Island Roofing and Restoration LLC v. Empire Indemnity Insurance Company

Filing 54

ORDER granting in part 30 Plaintiff's Motion to Confirm the Appraisal Award & Entry of Summary Judgment. Defendant's Cross-Motion for Summary Judgment (Doc. 37) is DENIED WITHOUT PREJUDICE to Defendant renewing its arguments in a subs equent motion consistent with this Order. Plaintiff's Motion for Protective Order (Doc. 31) is GRANTED IN PART to the extent that any discovery Defendant seeks must be consistent with this Order. The parties may renew their motions for summary judgment, consistent with this Order, at the close of discovery. The Court will also entertain motions to extend the remaining pretrial deadlines to allow reasonable time for the same. See Order for details. Signed by Judge John L. Badalamenti on 9/19/2022. (NM)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
ISLAND ROOFING AND RESTORATION
LLC, a/a/o Enclave at Naples Condominium
Association, Inc.,
Plaintiff,
v.

Case No: 2:21-cv-211-JLB-KCD

EMPIRE INDEMNITY INSURANCE
COMPANY,
Defendant.
ORDER
Island Roofing and Restoration LLC (“Island Roofing”), as the assignee of the
Enclave at Naples Condominium Association, Inc. (“Enclave”), sues Empire
Indemnity Insurance Company (“Empire”) for breach of an insurance policy based
on Empire not paying an appraisal award. Invoking the Court’s diversity
jurisdiction, the parties have filed cross-motions for summary judgment. (Docs. 30,
37.) Island Roofing asks that the Court confirm the appraisal award. Empire
maintains it has satisfied its contractual obligation because it has already paid
Island Roofing more than the amount that was actually spent to repair the insured
property. Alternatively, Empire seeks additional discovery into the appraisal
panel’s determination so that it can challenge purported procedural discrepancies
with the award. Island Roofing, in response to that discovery request, moves for a
protective order that largely reasserts the arguments in its summary judgment
motion. (Doc. 31.)

This dispute turns on Empire’s payment obligations under the policy. And
the plain language of the policy states that Empire is liable for no more than the
necessary amount Island Roofing spent in repairing the property. As will be
explained, Island Roofing’s motion for summary judgment (Doc. 30) is GRANTED
IN PART, Empire’s motion for summary judgment (Doc. 37) is DENIED
WITHOUT PREJUDICE, and Island Roofing’s request for a protective order (Doc.
31) is GRANTED IN PART.
BACKGROUND
A review of the parties’ respective Statements of Undisputed Facts reveals
little, if any, disagreement as to the factual background of this case. (Compare
Doc. 30 at 2–5, with Doc. 37 at 2–4.)1 The Enclave is a condominium association
that insured its buildings through a commercial lines policy with Empire. (Doc. 161.) After Hurricane Irma allegedly damaged the insured property, the Enclave
submitted a claim for its loss to Empire. (Doc. 37-1 at ¶ 6.) Between July and
October 2018, Empire conceded at least partial coverage for the loss and made three
separate payments on the Enclave’s claim. (Id.) Then, in November 2018, the
Enclave hired Island Roofing to repair the insured property and assigned its rights
and benefits, along with any proceeds under the policy, to Island Roofing
(“Assignment”). (Doc. 16-2.)

Despite neither expressly admitting nor denying the other’s assertions, the
parties’ statements largely overlap in every material and substantive way.
Accordingly, the Court will summarize those facts while viewing the same “in the
light most favorable to the non-moving party on each [cross-]motion.” Chavez v.
Mercantil Commercebank, N.A., 701 F.3d 896, 899 (11th Cir. 2012).
1

