[DO NOT PUBLISH]

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

________________________

No. 16-15625

Non-Argument Calendar

________________________

D.C. Docket No. 8:15-cv-01788-EAK-MAP

W&J GROUP ENTERPRISES, INC.,

d.b.a. Seabreeze Lounge,

WESLEY ALLEN BROWN,

SHERRI MAPEL,

 Defendants - Appellants,

versus

HOUSTON SPECIALTY INSURANCE COMPANY,

 Plaintiff - Appellee.

________________________

Appeal from the United States District Court

for the Middle District of Florida

________________________

(April 6, 2017)

Case: 16-15625 Date Filed: 04/06/2017 Page: 1 of 7 
2

Before TJOFLAT, WILLIAM PRYOR, and EDMONDSON, Circuit Judges.

PER CURIAM: 

In this state-law case, W&J Group Enterprises, Inc. and Wesley Brown 

(“Insureds”) appeal the district court’s determination that they are unentitled to 

attorneys’ fees -- pursuant to Fla. Stat. § 627.428 -- from their insurer, Houston 

Specialty Insurance Company (“HSIC”). Reversible error has been shown; we 

vacate and remand.

HSIC filed this civil action in federal district court seeking (1) a declaratory 

judgment that it owed no duty to defend or to indemnify the Insureds in an 

underlying state-court tort action and (2) rescission of the Insureds’ insurance 

policy. While the declaratory-judgment action was pending, HSIC and the 

Insureds settled the underlying tort action for $653,000. Of the settlement amount,

HSIC paid $650,000 and the Insureds paid $3000. As a result of the settlement, 

HSIC dismissed voluntarily the claims in this action. 

The Insureds then moved for attorneys’ fees pursuant to Fla. Stat. § 627.428. 

The district court denied the motion based in pertinent part on the Insureds’ 

contribution toward the settlement award.*

 

 * The district court also concluded that the Insureds were unentitled to attorneys’ fees on two 

separate grounds: (1) HSIC had a legitimate basis to withhold payment and, thus, denied 

Case: 16-15625 Date Filed: 04/06/2017 Page: 2 of 7 
3

We review de novo the district court’s interpretation of state law. Trans 

Coastal Roofing Co. v. David Boland, Inc., 309 F.3d 758, 760 n.1 (11th Cir. 2002). 

In interpreting state law, we look first to case precedent from the state’s highest 

court. Winn-Dixie Stores, Inc. v. Dolgencorp, LLC, 746 F.3d 1008, 1021 (11th 

Cir. 2014). Where no pertinent precedent exists, we “adhere to the decisions of the 

state’s intermediate appellate courts absent some persuasive indication that the 

state’s highest court would decide the issue otherwise.” Id. 

Under Florida law, an insured is entitled to an award of attorneys’ fees when 

judgment is entered against an insurer and in favor of the insured. Fla. Stat. § 

627.428(1). The Florida Supreme Court has held that this statutory rule also 

applies when the insured and the insurer settle an action before judgment is 

entered. Wollard v. Lloyd’s & Cos. of Lloyd’s, 439 So. 2d 217, 218-19 (Fla. 

1983). The Florida Supreme Court explained that “[w]hen the insurance company 

has agreed to settle a disputed case, it has, in effect, declined to defend its position 

 

“wrongfully” no benefits under the policy and (2) because HSIC’s complaint included twocounts, one of which purportedly could have been refiled, the voluntary dismissal constituted no 

confession of judgment. 

The Insureds challenge both grounds on appeal. Because these grounds for denial appear 

contrary to Florida law -- and because HSIC presents no argument on these issues -- they warrant 

no further discussion. See Johnson v. Omega Ins. Co., 200 So. 3d 1207, 1216 (Fla. 2016) 

(explaining that “the insurer’s intentions do not factor into a policyholder’s recovery of fees; it is 

the fact that the denial of benefits was ultimately incorrect that triggers the statute.”); State ex rel. 

March v. Doran, 958 So. 2d 1082, 1082 (Fla. Dist. Ct. App. 2007) (concluding that “[t]he refiling 

of the same suit after the voluntary dismissal does not alter the appellees’ right to recover 

prevailing party attorney’s fees incurred in defense of the first suit.”); Blizzard v. Gov’t Emps. 

Ins. Co., 654 So. 2d 565, 566 (Fla. Dist. Ct. App. 1995) (awarding attorneys’ fees under section 

627.428 to an insured that prevailed on one count of a two-count complaint).

Case: 16-15625 Date Filed: 04/06/2017 Page: 3 of 7 
4

in the pending suit.” Id. at 218. The payment of the insured’s claim, thus, is 

equivalent to a “confession of judgment.” Id. Moreover, “[r]equiring the plaintiff 

to continue litigation in spite of an acceptable offer of settlement merely to avoid 

having to offset attorney’s fees against compensation for the loss puts an 

unnecessary burden on the judicial system, fails to protect any interest -- the 

insured’s, the insurer’s or the public’s -- and discourages any attempt at 

settlement.” Id. 

Florida’s intermediate appellate courts have since extended the confession of 

judgment rule beyond the situation in Wollard -- which involved the settlement of 

a first-party suit between the insured and the insurer -- to the settlement of thirdparty suits and the voluntary dismissal of a related complaint for declaratory relief 

filed by an insurer against the insured. See, e.g., Mercury Ins. Co. of Fla. v. 

