Kelley Kronenberg - In the Know - First Party Property Appellate - May 2023

IN THE NOW

FIRST- PARTY PROPERTY APPELLATE EDITION

IN THIS ISSUE:

• Compliance with section 627.7152, Florida Statutes

• Judgment Notwithstanding the Verdict

• Application of Exclusions

FIRST-PARTY PROPERTY APPELLATE TEAM

ADMISSIONS

Florida • Georgia • United States Court of Appeal, Eleventh Circuit

SELECTED OPINIONS

For any questions, please contact:

Jeffrey M. Wank Chair of First-Party Property and Insurance Coverage

Fort Lauderdale

T: (954) 370-9970

jwank@kklaw.com

w Expert Inspections, LLC d/b/a ITest d/b/a Moldexpert.com a/a/o Pat Beckford v. United Property & Casualty Insurance Company, 333 So.3d 200 (Fla. 4th DCA 2022) (holding that an insurer cannot be required to follow the terms of an AOB contract where the insurer is not a party to that contract).

w The Kidwell Group, LLC d/b/a Air Quality Assessors of Florida a/a/o Maria Amadio v. Olympus Insurance Company, Case No. 5D21-2955 (Fla. 5th DCA July 22, 2022) (interpreting section 627.7152, F.S., as applying to AOB contracts executed after the enactment of the statute, finding the policy inception date irrelevant to the analysis).

Kimberly J. Fernandes Partner Tallahassee | Atlanta

T: (850) 577-1301

kfernandes@kklaw.com

w Saunders v. Florida Peninsula Insurance Company, 314 So.3d 592 (Fla. 3d DCA 2020) (interpreting the “faulty workmanship” policy exclusion to include the workmanship process as well as the finished product in affirming the insurer’s denial of a property damage claim).

w The Kidwell Group, LLC d/b/a Air Quality Assessors of Florida a/a/o Benjamin Kivovitz, Case No. 4D21-2843 (Fla. 4th DCA June 15, 2022) (enforcing the new section 627.7152, F.S., requirement of including a line-item estimate with an AOB contract at the time of execution)

ADMISSIONS

Florida • U.S. District Court, Northern District of Florida • U.S. District Court, Middle District of Florida

SELECTED OPINIONS

w Progressive American Insurance Company v. Glassmetics, LLC, No. 2D21-488, 2022 WL 1592154 (Fla. 2d DCA 2022) (“we reverse the trial court’s order and its conclusions (1) that the appraisal provision was against the public policy underlying section 627.428; (2) that the appraisal provision failed to provide sufficient procedures and methodologies; (3) that Progressive waived its appraisal right; (4) that the appraisal provision was unenforceable because Progressive failed to prove that the insured knowingly, voluntarily, and intelligently waived his rights of access to courts, to a jury trial, and to due process; and (5) that the appraisal provision contains an ambiguity.”).

Daniel Montgomery Partner Jacksonville

T: (904) 549-7700

dmontgomery@kklaw.com

w All Auto Glass v. Progressive American Ins. Co., Case No. 2018-SC-3126, 2019-33-AP (Fla. Seminole Cnty. Appellate Division.) (“reversing trial court, holding ruling of district court of appeal in jurisdiction other than where trial court is located is binding upon trial court absent conflict with another district court of appeal. )

w Progressive Am. Ins. Co. v Broward Ins. Recovery Ctr., LLC, 322 So. 3d 103 (Fla. 4th DCA 2021) (“reversing trial court, holding prohibitive cost doctrine inapplicable to appraisal”).

ADMISSIONS

Louis Reinstein Partner Fort Lauderdale

T: (954) 370-9970

lreinstein@kklaw.com

Florida • District of Columbia

• United States District Court, Southern District of Florida

• United States District Court, Middle District of Florida • United States District Court, Northern District of Florida • United States Court of Appeals, Eleventh Circuit Supreme Court of the United States

SELECTED OPINIONS

w Taffe v. Wengert, 775 F. App’x 459 (11th Cir. 2019) (reversing the denial of summary judgment in the district court for the sheriff and finding the sheriff was not negligent in the hiring, supervision, or retention of deputy sheriff)

w Taffe v. Wengert, 140 S. Ct. 1106, 206 L. Ed. 2d 179 (2020) (Petition for writ of certiorari to the United States Court of Appeals for the Eleventh Circuit denied).

w Williams v. Tony, 319 So. 3d 653 (Fla. 4th DCA 2021) (holding the plaintiff inmate was not an intended third-party beneficiary of the contract between county sheriff and inmate medical services provider, and, thus, could not pursue a negligence claim against provider based on the contract).

w People’s Tr. Ins. Co. v. Progressive Express Ins. Co., 336 So. 3d 1207 (Fla. 3d DCA 2021) (holding the commercial automobile liability policy excluded coverage for property damage caused by improper operation of mobile crane mounted on a truck).

w Watkins v. Pinnock, 802 F. App’x 450, 454 (11th Cir. 2020) (holding that the plaintiff’s proposed amendments could not cure the deficiencies in the fifth amended complaint as the factual allegations did not support deliberate indifference by the nursing staff).

Compliance with section 627.7152, Florida Statutes

MVP PLUMBING, INC. etc., v. CITIZENS PROPERTY INS. CORP., No. 3d22-1219 (April 26, 2023)

BACKGROUND:

KK TAKEAWAY:

A single line item meets the standard for a written itemized, per-unit cost estimate.