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Specifically, the Enclave assigned Island Roofing “any and all insurance
rights, benefits, and proceeds” under the policy relating to its claim. (Id. at 1.) In
exchange, Island Roofing agreed “to perform a replacement of the roof and other
repairs on the property.” (Id.) Island Roofing and the Enclave estimated the cost
of repairs in the Assignment at $6,853,187.60. (Id. at 3.) But they also agreed
that the Enclave “shall be responsible for only the insurance deductible in the
amount of $2,500,000 . . . and no other amounts in any circumstances.” (Id. at 1.)
Empire subsequently “confirmed the assignment” and began adjusting the claim
with Island Roofing. (Doc. 30-2 at ¶ 3; Doc. 37-1 at ¶ 7.)
Empire requested a proof of loss from Island Roofing who, in turn, provided
an estimate for the full cost of repair or replacement at $10,382,724.64. (Doc. 37-1
at 3, 170.) But in the permit applications for the repair work that Island Roofing
submitted to the local government around the same time, it provided an estimate of
$6,595,386. (See Doc. 37-2.) In any event, between February and May 2019,
Empire made three additional payments for “roof repairs” and “Enclave Hurricane
Repairs.” (Doc. 30-2 at 12, 19, 22.) All in all, Empire paid $3,552,199.60 in
adjusting the claim. (Doc. 37-1 at ¶ 13.)
Not shockingly, the parties still disagreed over the amount of loss. (Doc. 302 at ¶ 7; Doc. 37-1 at ¶ 14.) So, in August 2019, Empire invoked the policy’s
Appraisal provision:
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
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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.
....
If there is an appraisal, we will still retain our right to deny
the claim.
(Doc. 16-1 at 37 (emphasis added); Doc. 30-2 at 25.) The parties convened an
appraisal panel, where Island Roofing submitted a repair estimate of $6.4 million.
(Doc. 37-1 at 4, 25, 169.)
The appraisal panel issued its award in August 2020. (Doc. 16-3.)
Specifically, the appraisal award valued the amount of loss for both the Actual Cash
Value (“ACV”) and Replacement Cost Value (“RCV”) at $10,761.515.65, “less any
prior payments.” (Id. at 1.) A detailed, line-item valuation accompanied the
award. (Id. at 3.) The appraisal panel certified that it “investigated and
conscientiously considered all the material facts while performing the duties within
[their] appointment pursuant to the appraisal clause of the subject policy.” (Id. at
1.) They also clarified that “[t]his award does not include nor does this award
account for or deduct the insured’s deductible and/or any prior or advance payments
that were made to the insured.” (Id.) “Additionally, this award does not consider
any limitations or exclusions which may or may not exist under the terms of the
contract of insurance.” (Id. (emphasis added).) Under the policy, if Island Roofing
has “complied with all the terms of [applicable coverage],” Empire “will pay for

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covered loss or damage” within thirty days of receiving “the sworn proof of loss” and
“[t]here is a filing of an appraisal award with [it].” (Doc. 16-1 at 76.)
Empire made no further payments though. (Doc. 37-3.) In September 2020,
Empire acknowledged the appraisal award but maintained that “it does not owe any
more than it has paid so far on this claim” and “likely has paid more than it owes
under the policy[’s]” Replacement Cost coverage provision. (Id. at 1.) The
Replacement Cost coverage provision limits Empire’s obligation to pay benefits on
the claim as follows:
3.

Replacement Cost

a.

Replacement
Cost
(without
deduction
for
depreciation) replaces Actual Cash Value in the Loss
Condition, Valuation, of this Coverage Form.

....
d.

We will not pay on a replacement cost basis for any
loss or damage:
(1)
Until the lost or damaged property is actually
repaired or replaced; and
(2)
Unless the repairs or replacement are made
as soon as reasonably possible after the loss
or damage.

e.

We will not pay more for loss or damage on a
replacement cost basis than

....
(3)

The amount actually spent that is necessary
to repair or replace the lost or damaged
property.

(Doc. 16-1 at 42 (emphasis added).) Empire invoked this provision because
“[r]epairs have been performed at the property.” (Doc. 37-3 at 1.)

