A Florida court has ruled in favor of Naomi Marie Stiwich, the personal representative of the Estate of Mary Schiro, allowing her to seek attorney fees in a case against Progressive American Insurance Company. The court's decision, issued on August 4, 2023, reverses a lower court's order that denied Stiwich's request for fees and costs related to her claim for uninsured motorist (UM) benefits. This ruling is significant as it clarifies the conditions under which an insurer's payment can be considered a confession of judgment, impacting future insurance claims and settlements.
The dispute began after Mary Schiro was involved in a car accident in November 2019, resulting in injuries from which she later passed away due to unrelated causes. Stiwich filed a lawsuit against Progressive in December 2020, seeking to recover the $10,000 policy limits under Schiro's UM policy. Stiwich's amended complaint claimed that Progressive had issued a UM policy for Schiro and had failed to pay the benefits owed. Progressive responded by denying all allegations and asserting affirmative defenses.
In July 2021, Stiwich served Progressive with a demand for judgment for $7,999.99, but Progressive did not respond. Following this, Stiwich filed a civil remedy notice with the Florida Department of Financial Services, a necessary step before pursuing a bad faith claim against Progressive. Remarkably, just thirty-one days after this notice, Progressive paid the $10,000 limit on Schiro's UM policy. Stiwich then filed a motion requesting the court to enter a final judgment and award her attorney fees and costs, arguing that Progressive's payment constituted a confession of judgment.
Progressive opposed the motion, claiming that its payment was merely a settlement and not a confession of judgment, which would entitle Stiwich to fees. The trial court sided with Progressive, stating that no judgment had been entered in the underlying case, and therefore, Stiwich could not recover attorney fees under Florida law. Stiwich appealed this decision.
The court ruled that Progressive's actions did amount to a confession of judgment. Chief Judge Sleet stated, "Because Progressive's actions amounted to a confession of judgment on which the trial court should have entered final judgment for Stiwich, we reverse the court's order and remand for entry of a final judgment and a determination of whether Stiwich has satisfied all of the remaining statutory requirements for entitlement to fees." This ruling clarifies that an insurer's payment in response to a civil remedy notice can be treated as a confession of judgment, even if the insurer did not explicitly deny coverage.
The court's decision has important implications for future cases involving insurance claims. It establishes that when an insurer pays policy limits after a lawsuit has been filed, it can be interpreted as a confession of judgment. This means that plaintiffs like Stiwich may be entitled to attorney fees even if the insurer did not formally deny coverage. The ruling emphasizes the importance of the insurer's actions in determining the outcome of such disputes.
Looking ahead, Stiwich's case will return to the lower court to finalize the judgment and determine her entitlement to attorney fees and costs. The court's ruling opens the door for Stiwich to potentially recover her legal expenses, which could set a precedent for similar cases in the future. The outcome of this case may influence how insurers handle claims and settlements moving forward.
As for the possibility of an appeal, the ruling from the District Court of Appeal of Florida is final unless further challenged. There are no known related cases pending at this time, but the implications of this ruling may encourage other plaintiffs to pursue similar claims for attorney fees in insurance disputes.