Cooper, 919 So. 2d 491 (Fla. Dist. Ct. App. 2005) (“Cooper”); Unterlack v. 

Westport Ins. Co., 901 So. 2d 387 (Fla. Dist. Ct. App. 2005); O’Malley v. 

Nationwide Mut. Fire Ins. Co., 890 So. 2d 1163 (Fla. Dist. Ct. App. 2004). The 

Florida courts have explained that the settlement of a third-party claim and 

voluntary dismissal of the related declaratory-judgment action constitute a 

confession of judgment sufficient to trigger an award of attorneys’ fees. See 

Cooper, 919 So. 2d at 492-93; Unterlack, 901 So. 2d at 389; O’Malley, 890 So. 2d 

at 1164 (applying the confession of judgment rule because, by providing a defense 

Case: 16-15625 Date Filed: 04/06/2017 Page: 4 of 7 
5

and settling the underlying tort claim the insurer “provided the insured precisely 

what [the insurer] was contending the insured was not entitled to in the declaratory 

action.”). 

The purpose of section 627.428 “is to provide an adequate means to afford a 

level process and make an already financially burdened insured whole again, and 

to also discourage insurance companies from withholding benefits on valid 

claims.” Johnson v. Omega Ins. Co., 200 So. 3d 1207, 1209 (Fla. 2016); see also 

Wollard, 439 So. 2d at 218 (section 627.428 is intended “to discourage litigation 

and encourage prompt disposition of valid insurance claims without litigation.”). 

The Florida Supreme Court has also stressed that “[t]he need for fee and cost 

reimbursement in the realm of insurance litigation is deeply rooted in public 

policy.” Johnson, 200 So. 3d at 1215. 

HSIC attempts to distinguish the facts of this case from the facts involved in 

Cooper, Unterlack, and O’Malley, because -- unlike in those cases -- the Insureds 

contributed personally to the settlement award. HSIC relies in particular on 

language in Cooper that attorneys’ fees under section 627.428 are triggered by the 

insurer’s “unilateral” decision to enter a settlement and to dismiss the declaratoryjudgment action. See Cooper, 919 So. 2d at 493. Because the Insureds contributed 

to the settlement award, HSIC contends the decision to settle was not made 

“unilaterally” and, thus, did not trigger section 627.428. 

Case: 16-15625 Date Filed: 04/06/2017 Page: 5 of 7 
6

HSIC’s stress on the single use of the word “unilateral” in Cooper is 

unpersuasive to us. In Cooper, the state court twice stressed that -- instead of 

merely settling the underlying tort claim -- the insurer “could have negotiated a 

global settlement, which could have included a reservation of rights concerning 

attorney’s fees.” Id. at 492, 493. When read in context, we understand the term 

“unilateral” in Cooper as describing a circumstance in which the insurer, on one 

side, settles a third-party claim without also reaching an agreement, on the other 

side, with its insured about the payment of attorneys’ fees. Because HSIC -- like 

the insurer in Cooper -- settled the underlying claim absent a global settlement 

resolving the issue of attorneys’ fees, HSIC seemingly acted “unilaterally” within 

the meaning of Cooper irrespective of the Insureds’ contribution to the settlement 

amount. In any event, we do not understand Cooper as limiting, attempting to 

limit, or being capable of limiting the application of the state Supreme Court’s 

confession-of-judgment rule which is triggered simply by an insurer paying in 

settlement, against the background of a declaratory-relief action filed by an insurer 

against the insured. 

Contrary to HSIC’s position, we conclude that the award of attorneys’ fees 

under the facts of this case is consistent with Wollard and its progeny. By entering 

into the settlement agreement -- thereby agreeing to pay $650,000 -- HSIC 

“declined to defend its position” in the declaratory-judgment action. See Wollard, 

Case: 16-15625 Date Filed: 04/06/2017 Page: 6 of 7 
7

439 So. 2d at 218. HSIC, instead, provided the Insureds with “precisely what [it] 

was contending the insured was not entitled to in the declaratory action.” See 

O’Malley, 890 So. 2d at 1164. That the Insureds also contributed $3000 toward 

the settlement award -- in and of itself -- does not alter materially the nature of 

HSIC’s decision to abandon its position in the declaratory-judgment action.

Given the circumstances -- particularly where the Insureds’ contribution 

constituted less than 2% of the total settlement amount -- we see no meaningful 

distinction between this case and the facts involved in Cooper, Unterlack, and 

O’Malley. Moreover, requiring the Insureds to have rejected a reasonable 

settlement offer so that they may retain their right to attorneys’ fees appears 

contrary to the stated purpose of section 627.428 and to the public policy concerns 

expressed by the Florida Supreme Court. 

On this record, HSIC’s settlement of the underlying tort claim and voluntary 

dismissal of the related declaratory-judgment action constituted a “confession of 

judgment.” Thus, we conclude -- as a matter of Florida law -- that the Insureds are 

entitled to attorneys’ fees pursuant to section 627.428. 

VACATED AND REMANDED.

Case: 16-15625 Date Filed: 04/06/2017 Page: 7 of 7