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Empire reasoned that it had “paid more than ‘the amount actually spent that
is necessary to repair or replace the lost or damaged property’” because, “regardless
of any assignment,” the Enclave “has spent only $2,225,303.25 on repairs and will
never owe Island Roofing more than $2.5 million.” (Id. at 2; see also Doc. 37-1 at
172.) Put differently, no matter what Island Roofing spent on repairs, Empire
construed the “amount actually spent” as only what the Enclave agreed to pay
Island Roofing (which would never exceed $2.5 million per the Assignment).
(See Doc. 37-3 at 2.) And because “Empire has paid $3,552,199.60 on the claim so
far,” it posited that it “does not and will not owe anything more for Replacement
Cost coverage.” (Id.) Last, Empire informed Island Roofing that it was
investigating the discrepancy between the Assignment, Island Roofing’s proof of
loss, the permit application, and the estimate submitted to the appraisal panel—all
of which reflected different repair costs. (Id.)
Thereafter, Island Roofing filed its Amended Petition for Declaratory
Judgment & Breach of Contract in this Court. (Doc. 16.) In Count I, Island
Roofing seeks a declaratory judgment that “the amount actually spent”: (a) is not
limited to the Enclave paying the policy’s deductible but also includes Island
Roofing’s expenditures as assignee; and (b) “is to be made in accordance with the
Policy’s Appraisal provision.” (Id. at 14–15.) In Count II, it requests a declaration
that, under the policy’s Appraisal provision, “Empire [is] not afforded the right to
withhold payment because it believes the Appraisal Award should be ‘millions less.’”
(Id. at 17.) In Count III, Island Roofing contends that Empire breached the policy

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by not paying “all that is due and owing under the policy” after receiving a proof of
loss and the appraisal award. (Id. at 19.)
Empire counters with eight affirmative defenses. (Doc. 18.) First, it claims
that Counts II and III are duplicative, but the Court rejected this when it denied
Empire’s motion to dismiss based on the same argument. (Id. at 8; Docs. 17, 49.)
Second, it argues the policy’s Replacement Cost coverage provision precludes
recovery because “the Enclave has neither paid more than the deductible for
completed repairs nor presented evidence that repairs were performed ‘as soon as
reasonably possible after the loss.’” (Doc. 18 at 8 (quoting Doc. 16-1 at 42).) Third,
Empire argues that the Enclave “has neither ‘actually spent’ the amount of money”
that Island Roofing claims “nor presented . . . evidence of such expense.” (Id. at 9
(quoting Doc. 16-1 at 42).) Fourth, it asserts that the Enclave (through Island
Roofing) breached the policy by submitting allegedly inflated repair estimates and
“precluding the appraisers from relying on the value reflected in the Plaintiff’s
permit documentation or any evidence of money actually spent on repairs.” (Id.)
In its fifth affirmative defense, Empire asserts that the appraisal award is not
enforceable because “the amount of loss calculated includes items not covered under
the Policy” and thus Empire “has not breached the Policy, but has merely exercised
its right to deny the aspects of a claim not covered despite the issuance of an
appraisal award.” (Id. at 10.)
Sixth, it asserts that the award is invalid because the appraisers mistakenly
relied on “inflated pricing and unsupported estimates,” failed to consider “the actual

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cost of the actual repair,” and erroneously calculated an amount of loss that “results
in a windfall [for Island Roofing] if it is enforced.” (Id. at 11.) Seventh, Empire
alleges Island Roofing acted with unclean hands in failing to “provide reasonably
prompt, accurate and complete information . . . concerning the money actually spent
in conducting repairs, and by inflating the prices upon which its repair estimates
relied.” (Id. at 11–12.) Finally, as its eighth affirmative defense, Empire contends
that “the appraisal panel calculated only the value of estimated repair costs and the
[appraisal award] is enforceable, if at all, only as to those costs.” (Id. at 12.)
Island Roofing has now filed a Motion to Confirm the Appraisal Award &
Entry of Summary Judgment based on Empire’s refusal “to issue payment for the
remaining amount of loss [in the appraisal award] in breach of the Policy.” (Doc.
30 at 6.) Though its motion and associated filings address a host of ancillary
issues, Island Roofing relies on two main arguments in support of its position.
(Docs. 42, 43.) First, it maintains that the policy “does not restrict payment to the
amount only spent by the Enclave.” (Doc. 42 at 11.) Second, it claims that the
appraisal award is the appropriate measure of Island Roofing’s damages for
Empire’s alleged breach of the policy. (See id. at 8, 10–14.)
Empire has responded to Island Roofing’s motion and (in the same filing)
cross-moves for summary judgment on its third affirmative defense––that the
“amount actually spent” for repairs under the policy is limited to the Enclave’s
financial liability under the Assignment. (Doc. 37 at 20.) Again, to clarify the
dispositive issue before the Court (see Doc. 48), Empire’s pertinent argument is that

