Understanding Key Provisions and the Potential Negative Impact on the Legal Landscape
Introduction
On March 24th, 2023, Governor Desantis signed into law the much-debated Tort Reform HB 837, bringing significant changes to Florida’s legal landscape. This comprehensive legislation impacts various aspects of tort law, including the switch from pure to modified comparative negligence, alterations to bad faith laws, adjustments to medical damage caps, changes to statutes of limitations, and the repeal of one-way attorney fees. In this article, we’ll discuss the key provisions of this new law and the potential negative consequences it may have on both plaintiffs and defendants.
Key Provisions of Tort Reform HB 837
HB 837 changes Florida’s standard from “pure” comparative negligence to “modified” comparative negligence. Under the old “pure” system, injured victims could recover damages even if they were partially responsible for their injuries, but their compensation would be proportionately reduced. Within the new “modified” comparative negligent standard, if the plaintive is deemed more negligent than the defendant, the plaintiff is barred from making a recovery for damages.
Change from Pure to Modified Comparative Negligence
Florida previously followed a pure comparative negligence standard, which allowed plaintiffs to recover damages proportionate to their level of fault, even if they were more than 50% responsible for the accident. With HB 837, the state has transitioned to a modified comparative negligence system (source 1). Under this new rule, plaintiffs can only recover damages if they are found to be less than 50% at fault for the accident. If the plaintiff’s negligence is equal to or more than 50%, they are barred from recovering any damages.
Changes to Bad Faith Laws
The new law also brings significant changes to the state’s bad faith laws. Previously, if an insurance company failed to settle a claim in good faith, it could be held liable for the entire judgment against its insured, even if the judgment exceeded the policy limits. With the introduction of HB 837, the insurer’s liability is now capped at the policy limits, plus any additional interest and costs.
Changes to Medical Damage Caps
HB 837 introduces new caps on non-economic damages in medical malpractice cases. Non-economic damages, such as pain and suffering, previously had no cap in Florida. Under the new law, non-economic damages in medical malpractice cases are now capped at $1 million for wrongful death claims and $500,000 for other cases.
Changes to Statutes of Limitations
The new law modifies the statutes of limitations for certain types of personal injury cases. Medical malpractice claims must now be filed within two years of the date of injury, or within two years of when the plaintiff should have reasonably discovered the injury, but no more than four years from the date of the injury (source 5). Previously, plaintiffs had up to four years to file their medical malpractice claims.
Repeal of One-Way Attorney Fees
Florida’s one-way attorney fee provision allowed policyholders to recover their attorney fees if they won a lawsuit against their insurance company, but did not require the policyholder to pay the insurer’s attorney fees if the insurer won. HB 837 repeals this provision, effectively creating a “two-way attorney fee” system where both parties are responsible for their own attorney fees, regardless of the outcomeFlorida’s one-way attorney fee provision allowed policyholders to recover their attorney fees if they won a lawsuit against their insurance company, but did not require the policyholder to pay the insurer’s attorney fees if the insurer won. HB 837 repeals this provision, effectively creating a “two-way attorney fee” system where both parties are responsible for their own attorney fees, regardless of the outcome.
Negative Impact of Tort Reform HB 837
Reduced Recovery for Injured Plaintiffs
The shift from pure to modified comparative negligence may reduce the amount of compensation available to injured plaintiffs. Under the previous system, plaintiffs could still recover a portion of their damages, even if they were more than 50% at fault. With the new modified comparative negligence rule, plaintiffs who are found to be 50% or more at fault will be unable to recover any compensation.
Limitations on Insurer Liability
The changes to bad faith laws may limit the financial responsibility of insurance companies, potentially leaving injured parties without full compensation for their damages. By capping an insurer’s liability at policy limits, plus interest and costs, HB 837 may make it more difficult for plaintiffs to receive full compensation, particularly in cases where the damages far exceed the policy limits.
Restricted Compensation for Non-Economic Damages
The introduction of caps on non-economic damages in medical malpractice cases may disproportionately impact plaintiffs who have suffered severe, life-altering injuries. While the new law aims to reduce the cost of medical malpractice insurance and protect healthcare providers from excessive jury awards, it may also leave victims with significant non-economic losses uncompensated.
Shortened Timeframes for Filing Claims
The changes to statutes of limitations may make it more challenging for injured plaintiffs to pursue their claims, especially in medical malpractice cases. With the shortened timeframes, potential claimants may struggle to discover the extent of their injuries, gather necessary evidence, and secure legal representation within the prescribed period.
Increased Financial Burden on Plaintiffs
The repeal of the one-way attorney fee provision increases the financial burden on plaintiffs, as they are now responsible for their own attorney fees, regardless of the outcome. This change may discourage some plaintiffs, particularly those with limited financial resources, from pursuing legitimate claims against insurance companies out of fear of incurring substantial legal fees.
Conclusion
The recently enacted Tort Reform HB 837 brings significant changes to Florida’s legal landscape, affecting multiple aspects of tort law. While the new law aims to address concerns related to excessive litigation and high insurance costs, it may also introduce potential negative consequences for both plaintiffs and defendants. The shift to a modified comparative negligence system, alterations to bad faith laws, caps on non-economic damages, and changes to statutes of limitations, as well as the repeal of one-way attorney fees, may result in reduced compensation for injured parties, limited insurer liability, restricted compensation for non-economic damages, and increased financial burdens on plaintiffs. As the new law takes effect, it will be crucial to monitor its impact on the legal system and consider potential adjustments to ensure that the rights of all parties are fairly balanced.
