by Robert T. Schulte, Esq.
Robert Schulte, Esq. Courtesy, Scarborough Attorneys at Law
One provision of the 2019 Assignment of Benefits (AOB) statutory change in Florida was the requirement that a claimant seeking compensation from an insurer as the recipient of an AOB from the insured “[m]ust, as a condition precedent to filing suit under the policy, and, if required by the insurer, participate in appraisal or other alternative dispute resolution methods in accordance with the terms of the policy.” F.S. §627.7152(4)(e). The insurer was also empowered in response to a statutory pre-suit notice from the claimant to “[require] the assignee to participate in appraisal or other method of alternative dispute resolution under the policy.” F.S. §627.7152(9)(b). However, even after the statutory change, many AOB claimants continue to seek to avoid appraisal by claiming through various legal arguments that while appraisal provisions were binding upon the insureds, such provisions were either not applicable to them or the services they claimed to have provided. Two recent Florida appellate decisions could* pour cold water on such legal claims and keep appraisal as a viable option to resolve such disputes.
On April 7, 2021, the Second District Court of Appeal in the case of Webb Roofing & Construction LLC a/a/o John Leferve and Lisa Leferve v. FedNat Insurance Company affirmed a trial court’s order compelling appraisal of Webb Roofing’s claims. Webb Roofing argued that the post-loss assignment from the Leferves transferred the claim and right to collect payment without the accompanying baggage of the policy’s appraisal provision. The appellate court disagreed, citing prior decisions, including Certified Priority Restoration v. State Farm Florida Insurance, 191 So. 3d 961, 962 (Fla. 4th DCA 2016) in ruling that when Webb Roofing received an assignment that entitled it to receive payment from the insurer, it also received the duty to comply with conditions that afford payment, and appraisal was one such duty.
On May 5, 2021, the Third District Court of Appeal in the case of Express Damage Restoration, LLC etc. v. Citizens Property Insurance Corporation affirmed a trial court’s order awarding summary judgment in favor of the insurer that the policy’s appraisal provision applied to the water mitigation services at issue. In taking a slightly different approach than Webb Roofing, Express Damage argued that its services were not subject to appraisal, as appraisal was only applicable to disputed valuation of property damaged by a covered loss. Looking to the policy, the appellate court rejected this argument, finding that the “Reasonable Repairs” provision of the policy applied to Express Damages’ services and there was no ambiguity in the appraisal provision of the policy that would operate to exempt their water mitigation services from appraisal.
*These decisions are non-final until any motions for rehearing are resolved, and as of this writing the deadlines for same have not expired.
Robert T. Schulte, Esq. is a partner in the Tampa office of Scarborough Attorneys at Law. Since 2012 his practice has been limited almost exclusively to representing Florida’s insurers in homeowners and commercial insurance matters relating to sinkhole claims, water claims, windstorm claims, hail claims, collapse claims, fire claims, theft claims, business interruption claims, extra expense claims, assignment of benefits issues, misrepresentations in insurance applications, and more. He can be reached via E-mail at [email protected] or via Telephone at (813)253-0097.
LMA Newsletter of 5-17-21
