Job one of lawyers who represent individuals who have suffered personal injuries and/or property damage losses is to maximize the client’s recovery. The conventional thinking is that the recovery in every case is limited by the measure of actual damages, in other words, the recovery cannot exceed the loss.
Surprisingly, this is a rule that can be broken … with a proviso.
In Despointes v. Florida Power Corporation, 2 So.3d 360 (2nd DCA 2008), a person who was paid $224,567.66 by her own insurance company, CIGNA, for fire damage, was able to pursue a claim for damages, through her estate, against a third party for the amount already recovered from the insurance company.
The device used for this opportunity was an assignment from CIGNA of its subrogation/reimbursement right.
The CIGNA policy provided for the right of subrogation against any third party recovery. This right authorized CIGNA to pursue a claim against the third party responsible for causing the house fire for the amount it paid to its insured. Instead of pursuing the claim, it assigned the right to its insured.
Thereafter, the insured sued the third party, Intermatic, alleging that the fire had been caused by a defective surge protector. The Defendant argued that the insured was not allowed to recover the money she had already received.
The trial court agreed. The Second District Court of Appeal did not.
In reversing the trial court, the DCA wrote that “[T]he trial court’s finding would allow the alleged tortfeasor to avoid paying for its alleged tort because the victim was prudent enough to obtain insurance.”
768.76(1) Collateral sources of indemnity.
Robarts v. Diaco, 581 So.2d 911 (Fla. 2d DCA 1991) (a case involving the assignment of right of contribution in a medical malpractice case. Two defendants assigned to the Plaintiff their rights of contribution against a third defendant.)
What this blog illustrates is that when there exists a right of subrogation, reimbursement, or contribution, the Plaintiff should give consideration to obtaining an assignment of the right. However, the Plaintiff should be mindful that the assignment may come with a cost. Because the assignor is usually selling something of value – for example, in Despointes, CIGNA gave up the right to recover the money it had paid to its insured – it may expect consideration in return. Frequently, the price tag is agreeing to settle for less than might be recovered. Again to the Despointes case. Although the DCA opinion is silent either way, it could be that the insured agreed to accept less from CIGNA in exchange for the assignment.
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Jeffrey P. Gale, P.A. is a South Florida based law firm committed to the judicial system and to representing and obtaining justice for individuals – the poor, the injured, the forgotten, the voiceless, the defenseless and the damned, and to protecting the rights of such people from corporate and government oppression. We do not represent government, corporations or large business interests.