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Landers v. State Farm Florida Insurance Co.

Florida Court of Appeals, Fifth District

January 19, 2018



         Appeal from the Circuit Court for Seminole County, Jessica J. Recksiedler, Judge.

          George A. Vaka and Nancy A. Lauten, of Vaka Law Group, PL, Tampa, and Kelly L. Kubiak, of Merlin Law Group, Tampa, for Appellant.

          Matthew J. Lavisky, Anthony J. Russo and Lee Craig, of Butler Weihmuller Katz Craig LLP, for Appellee.


          COHEN, C.J.

         Upon consideration of Appellee State Farm Florida Insurance Company's Motion for Rehearing, we grant the motion, withdraw our prior opinion, and substitute this one in its place.

          In this appeal, we consider whether, when an insurance contract provides for an appraisal process, an insured must wait until that process is completed before filing a civil remedy notice pursuant to section 624.155, Florida Statutes (2008). Because we find no such limitation in the statute or relevant case law, we reverse.

         In 2009, Phillip Landers's home sustained a loss from suspected sinkhole activity. He submitted a claim to his insurer, State Farm Florida Insurance Company ("State Farm").[1] State Farm hired SDII Global Corporation ("SDII") to conduct a subsidence investigation. SDII verified that sinkhole activity was the cause of the damage, and State Farm admitted coverage. SDll initially concluded that 975 cubic yards of grout needed to be injected into forty-nine holes around the home's perimeter. SDII did not recommend underpinning. After considering the report of a neutral evaluator from the Department of Financial Services pursuant to section 627.7074, Florida Statutes (2008), SDII amended its report to require an additional fifteen grout injection points.

         Landers obtained an independent opinion from Biller Reinhart Structural Group ("Reinhart"). In Reinhart's opinion, proper stabilization required underpinning.[2] State Farm provided Reinhart's report for review by the neutral evaluator. The neutral evaluator concluded that underpinning was unwarranted. While State Farm demanded appraisal under the policy to resolve the parties' disagreement over the amount of the loss, [3] Landers agreed, pursuant to the terms of the insurance contract, to proceed with SDll's recommended repair plan, despite his belief that the repairs were inadequate. State Farm placed its appraisal demand on hold while the stabilization repairs were made. Further appraisal would be required to address cosmetic repairs to the home.

         After the repairs were completed in September 2011, State Farm reiterated its request for appraisal of the cosmetic damage to the home. The home continued to experience damage after repairs were completed. As a result, Landers hired Sonny Gulati, a geotechnical engineer, to examine the property. In January 2012, while Gulati's report was pending, Landers filed a civil remedy notice ("CRN"), alleging, among other things, claim delay, failure to promptly and properly investigate the claim, failure to adjust the loss, and the failure to tender policy limits. Landers contended that the repairs were completed pursuant to State Farm's expert's recommendation, yet his home remained unlivable. Landers demanded the immediate tender of "the policy limits for dwelling . . . of $1, 026, 500.00 minus any prior payments that have been made to the insured . . . so that [Landers] may adequately complete the repairs [he] has started to [his] home." In response, State Farm requested that all issues be submitted to appraisal.

         In March 2012, Landers brought suit against State Farm for breach of contract. In that suit, State Farm sought to compel appraisal, which Landers opposed. The circuit court compelled appraisal, and Landers appealed from that order. This Court affirmed. Landers v. State Farm Fla. Ins. Co., 149 So.3d 33 (Fla. 5th DCA 2014). In July 2014, the appraisal panel determined that the amount of loss exceeded the policy limits. State Farm tendered the policy limits in August 2014, without any deduction for the amounts previously paid.

         Landers then brought the underlying first-party bad-faith suit against State Farm, alleging ten purported violations of sections 624.155(1)(b)(1) and 626.9541(1)(i), Florida Statutes (2008), including allegations of claim delay and low-balling. Landers contended that his damages always exceeded the policy limits and that State Farm acted in bad faith by delaying payment of the policy limits until after appraisal.

         State Farm moved for summary judgment. State Farm asserted that when Landers filed the CRN, "there was no contractual amount due and no damages owed under the contract" because a condition precedent to payment-determining the amount of loss through appraisal-had not been fulfilled. Therefore, the CRN was not valid and Landers had no claim. The trial court granted summary judgment, but the order granting summary judgment contained no explanation, findings of fact, or conclusions of law.[4] This appeal followed.

         This Court reviews orders granting summary judgment de novo. Volusia Cty. v. Aberdeen at Ormond Beach, 760 So.2d 126, 130 (Fla. 2000). The issue presented on appeal is primarily a question of law: whether the insurer's demand for appraisal tolls the filing of a CRN until the amount of the appraisal has been established. State Farm asserts the CRN was void because Landers's claim was not yet ripe.[5]

         Bad-faith claims are governed by section 624.155, Florida Statutes (2008). Section 624.155(1) provides that:

(1) Any person may bring a civil action against an insurer when such ...

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