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Eight physical therapy students at a state university in Florida who unsuccessfully sued the school for failing to obtain accreditation for its P.T. program must pay the university’s attorney fees, a state appeals court ruled Wednesday. After the students lost their Palm Beach Circuit Court case in October 2001, Florida Atlantic University argued that it was entitled to the fees because the former students had rejected the university’s settlement offer before their negligence case went to trial. Even though the jury found in favor of the university, Palm Beach Circuit Judge Elizabeth Maass denied FAU’s motion for attorney fees. Maass rejected the request for legal fees because she said the university’s settlement offer included a general release that was too broad and rendered the offer invalid. The release required the students to relieve the university and any of its employees or associates of all liability “including all issues, causes, claims, counterclaims, set-offs and allegations which were raised or could have been raised out of this action.” Maass ruled that the settlement offer was invalid because it required students to release claims that weren’t raised in their lawsuit. It also was unreasonable because the students were barred from bringing claims against third parties. Therefore, the judge ruled, the students had a right to reject the offer without triggering the state’s offer of judgment statute. Florida Statute 768.79 requires a party that rejects a valid settlement offer, then loses at trial, to pay the other side’s attorney fees. But the state’s 4th District Court of Appeal in West Palm Beach unanimously reversed Maass’ ruling, finding that the terms of the general release in the university’s settlement proposal were standard conditions often found in such releases. The three-judge appellate panel ruled that the general release was valid because it absolved the defendant of liability only for claims up to the date of the settlement. “The language in the general release, even though expansive, is typical of other general releases and is clear and unambiguous,” 4th DCA Judge Fred Hazouri wrote for the three-judge panel. “The plaintiffs were not required to release all rights to sue the defendant based on any causes of action accruing in the future.” Judges Carole Taylor and Melanie May concurred. Russell Bohn, a solo practitioner in Boynton Beach, and Joseph Ackerman, a partner at Boose Casey Ciklin Lubitz Martens McBane & O’Connell in West Palm Beach, represented FAU in the appeal. Peter Aldrich, a solo practitioner in Palm Beach Gardens, represented the students. The students were Laura Bowman, Jennifer Pharo, Karen Latham, Carol-Lynne Taylor, Pritesh Patel, Arnot Wadsworth, Jennifer Stein and Christopher Herndon. Attorneys for the two sides did not return calls for comment. FAU officials also did not respond to requests for comment. The eight plaintiffs were full-time students in the school’s three-year physical therapy program. The program was established on a Fort Lauderdale-area campus of the Boca Raton-based university in 1997. When the students first enrolled in fall 1997, the program was not yet accredited. But in its written curriculum given to students, FAU officials promised to seek certification. Two years later, the program was still unaccredited; it was disbanded in July 2000. The university was forced to shutter the program after officials missed the filing deadline for applying for accreditation. Without a degree from a nationally accredited program, the students would not have been able to take the Florida physical therapist licensing exam. But FAU officials subsequently reached an agreement that allowed the school’s 38 P.T. students to transfer to accredited programs at Florida International University in Miami and the University of Central Florida in Orlando. That allowed them to graduate with accredited degrees and to take the licensing exam. Despite the arrangement, in December 1999 the eight students sued the FAU board of trustees for negligence and breach of obligation. The students claimed that they were entitled to multiplied damages because FAU officials allegedly lied to them between May 1997 and spring 1999 about the accreditation status of the P.T. program. In May 2001, FAU offered the students $2,001 each to settle their claims. The students did not respond to the offer within 30 days, which is legally considered a rejection. At trial, the jury found that the students did have an express, written contract with the defendant but that FAU had not breached that contract. Judge Maass entered final judgment in favor of FAU. Because the 4th DCA decided that FAU’s settlement offer was made in good faith, under the offer of judgment statute the university was entitled to collect attorney fees from the plaintiffs. The appellate court remanded the case to the trial court for determination of reasonable legal fees.

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