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the appraisal award is not synonymous with Island Roofing’s damages
determination. (Doc. 37 at 10.) Specifically, Empire first argues that the policy’s
Replacement Cost coverage provision limits the amount it is obligated to pay on the
claim. (Id. at 7–8.) Then, it asserts that its obligation under that provision is
tethered to what the Enclave agreed to pay Island Roofing for repairs under the
Assignment, not what Island Roofing spent on repairs. (Id. at 8–9.) The rest of
Empire’s arguments focus on alleged improprieties over Island Roofing’s and the
appraisal panel’s conduct in valuing the claim and issuing an appraisal award. For
example, Empire asserts that the appraisal panel failed to consider evidence of
lower repair estimates and erred in its calculations. (See id. at 11–13.)
To tie up the facts and procedural history, Island Roofing requests a
protective order directed at propounded discovery related to these contentions.
(See Doc. 31.) As the Court will explain, Empire is not entitled to such discovery.
SUMMARY JUDGMENT STANDARD
Summary judgment is appropriate if “the movant shows that there is no
genuine dispute as to any material fact and the movant is entitled to judgment as a
matter of law.” Fed. R. Civ. P. 56(a). The moving party bears the initial burden of
showing the absence of a genuine dispute and may discharge this burden by
“pointing out to the district court . . . that there is an absence of evidence to support
the nonmoving party’s case.” Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986).
The nonmoving party must then come forward with specific facts “to establish the
existence of an element essential to that party’s case, and on which that party will

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bear the burden of proof at trial.” Id. at 322. “In other words, summary judgment
is warranted if a jury, viewing all facts and any reasonable inferences therefrom in
the light most favorable to plaintiffs, could not reasonably return a verdict in
plaintiffs’ favor.” Hale v. Tallapoosa Cnty., 50 F.3d 1579, 1581 (11th Cir. 1995)
(citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)).
DISCUSSION
As a threshold issue, the Court must determine the grounds Empire may
challenge the appraisal award. Because this Court sits in diversity, it must apply
Florida law. Erie R.R. Co. v. Tompkins, 304 U.S. 64 (1938). “[W]here a contract is
clear and unambiguous, it must be enforced as written.” Andersen Windows, Inc.
v. Hochberg, 997 So. 2d 1212, 1214 (Fla. 3d DCA 2008). And Florida courts “may
not rewrite contracts, add meaning that is not present, or otherwise reach results
contrary to the intentions of the parties.” Intervest Const. of Jax, Inc. v. Gen. Fid.
Ins. Co., 133 So. 3d 494, 497 (Fla. 2014) (quotation omitted). It is well established
in Florida that insurers are bound to pay an appraisal award unless they are able to
“avoid[] [it] in some legally recognized way.” Hanover Fire Ins. Co. v. Lewis, 10 So.
297, 303 (Fla. 1891).
For example, an insurer may challenge an appraisal award by asserting “any
coverage defenses which may be available to it.” State Farm Fire & Cas. Co. v.
Licea, 685 So. 2d 1285, 1287 (Fla. 1996). After all, only “[i]f a court decides that
coverage exists” for a claim under a policy will “the dollar value agreed upon under
the appraisal process . . . be binding upon both parties.” Id. at 1287–88 (emphasis

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added). Yet “[w]hile issues concerning coverage challenges are exclusively for the
courts, where an insurer admits there is a covered loss and there is a disagreement
regarding the amount of the loss, the appraisers are charged with determining the
loss.” First Protective Ins. Co. v. Hess, 81 So. 3d 482, 485 (Fla. 1st DCA 2011).
“The division of responsibility between the appraisers and court is therefore clear.
The appraisers determine the amount of the loss, which includes calculating the
cost of repair or replacement of property damaged, and ascertaining how much of
the damage was caused by a covered peril.” Citizens Prop. Ins. Corp. v. River
Manor Condo. Ass’n, Inc., 125 So. 3d 846, 854 (Fla. 4th DCA 2013). “Appraisers
generally are chosen for and expected to act on their own skill and knowledge
relating to the matters being appraised.” Citizens Prop. Ins. Corp. v. Mango Hill
#6 Condo. Ass’n, Inc., 117 So. 3d 1226, 1229 (Fla. 3d DCA 2013). “There is no
obligation for appraisers to give formal notice of their activities to the parties or
counsel, or to hear evidence.” Id.
The Appraisal provision here states that “[i]f there is an appraisal,” Empire
“still retain[s] [its] right to deny the claim.” (Doc. 16-1 at 37.) “The purpose of
[this] ‘right to deny’ sentence is to state, quite simply, that if . . . the insurer
proceeds with the appraisal process, the insurer has not thereby abandoned any
coverage defenses which may be available to it.” Licea, 685 So. 2d at 1287
(quotation omitted).
That said, the policy unambiguously states that “[a] decision [on the value of
the property or the amount of loss] agreed to by any two [appraisers] will be

