Two years ago, insurance defense lawyers around the state of Florida breathed a sigh of relief when the Fourth District Court of Appeal issued its decision in Arch Insurance v. Kubicki Draper, 266 So. 3d 1201 (Fla. 4th DCA 2019). In Arch, the Fourth District held that an insurer lacked standing to pursue a professional negligence claim against the law firm it retained to defend an insured in an underlying action.
However, the Florida Supreme Court has reversed course in Arch Insurance v. Kubicki Draper, SC19-673 (Fla. June 3, 2021). The Supreme Court quashed the Fourth District’s decision and held that an insurer has standing to maintain a legal malpractice action against counsel hired to represent the insured where the insurer is contractually subrogated to the insured’s rights under the insurance policy.