, or Medicaid as follows: 

• If they have health care insurance but obtain treatment under a letter of protection or they don’t submit charges, they can admit evidence of the amount that health insurance would have paid to satisfy charges, plus their share of medical expenses. Reasonable amounts billed to the plaintiff for medically-necessary treatment or services are also admissible as evidence. 
• If they don’t have health insurance, or they have Medicare or Medicaid coverage, they can admit evidence of 120 percent of the Medicare reimbursement rate.
• If there is no applicable Medicare rate, 170 percent of the applicable state Medicaid rate is admissible as evidence.

Damages can’t include any amount exceeding the evidence of medical treatment and services expenses admitted. Claimed amounts also cannot exceed the amounts actually paid, amounts necessary to satisfy charges due, and those essential for reasonable and necessary future medical treatment and care. 

For future medical expenses, the “usual and customary” sum will depend on whether the plaintiff has health care coverage as follows: 

• Suppose the plaintiff has health care coverage outside of Medicare or Medicaid. In that case, they can admit evidence of the amount that could be satisfied if charges were submitted, along with the portion of medical expenses under the insurance contract.
• If the plaintiff doesn’t carry health insurance or has Medicare or Medicaid, evidence of 120 percent of the Medicare reimbursement rate in effect is admissible. 
• If there is no applicable Medicare rate, 170 percent of the applicable state Medicaid rate is admissible as evidence.

In essence, there are now uniform standards to help juries calculate the actual amount of medical damages in civil personal injury and wrongful death cases. If an insurance company has paid a full medical bill for past services, the actual amount they paid is the only amount admissible at trial.

Disclosure of Letters of Protection and Referrals

If a plaintiff receives medical treatment under a letter of protection, an agreement to defer collection on a medical bill until the plaintiff recovers in a lawsuit, it must be disclosed, along with all bills for medical expenses. The new law also requires them to be itemized and coded. Plaintiffs must also disclose if they were referred for treatment under the letter of protection and who referred them.

If the plaintiff was referred for medical treatment under a letter of protection by their legal counsel, disclosure of the referral is allowed, notwithstanding the attorney-client privilege. Why? Because the financial affiliation between the law firm and the medical provider pertains to the issue of bias of the testifying medical provider. This portion overturns the Florida Supreme Court’s decision in Worley v. Central Florida Young Men’s Christian Ass’n, Inc., 228 So. 2d 18 (Fla. 2017).

Changes to the Law for Bad Faith Actions

The new laws also address bad-faith actions. For example, the insured and their representative now have a duty to act in good faith to attempt to settle a claim. If it goes to court, the trier of fact (judge or jury) can consider if good faith efforts were made. If they determine they were not, then they can reduce the amount of damages. In addition, negligence alone is insufficient for bringing a bad faith claim against an insurer.

Bad faith actions aren’t viable if the insurance company pays the lesser of the policy limits or the damages demanded by the plaintiff within 90 days after receipt of a notice of claim with sufficient evidence. If the insurance company doesn’t pay, the 90 days won’t be admissible in court for bad faith actions, and the statute of limitations extends for 90 days. 

If one occurrence leads to multiple claims, the insurer isn’t liable beyond the policy limits for failure to pay within 90 days as long as one of the following applies:

• The insurer files an interpleader to identify rights of claims, and if they are in excess of the policy limits, claimants can then receive a pro-rated amount
• The insurer provides the full policy limits available at binding arbitration, which provides a pro-rata share of the funds as the arbitrator decides, who should include comparative fault and the potential trial outcome in their decision. 

Negligent Security

For negligent security actions against owners or operators of real property brought someone legally on the premises who suffered harm by the criminal act of a third party, the judge or jury in the case now must consider the fault of all individuals who contributed to the injury or death, including the criminal. As such, the property’s owner or operator can’t be held liable for damages caused by a third party attempting to commit, or while committing, any criminal act on the property. 

 This bill also establishes a presumption against negligent security liability for “multifamily residential property” owners or operators if they meet the burden of proof demonstrating “substantial compliance” with such things as crime assessments, employee crime and safety training, and safety and security measures to include:

• Active security camera systems at places of exit and entry that maintains retrievable video for at least 30 days
• Lights in the parking lot from dusk to dawn
• Lighting in common areas, walkways, proches, and laundry rooms from dusk to dawn
• A deadbolt in every door that measures a minimum of one inch
• Locking devices on every sliding door and window
• Locked gates at pool fence areas 
• A peephole or viewer on a door that doesn’t have a window or window next to the door

Changes to the Contingency Fee Multiplier

Under previous tort laws, courts could consider and award contingency fee multipliers to attorneys’ fees based on various factors such as:

• The applicable market if contingency fee multipliers were required to obtain competent counsel
• If the attorney mitigated the risk of nonpayment
• The amount of fees involved
• The final results obtained
• The fee arrangement between the lawyer and client
• The chances of success at the outset of the action

The new law creates a “strong presumption” that the “lodestar” fee, the number of hours a lawyer would have reasonably spent, and multiplying it by a reasonable hourly rate, is sufficient and reasonable. Only in rare and exceptional circumstances can this presumpting be overcome and the evidence must show that competent counsel couldn’t otherwise have been retained. 

