Lizardi v. Federated Nat'l Ins. Co.

Decision Date11 June 2021
Docket NumberNo. 2D19-2115,2D19-2115
Citation322 So.3d 184
Parties Misael Gomez LIZARDI and Tanya Torres Gomez, Appellants, v. FEDERATED NATIONAL INSURANCE COMPANY, Appellee.
CourtFlorida District Court of Appeals

Nicholas A. Shannin of Shannin Law Firm, P.A., Orlando; and Gregory P. Abaray of Law Offices of Allen & Abaray, P.A., Lakeland, for Appellants.

Warren B. Kwavnick of Cooney Trybus Kwavnick Peets, PLC, Fort Lauderdale, for Appellee.

MORRIS, Judge.

Misael Gomez Lizardi and Tanya Torres Gomez appeal a final order on attorneys' fees entered in an underlying homeowners' insurance dispute. Following an evidentiary hearing that was apparently conducted without a court reporter, the trial court entered its order awarding attorneys' fees to the appellants but in an amount that reduced not only the appellants' attorney's hourly rate but also the amount of hours for which payment was requested. The appellants contend that they submitted evidence supporting their requested amount of attorneys' fees. The appellants also contend that the trial court's failure to make specific findings as contemplated by Florida Patient's Compensation Fund v. Rowe , 472 So. 2d 1145, 1151 (Fla. 1985), in its order awarding attorneys' fees and its failure to award prejudgment interest on the fee award constitute errors apparent on the face of the record and, therefore, that the transcript of the evidentiary hearing is not required. We agree with this latter argument, and we reverse the order on appeal.

I. BACKGROUND

Because this appeal involves an award of attorneys' fees—rather than the settlement which provided the basis for the claim to attorneys' fees—a complete recitation of the facts underlying the homeowners' insurance claim is unnecessary. It is sufficient to note that the appellants settled their insurance claim with Federated National Insurance Company prior to trial. The appellants then filed a motion to determine the amount of attorneys' fees and costs. The trial court conducted an evidentiary hearing at which the appellants introduced a copy of the civil contingency contract they had with their counsel, Gregory P. Abaray. The contract provided that if the appellants were successful in their litigation, Mr. Abaray would seek compensation from the opposing party at a rate of $425 per hour. The appellants also entered into evidence Mr. Abaray's billing ledger reflecting that he spent 331.20 hours working on their case at the $425 hourly rate.1

At the conclusion of the hearing, the trial court awarded the appellants taxable costs and all of the paralegal time at the requested rate. However, the trial court reduced Mr. Abaray's requested rate from $425 to $350 per hour, and it reduced the number of hours for which attorneys' fees were requested from 331.20 to 200 hours. In its subsequent written order, the trial court provided no explanation for the reductions.2

The day after the hearing, the appellants filed a motion for reconsideration as to the hourly rate, prior to the entry of the written order awarding fees and costs. However, the trial court entered the written order awarding fees and costs approximately three weeks later, without ruling on the pending motion for reconsideration. That written order failed to award prejudgment interest on the fee award.

The appellants then filed an amended motion for reconsideration or, alternatively, motion for rehearing directed at the issues of the hourly rate, specificity in the order, and prejudgment interest. They argued that the earlier motion was legally moot since the final judgment on fees and costs had now been entered. The appellants asserted that they wanted to amend the previously filed motion and have it treated as a motion for rehearing. Besides arguing that there were sufficient reasons to justify Mr. Abaray's requested hourly rate and number of hours requested, the appellants also argued that the trial court failed to explain why it reduced the hourly rate and number of hours. Finally, the appellants argued that the trial court erred in failing to award prejudgment interest.

The trial court denied the amended motion for reconsideration/rehearing without a hearing, but in doing so, the trial court obliged the appellants' request to treat the earlier motion as a motion for rehearing. The trial court stated that both motions would be treated as motions for rehearing. The trial court denied the original motion finding that there was no legal basis on which to grant it. The trial court then concluded that the amended motion was untimely but stated it would have denied it on the merits as well.

II. ANALYSIS
A. Failure to make specific findings pursuant to Rowe

We review a trial court's award of attorneys' fees for abuse of discretion. DiStefano Constr., Inc. v. Fid. & Deposit Co. of Md. , 597 So. 2d 248, 250 (Fla. 1992).

