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Lawyers Suffer From Florida's Claims Allocation Problems



Kovar Law Group, PLLC (KLG), represented Benchmark Consulting, Inc. d / b / a Castle Roofing (Castle) in more than 90 lawsuits against insurers based on the award of benefits granted its claiming the Castle. KLG sued to recover contingent charges that they claimed to have earned after withdrawing from Castle's representation because they claimed that a withdrawal was mandatory after finding out that Castle was involved in presenting fraudulent insurance claims.

I Kovar Law Group, PLLC v. Benchmark Consulting, Inc., D / B / A Castle Roofing And Construction, Inc., a Florida Corporation, a / a / o James Nunley, No . 2D21-885, Florida Court of Appeals, Second District (December 1, 2021) settled the attorneys' claims for fees.

Castle claimed that KLG filed payment entitlements in each of the ninety cases it represented Castle before its representation withdrew. and that it would be unfair to Castle, and an unnecessary burden for the courts, to allow repeated litigation in the same matter when each attachment involves what is essentially the same controversy.

FACTUAL BACKGROUND

KLG began to represent Castle in insurance. -related matters sometime around 2017 or 2018 according to an oral agreement on contingency fees. It also represented Castle's principal, Jim Lathrop, in personal lawsuits. The dispute between the parties regarding KLG's debiting attachment in Castle's insurance case began in the United States District Court for Florida's district. In both the federal case and the present case, KLG sought to enforce a debiting lien on Castle after KLG had terminated its representation in all of Castle's cases. agreement between the lawyer and the client;

  • that the parties had an express or implied agreement that legal fees would be paid from the recovery;
  • that the client avoided paying or that a dispute arose as to the amount of the fee; and
  • that the lawyer notified in good time of his pledge. [ Daniel Mones, P.A. v. Smith 486 So.2d 559, 561 (Fla. 1986).]
  • Process in the Federal Case

    an insurer. KLG withdrew from the representation and lodged a lien, claiming that it had not received full payment from Castle for the legal services it had provided and the costs it had advanced.

    Specifically, KLG believed that Castle was engaged in fraud because Castle hired and employed an in-house attorney and Castle waived insurance deductions and allegedly fraudulently performed interior design work that it had not actually performed in violation of Florida insurance law. Because KLG filed complaints on behalf of Castle based on alleged false insurance claims, KLG claimed that its services were used to facilitate fraud and, as a result of state rules of professional conduct, it was required to withdraw.

    At the hearing, Kovar testified that the "incompatible differences" he referred to in the latest email concerned Castle's use of KLG's insurance fraud services, which prevented KLG from continuing to act as Castle's agent under Rule 4- 1.16 (a) (4).

    The Federal Court adopted an eighteen-page decision that thoroughly covered the disputed parts of the execution of the debit pledge and held that KLG could meet the requirement of an express or implied agreement between it and Castle but not that there was an agreement that the fees would be paid. of the recovery.

    The Federal Court cited Faro v. Romani 641 So.2d 69, 71 (Fla. 1994), for the claim that a lawyer voluntarily resigned from representation before the unforeseen event occurred as referred to in the agreement of the parties loses that lawyer's claim for compensation. It then concluded that KLG failed to meet its burden of proving that its withdrawal was involuntary. On June 12, 2019, KLG filed a Notice of Attorney & # 39 ;s Charging Lien, claiming that Castle did not pay for the legal services that KLG had provided and requesting that KLG be informed of a settlement, trial or judgment in the case. On June 20, 2019, a common condition was submitted for the substitution of agents, indicating that the law firm Smith Thompson Law would be replaced as Castle's record councilor. , October 24, 2019. On January 6, 2020, KLG filed a claim for enforcement of the debit lien, claiming that Castle and Citizens had resolved the underlying breach of contract in September 2019 and that KLG had not been consulted on its fees or the satisfaction of its lien prior to the settlement. KLG claimed a right to legal fees and compensation for expenses that it had advanced in its first representation of Castle in the case. With reference to Rule 4-1.16 (a) (4), which states that a lawyer must terminate the representation of a client if “the client persists in an act involving the lawyer's services which the lawyer reasonably believes is criminal or fraudulent, unless the client agrees to to expose and correct the crime or deception, "

    The Court of Appeal finally adopted a decision granting Castle's claim for acquittal and rejecting KLG's request to enforce the lien as a security ban applied in this case.

    ANALYSIS

    estoppel" generally enters into a case when, in a previous proceeding involving another action, the same parties "tried" the same issues "which are again submitted for decision." M.C.G. against Hillsborough Cnty. Sch. Bd. 927 So.2d 224, 226 (Fla. 2d DCA 2006) (citing Cook v. State 921 So.2d 631, 634 (Fla. 205 DCA)). 19659004] The security ban applies if the following factors are met:

    • an identical question must have been presented in the previous procedure;
    • the question must have been a critical and necessary part of the previous decision;
    • has been a complete and fair opportunity to consider that question;
    • the parties to the two proceedings must be identical; and
    • the questions must have actually been tried.

    In appeal, the only element that KLG does not dispute number two, that the question must have been a critical and necessary part of the preliminary

    While the parties to the underlying breach of contract the federal and immediate cases are not identical because the responding insurance companies are different insurance companies, the parties to the dispute of charge of attachment are the same-KLG and Castle. The Federal Court ruled that the KLG voluntarily withdrew from representation before the unforeseen event that the parties' agreement occurred and thus lost their claim for compensation.

    The assessment of the federal case is decisive in the question of whether KLG voluntarily withdrew from its agreement. representation of the castle. Therefore, since the execution of a debit lien requires that all parts are satisfactory and the decision of the federal case is given a preclusive effect, KLG cannot fulfill its burden of enforcing the debit lien. Consequently, we confirm the decision on appeal.

    When a law firm represents an insurance dispute in more than 90 different cases and first finds out what it considered to be insurance fraud after filing more than 90 lawsuits and then withdraws without explanation as to why and how the law firm came to the conclusion that its client committed fraud stresses gullibility. The federal court that first heard the issue concluded that the revocation was voluntary and not because of the discovery of fraud that would have made the withdrawal mandatory. Lawyers are by definition detail-oriented. Failure to clearly document the withdrawal of representation and then file 90 liens and try to try them separately after losing in the federal court is the reason for the security ban. KLG's mortgages failed because they did not clearly inform Castle of the reasons why they had to withdraw and because, after losing in one of the 90 cases, they tried the same question again during the remaining 89.


    © 2021 – Barry Zalma

    Barry Zalma, Esq., CFE, now limits his internship to the position of insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders.

    He also acts as an arbitrator or mediator for insurance-related disputes. He practiced law in California for more than 44 years as a lawyer for insurance coverage and claims management and more than 54 years in the insurance industry.

    Subscribe to Excellence in Claims Handling at https://barryzalma.substack.com/welcome.

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