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Eleventh Circuit Court of Appeals rules that damages determination in UIM breach of contract case is not binding in bad faith case where insurer was not granted appellate review

On June 15, 2017, in Bottini v. GEICO, No. 15-12266, the Eleventh Circuit Court of Appeals reversed a federal trial court’s order granting a partial summary judgment on the binding effect in a bad faith proceeding of the verdict as to statutory damages in the preceding breach of contract case by the estate of a UM insured against the UM insurer. The breach of contract case in state court had resulted in a $30,872,255 jury verdict, which was reduced to the policy maximum of $50,000. GEICO appealed the verdict, but the Florida Second DCA declined to substantively review the jury’s damages determination, noting only that any errors in the determination were harmless given the amount of the judgment. The plaintiff then filed a bad faith action against GEICO in federal court in the Middle District of Florida for the balance of the statutory damages, and in accordance with the recent opinion of the Florida Supreme Court in Fridman v. Safeco Ins. Co, of Ill., 185 So.3d 1214 (Fla. 2016), the district court concluded that the amount of the damages had been fixed by the state breach of contract case. GEICO appealed this decision to the Eleventh Circuit Court of Appeals on the basis that it had been denied any appellate review of the damages determination by the Florida Second DCA. As a basis for reversing the decision of the district court, the Eleventh Circuit noted that the Florida Supreme Court had expressly conditioned its ruling in Fridman, holding that the damages determination is not binding unless both parties are afforded an opportunity to obtain appellate review of any alleged errors in the damages determination.