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binding” on the parties. (Doc. 16-1 at 37.) By its own terms, Empire may not seek
to alter the value of the property or amount of loss determined by the appraisal
panel. To the extent that Empire’s affirmative defenses or discovery requests
target alleged mistakes with the appraisal panel’s rational, the unambiguous
language of the policy means that it must fail. See River Manor, 125 So. 3d at 854
(“An alleged mistake of that nature raises an issue directly related to the ‘amount of
loss’ sustained to the particular property—an issue solely within the province of the
appraisers.”) 2
It is also undisputed that Island Roofing may recover, at most, “the amount
actually spent that is necessary to repair or replace the lost or damaged property.”
(Doc. 37 at 7; Doc. 42 at 8–9 (quotation omitted).) Still, Empire argues that “the
amount actually spent” is only what the Enclave agreed to pay Island Roofing under
the Assignment, which is an amount only up to the policy’s deductible. But if an
assignment is valid, the assignee “stands in [the] shoes” of the assignor and “has the
same rights and status” that the assignor did. Pro. Consulting Servs., Inc. v.
Hartford Life & Accident Ins. Co., 849 So. 2d 446, 447 (Fla. 2d DCA 2003) (citing
Foster v. Foster, 703 So. 2d 1107, 1109 (Fla. 2d DCA 1997)). And, as this Court has
explained, this includes “all rights attendant to work performed (or to be

Because the Court resolves this issue on separate grounds, it declines to
address Island Roofing’s argument that Empire is time-barred from seeking to
modify or vacate the appraisal award under Florida’s Arbitration Code. (Doc. 30 at
7–8 (citing Fla. Stat. § 682.13(2)).) Regardless of the Arbitration Code’s
applicability, Empire may still raise defenses of coverage against the appraisal
award and Island Roofing must demonstrate that its requested relief comports with
the policy’s terms.
2

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performed).” SFR Servs. LLC v. GeoVera Specialty Ins. Co., No. 2:19-CV-466-JLBMRM, 2021 WL 1909669, at *4 (M.D. Fla. May 12, 2021) (citing Florida cases).
Oddly enough, Empire never explains why the appropriate focus is on what
the Enclave spent when the Enclave assigned “any and all insurance rights,
benefits, and proceeds” under the policy to Island Roofing. (Doc. 16-2 at 1
(emphasis added).) Because the Enclave transferred to Island Roofing all rights
and benefits associated with its claim, nothing precludes Island Roofing from
recovering the amount it spent on repairing covered losses. Nor does Empire
identify any policy provision that requires the Enclave, especially after an
assignment of its rights and entitlement to proceeds under the policy, to make the
repairs or replace the insured property. (See Doc. 16-1 at 42.) Thus, to the extent
Empire argues it is only liable for what the Enclave actually spent in repairing the
property, that argument fails. 3

Nor would Empire’s seventh defense of unclean hands prevent this
conclusion. That doctrine applies to equitable actions against “one who has acted
in bad faith, resorted to trickery and deception, or been guilty of fraud, injustice or
unfairness.” In re Kingsley, 518 F.3d 874, 878 (11th Cir. 2008). But suits for
declaratory judgment “are neither inherently legal nor equitable in nature.” Gulf
Life Ins. Co. v. Arnold, 809 F.2d 1520, 1523 (11th Cir. 1987) (quotation omitted).
“When determining whether a declaratory judgment action is legal or equitable,
courts have examined the basic nature of the issues involved to determine how they
would have arisen had Congress not enacted the Declaratory Judgment Act.” Id.
Since Island Roofing is seeking an interpretation of its rights and Empire’s
obligations under the policy to pursue money damages (i.e., recover the appraisal
award or a portion thereof), the Court finds that the dispute is akin to a breach of
contract claim for damages and thus the defense is inapplicable. Put differently,
Island Roofing “does not seek equitable relief (instead, it seeks money damages on
its breach of contract claims). Accordingly, the defense is inapplicable.” Wausau
Underwriters Ins. Co. v. Horizon Staffing, LLC, No. 11-21950-CV, 2012 WL
13012741, at *7 (S.D. Fla. Oct. 12, 2012).
3

