Citizens Property Insurance had sanctions within reach - then served the same demand twice, gave its opponents fresh way out, and lost its fee bid.
A Florida appeals court on August 12, 2026, affirmed a trial court's refusal to sanction two policyholders and their lawyer - a ruling that turns entirely on how carefully insurers time their fee demands.
The backstory is a Hurricane Irma claim. Citizens wrote a homeowners policy running December 9, 2016 to December 9, 2017. After the insureds reported storm damage on September 21, 2017, Citizens accepted coverage and paid $28,914.12. Following an appraisal demand, it paid supplemental sums totaling more than $212,000.
The insureds sued anyway, first in March 2019 and again in December 2022, the second time seeking $142,500 over disputed settlement proposals from the first case. When they filed a second amended complaint without the court's permission, Citizens moved for fees.
The case turned on one rule. Section 57.105 of the Florida Statutes lets a court order a losing party and its attorney to pay fees for claims not "supported by the material facts" or by "then-existing law." The catch is a safety valve: the motion "may not be filed with or presented to the court unless, within 21 days after service of the motion," the offending claim "is not withdrawn or appropriately corrected."
Citizens served that notice and filed its motion on August 20, 2024. Then, on January 8, 2025, it served a second notice on the same grounds. The insureds took the opening and dismissed their suit on January 24 - day 16 of the fresh 21-day window.
The trial judge summed it up: when repeat sanctions motions rest on the same points, "the last one you get is your final opportunity." Citizens' counsel answered, "I agree with you, that's exactly what it did."
The appeals court agreed. Calling it a question of first impression, it held that a timely dismissal in response to a later, successive motion on the same grounds ends any shot at sanctions on the earlier one. The second notice simply gave the insureds another chance, and they used it.
For claims and defense teams, the lesson is blunt. A duplicate safe-harbor notice meant to lock in fees can reset the clock instead - and hand the other side a clean exit.
