Second DCA holds payment in response to a Civil Remedy Notice constitutes “confession of judgment.”

In the case styled, NAOMI MARIE STIWICH, as the personal representative of the Estate of Mary Schiro, v. PROGRESSIVE AMERICAN INSURANCE COMPANY and GARY PARSONS,. Case No. 2D22-1505. August 4, 2023, the Second DCA held that an insurance company who issued payment of policy limits in response to a Civil Remedy Notice, after suit had been filed, confessed judgment as to the lawsuit, potentially triggering entitlement to attorney’s fees under section 768.79, Florida Statutes.

In 2019, Schiro was involved in an automobile accident and sustained injuries. She subsequently passed away for reasons unrelated to the accident. Ms. Stiwich, as the personal representative of her estate, filed suit against Progressive, Schiro’s uninsured motorist carrier, seeking UM benefits under Shiro’s policy. During the lawsuit Stiwich served Progressive with an offer of judgment pursuant to section 768.79, Florida Statutes. Progressive never responded to the offer, and it expired.

Later on, Stiwich filed a Civil Remedy Notice (“CRN”) against Progressive with the Florida Department of Financial Services, as a pre-requisite for filing a bad faith action. In response to the CRN, in order to cure any alleged violation, Progressive tendered its policy limits to Stiwich. Stiwich then requested that the court enter an Order of Confession of Judgment/Final Judgment against Progressive, and requested attorney’s fees and costs in light of the rejected offer of judgment.

Progressive opposed the motion asserting that no judgment has ever been entered, therefore, Stiwich could not recover fees under 768.79(1). The court agreed with Progressive and found that Progressive’s payment was not a “judgment” which would satisfy the language in 768.79(1). Stiwich appealed. 

On appeal, the Second DCA agreed with Stiwich that by tendering the policy limits, Progressive confessed judgment which was the equivalent to a verdict upon which final judgment in her favor should have been entered, triggering her entitlement to seek fees under the statute. The 2nd DCA held that the trial court should have entered final judgment in favor of Stiwich in the amount of Progressive’s payment. The Second DCA reversed and remanded for the trial court to determine whether Stiwich satisfied all of the requirements to entitle her to attorney’s fees under section 768.79(1).

We do not believe that the Second DCA gave adequate consideration to the fact that the CRN created a change in circumstances, and resulted in a business decision to resolve the case. We do not believe that this should have resulted in a confession of judgment as to the claim, when the PFS was served prior to the CRN. While this decision may be binding in the Second DCA, is not binding on other district courts of appeal.