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Still, Island Roofing must demonstrate that it is entitled to the entire
appraisal amount before the Court confirms the same. The term “‘[a]ppraisal
award’ is really a misnomer because the appraisal panel only determines the
amount of loss, not an insured’s entitlement to any damages.” Mango Hill, 117 So.
3d at 1227 n.1 (emphasis added). Indeed, “courts have recognized that an
appraisal award does not establish the amounts owed under the policy where (as
here) the award includes language stating that it was made without consideration
of the deductible amount, prior payments, or policy exclusions.” Ford v. Am. Sec.
Ins. Co.s2019 WL 6609239, at *2 (S.D. Fla. Dec. 5, 2019) (emphasis added). Simply
put, an “appraisal award [is] not a damages determination.” People’s Tr. Ins. Co. v.
Espana, 320 So. 3d 940, 944 n.4 (Fla. 3d DCA 2021) (citing Mango Hill, 117 So. 3d
at 1227 n.1.)
Keeping with the above, Island Roofing concedes that “the award may be
reduced to reflect prior payments, the deductible or exclusions – that is not in
dispute.” (Doc. 42 at 8 (emphasis added).) And the Replacement Cost coverage
provision limiting Empire’s payment on the claim to the “amount actually spent” in
repairing the property constitutes just such a reduction. Sands on the Ocean
Condo. Ass’n, Inc. v. QBE Ins. Corp., No. 05-14362-CIV, 2009 WL 790120, at *2
(S.D. Fla. Mar. 24, 2009) (“[T]he award reflects the agreement of the appraisers as
to the amount owed to [p]laintiff based on the evidence of property damage before
them. It does not reflect the amount owed to [p]laintiff under the policy.”). Island
Roofing nevertheless asserts that the appraisal award is coextensive with the

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damages it seeks because “the determination as to the amount spent by . . . Island
Roofing is a determination for the appraisal panel.” (Doc. 42 at 12–13). Empire
counters that “Island Roofing has failed to present any evidence of any amount
actually spent by anyone. Instead, it relies on the appraisal award, as if that were
evidence of actual expenditures.” (Doc. 48 at 8 (emphasis omitted).) The Court
agrees with Empire. Island Roofing is not entitled to confirmation of the appraisal
award at this juncture because it has not met its burden in showing that the award
is the amount it actually and necessarily spent in repairing the property.
Island Roofing cites Marlowe v. Ironshore Specialty Insurance Co., No. 2:18cv-245-FtM-38MRM, 2020 WL 736628, at *1 (M.D. Fla. Jan. 29, 2020), adopted,
2020 WL 736000 (M.D. Fla. Feb. 13, 2020), in arguing that the appraisal award is
now functionally what it “spent to make the repairs” and that “this Court is without
authority to look beyond the face of the Appraisal Award, even if that means the
amounts actually spent might not be resolved.” (Doc. 42 at 13.) Yet Marlowe only
held that the appraisal panel “had the full authority to . . . determine . . . the sum
necessarily incurred as a result of the loss.” Marlowe, 2020 WL 736628, at *5
(emphasis added). In other words, the appraisal panel had the authority to
determine an RCV for the loss.
The focus here, however, is not whether the appraisal panel could determine
an RCV for Island Roofing’s claim, but whether that RCV determination is what
Empire owes on the claim given the policy’s Replacement Cost coverage provision.

