February 20, 2020
Collier County Circuit Judge Hugh Hayes recently granted a Motion for Summary Final Judgment for the insurance carrier in an appraisal case with the Strems Law Firm. The Final Judgment is pending.
Plaintiffs filed a water intrusion insurance claim for an event in 2015. The carrier accepted coverage for the claim and determined that the amount of loss was less than the applicable deductible. The carrier paid a mitigation company’s invoice in full.
Without submitting a counter-estimate to demonstrate that they disputed the carrier’s position, the policyholders filed suit for breach of contract. After the parties engaged in discovery, appeared before the court, and mediated to an impasse over a period of approximately one year, the carrier demanded appraisal.
The trial court judge entered an order requiring appraisal, but refused to abate the litigation. The appraisal concluded when the parties’ appraisers agreed on the amount of loss, without the involvement of an umpire. Notably, the carrier had denied coverage for the roof but accepted coverage for interior damage, consistent with provisions in the insurance policy. The policyholder’s appraiser, in the course of the appraisal proceeding, agreed with the carrier’s position that the roof did not sustain damage that would have been covered under the policy.
The carrier paid the appraisal award in full and on time, then filed a Motion for Summary Final Judgment. The Motion was argued before Judge Hayes, who, at the hearing, announced his ruling in favor of the carrier. Entry of Final Judgment is pending.
Many insurance claims have been placed into appraisal as a result of Hurricane Irma and other recent events. Florida courts have developed a growing body of case law supporting appraisal of these claims, including those which involved causation-related issues, like the roof in this instance.
The body of case law concerning ancillary claims, including attorneys’ fees and costs, is also growing. In matters where the policyholder has initiated suit before engaging in any meaningful exchange consistent with the claim process, attorneys’ fees and costs should not be awardable.
Please contact us if you would like copies of any filings in this matter.
January 30, 2020
A property carrier received summary final judgment in a Dade County case involving a Plaintiff/AOB’s motion for “confession of judgment.”
The Plaintiff/AOB initially sued the wrong insurer. Before the Plaintiff/AOB amended the Complaint to name the proper insurer, the carrier issued payment in full for Plaintiff’s invoice for mitigation services.
The Plaintiff/AOB, which had provided water mitigation services related to a pipe leak, filed suit against the wrong insurer only three weeks after first reporting its mitigation services, and before ever receiving any coverage determination. At the time Plaintiff filed suit, the actual insurer had not yet completed its coverage determination. However, approximately one month after Plaintiff filed suit against the wrong party, the actual carrier completed its coverage evaluation and decided to pay the full amount of Plaintiff’s invoice.
Before the Plaintiff/AOB amended the complaint, the carrier delivered a check to Plaintiff’s counsel, made payable to Plaintiff for the full amount of its invoice A cover letter from counsel told Plaintiff that it had sued the wrong party, but that the actual insurer had decided to pay the entire claim. The carrier demanded that the lawsuit be dismissed.
Rather than dismiss, Plaintiff “amended” the Complaint six hours after receiving the letter, to name the correct carrier as the “new defendant.” Plaintiff’s counsel claimed mysteriously that the parcel containing the letter had included only a “photocopy of the check,” not the actual check. Plaintiff then served process on the correct carrier eight days later.
The correct carrier/new defendant immediately answered, then filed for summary judgment on grounds that it had never breached the policy, but had instead complied with the policy by timely paying the full amount of the invoice before it was ever sued (albeit after Plaintiff had prematurely sued the wrong party). In opposing the Motion for Summary Judgment, Plaintiff argued in a separate motion that the carrier confessed judgment by agreeing to pay and “attempting unsuccessfully to pay” the full amount of Plaintiff’s invoice through the letter Plaintiff’s counsel received on September 10, 2019. At a hotly contested hearing, Plaintiff also argued that the carrier had somehow breached the policy by failing to pay the invoice sooner (even though the carrier determined coverage less than 60 days after receiving initial notice of Plaintiff’s services) and by failing to include the check in the parcel.
In his order granting summary judgment and denying the motion for confession of judgment, the Judge held that Plaintiff’s “lawsuit was premature,” and “Plaintiff’s errors shall not inure to its benefit.” “To begin the matter, Plaintiff filed suit against the wrong entity and then electronically sprinted to the courthouse a mere six hours after Defendant, the correct entity, indicated its willingness to pay. Plaintiff’s counsel owed a duty to both parties and the court to make a good faith effort to resolve the September 10, 2019 payment confusion prior to filing an amended complaint.”
The Court added, “Defendant’s conduct in response to Plaintiff’s actions was reasonable. Despite the bizarre facts of this case, Defendant timely indicated its willingness to pay Plaintiff’s confusing and misaddressed invoice approximately sixty (60) days after its receipt. . . . Plaintiff’s minimal efforts to contact Defendant’s counsel after September 10, 2019 do not equate to a determination that Defendant unlawfully or incorrectly refused to pay the claim, especially considering Plaintiff’s haste to amend its complaint.”
This case illustrates a common scenario: hastily filed lawsuits with inaccurate allegations (in this instance, the wrong carrier). The carrier completed its investigation in due course and achieved resolution through the claim process, not litigation.
Attorney Rob Rogers prepared and argued the dispositive motion. Please contact us for further information and copies of any of the filings.
