It is not uncommon these days to see an Examination Under Oath (“EUO”) provision (usually by way of endorsement) that reads along these lines:
You, an ‘insured’ seeking coverage, must submit to recorded statements and examinations under oath, while not in the presence of any other ‘insured’, and sign the same. Also, your representative, including any public adjuster engaged on your behalf, must each submit to recorded statements and examinations under oath, while not in the presence of any other ‘insured’, and sign the same. The legal representative of the insured may always be present under the circumstances described in this condition.
And then “insured” is usually defined like this: “‘Insured’ means you and residents of your household who are: a. Your relatives; or b. Other persons under the age of 21 and in the care of any person named above.”
On Wednesday, I encountered a carrier that, in my opinion, took a legally untenable position as to who could sit in on certain EUOs. More specifically, the carrier argued that, pursuant to the above EUO condition, a public adjuster could not sit in on the insured’s EUO. “Legally untenable,” in my opinion, because unambiguous policy language is to be plainly read and is not to be broadened.1 If plainly read and not broadened, the above condition makes clear that an insured cannot be present during a public adjuster’s EUO and one insured cannot be present during another insured’s EUO, but the above condition says nothing about a public adjuster not being able to sit in on an insured’s EUO.
So, what do you do when you encounter a carrier who takes the untenable position that I speak of? It depends on personal preferences and / or the particulars of your claim, but, in my opinion, here are the two choices if the carrier does not relent; i.e., if the carrier refuses to conduct the insured’s EUO because of the public adjuster being present. Choice Number One: object to the carrier’s position on the record, note on the record that your relenting to the public adjuster not being present during the insured’s EUO is not to be construed as some sort of concession as to the propriety of the carrier’s position, and note on the record that the carrier’s position is a breach of the insurance contract. If you subsequently end up in a lawsuit, I believe the carrier’s improper position could come back to hurt it (remember, for example, the contractual doctrine that party number one to a contract cannot insist on party number two’s compliance with contractual provisions after party number one breaches the contract). Choice Number Two: file a Declaratory action. In the Declaratory action, the court should find Nawaz highly instructive and come down in your favor for the same or similar reasons the Fourth District Court of Appeal came down in Nawaz’s favor.2 Then the carrier should be made to pay your attorney’s fees and costs pursuant to Section 627.428 of the Florida Statutes.
To read previous posts in my series on insurance policy conditions, click here.
1 See, e.g., Nawaz v. Universal Prop. & Cas. Ins. Co., 91 So. 3d 187 (Fla. 4th DCA 2012).
2 In the Dec action, you might also ask the court to declare that the carrier’s untenable position constituted a breach of contract and such breach excuses the insured from the carrier’s every whim (e.g., the carrier’s request to produce scores of irrelevant documents). If the court so declares, I’d imagine the carrier would be left with little practical choice other than the choice to just pay the claim.