Florida Senate - 2019                        COMMITTEE AMENDMENT
       Bill No. CS for SB 122
                              LEGISLATIVE ACTION                        
                    Senate             .             House              

       The Committee on Judiciary (Broxson) recommended the following:
    1         Senate Substitute for Amendment (380464) (with title
    2  amendment)
    4         Delete everything after the enacting clause
    5  and insert:
    6         Section 1. Section 501.172, Florida Statutes, is created to
    7  read:
    8         501.172 Agreements between service providers and
    9  consumers.—
   10         (1)DEFINITIONS.As used in this section:
   11         (a)“Consumer” means a person who has an interest in, or
   12  who has a right to manage real or personal property, including
   13  improvements upon such property, regardless of whether for
   14  personal or business purposes, including an owner, a tenant, a
   15  licensee, or a property manager.
   16         (b)“Service provider” means a person who enters into an
   17  agreement with a consumer for the stabilization, repair,
   18  improvement, or remediation of real or personal property.
   21         (a)If a consumer acts under urgent or emergency
   22  circumstances to protect property from damage and enters into an
   23  agreement with a service provider to stabilize, protect, repair,
   24  or improve the property, the service provider may only contract
   25  for, receive, or acquire in any manner from the consumer at the
   26  time the right to payment for the work necessary to stabilize,
   27  protect, and prevent additional damage to the property. The
   28  agreement must be in writing and detail, to the extent
   29  reasonable under the circumstances, the work to be performed and
   30  the charges for the services to be provided. The right to
   31  payment may include:
   32         1.A post-loss assignment of benefits under a property
   33  insurance policy or under the comprehensive or combined
   34  additional coverage under a motor vehicle insurance policy for
   35  coverage of windshield damage, executed pursuant to subsection
   36  (3), except that notwithstanding ss. 626.9373 and 627.428, any
   37  right to attorney fees or costs against an insurer by any such
   38  service provider shall be as provided in subsection (4). A
   39  service provider may not receive from a consumer acting under
   40  urgent or emergency circumstances an assignment of post-loss
   41  benefits:
   42         a.Under a property insurance policy, in excess of the
   43  greater of $3,000 or 1 percent of the Coverage A limit under
   44  such policy.
   45         b.Under a motor vehicle insurance policy for comprehensive
   46  or combined additional coverage for windshield damage, in excess
   47  of $500.
   48         2.An acknowledgment of the rights that may exist, if any,
   49  under chapter 713 to make a claim upon the property.
   50         (b)To the extent that an agreement between a consumer and
   51  a service provider purports to provide greater rights to the
   52  service provider under such urgent or emergency circumstances,
   53  including alleged rights to do further repairs, remediation, or
   54  improvements or an assignment of rights, benefits, causes of
   55  action, or other contractual rights in violation of this
   56  subsection, such purported assignment is void.
   59  circumstances, an agreement entered into by a consumer and a
   60  service provider after a loss or damage has occurred to the
   61  consumer’s property must be in writing. The agreement must
   62  detail, to the extent reasonable under the circumstances, the
   63  work to be performed, the charges for the services to be
   64  provided, and the dates by which work on the property will
   65  commence and be completed. The agreement may also provide for
   66  subsequent change orders, subject to the approval by the
   67  consumer and service provider, which must also set forth in
   68  writing the changes to the scope of work and the cost for the
   69  changes to the work. To the extent that the agreement contains a
   70  post-loss assignment of insurance benefits to the service
   71  provider or some third person under a property insurance policy
   72  or under the comprehensive or combined additional coverage under
   73  a motor vehicle insurance policy for coverage of windshield
   74  damage, the purported assignment of benefits is valid only if
   75  all of the following are satisfied:
   76         (a)The consumer or service provider provides a copy of the
   77  agreement to the consumer’s insurer, sent to the location
   78  designated for receipt of such agreements if specified in the
   79  insurance policy, within 3 business days after the agreement’s
   80  execution.
   81         (b)The agreement provides that the consumer may rescind
   82  the agreement by submitting a written notice of rescission which
   83  is signed by the consumer to the service provider within 14 days
   84  after the execution of the agreement, at least 30 days after the
   85  date work on the property is scheduled to commence if the
   86  service provider has not substantially performed, or at least 30
   87  days after the execution of the agreement if the agreement does
   88  not contain a commencement date and the service provider has not
   89  begun substantial work on the property. However, the service
   90  provider retains the right to payment for services performed
   91  pursuant to the agreement before receiving notice of the
   92  rescission.
   93         (c)The agreement does not impose any fee or penalty for
   94  rescinding the agreement, for check processing, for not using a
   95  specified service provider for permanent repairs, or for
   96  mortgage processing.
