139 W. Marion Ave, LLC v. Scottsdale Insurance Company
Filing
25
OPINION AND ORDER granting 19 defendant's Motion to Compel Appraisal and to Stay Litigation and to Delineate and Itemize Appraisal Award. The Court compels appraisal and will stay the case. The parties shall cooperate in expeditiously ob taining appraisal in the manner proscribed by the appraisal clause of the subject insurance policy and this case is stayed pending further notification by the parties that the stay is due to be lifted. The parties shall file a status report on or before November 16, 2018 if the appraisal is not complete or a notification has not been filed by this date. The Clerk shall terminate all deadlines, administratively close the case, and add a stay flag to the docket. (AMB)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
139 W. MARION AVE, LLC,
Plaintiff,
v.
Case No:
SCOTTSDALE
COMPANY,
2:18-cv-278-FtM-29MRM
INSURANCE
Defendant.
OPINION AND ORDER
This matter comes before the Court on defendant’s Motion to
Compel Appraisal and to Stay litigation and to Delineate and
Itemize
Appraisal
Award
(Doc.
#19)
filed
on
June
8,
2018.
Plaintiff filed a Response (Doc. #21) on June 22, 2018, to which
defendant filed a Reply (Doc. #24) on July 9, 2018.
For the
reasons set forth below, the Motion is granted.
I.
Plaintiff, 139 W. Marion Ave, LLC, originally filed this
action on April 18, 2018 in the Circuit Court for the Twentieth
Judicial Circuit in and for Charlotte County, Florida. (Doc. #2.)
Defendant, Scottsdale Insurance Company (“Scottsdale”) removed the
matter to this Court on April 25, 2018 pursuant to 28 U.S.C. §§
1332 and 1446. (Doc. #1.)
Plaintiff alleges one count for breach
of contract (Doc. #2) with respect to a commercial insurance
policy, Policy No. CPS2715741, issued by Scottsdale (the “Policy”)
(Doc. #2-1).
Scottsdale filed a Motion to Compel Appraisal and
to Stay litigation and to Delineate and Itemize Appraisal Award
(Doc. #19) on June 8, 2018.
At all times relevant, plaintiff owned property located at
139 W. Marion Ave., Punta Gorda, Florida 33950 (the “Property”),
which was covered by the Policy issued by defendant. (Doc. #2, ¶¶
2-3, 6-7.)
On September 10, 2017, plaintiff discovered damage to
the property incurred as a result of Hurricane Irma and submitted
a claim to defendant.
(Id. ¶¶ 7-8).
Although defendant accepted
coverage for the loss, the parties dispute the extent and valuation
of the covered damages. (Id. ¶¶ 9, 13, 16.)
Plaintiff claims that
defendant breached the Policy by failing to pay the loss in full,
causing it damages. (Id. ¶ 14.)
It
does
not
appear
that
Scottsdale
has
previously
sent
plaintiff a demand for appraisal, other than the filing of the
instant Motion to Compel.
Scottsdale believes that it is entitled
to appraisal because it is invoking its right to an appraisal under
the “Appraisal” clause of the Policy and under Florida law 1 an
appraiser may determine the value of the loss so the parties can
then allow the Court to resolve the coverage issues.
The Policy’s Appraisal clause provides:
1
In this
substantive law.
diversity
case,
- 2 -
the
Court
applies
Florida
E. Loss Conditions
. . .
2. Appraisal
If we and you disagree on the value of the
property or the amount of loss, either may
make written demand for an appraisal of the
loss. In this event, each party will select
a competent and impartial appraiser. The two
appraisers will select an umpire.
If they
cannot
agree,
either
may
request
that
selection be made by a judge of a court having
jurisdiction.
The appraisers will state
separately the value of the property and
amount of loss. If they fail to agree, they
will submit their differences to the umpire.
A decision agreed to by any two will be
binding. Each party will:
a.
Pay its chosen appraiser; and
b.
Bear the other expenses of the appraisal
and umpire equally.
