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Florida's Offer of Judgment Statute Not Applicable Where Parties Agree Otherwise

In the decision of Southeast Floating Docks, Inc. v. Auto-Owners Ins. Co., No. SC11-285 dated February 2, 2012, the Florida Supreme Court answered the following certified question:

Whether Florida's offer of judgment statute, section 768.79, Florida Statutes, constituted substantive law and therefore was inapplicable in instances where parties to a contract have agreed to be bound by the substantive law of another forum.

This case involved a dispute between the parties when Auto-Owners issued a performance bond in connection with the work of Southeast pursuant to a contract which provided that Southeast would build a floating dock for Rivermar. The court held that section 768.79 created a substantive right to costs and attorney's fees upon the satisfaction of certain conditions. Accordingly, under a conflict of law analysis, when parties have agreed to be bound by the substantive law of another jurisdiction, section 768.79 simply did not apply.

This is an important pronouncement from the Florida Supreme Court, particularly in maritime cases. It makes clear that Florida Statute section 768.79 is substantive and therefore, should be parties agree to be bound by the law of another jurisdiction, this statute would not apply. This means that the U.S. rule that each party pays their own lawyer regardless of outcome should apply--with the usual caveat that each case is different and the particular contract at issue should be reviewed before presuming that Southeast Floating applies.

If you are interested in reading the complete decision, you may access the decision here => http://law.justia.com/cases/florida/supreme-court/2012/sc11-285.html.

If you are interested in contacting me, please feel free to do so at miamipandi@comcast.net.

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