   97         (d)The agreement does not prevent or inhibit an insurer
   98  from communicating with the consumer at any time.
   99         (e)The agreement, if made under a motor vehicle insurance
  100  policy for comprehensive or combined additional coverage for
  101  windshield damage, does not assign the right to more than $500
  102  in post-loss benefits.
  103         (f)The agreement does not transfer or create any authority
  104  to adjust, negotiate, or settle any portion of a claim to a
  105  person or an entity who is not authorized to adjust, negotiate,
  106  or settle a claim on behalf of the insured or claimant under
  107  part VI of chapter 626.
  108         (g)The agreement does not transfer to the assignee any
  109  greater right to attorney fees and costs from the insurer than
  110  the right to attorney fees and costs as provided for in
  111  subsection (4).
  112         (h)The agreement relates only to work performed or to be
  113  performed by the service provider.
  114         (4)ATTORNEY FEES.
  115         (a)In a civil action under a property insurance policy or
  116  under the comprehensive or combined additional coverage under a
  117  motor vehicle insurance policy for coverage of windshield
  118  damage, between an insurer and a service provider who obtains an
  119  assignment of post-loss benefits, the prevailing party has the
  120  right to attorney fees and costs from the:
  121         1.Insurer, if the service provider is the prevailing
  122  party.
  123         2.Service provider, if the insurer is the prevailing
  124  party.
  125         (b)The prevailing party is the party which prevails on the
  126  significant issues of the case. The court may determine that
  127  there is no prevailing party in a case. In determining if there
  128  is a prevailing party, the court must consider:
  129         1.The issues litigated;
  130         2.The amount of the claims by the service provider versus
  131  the amount recovered;
  132         3.The existence of setoffs and counterclaims, if any; and
  133         4.The amounts offered by either party to resolve the
  134  issues prior to or during litigation.
  135         (5)LIMITATION ON RECOVERY FROM ASSIGNOR.—An assignee
  136  service provider that accepts an assignment of post-loss
  137  benefits waives any and all claims against a consumer, except as
  138  provided herein. The consumer remains responsible for the
  139  payment of any deductible amount provided for by the terms of
  140  the insurance policy, and for the cost of any betterment ordered
  141  by the consumer. This subsection does not prohibit the assignee
  142  from collecting or attempting to collect money from, maintaining
  143  an action at law against, or claiming a lien on the property of
  144  a consumer or reporting a consumer to a credit agency for
  145  payment of the amount of the insurance deductible, or any amount
  146  attributable to betterment ordered by the consumer. This waiver
  147  is effective notwithstanding any subsequent determination that
  148  the assignment agreement is invalid or the rescission of the
  149  assignment agreement by the consumer.
  151  VOLUNTARILY DISMISSED.—If a service provider assignee commences
  152  an action in any court of this state based upon or including the
  153  same claim against the same adverse party that such assignee has
  154  previously voluntarily dismissed in a court of this state, the
  155  court may, as it deems proper, order the assignee to pay the
  156  attorney fees and costs of the adverse party of the action
  157  previously voluntarily dismissed. Upon the issuance of such
  158  order, the court shall stay the proceedings in the subsequent
  159  action until the assignee has complied with the order.
  160         (7)APPLICATION.—This section does not apply to a power of
  161  attorney granted to a management company, family member,
  162  guardian, or similarly situated person which complies with
  163  chapter 709 and which may include, as part of the authority
  164  granted, the authority to act in place of a principal as it
  165  relates to a property insurance or motor vehicle insurance
  166  claim, if such power of attorney is not provided to a service
  167  provider or any person with a personal or financial interest in
  168  the service provider.
  169         Section 2. Section 626.9373, Florida Statutes, is amended
  170  to read:
  171         626.9373 Attorney Attorney’s fees.—
  172         (1) Upon the rendition of a judgment or decree by any court
  173  of this state against a surplus lines insurer in favor of any
  174  named or omnibus insured or the named beneficiary under a policy
  175  or contract executed by the insurer on or after the effective
  176  date of this act, the trial court or, if the insured or
  177  beneficiary prevails on appeal, the appellate court, shall
  178  adjudge or decree against the insurer in favor of the insured or
  179  beneficiary a reasonable sum as fees or compensation for the
  180  insured’s or beneficiary’s attorney prosecuting the lawsuit for
  181  which recovery is awarded.
  182         (2) If awarded, attorney attorney’s fees or compensation
  183  shall be included in the judgment or decree rendered in the
  184  case.
  185         (3)Attorney fees may not be awarded under this section to
  186  an assignee of post-loss benefits who is a service provider
  187  under s. 501.172.
