The court then ordered the parties to complete the appraisal process required by the insurance policy, abated the case, and directed the parties to reopen the case, if necessary, upon the completion of the appraisal process.

Big Wheel and Scottsdale completed the appraisal process, which led Scottsdale to pay Big Wheel $119,556.95 – far in excess of the policy's $26,250 deductible.

Big Wheel moved to reopen the case so that it could file a motion for attorneys' fees and costs. It claimed that Scottsdale's payment operated as a confession of judgment.

For its part, the insurer argued that attorneys' fees were not recoverable because Big Wheel did not have to file suit to compel Scottsdale to participate in the appraisal process.

Florida Law

The statutory provision governing attorneys' fees against surplus lines insurers provides:

Upon the rendition of a judgment or decree by any court of this state against a surplus lines insurer in favor of any named or omnibus insured or the named beneficiary under a policy or contract executed by the insurer on or after the effective date of this act, the trial court or, if the insured or beneficiary prevails on appeal, the appellate court, shall adjudge or decree against the insurer in favor of the insured or beneficiary a reasonable sum as fees or compensation for the insured's or beneficiary's attorney prosecuting the lawsuit for which recovery is awarded.

Fla. Stat. § 626.9373.

The District Court's Decision

The district court granted Big Wheel's motion to reopen the case.

In its decision, the district court pointed out that Scottsdale had invoked the appraisal process only after Big Wheel had filed suit. Moreover, the district court said, it could not accept Scottsdale's contention that Big Wheel had filed its lawsuit primarily for the purpose of obtaining attorneys' fees. The district court observed that Big Wheel had first attempted to resolve any difference without resorting to formal legal action.

In any event, the district court noted, the Scottsdale policy permitted Big Wheel to file a lawsuit without first requesting an appraisal.

Referencing Fla. Stat. § 626.9373, the district court ruled that Scottsdale's payment operated as a “confession of judgment” and, as a result, Big Wheel was entitled to an award of attorneys' fees.

It concluded by reopening the case and authorizing Big Wheel to file a motion for its attorneys' fees and costs.

The case is Big Wheel Schwinn, Inc. v. Scottsdale Ins. Co., No. 18-cv-60593-BLOOM/Valle (S.D. Fla. Aug. 28, 2018). Attorneys involved include: For Big Wheel Schwinn, Inc., Plaintiff: Jeremy Fenton Tyler, Wayne Wyndham Geyer, Jr., LEAD ATTORNEYS, Geyer Fuxa Tyler, Sunrise, FL. For Scottsdale Insurance Company, Defendant Andrew P. Rock, Nhan T. Lee, LEAD ATTORNEYS, Julia Grimke Young, The Rock Law Group, P.A., Maitland, FL.