The costs of filing or defending a lawsuit can seem daunting. In fact, our laws are set up so that unless there is some specific basis in statute or contract, litigants must generally pay their own attorney’s fees and costs. These costs can make a major impact on how a case is litigated and, in some instances, whether it is even brought or contested. Fortunately, however, Florida’s Offer of Judgment Statute and the accompanying rule of civil procedure provide a means of recovering attorney’s fees from your opponent in certain cases.
An offer of judgment (or an “OJ”) is a kind of settlement offer that is presented in a particular way established by statute and court rule. If the offer is accepted, the case is settled. But, if a party receives an OJ, refuses to accept it, and goes on to lose the case by at least 25% worse than the OJ amount, he or she may end up being liable for both his or her attorney’s fees and the attorney’s fees of the other party. Here is an example of how it works:
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Plaintiff in a lawsuit for money damages presents an OJ in the amount of $100.00 to the defendant on March 1 (meaning, plaintiff will accept $100.00 from defendant to settle the case). Defendant refuses to accept the OJ, or ignores it for at least 30 days. The case goes to trial. If plaintiff wins a verdict of at least $125.00, then plaintiff can also recover from defendant all of the attorney’s fees she incurred since March 1. If plaintiff loses the trial, or wins a verdict of less than $125.00, she will not recover her fees from the defendant. Conversely, if defendant in the same case gives plaintiff an OJ in the amount of $100.00 on March 1 (meaning, defendant will give $100.00 to plaintiff to settle the case), which the plaintiff refuses to accept, then defendant can recover his fees (from March 1) from plaintiff is she does not get a judgment for at least $75.00 at the trial.
With all of the necessary case preparations, including taking witness depositions, exchanging discovery, and preparing procedural motions, litigation costs can become significant even before the trial. The risks associated with shifting that fee burden can, in some cases, provide the incentive either or both parties need to come to a settlement. In other cases, it can “level the playing field” by preventing a more wealthy party from pushing the litigation costs beyond the amount the other party could recover.
However, because OJs can be such powerful tools, courts require strict compliance with the requirements established by the statute and the rule. Here are a few points to keep in mind:
- A defendant must wait 90 days from the filing of the complaint before serving plaintiff with an OJ. A plaintiff must wait 90 days from service on the defendant before serving defendant with an OJ.
- OJs must be made in writing and state that they are being made pursuant to section 768.79, Florida Statutes, they must identify the person making the offer and the person to whom the offer is being made, and they must separately identify any amount offered for punitive damages, as well as the total amount being proposed.
- The OJ must be made “in good faith.”
- OJs are only available in cases involving claims for money damages. Therefore, if you are seeking an injunction, a declaration, or some other form of equitable relief, consult with your attorney to see if there is some other method available to recover your attorney’s fees.
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As mentioned above, courts require strict compliance with the rules and formatting requirements for an OJ. If not prepared and delivered in accordance with the law and rules of procedure, an OJ will not produce its intended fee shifting effect. Therefore, it is important to consult with your attorney to determine whether an OJ is appropriate for your case and, if so, when sending an OJ is likely to provide you with the greatest advantage for your case.
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