Plus another distinction with appraisals
A Florida appeals court delivers another blow to the idea that adjusters can also serve as appraisers in the same claims case, while another appeals court rules that an appraisal is meant to not only resolve disputes over the scope of a claim, but the amount of loss as well. It’s all in this week’s Legal Briefs.
Public Adjusters as Appraisers: The First District Court of Appeal has upheld a trial court ruling that “adjusters as appraisers” contracts with homeowners are not allowed under Florida’s fee cap on public adjusters. Cliff and Jane Fleming of Bay County suffered damage to their home from 2018’s Hurricane Michael and entered into a contract with Monarch Claims Consultants of Miami, headed by Edgar Velazquez, whose LinkedIn profile notes him as Founder, Public Adjuster, Appraiser, and Umpire. The contract called for public adjuster services in exchange for 10% of any insurance recovery. But the contract also provided that if the loss went to appraisal, the Flemings would appoint Monarch as the appraiser. At that point, Monarch would act solely as the appraiser, not as a public adjuster, and would be entitled to another 10% of the insurance recovery.
A year later, the Flemings said, with no progress made by Monarch, they cancelled the contract and settled on their own with their insurance company. Monarch claimed it was entitled to its fee and attempted to change venue. “You had a carpetbagger running up there and signing up people, then not doing any of the work he’d promised to do,” said the Fleming’ attorney, Charles “Chip” George, for William Rabb’s story in the Insurance Journal.
The 1st DCA found that public adjusters cannot double as appraisers in a claim if their total fees exceed the state’s 10% cap on adjuster’s fees during declared disasters. “Even if the added ten percent fee counts as an ‘appraiser fee’ instead of a ‘public adjuster fee’ as Monarch suggests, the contract would still violate the statute. The Flemings’ promise to appoint Monarch as their appraiser, on its own, is a ‘thing of value’ that exceeds the ten percent cap,” the appeals court noted.
In February of this year, the Florida Supreme Court ruled that a public adjuster cannot also act as an appraiser for a homeowner they represent, when the insurance policy requires a “disinterested” appraiser.
Appraisals Settle More than Coverage: Florida’s Sixth District Court of Appeal has reversed a trial court’s denial of a motion to compel appraisal in a dispute between an insurance company and a policyholder’s assignee for repairs. First Acceptance Insurance Company got into a dispute with At Home Auto Glass LLC over the value of the loss and paid what it deemed the prevailing competitive price to repair. It went to appraisal and At Home sued, arguing that appraisal was inappropriate since the extent of the physical damage was not disputed.
The trial court agreed with At Home but the 6th DCA held this interpretation to be unreasonable, citing several cases holding that appraisal is utilized to determine both the extent and the cost of repairs. It reversed the order and sent it back to the trial court for further proceedings. You can read more about this and other very relative case updates in Kelley Kronenberg’s First-Party Property Appellate Division’s “In The Know” latest monthly newsletter.
LMA Newsletter of 9-11-23
