A proposal for a settlement under Florida law is a formal offer made in civil litigation under Florida Rules of Civil Procedure Rule 1.442 and Florida Revised Statutes § 768.79. A party declining an offer may face penalties and costs if the results at trial are significantly less than what was offered in a proposal for settlement.
Our injury lawyers in Coral Gables, FL at Maderal Byrne & Furst PLLC explain what you need to know about evaluating a proposal for settlement.
Understanding Proposals for Settlement in Florida
Civil litigation is a legal dispute between two parties. Before a case goes to trial, either party may make an offer of settlement. A settlement offer proposes terms and conditions to resolve the case without the need for trial.
Florida civil litigation has a process where a settlement offer may be made formally, and potentially with consequences for a party declining an offer. This process is called a proposal for a settlement.
What is a proposal for a settlement in Florida?
Florida law allows a party in a pending lawsuit to propose a settlement. When the proposal follows the requirements of Florida Rules of Civil Procedure Rule 1.442 and Florida Revised Statutes § 768.79, the other party has 30 days to accept the proposal. If they don’t, and the outcome at trial is 25% or lower for the declining party, the party is liable to pay costs and attorney fees for the offering party, from the date of the settlement proposal.
Proposal for Settlement Statute
There are two primary authorities for proposal for a settlement in Florida law.
Florida Revised Statutes § 768.79
Florida Revised Statutes § 768.79 authorizes offers of settlement and creates rules for how they work. To be official, an offer of settlement must:
- Be in writing
- Invoke § 768.79 as its authority
- Name the parties involved in the offer
- State the total amount
- Specify any amount offered for punitive damages
An offer includes all damages that may be awarded in the case. It must be served on the party to which it is made.
Florida Rules of Civil Procedure – Rule 1.442
Florida Rules of Civil Procedure Rule 1.442 further governs how offers of settlement work in Florida. It says:
- The plaintiff may serve an offer no sooner than 90 days after the defendant has been served with case documents.
- The defense may serve an offer no sooner than 90 days after an action has commenced.
- Either party may extend an offer up to 45 days before trial.
Other statutes may be relevant in specific types of cases. See Florida Revised Statutes § 624.1552 and Florida Statutes § 70.001(4)(c).
The 25% rule and proposals for settlement
A proposal for settlement is a formal offer to resolve a case. It carries potential consequences for a litigant who chooses to reject it.
If a plaintiff’s award is 25% less than the defendant’s proposed settlement offer, or if the plaintiff loses the case entirely, the defendant is awarded costs and attorney fees from the date of the offer. The net result may be a judgment for the defendant even if the plaintiff is awarded compensation at trial.
Similarly, if the plaintiff extends a settlement demand, and the result at trial is a judgment 25% or higher than the offer, it’s the plaintiff who receives attorney fees and costs. Fees and costs are awarded from the date the offer was served.
Recent amendments and non-monetary terms in settlement proposals
Florida amended the Florida Rules of Civil Procedure Rule 1.442 effective July 1, 2022. A proposal for settlement can no longer include non-monetary terms. For example, a confidentiality agreement, a provision to hold harmless, a requirement for cooperation or a release of all claims are now prohibited. There is an exception for voluntary dismissal of all claims with prejudice, and there may be other exceptions allowed by law.
Those supporting the change say that it makes Rule 1.442 more consistent with Florida Statutes § 768.79. Opponents say the rule change may result in a higher number of claims going to trial because non-monetary terms are often a critical part of reaching a mutually agreeable resolution.
Proposal for settlement example
The plaintiff sued the defendant in a personal injury case. The plaintiff extends a settlement offer to the defendant, offering to settle the case at $70,000. The defendant declines. The case goes to trial, and the plaintiff is awarded $100,000 – approximately 40% more than the amount they offered in settlement.
The case result triggers the offer of settlement penalties. The plaintiff can claim their litigation costs and attorney fees from the date they extended the offer. Having to pay fees and costs — or have them deducted — can significantly change an award of compensation.
Florida Proposal for Settlement FAQs
What is the purpose of a proposal for settlement in Florida?
The purpose of a proposal for settlement in Florida is to encourage the resolution of disputes, conserve judicial resources and encourage parties to seriously pursue non-trial resolution.
If I propose a settlement under Florida law, is it admissible at trial?
No. A proposal for settlement made under Florida law is not admissible at trial. It is filed in court if it is accepted or needs to be enforced.
How do you accept a proposal for settlement in Florida?
To accept a proposal for settlement for settlement in Florida, file an acceptance with the court within 30 days of the offer. When both the offer and acceptance are filed, the court has jurisdiction to enforce the offer.
Who decides if attorney’s fees are reasonable for a Florida proposal of settlement?
The court may determine the reasonableness of attorney’s fees sought under a Florida proposal of settlement offer. They may consider numerous factors relating to the litigation.
Can you withdraw a proposal for settlement in Florida?
You can withdraw a proposal for settlement in Florida before it is accepted.
Talk to a Lawyer
Have you received a proposal for settlement? Are you wondering how to extend a proposal for settlement? Do you have other questions about your case?
We invite you to talk to a lawyer at Maderal Byrne & Furst. Call (305) 520-5690 or send us a message.