KK TAKEAWAY:

The key is whether there were more services contemplated or if it was actually the only service (e.g., pipe inspection).

The trial court dismissed MVP’s Complaint seeking benefits for $750 for a single service, pipe inspection as an assignee of benefits under section 627.7152, Florida Statutes. The Third District Court of Appeals reversed and remanded the trial court dismissal holding that the single item listing on the assignment of benefits was compliant as it was the only service provided. Of note, the Third District Court of Appeal made note that the deficiency was not not part of the challenge raised in the Motion to Dismiss although the trial court’s basis for dismissal.

Judgment Notwithstanding the Verdict

CITIZENS PROPERTY INS. CORP., v. LLUNAILY HERNANDEZ, 4d212469 (April 12, 2023)

reviewed 173 photographs and concluded that there was no evidence to support wind damage. He opined that the cracked tiles were from foot traffic and pointed out the prior repairs.

As to the interior, he did not believe the ceiling spots were water damage. His position was that if the roof leaked, there would have been more damage to the ceiling. Citizens also had an adjuster testify who did not observe any damage to the attic ceiling or any missing tiles from the roof.

KK TAKEAWAY:

For a judgment notwithstanding a verdict, there must be no evidence or inferences which support the opposing party’s position

KK TAKEAWAY:

Findings of prejudice or bias are questions to be raised through a motion for a new trial, not judgment, notwithstanding a verdict.

BACKGROUND:

This is a Hurricane Irma claim in which coverage was denied. At trial, the public adjuster testified to Hurricane damage to the tile roof allowing for water entry. The Insured also had an engineer testify who opined that, to a reasonable scientific certainty, the interior water damage resulted from water entry through the damaged roof.

Citizens relied on two engineers, one who conducted a site inspection and one who only formed opinions based on the information provided. The inspecting engineer denied that ceiling spotting was water damage. The reviewing engineer (“causation expert”)

At the close of the case, Insured moved for a directed verdict arguing that Citizens failed to meet its burden of proof to establish that interior damages were excluded by failing to show that there was no roof opening. The trial court reserved ruling.

After deliberations, the jury returned a verdict in favor of Citizens. The Insured’s counsel renewed the motion for a directed verdict based on a lack of evidence and the failure to meet the burden of establishing an excluded loss. The trial court noted that this was either a motion for a new trial or a motion for judgment notwithstanding the verdict.

The trial court then questioned Citizen’s counsel regarding the cross-examination of the Insured. There was a pre-trial ruling that Citizens could not bring up a prior insurance claim. Citizen’s counsel advised that the Insured opened the door. The trial court then raised concern that the causation engineer referred to his opinions as “our” opinions when the inspecting engineer was not a testifying

expert. The causation engineer did clarify during testimony that since the work came out of the same firm, they standard call it “our.” The trial court found this to be improper bolstering and a violation of the pre-trial order. The trial court also took issue with the fact that the causation expert testified to seeing water damage but did not see roof damage. Citizen’s counsel argued that this was a credibility analysis to be determined by the jury.

The trial court granted Insured’s motion for judgment, notwithstanding the verdict, due to concern of violation of court orders. The trial court expressly found that the verdict was reached based on prejudicial evidence and caused bias. The trial court also found that the underlying facts did not support the expert’s testimony.

In review, the Third District Court of Appeals clarifies that the policy language placed the initial burden upon the Insured to establish that a wind-created opening allowed rain to enter the building, causing interior damage. The trial court concerned itself with the fact that the causation expert did not consider the Insured’s testimony to establish that tiles were missing. However, the causation expert opined that prior repairs were pre-dating the loss. The Third District Court of Appeals held this was sufficient to establish a jury issue precluding judgment notwithstanding a verdict.

The trial court’s order was not a judgment notwithstanding the verdict but a sanction for pre-trial order violations. However, the trial court did not enter an order for sanctions, and it is not the reviewing court’s role to interpret something other than what it states.

The issues the trial court raised were improper for a judgment notwithstanding a verdict. The prejudice and bias should have been addressed via a motion for a new trial. The Third District Court of Appeals overturned the order and remanded for entry of judgment in favor of Citizens.

Application of Exclusions

FLORIDA FARM BUREAU GEN. INS. CO. v. JOHN WORRELL and JOYCE WORRELL, No. 5D21-3196, (April 28, 2023)

KK TAKEAWAY:

Policy exclusions must expressly exclude coverage otherwise, all interpretations will be rendered in favor of the insured.

KK TAKEAWAY:

Bodily fluids are not pollutants

BACKGROUND:

Insureds filed a claim for cleaning services for their property. An intoxicated and injured person broke into their shed, leaving behind blood and feces. The intoxicated individual was later found dead outside of a neighboring home.

The Insureds contacted a restoration company to clean the shed. Florida Farm denied coverage as it was the result of a pollution exclusion. The trial court granted summary judgment finding that the pollutant exclusion did not apply, thus, the Insureds were entitled to judgment as a matter of law.

The Fifth District Court of Appeals upheld the trial court finding solely on the issue of the blood as it was not a pollutant, nor did it equate to waste. Given that the blood was not a pollutant, the District Court did not consider the feces other than the fact that the policy had no anti-concurrent causation exclusion for the pollutant exclusion, thus, coverage for the blood triggered a covered loss.

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