One of the many questions faced by the Florida Supreme Court is whether the lawmakers who drafted the statutory scheme which created Citizens Property Insurance Corporation intended to grant the insurance carrier immunity from liability for bad faith causes of actions. Not surprisingly, the issue came up during oral argument last week when Perdido Sun Condominium Association’s counsel noted,
It is clear to me, from a full reading of the Citizens Statute that the Legislature was out to help the individuals. And they make it clear that they don’t want those individual insureds of Citizens to be in any worst situation than a private insured.
The statutory provision alluded to by Perdido’s attorney is Section 627.351(6)(a)(4), which states:
4. It is the intent of the Legislature that policyholders, applicants, and agents of the corporation receive service and treatment of the highest possible level but never less than that generally provided in the voluntary market. It is also intended that the corporation be held to service standards no less than those applied to insurers in the voluntary market by the office with respect to responsiveness, timeliness, customer courtesy, and overall dealings with policyholders, applicants, or agents of the corporation.
As noted later on by Chief Justice Labarga, the First District Court of Appeals cites to this statutory language as part of the reasoning of its holding1 (which is the subject of the Florida Supreme Court’s review):
In light of the definitions of "willful" and "tort," and considering that Citizens, while not a private insurance company, is nonetheless charged by the legislature to provide affordable property insurance to policy holders and to serve the policy holders at "the highest possible level but never less than that generally provided in the voluntary market," (§ 627.351(6)(a)(4), Fla. Stat.), the "willful tort" exception to Citizens’ immunity from suit allows Citizens’ to be sued for the statutory civil remedy provided in section 624.155(1)(b).
Frankly, as I was watching the Justices reaction to each party’s oral argument, it was difficult for me to tell which position they seemed to agree with. For example, at one point Justice Pariente candidly notes, "I’m with you on wanting this to be something that’s imposed on Citizens, but we can’t do it in the absence of the legislature not doing it." Justice Canady similarly explained, "I understand your position, but I’ll be interested to look back in your brief and find the specific textual provision that says that there is an identical treatment of Citizens policyholders with private company policyholders. Then I’d be interested to see how that squares with what we’ve been looking at here." What the Florida Supreme Court Justices decide is the answer to this question may very well determine the outcome of this hotly debated case.