A recent Law 360 story by Brett Barrauquere, “Safeco Tells 11th Circ. Atty Fees Aren’t Damages,” reports that Safeco Insurance wants the Eleventh Circuit to affirm a lower court ruling that another insurer is time-barred from seeking attorney fees on a $1.6 million judgment stemming from a fatal motorcycle accident. Safeco Insurance of Illinois and Safeco Insurance Co. of America said in a brief said that Endurance American Specialty Insurance Co. waited eight months too long to request attorney fees.
Endurance should have either sought attorney fees within 14 days of the judgment as the prevailing party or presented evidence at trial to claim them as damages, Safeco argued. Because it did neither, Endurance isn't entitled to anything, Safeco said. "Endurance cannot circumvent the time requirement of the federal and local rules by arguing its fees were damages, either," Safeco said.
Endurance asked the federal appeals court in April to overturn a lower court decision that the insurer says improperly adopted recommendations by a magistrate judge that said Endurance had waited too long to argue it was due attorney fees. A federal jury that had sided with Endurance decided that another insurer had violated an agency agreement, which included an indemnity provision that forces it to pay attorney fees to Endurance, according to the company's brief. That jury finding supports Endurance's fee request, it says.
Safeco argues that under the controlling Florida law, attorney fees aren't recoverable as damages and that they are an ancillary claim based on a contractual provision. And Endurance has no legal way of beating the 14-day deadline for claiming attorney fees, Safeco said.
Endurance didn't present evidence to back up its claim for attorney fees at trial, and it failed to move to appeal the final judgment and claim that the fees were wrongly excluded, Safeco said. "Because Endurance never argued it's attorney's fees were damages to the magistrate judge, the district court was within its discretion to decline to consider the argument," Safeco said.
U.S. Magistrate Judge Christopher P. Tuite had issued a report and recommendation saying that Endurance filed its motion for fees almost a year after judgment was entered. The judge said the company "provides no rationale for its belated filings." Judge Tuite's first denial was based on Florida statute. The second one at issue is for recovery of fees "expended in enforcing the agency agreement's indemnification provision." Judge Tuite said it looked like Endurance filed the second motion "after it gleaned from the [first report and recommendation] that it might not prevail on its first motion."