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Thus, the appraisal award creates a ceiling for the “amount . . . that is necessary to
repair or replace” the insured property. (Doc. 16-1 at 42 (emphasis added).)
Consider a scenario in which Island Roofing spends $5 million to repair the
property. Given the policy’s Replacement Cost coverage provision, it defies both
logic and the plain terms of the policy (nor does Island Roofing cite authority to the
contrary) to award it the full $10 million appraisal award which only estimates the
RCV of necessary repairs. Alternatively, assume Island Roofing—perhaps through
selecting premium materials and hiring the most skilled contractors—spends $20
million in repairing the property. Then, Island Roofing would be unable to recover
more than the appraisal award because the appraisal panel determined that the
necessary amount to repair the property is only $10 million. The appraisal award
is binding in either scenario, but the Replacement Cost coverage provision
ultimately determines what Island Roofing may claim as damages under the
policy. 4
At bottom, the parties have not shown the absence of a genuine dispute over
Island Roofing’s damages and Empire’s obligations under the Replacement Cost
coverage provision. Island Roofing must demonstrate that the amount it seeks to
recover (e.g., the entire appraisal award) comports with the policy’s coverage

For this reason, Island Roofing’s reliance on First Protective Insurance Co.
v. Hess is also misplaced. 81 So. 3d 482 (Fla. 1st DCA 2011). Hess refused to
allow a trial court “to discern the value of each individual item to which [a policy’s]
limitations could be applied,” not whether the insured was liable for the appraisal
award’s entire amount of loss as issued despite a relevant policy limitation. Id. at
485 (emphasis added).
4

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provision and any relevant exclusions. And Empire must show that the amount
already paid is what Island Roofing actually spent on repairs or the absence of a
genuine dispute on this point. On this record, summary judgment in favor of either
party—absent the limited findings stated in this Order—is inappropriate at this
juncture. Beyond the principles outlined above, the motions are therefore denied
without prejudice for both parties to refile after the conclusion of discovery.
CONCLUSION
For the above reasons, Island Roofing is entitled to summary judgment on
Counts I and II of its Amended Petition to the extent the Court finds that: (1) the
“amount actually spent,” as contemplated by the policy’s Replacement Cost coverage
provision encompasses what Island Roofing actually spent in repairing the insured
property; and (2) Empire may not have this Court substitute its judgment for the
appraisal panel’s calculations and considerations in determining the value of
property or the amount of loss. Furthermore, Empire may not obtain discovery
solely focusing on appraisal panel issues over valuation or amount of loss
determinations.
Because Island Roofing has “fail[ed] to describe the specific judgment sought”
(Doc. 37 at 1) and identifies no evidence suggesting that the appraisal award is
what it is entitled to recover under the Replacement Cost coverage provision, the
remainder of Island Roofing’s motion is due to be denied. The parties may renew
their motions for summary judgment, consistent with this Order, at the close of
discovery. The Court will also entertain motions to extend the remaining pretrial

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deadlines to allow reasonable time for the same. Island Roofing’s motion for a
protective order is due to be granted to the extent that the Court will prohibit
Empire from propounding discovery seeking information about the appraisal panel’s
amount of loss calculations and how that panel arrived at its valuations. Empire
may only seek discovery that supports a coverage defense, not whether the
appraisal panel incorrectly determined the value of an otherwise covered loss—such
determination is binding on Empire under the policy.
Accordingly, it is ORDERED:
1.

Island Roofing’s Motion to Confirm the Appraisal Award & Entry of
Summary Judgment (Doc. 30) is GRANTED IN PART as follows.

2.

The Court enters summary judgment on Counts I and II of its
Amended Petition (Doc. 16) to the extent that: (a) the Court declares
“the amount actually spent” to repair the property (Doc. 16-1 at 42)
includes the amount Island Roofing spent in repairing the insured
property; and (b) Empire may not defend against Island Roofing’s
allegations on the grounds that it believes the appraisal panel arrived
at an incorrect value for losses that are covered under the policy. The
motion (Doc. 30) is DENIED WITHOUT PREJUDICE to the extent
it seeks any greater or different relief than this Order grants.

3.

Empire’s Cross-Motion for Summary Judgment (Doc. 37) is DENIED
WITHOUT PREJUDICE to Empire renewing its arguments in a
subsequent motion consistent with this Order.

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4.

Island Roofing’s Motion for Protective Order (Doc. 31) is GRANTED
IN PART to the extent that any discovery Empire seeks must be
consistent with this Order. The motion is DENIED WITHOUT
PREJUDICE to the extent it seeks any greater or different relief than
this Order grants.

ORDERED at Fort Myers, Florida, on September 19, 2022.

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