December 6, 2019
Judge Corey A. Cawthon, of Broward County, entered an Order on October 23, 2019 granting Scottsdale Insurance Company’s Motion for Final Summary Judgment in a suit filed by a water mitigation company pursuant to an Assignment of Benefits. Plaintiff, by way of a single Count for Declaratory Judgment (a second Declaratory Judgment Count was previously voluntarily dismissed by Plaintiff in response to Scottsdale’s Motion to Dismiss), sought rulings from the Court that Plaintiff’s services were reasonable, necessary, and effective and, therefore, covered under the subject policy. In fact, Scottsdale had denied the underlying claim of Plaintiff on the basis of the applicable Policy’s Water Exclusion Endorsement; Scottsdale had never reached the question of whether Plaintiff’s services were reasonable, necessary and/or effective. In other words, there was not, and was never, any actual, bona fide dispute among the Parties as to the declarations sought by Plaintiff.
Scottsdale’s Motion for Final Summary Judgment was premised upon arguments that: (i) Plaintiff failed to state a claim for Declaratory Judgment; (ii) the declarations sought by Plaintiff would not redress the injury alleged by Plaintiff, and, thus, Plaintiff lacked standing to bring the suit; (iii) Plaintiff’s claim for Declaratory Judgment was not ripe for adjudication, and the Court, therefore, lacked subject matter jurisdiction; and, (iv) Plaintiff’s claim for Declaratory Judgment was moot, and the Court, therefore, lacked subject matter jurisdiction over the matter.
In response to Plaintiff’s Motion for Final Summary Judgment, Plaintiff, on the eve of hearing, filed a Motion for Leave to Amend its Petition so as to state a claim for declaratory judgment with regard to the Policy’s Water Exclusion Endorsement. Judge Cawthon denied Plaintiff’s Motion for Leave to Amend based upon the timeline of the case, which supported notice to Plaintiff of the deficiencies of its Petition as of the inception of litigation. Judge Cawthon ruled that amendment would be prejudicial to Scottsdale, and would constitute an abuse of Plaintiff’s right to amend.
Judge Cawthon additionally denied Plaintiff’s Motion for a Continuance of the October 23, 2019 hearing, and denied Scottsdale’s Motion for Sanctions, remarking that she believed Plaintiff’s counsel’s maintenance of the frivolous action was unintentional and the result of excusable neglect.
October 30, 2019
With the new AOB law, policyholders’ attorneys rushed to the courthouse to avoid application of the law. Some of these hastily filed suits are now being weeded out.
Judge Jeffrey Levenson of Broward County entered an Order on August 27, 2019 granting Scottsdale Insurance Company’s motion to dismiss, with prejudice, of a suit filed by a mitigation company (fire damage) pursuant to an assignment of benefits in a first-party breach of contract case. Scottsdale’s motion sought dismissal, in part, because the assignment upon which Plaintiff relied for standing identified an incorrect policy of insurance. Judge Levenson ruled that the matter was subject to dismissal and, then, remarking upon recent AOB legislation enacted in Florida, determined that amendment of Plaintiff’s complaint would be futile, as an actionable claim against the carrier would require that Plaintiff obtain a new assignment of benefits. Judge Levenson entered an order dismissing the case, with prejudice.
In another assignment of benefits case, Judge Evellen Jewett of Orange County granted GeoVera Specialty Insurance Company’s Motion to Dismiss on October 11, 2019. Judge Jewett found that Plaintiff’s assignment of benefits was invalid in that it lacked the signature of a named insured under the subject policy of insurance, and that Plaintiff, therefore, lacked standing to sue.
August 28, 2019
In litigation, it is very important to scrutinize the initial complaint to determine whether it is legally and factually sufficient. Plaintiffs’ attorneys routinely file complaints that do not state a cause of action.
For example, in a recent case involving a Hurricane Irma claim, Plaintiff merely alleged that on or about a certain date, Plaintiff’s structure sustained damage from a covered peril. Plaintiff failed to allege the nature of the loss, the nature of the damage, the type of insurance, nor the provisions of the policy implicated.
Federal Judge Lawrence King entered Order Granting a Motion to Dismiss we filed, based on Plaintiff’s failure to allege sufficient facts to state a cause of action. As the Court was required to do, the complaint was dismissed without prejudice, with leave for Plaintiff to file an amended complaint within 30 days of the order. Plaintiff’s counsel failed to file an amended complaint, and the action was dismissed, with prejudice.
Although it may seem surprising that Plaintiff’s counsel failed to amend the complaint so as to state a cause of action, this is not a rare occurrence. The initial complaint was very similar to many we see. Likewise, the fact that Plaintiff’s counsel did not amend is consistent with many Plaintiffs’ firms, which for whatever reason find themselves incapable of complying with fairly simple orders. If you would like to see anything else in this or similar cases, just let me know.
April 24, 2019
Florida Senate voted in favor of House Bill 7065. The governor is expected to sign this.
This is a very significant piece of legislation that should have far-reaching effects. However, as we have seen in other realms, including Worker’s Compensation, sinkhole litigation, and PIP/no-fault legislation, implementation will need to be given careful consideration. Moreover, developments like this sometimes initiate a rush to the courthouse. Be prepared. We will share developments as they occur.
February 6, 2019
Catastrophe lawsuits may require a strong response. In a recent first party lawsuit, our client agreed to an aggressive plan of defense.
We filed a motion to dismiss Plaintiff’s complaint for failure to state a cause of action. Plaintiff’s counsel realized that the court would most likely grant the motion, so Plaintiff filed an amended complaint just before
Concurrently, we recommended a roofing expert who assisted us in a previous jury trial that resulted in a defense verdict. The expert inspected and provided his opinion, specifically finding that the roof was not damaged by Hurricane Irma.
We collaborated with our client and served a nominal statutory proposal for settlement. Just days before the proposal was set to expire, Plaintiff filed a notice of voluntary dismissal without prejudice. We contacted Plaintiff’s counsel, who said that Plaintiff would most likely not refile because of the risk of losing the case and incurring financial responsibility.
This is an example of what can happen when a client draws the line. If you would like any more specific information or court filings, please let me know.