Florida judge rejects contractors’ challenge to SB 2D’s attorney fee limits


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A Florida judge has dismissed a constitutional challenge to an insurance litigation reform law, noting that the state officials named in the lawsuit were the wrong defendants.

Plaintiffs Restoration Association of Florida and Air Quality Assessors, led by entrepreneur Richie Kidwell, argued that the Senate’s 2D bill, approved in the special session of the Florida Legislature in May, violates the rights contractors’ constitutional rights by distinguishing them and blocking their attorney’s fees in the award of benefit cases.

The plaintiffs sued Florida’s Secretary of Business and Occupational Regulation and the Director of the Construction Industry Licensing Board because they have disciplinary and regulatory authority over contractors.

Leon County Circuit Judge Lee Marsh did not address the constitutional issue, but concluded that the named officials were not true defendants and were not law enforcement officials. Marsh cited a 2017 appeals court decision, State v. Francati, and noted that for public office holders to be considered defendants, they must meet three criteria: whether the official is charged with enforce the law; whether the matter involves a broad constitutional obligation of the state; and whether the official has a genuine interest in the matter.

Kidwell

The judge said the appointed officials did not meet these requirements. Marsh’s order, issued Monday, did not indicate which state officials would be the correct defendants. He also fired Citizens Property Insurance Corp. and three other property insurers of the lawsuit.

The Senate 2D bill, signed into law by Gov. Ron DeSantis in late May, included several measures to stem property insurance claims litigation and attorney fees. The insurance industry has repeatedly argued that excessive litigation and one-way attorneys’ fees provide an unhealthy incentive for named subcontractors and plaintiffs’ attorneys to file fraudulent or exaggerated roof claims and then sue. lawsuits when insurers do not accept claims.

The law prohibits benefit assignees from having defendants pay their attorneys’ fees when AOB plaintiffs prevail in court. Kidwell’s lawsuit accused the section of the law of violating equal protection and due process rights and denying contractors access to the courts.

“Failure to recover effective parties’ attorneys’ fees will effectively close the courthouse door to plaintiffs, as it will be prohibitively expensive to pay an attorney for this type of small claims,” ​​the complaint reads.

Kidwell and his attorney could not be reached Wednesday morning to answer questions about whether the plaintiffs can appeal the decision or file another lawsuit, naming other state officials.

The Restoration Association and air quality assessors have filed other constitutional actions this year. One challenges policy endorsements adopted by American Integrity Insurance Co. that provide binding arbitration instead of litigation in claims disputes, and a policy restriction by Heritage Property & Casualty Insurance on assignment of benefits agreements .

Restoration Association and Florida Premier Roofing Inc. also filed suit against another law passed in the special session, SB 4D. This lawsuit names the same state officials as in the SB 2D lawsuit and argues that 4D unlawfully singles out roofers and allows insurers to pay only for roof repairs, not full replacement, in certain circumstances.

Those cases are still pending in the Leon County Circuit Court, before Judge Angela Dempsey.

Topics
Florida Contractors Legislation

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