(Doc. #2-1, p. 64.)
Plaintiff
objects
to
an
appraisal,
arguing
that
because
Scottsdale is in material breach of the Policy for its failure to
pay the full amount of the loss, Scottsdale has waived its right
to
appraisal.
(Doc.
#21,
¶
5.)
Plaintiff
also
argues
that
defendant waived its right to appraisal by failing to invoke the
option for ten months. (Id. ¶ 6.)
II.
A. Appraisal Right
Under Florida law, a dispute regarding a policy’s coverage
for a loss is exclusively a judicial question.
- 3 -
Gonzalez v. Am.
Sec. Ins. Co., No. 8:15-cv-1515-36EAJ, 2015 WL 12852303, at *4
(M.D. Fla. Nov. 10, 2015) (citations omitted).
However, when an
insurer acknowledges that there is a covered loss, any dispute
regarding the amount of such loss is appropriate for appraisal.
Id. (citations omitted); Freeman v. Am. Integrity Ins. Co. of Fla.,
180 So. 3d 1203, 1208 (Fla. 1st DCA 2015).
the
amount
of
loss,
an
appraiser
is
“Notably, in evaluating
necessarily
tasked
with
determining both the extent of covered damage and the amount to be
paid for repairs.”
Cincinnati Ins. Co. v. Cannon Ranch Partners,
Inc.,
140,
162
So.
original).
3d
143
(Fla.
2d
DCA
2014)
(emphasis
in
Thus, the question of what repairs are needed to
restore a property is a question relating to the amount of loss
and not coverage.
Scottsdale has stated that damages caused by Hurricane Irma
are covered but disputes the amount of damage.
On the other hand,
plaintiff believes that the damage caused by Hurricane Irma is
much more extensive.
Thus, because there is no dispute between
the parties that the cause of at least some of the damage to the
Property
is
covered
under
the
Policy,
the
remaining
dispute
concerning the scope of the damage is not exclusively a judicial
decision and may be appropriate for appraisal.
B. Waiver
Plaintiff contends that Scottsdale waived its right to an
appraisal when it breached the Policy and failed to invoke the
- 4 -
appraisal provision for ten months. (Doc. #21.)
“A waiver of the right to seek appraisal occurs when the party
seeking appraisal actively participates in a lawsuit or engages in
conduct inconsistent with the right to appraisal.”
Fla. Ins.
Guar. Ass’n v. Rodriguez, 153 So. 3d 301, 303 (Fla. 5th DCA 2014)
(citing Fla. Ins. Guar. Ass’n v. Branco, 148 So. 3d 488, 493 (Fla.
5th DCA 2014)). “[T]he primary focus is whether [the insureds]
acted
inconsistently
with
their
appraisal
rights.”
Id.
(alteration in original) (quoting Branco, 148 So. 3d at 494).
On the facts of this case the Court does not find waiver.
First, plaintiff provides the Court with no legal authority to
support its argument that an alleged breach by an insurer of the
terms of the Policy is a basis for wavier of an appraisal right.
Nor has plaintiff provided the Court with any specific facts or
Policy terms and conditions that Scottsdale breached which would
impair its right to an appraisal under the Policy.
Because
Scottsdale clearly disputes that it breached the terms of the
Policy and plaintiff does not argue that the Policy contains any
conditions
precedent
that
are
a
prerequisite
to
demanding
appraisal, plaintiff’s first argument in support of waiver fails.
Second, the ten-month delay in this case does not constitute
a waiver.
The appraisal clause does not require invocation prior
to suit and Scottsdale filed its Motion to Compel on June 8, 2018,
approximately six weeks after removing the case.
- 5 -
See, e.g., Am.
Capital Assur. Corp. v. Courtney Meadows Apartment, L.L.P., 36 So.
