A Hillsborough County Court recently held that Florida’s offer of judgment statute, Fla. Stat. § 768.79, is preempted by the Florida Consumer Collection Practices Act (the “FCCPA”), Fla. Stat. § 559.72.  This decision and, others like it, have stripped defendants in lender liability suits of valuable settlement tools.  In May 2013, the plaintiff in Hall v. Deutsche Bank Nat’l Tr. Co. & Ocwen Loan Servicing LLC, No. 13-CC-13185 (Fla. Hillsborough County Ct. Aug. 25, 2015), filed a one count complaint against a mortgagee and a mortgage servicer alleging a violation of the FCCPA.  The defendants filed an offer of judgment and the plaintiff moved to strike the offer of judgment arguing that the offer of judgment statute is preempted by the FCCPA.  Florida’s offer of judgment statute, Section 768.79, is used by plaintiffs and defendants alike to resolve cases prior to trial.  The statute was enacted to encourage settlement by taxing attorneys’ fees against a party that rejects a reasonable offer or demand for judgment.  Florida courts, however, have held that the offer of judgment statute is preempted in a number of actions including actions under Florida’s FCCPA, the Federal Fair Debt Collection Practices Act (the “FDCPA) and 42 U.S.C. § 1983.  See, e.g., Clayton v. Bryan, 753 So. 2d 632, 633 (Fla. 5th DCA 2000).

In striking the offer of judgment, the Hillsborough County Court cited Clayton as the controlling appellate authority on this issue.  Clayton, 753 So. 2d at 634.  In Clayton, Florida’s Fifth District Court of Appeal held that the FDCPA preempts a defendant’s use of an offer of judgment under § 768.79 in actions arising under either the federal FDCPA or the state law FCCPA.  Specifically, the offer of judgment statute is preempted by the FDCPA because the FDCPA only allows a prevailing defendant to recover its attorneys’ fees if the court expressly finds that the plaintiff’s case was brought in bad faith for the purpose of harassment.  Id. at 633.  Even though the state law FCCPA is silent as to awarding attorneys’ fees to successful defendants, the FCCPA is bound by the rule that it must be at least as protective of a consumer as the FDCPA.  Id. at 634.  In the event of an inconsistency in the application of these two consumer protection statutes, the FCCPA must adopt whichever provision is more protective of the consumer.  See Fla. Stat. § 559.552; Clayton, 753 So. 2d at 634.  The Fifth DCA found that the attorneys’ fee shifting provision of the FDCPA is more protective of the consumer and therefore that provision also applies under the FCCPA.  Clayton, 753 So. 2d at 634.  As a result, offers of judgment under § 768.79 are also preempted for state law FCCPA claims. Id.

While the Hillsborough County Court noted that its decision striking the offer of judgment was not a final order, it stated that if its decision were a final order, it would certify the following as a question of great public importance for review by the Second District Court of Appeal: “Does a claim made pursuant to Fla. Stat. 559.72 (FCCPA) pre-empt the application of the offer of judgment provisions of Fla. Stat. 768.79?”  It is worth noting that other circuits within the Second District Court of Appeal have also expressed agreement with the preemption analysis in Clayton, including the neighboring Sixth Judicial Circuit in Pinellas County, which, in its appellate capacity, stated that “a proposal of settlement made pursuant Florida Statute, § 768.79, is not applicable to claims filed under the Florida Consumer Collection Practices Act.”  Townsend v. Asset Acceptance Corp., No. 03-1921CI-88A (Fla. 6th Cir. App. Ct. Aug. 6, 2004).