In Rowe , the Florida Supreme Court held that in determining an appropriate attorneys' fee award, the trial court must consider certain factors3 to determine the reasonable number of hours expended on the case and the reasonable hourly rate. 472 So. 2d at 1150. The first step, which requires the trial court to determine the reasonable number of hours expended on the case, requires a review of the attorney's time records. Id. A trial court is permitted to reduce the number of hours if there is inadequate documentation provided or if the court finds that the claim is "excessive or unnecessary." Id. The trial court must then determine the reasonable hourly rate by looking at the prevailing market rate for attorneys of reasonably comparable skill or experience. Id. at 1150-51. The trial court then multiplies the number of hours it determined were reasonably expended by the reasonable hourly rate to arrive at the lodestar figure. Id. at 1151. It may then add or subtract from that lodestar figure by application of a contingency risk factor or the results obtained. Id.

In rendering a fee award, trial courts are required to make specific findings to support their conclusions regarding the number of hours reasonably expended, the reasonable hourly rate, and the appropriateness of the reduction or enhancement factors. Id. ; see also Joyce v. Federated Nat'l Ins. , 228 So. 3d 1122, 1126 (Fla. 2017) (explaining that while a trial court must look at all eight factors addressed in Rowe , it must set forth specific findings as to the "number of hours, the hourly rate, and any reduction or enhancement factors" (citing Rowe , 472 So. 2d at 1151 )). And "[i]f the court decides to adjust the lodestar, it must state the grounds on which it justifies the enhancement or reduction." Rowe , 472 So. 2d at 1151.

Here, the lodestar amount was $70,000. That figure was arrived at by multiplying the number of hours that the trial court deemed were reasonably expended (200) by the hourly rate that the trial court deemed was reasonable ($350). But the appellants are not challenging any reduction in the lodestar. Rather, they are challenging the figures used by the trial court to arrive at the lodestar amount. They contend that the trial court inexplicably reduced their requested number of hours from 331.20 to 200 and the hourly rate from $425 to $350 without providing specific reasons for doing so. Indeed, while the order awarding fees lists the amount of reasonably expended hours and reasonable hourly rate, there is no explanation contained therein as to how the trial court arrived at those figures.

The requirement for specific findings as set forth in Rowe is not limited to situations where trial courts reduce or enhance the lodestar figure. Indeed, as this court has previously explained, Rowe requires a specific explanation if a trial court reduces requested fees without regard to the lodestar amount. See Puleo v. Morris , 98 So. 3d 248, 249-50 (Fla. 2d DCA 2012) (applying Rowe requirement where trial court awarded lump sums that were significantly less than what was requested but failed to make any findings concerning number of hours, hourly rate, or the specific reasons for reducing the requested fees). While trial courts are not bound by expert opinions provided at evidentiary hearings or by attorney affidavits submitted at such hearings, they may only reduce attorneys' fees that they deem to be excessive if they make specific findings to support that determination. Id. at 250 ; see also Parton v. Palomino Lakes Prop. Owners Ass'n , 928 So. 2d 449, 453 (Fla. 2d DCA 2006) (noting that in addition to failing to make findings as to the hourly rate and number of hours reasonably expended, the trial court also made the conclusory assertion that the fees seemed excessive because it appeared "that the [p]laintiff's attorneys spent somewhat more time on this case ... than what would be reasonably necessary to accomplish their goal," and holding that on remand, the trial court "must make the required [factual] findings to support its determination of the amount of reasonable attorneys' fees"); Mitchell v. Mitchell , 94 So. 3d 706, 708 (Fla. 4th DCA 2012) (holding that trial court's order was insufficient under Rowe in part where it failed "to explain the basis for a reduction in fees which the court determined was for ‘multiple lawyers on the same matter’ " because the trial court needed to make a specific finding as to which work was duplicative).4

Federated cites to Gonzalez v. Veloso , 731 So. 2d 63, 64 (Fla. 3d DCA 1999), and Hartleb v. State, Department of Transportation , 711 So. 2d 228, 229 (Fla. 4th DCA 1998), for the argument that fee awards are not defective under Rowe where the lodestar amount is not modified. But neither of those cases indicates that it involved a significant reduction in the number of hours claimed or the reasonable hourly rate prior to arriving at the lodestar amount. Consequently, they do not control the disposition of this case.

Had the trial court in this case made specific findings as to why it reduced the requested number of hours or hourly rate, the order would have...

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    ...deem to be excessive if they make specific findings to support that determination ." Id. at 556 (quoting Lizardi v. Federated Nat'l Ins. Co. , 322 So. 3d 184, 189 (Fla. 2d DCA 2021) (emphasis in original). We noted that in Lizardi , where the trial court had not made specific findings as to......
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