3d 704, 707 (Fla. 1st DCA 2010) (indicating appraisal demand was
timely as policy did not contain any language to invoke appraisal
within set time from receiving or waiving sworn proof of loss);
Fla. Ins. Guar. Ass’n v. Castilla, 18 So. 3d 703, 703-05 (Fla. 4th
DCA 2009); (explaining appraisal clause may be invoked for first
time after litigation has commenced and concluding that party did
not act inconsistently with right to appraisal by participating in
suit); Gonzalez v. State Farm Fire & Cas. Co., 805 So. 2d 814, 818
(Fla. 3d DCA 2000) (finding no waiver where motion to compel
appraisal was made within thirty days of filing the lawsuit). Cf.
Shoma Dev. Corp. v. Rodriguez, 730 So. 2d 838 (Fla. 3d DCA 1999)
(finding
waiver
where
discovery
for
clause).
Moreover, the facts as set forth by the parties show
seven
parties
months
had
before
engaged
in
invoking
litigation
the
and
arbitration
that Scottsdale was working on the claim throughout the time period
that
plaintiff
alleges
inactivity
and
the
Court
finds
that
Scottsdale has not extensively litigated this case.
Appraisal
is
appropriate
here
given
that
Scottsdale
has
admitted that at least some of the loss is covered by the Policy
but disputes the amount of its liability.
“‘[W]hen the insurer
admits that there is a covered loss, any dispute on the amount of
loss suffered is appropriate for appraisal.’”
Fla. Ins. Guar.
Ass’n v. Lustre, No. 2D13–5780, 2015 WL 1874445 (Fla. 2d DCA Apr.
- 6 -
24, 2015) (emphasis in original) (quoting Cannon Ranch Partners,
Inc., 162 So. 3d at 143).
Accordingly, the appraisal requested
by Scottsdale is both mandated by the Policy and appropriate under
the facts of the case.
The case will be stayed while the appraisal
is obtained.
C. Itemized and Delineated Appraisal
Scottsdale requests that the Court direct the appraisers to
prepare a line itemization of damages and delineation of scope in
the appraisal award as there are remaining coverage issues to be
decided by the Court. (Doc. #19, pp. 5-6.)
Plaintiffs did not
state a position as to Scottsdale’s request for a delineated
appraisal. (Doc. #21.)
A detailed line-item appraisal has been found to streamline
the litigation process because an appraiser assigns a value for a
particular type of damage, which allows the Court to more easily
assess coverage disputes.
Bonafonte v. Lexington Ins. Co., No.
08-cv-21062-CIV, 2008 WL 2705437, *2 (S.D. Fla. July 9, 2008).
See also Fla. Ins. Guar. Ass’n, Inc. v. Olympus Ass’n, Inc., 34
So. 3d 791, 796 n. 1 (Fla. 4th DCA 2010) (approving the use of a
line-item appraisal form, which allows the court to “readily
identify any coverage issues that arise during the course of the
appraisal and resolve these without having to try and decipher
what value the appraiser assigned for a particular type of damage”
(quoting Bonafonte, 2008 WL 2705437 at *2)).
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The Court agrees
that such an approach could streamline coverage issues and seeing
no objection from plaintiffs, the Court approves the use of a lineitem appraisal.
Accordingly, it is hereby
ORDERED:
1.
Defendant’s
Motion
to
Compel
Appraisal
and
to
Stay
Litigation and to Delineate and Itemize Appraisal Award (Doc. #19)
is GRANTED.
The
parties
The Court compels appraisal and will stay the case.
shall
cooperate
in
expeditiously
obtaining
an
appraisal in the manner proscribed by the appraisal clause of the
subject insurance policy, and this case is STAYED pending further
notification by the parties that the stay is due to be lifted.
2.
November
The parties shall file a status report on or before
16,
2018
if
the
appraisal
is
not
complete
or
a
notification has not been filed by this date.
3.
The
Clerk
shall
terminate
all
deadlines,
administratively close the case, and add a stay flag to the docket.
DONE and ORDERED at Fort Myers, Florida, this _16th_ day of
August, 2018.
Copies:
Counsel of Record
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