Appraisal Ordered Where Insurer's Demand Found Timely---And No Appraisal if No Adjustment
Sandy Burnette won an appeal and had a matter remanded for appraisal. In American Capital Assurance Corp v. Courtney Meadows Apartment, 35 Fla. L. Weekly D802a (Fla. 1st DCA April 7, 2010), the court held:
[T]here is no language in the policy that requires appraisal to be invoked, if at all, within any set time from receiving or waiving the sworn proof of loss. Thus, under the terms of the instant policy, the insurer's demand for appraisal was not untimely. Furthermore, the insurer has not waived its right to appraisal as it has not acted inconsistently with that right from the time of demand...
Accordingly, because the insurance contract provided for appraisal, the insurer's demand for such was not untimely, and the insurer did not waive its right to appraisal, the trial court erred in partially denying the motion to compel appraisal.
Given the facts of the case, this ruling is not earth shattering. What will create a great deal of litigation and a lot of gamesmanship during the adjustment of claims is the following language of the decision:
Furthermore, granting appraisal of the items of loss in the insured's cross-appeal was premature as those items had yet to be adjusted. Without adjustment, it is impossible to know whether the parties disputed the amount of loss to warrant appraisal. See United States Fidelity & Guar. Co. v. Romay, 744 So. 2d 467, 469-70 (Fla. 3d DCA 1999).
What exactly does that mean? I anticipate that claims will drag on forever, as insurers will claim that the actions of the parties have not concluded in an "adjustment." Investigations already seem delayed and unnecessarily long from the policyholder's standpoint. Now, insurers can argue that various portions of a claim are not ripe for appraisal or litigation because they have not been "adjusted."
Nowhere in the policy does it require that the entirety of every item claimed must be "adjusted" before an appraisal is demanded or a lawsuit filed. All that has to happen to trigger appraisal is a disagreement on "the amount of loss." It would seem that here, where the insurer has had notice of the loss and after five months the parties could not agree upon "the amount of loss," even after a settlement meeting and a check was issued for the undisputed amounts, everything in dispute or which could be at issue should be determined through appraisal, if timely demanded and not waived. I disagree with the second quoted portion of this decision.
This decision will certainly lead to greater delays and nitpicking of issues by insurers wishing to drag out the time when resolution of amounts of loss will be determined.
The following scenario should result in immediate summary judgement for the insured: The insurer spends an amount equal to or greater than the value of the claim IN THE ATTEMPT TO DENY OR DELAY THE CLAIM.
Mark,
I can appreciate your comment. Some insurers, not all, simply investigate and wear down claimants. Many get the claims paid and nobody hears about those claims.
I do think that the policyholder should cooperate and the parties work together to resolve a claim before appraisal or a lawsuit is filed. But after five months, the insurer if it has the proper standards to adjust the loss, should have uncovered all the damages and paid for items the policyholder may not even have thought of assuming there is an honest and cooperative attitude.
Chip
Why could this not be considered a two-edged sword.?
I have a case in process where insurers have demanded appraisal and they are far far short of the mark to include all damages. It is my thoughts that to allow items of obviously owed damages to be included in the appraisal process to be punitive to the entitlement of the insured. It is almost like, we have to go to appraisal to see what to take to appraisal and what should be paid as undisputed damages in my case.
A question to be considered is, "Would the insured be entitiled to interest (subject to the 90 day rule) on any sums found to be due, after the adjournment of the appraisal forum, from the date of loss until paid?"
Bill Cook