As a follow up to my colleague, Shaun Marker’s series, In Florida, An Appraisal Award May Be A Final Determination Of Liability For A Bad Faith Case, posted August 30, September 8, and September 15, 2014, I wanted to take a moment and highlight the cases that have come out since Cammarata v. State Farm Florida Insurance Company,1 that further underscore the principle that a first party property bad faith suit can be ripe absent an actual finding that the insurer breached the contract.

To recap, in Cammarata, the trial court granted summary judgment for State Farm based on its finding that a bad faith claim was not ripe before a determination of liability for breach of contract. In reversing the trial court, the Fourth District Court of Appeal (“DCA”) found that the key issues that must be determined as a pre-requisite for bad faith were not the insurer’s liability for breach of contract, but instead, liability for coverage and the extent of damages. It further expanded the rule of law from Hunt v. State Farm Florida Insurance Company,2 in finding that even a settlement during the appraisal process served as a determination of liability and extent of damages to be able to bring a bad faith case.3

Since then, the Fifth DCA has followed the above opinions, addressing the issue once again in Barton v. Capitol Preferred Insurance Company.4 In Barton, the court held that the insurer’s payment of $65,000 to settle the Bartons’ breach of contract claim relating to their sinkhole claim was a determination of liability and constituted a favorable resolution for the insureds, as required for the insureds to bring a bad faith claim, reversing summary judgment for Capitol on the Bartons’ first party bad faith complaint. This was even though the $65,000 was less than the insurance policy limits and less than the amount that insureds initially demanded.

Capitol raised the argument that because it settled for an amount less than policy limits or the amount initially demanded by the Bartons, there was no determination of liability or extent of damages. The Fifth DCA rejected that argument, however, finding that “Section 624.155 [of Florida’s bad faith statutes] authorizes an insured to bring a first-party bad-faith action where the insured has been damaged by the insurer’s failure to comply with certain enumerated statutory provisions,” and noting further, “that the statute does not condition the right to bring an action on the insured’s recovery of the policy limits or an amount equal to or greater than its initial demand in the underlying action.”5

This argument by an insurance company was also rejected by the Third DCA in American Integrity Insurance Company v. Torres,6 where American Integrity petitioned the appellate court for writ of certiorari on the issue, but was unsuccessful, as the court denied the petition without opinion, but simply cited to Cammarata. This, as with Cammarata, was a case handled by Merlin Law Group, P.A.’s own Kelly Kubiak,7 this time, alongside Tom Elligett as appellate counsel.
1 Cammarata v. State Farm Fla. Ins. Co., 152 So. 3d 606 (Fla 4th DCA 2014), review denied, 171 So. 3d 120 (Fla. 2015).
2 Hunt v. State Farm Fla. Ins. Co., 112 So. 3d 547 (Fla. 2d DCA 2013)(Where the Second DCA found that an appraisal award satisfied the favorable-resolution condition precedent for bringing bad-faith action)
3 Cammarata, 152 So. 3d 606.
4 Barton v. Capitol Preferred Ins. Co., Inc., 208 So. 3d 239 (Fla. 5th DCA 2016).
5 Id. at 244-245 (bracketed material added).
6 American Integrity Ins. Co. v. Torres, No. 3D14-0685, 2016 WL 8609396 (Fla. 3d DCA Aug. 30, 2016).
7 Appellate Counsel George Vaka assisted Kelly Kubiak with Cammarata.