Limited Applicability of One-Way Attorney Fees

Before the new law was enacted, “one-way attorneys’ fees” applied when the insured prevailed in an action against an insurance company. Since the law went into effect, they only apply to declaratory judgment actions for determining insurance coverage against an insurer after coverage is denied for a claim, excluding a defense under a reservation of rights. Suppose a declaratory judgment is granted for the insured against the insurer. In that case, the court shall award reasonable attorneys’ fees; however, they are still limited to those incurred in the action. 

Furthermore, section 768.79, Florida Statutes, the “offer of judgment” or “proposal for judgment” statute, applies to any civil action involving an insurance contract.

What Critics of Florida’s Tort Reform Say

Opponents of this year’s tort reform argue that it won’t lead to lower insurance rates and may negatively impact policyholders and their lawyers. Instead, they say that insurance companies will have an easier time avoiding or defending against lawsuits by policyholders claiming denial or low-balling of benefits. 

In addition, ordinary Floridians will face higher risks, less safety, and fewer options to hold wrongdoers accountable as the law removes the incentive for private businesses to take the necessary steps to keep their customers safe. The measure might also discourage trial attorneys from representing clients against insurance companies as it stands to constrain what they can garner in attorney fees sharply.

The legislation lacks any requirements for insurance companies to decrease their policyholder rates as a result of the substantive changes. This is only one reason the legislation has been criticized by trial attorneys and their clients, who argue that this reform goes too far and will cause a windfall for insurance companies.

Critics of the newly signed legislation also say the new law itself will likely face a lawsuit.

Florida’s Civil Courts Inundated with New Case Filings

Plaintiffs in recent civil cases were in a race against the clock when the legislative process wrapped up on March 24th when the governor signed the bill into law, which took effect immediately.

Last year in March, Orange County reported under a thousand circuit civil lawsuit filings. Contrastly, 9,194 cases were filed before Florida’s governor signed the new bill into law before the end of March this year. As of March 28, 2023, 4,097 were still being processed.

In Seminole County, 285 circuit civil suits were filed last March, compared to 1,856 this March. Osceola County’s civil lawsuit filings increased from 158 in March of 2022 to 1,679 this March. Some lawyers estimate that 100,000 civil cases were filed statewide in March alone, mainly because the new law is considered unfavorable to attorneys and their clients.

Statewide, data from the Florida Courts E-Filing Portal (responsible for maintaining a statewide court registry) show that a total of 90,593 circuit civil cases were filed between March 17 and March 22 in Florida. This figure equals 77 percent of the 118,179 cases filed between January 1 and March 22.

Meanwhile, in South Florida’s tri-county area, 23,666 circuit civil cases were filed between March 17 and 24, representing 71 percent of the 33,315 filed in 2023 through March 22. The dramatic rise in case filings has caused staffers throughout the state to work overtime and administrators to implement measures to limit expected delays. 

Attorney and founder of the personal injury firm Morgan & Morgan, John Morgan, shared with the South Florida Sun Sentinel that his legal teams filed about 25,000 of these civil suits before the bill took effect. He described it as “a Herculean effort” and then went on to express that not to do so would have been “legal malpractice.”

A civil defense lawyers association requested Florida Supreme Court Chief Justice Carlos Muñiz in a letter dated March 23, 2023, to issue an emergency declaration providing defendants additional time to respond to the downpour of litigation. Supreme Court spokesperson Paul Flemming told the public a few days later that Muñiz knows about their issues and “is trying to decide what the best course of action would be.”

HB 837 immediately took effect upon becoming law. However, it should be noted that many of the changes will apply only to causes of action filed after the law’s effective date, which is why so many were in a hurry to file cases earlier in March. 

The change to the statute of limitations for negligence actions also applies to causes of action accruing after the effective date. Regarding insurance contracts, the law may not be used to impair consumer rights under insurance contracts arising before the effective date. However, the legislative changes will only apply to insurance contracts issued or renewed after the law’s effective date.

What’s Next?

Whether the new law faces legal action is yet to be seen. There’s no denying that some parties will benefit more than others from these changes. Still, the full effects of changes and their benefits or consequences won’t be known for some time. No matter how courts, attorneys, lawmakers, consumers, policyholders, or businesses think about Florida’s new tort reform, the fact remains that the change has happened, and they must move forward together. All involved parties will need to make some adjustments to their practices, some more than others. Consumers and policyholders should seek counsel from an experienced attorney as soon as they suspect they have legal matter on their hands.