  188         Section 3. Section 627.428, Florida Statutes, is amended to
  189  read:
  190         627.428 Attorney fees Attorney’s fee.—
  191         (1) Upon the rendition of a judgment or decree by any of
  192  the courts of this state against an insurer and in favor of any
  193  named or omnibus insured or the named beneficiary under a policy
  194  or contract executed by the insurer, the trial court or, in the
  195  event of an appeal in which the insured or beneficiary prevails,
  196  the appellate court shall adjudge or decree against the insurer
  197  and in favor of the insured or beneficiary a reasonable sum as
  198  fees or compensation for the insured’s or beneficiary’s attorney
  199  prosecuting the suit in which the recovery is had.
  200         (2) As to suits based on claims arising under life
  201  insurance policies or annuity contracts, no such attorney fees
  202  attorney’s fee shall be allowed if such suit was commenced prior
  203  to expiration of 60 days after proof of the claim was duly filed
  204  with the insurer.
  205         (3) When so awarded, compensation or fees of the attorney
  206  shall be included in the judgment or decree rendered in the
  207  case.
  208         (4)Attorney fees may not be awarded under this section to
  209  an assignee of post-loss benefits who is a service provider
  210  under s. 501.172.
  211         Section 4. Section 501.172, Florida Statutes, as created by
  212  this act, and the amendments made by this act to ss. 626.9373
  213  and 627.428, Florida Statutes, apply to actions pending on or
  214  after July 1, 2019, to the extent that the act does not require
  215  the invalidation of any provision of a contract executed before
  216  July 1, 2019.
  217         Section 5. This act shall take effect July 1, 2019.
  219  ================= T I T L E  A M E N D M E N T ================
  220  And the title is amended as follows:
  221         Delete everything before the enacting clause
  222  and insert:
  223                        A bill to be entitled                      
  224         An act relating to agreements between service
  225         providers and consumers; creating s. 501.172, F.S.;
  226         defining terms; specifying limitations and authorized
  227         provisions relating to a service provider’s right to
  228         payment under certain agreements with consumers under
  229         urgent or emergency circumstances; specifying
  230         requirements, limitations, and prohibited provisions
  231         for agreements containing a post-loss assignment of
  232         benefits; providing that a prevailing party under
  233         certain policies and coverages has the right to
  234         attorney fees and costs; providing that a court need
  235         not determine that there is a prevailing party;
  236         providing factors a court must consider in determining
  237         who is the prevailing party, under certain
  238         circumstances; providing construction relating to
  239         waiver of claims and limitations on recovery;
  240         authorizing a court to order an assignee to pay
  241         attorney fees and costs under certain circumstances;
  242         requiring the court to stay proceedings under certain
  243         circumstances; providing applicability; amending ss.
  244         626.9373 and 627.428, F.S.; providing that attorney
  245         fees under certain provisions of the Florida Insurance
  246         Code may not be awarded to an assignee of post-loss
  247         benefits who is a service provider; providing
  248         applicability; providing an effective date.
  250         WHEREAS, the Legislature finds that provisions of law
  251  allowing insureds to recover attorney fees in litigation against
  252  their insurers are intended to level the economic playing field
  253  between the economically-advantaged insurance company and the
  254  individual consumer, and
  255         WHEREAS, the award of attorney fees to the individual
  256  consumer under such laws makes the consumer financially whole
  257  and discourages insurance companies from contesting valid
  258  claims, and
  259         WHEREAS, however, the Legislature finds that the increased
  260  use of post-loss assignment of benefits by service providers has
  261  led to a dramatic increase in assignment of benefits litigation,
  262  and
  263         WHEREAS, the Legislature recognizes that additional costs
  264  incurred by insurance companies in contesting assignment of
  265  benefits-related litigation or in paying inflated claims for
  266  insurance proceeds are factored into the rates charged for
  267  property insurance and motor vehicle insurance, and
  268         WHEREAS, the Legislature finds that by explicitly providing
  269  that any right to attorney fees or costs against an insurer by a
  270  service provider must be as provided in this act, the
  271  Legislature is addressing the dramatic increase in assignment of
  272  benefits litigation by nonparties to property insurance policies
  273  and motor vehicle insurance policies for coverage of windshield
  274  damage and the associated increase in insurance premiums that
  275  are experienced by consumers, and
  276         WHEREAS, the Legislature intends to maintain its public
  277  policy of making consumers financially whole and reducing
  278  inequities between consumers and their insurance companies, as
  279  such consumers have the right to obtain attorney fees in civil
  280  actions they bring against their insurers, NOW, THEREFORE,