United States District Court, M.D. Florida, Tampa Division
D. MERRYDAY UNITED STATES DISTRICT JUDGE
April 19, 2014, a vagrant torched a building co-owned by
Robert and Fred Fox. The Foxes submitted a claim to Starr
Indemnity & Liability Company, which insured the building
under a policy that covered “fire loss.”
(See Doc. 2 at 41-90, the insurance policy)
Dissatisfied with Starr's purported tardiness in
tendering $1, 057, 192.56 (the building's estimated
damage, according to the Foxes' contractor), on September
9, 2014, Fred Fox filed a “Civil Remedy Notice”
with the Florida Department of Financial Services. (Doc. 2 at
93-95, the notice) In a response to the department, Starr
argues that the notice fails to identify with specificity a
violation of Florida law and fails to identify with
specificity a policy term breached by Starr. (Doc. 2 at
96-97, Starr's response)
accord with the contract's appraisal provision (Doc. 2 at
62), each party selected an appraiser, and the two appraisers
selected an umpire. (Doc. 2 at ¶ 14) On May 12, 2016,
the appraisal panel awarded the Foxes $930, 041.36 for the
building's damage. (Doc. 2 at ¶ 15)
that Starr violated fourteen duties imposed by Florida law,
the Foxes sue (Doc. 2) Starr under Section 624.155 for bad
faith. Starr moves (Doc. 4) to dismiss the
bad-faith claims for failure to state a claim for relief and
for the lack of particularity in a fraud
state a bad-faith claim, the plaintiff first must prevail on
a breach-of-contract claim.
Florida common law provides no cause of action for an
insured's bad-faith claim against his insurer, Section
624.155 permits a first-party bad-faith claim. The typical
first-party bad-faith claim alleges that the insurer failed
to pay timely the insured's demand or failed to
investigate adequately the insured's claim.
matter how unfair the insurer's conduct, a respect for
the parties' bargain precludes the judiciary's
rewriting a contract to add a term not agreed by the parties.
As QBE Ins. Corp. v. Chalfonte Condo. Ass'n,
Inc., 94 So.3d 541, 548 (Fla. 2012), explains:
A duty of good faith must “relate to the performance of
an express term of the contract and is not an abstract and
independent term of a contract which may be asserted as a
source of breach when all other terms have been performed
pursuant to the contract requirements.”
94 So.3d at 548 (quoting Ins. Concepts and Design, Inc.
v. Healthplan Serv's, Inc., 785 So.2d 1232, 1235
(Fla. 4th DCA 2001) (per curiam) (internal citation
omitted)). If an insured cannot allege success on a
breach-of-contract claim, the insured's bad-faith claim
must fail. See, e.g., QBE Ins.
Corp., 94 So.3d at 548; Progressive Am. Ins. Co. v.
Rural/Metro Corp. of Florida, 994 So.2d 1202, 1207-08
(Fla. 5th DCA 2008) (Pleus, J.) (“There can be no cause
of action for a breach of the implied covenant [of good
faith] absent an allegation that an express term of the
contract has been breached.”) (citing Snow v. Ruden
et al., 896 So.2d 787, 791-92 (Fla. 2d DCA 2005)
Porcelli v. Onebeacon Insurance Co., 635 F.Supp.2d
1312 (M.D. Fla. 2008) (Porcelli II ) and Canales
v. Am. Sec. Ins. Co., 2011 WL 5358753 (M.D. Fla. 2011),
the Foxes argue that a bad-faith claim need not allege a
breach of contract. But Porcelli II (on which
Canales relies) “take[s] judicial
notice” of Porcelli I, which holds that
Onebeacon breached a contract with Porcelli. Porcelli
II, 635 F.Supp.2d at 1315 (noticing the judgment in
Porcelli I, 2:02-cv-303 (M.D. Fla. Sept. 20, 2005)).
Porcelli II subverts the Foxes' argument.
the Foxes cite Cammarata v. State Farm Florida Ins.
Co., 152 So.3d 606 (Fla. 4th DCA 2014) (per curiam),
which holds that an appraisal award entered under an
insurance policy might establish “liability.” But
Cammarata misapplies Blanchard v. State Farm
Mut. Auto. Ins. Co., 575 So.2d 1289 (Fla. 1991), which
states that “a determination of . . . liability”
must precede a bad-faith claim. Blanchard's
statement that a bad-faith claim must allege the earlier
determination of liability means the earlier determination of
liability for the defendant's breach of contract. And an
award entered in accord with an appraisal provision fails to
establish liability for a breach of contract. See Hill v.
State Farm Florida Ins. Co., 35 So.3d 956, 959 (Fla. 2d
DCA 2008) (Altenbernd, J.) (“[A]ppraisal is not a
process to resolve a breach of contract claim . . .
[a]ppraisal is a method of adjusting a claim within the terms
of the insurance contract.”). Rather than show a breach
of contract, the payment of an appraisal award shows a
defendant's compliance with a contract.
citing an earlier action or an arbitration that establishes
Starr's liability for breach of contract, the complaint
alleges that Starr's violation of fourteen duties
purportedly imposed by Florida law “demonstrates
Defendant's failure to comply in good faith with the
terms and conditions of the [p]olicy.” (Doc. 2 at
¶ 23) Because no facts support the conclusory allegation
that Starr breached the contract, the bad-faith claims
warrant dismissal under Rule 12(b)(6).
the complaint fails to allege facts that show the violations
of Florida law in ¶ 23. See Bell Atlantic Corp v.
Twombly, 550 U.S. 544, 555 (2007) (explaining that a
claim must allege facts ...