Archives for December 2012

Florida Condominium Hurricane/Storm Insurance Claims – Which Statute of Limitations is Applicable to my Property Loss?

Florida Condo Hurricane Damage Insurnance Claims_fightsforyou.netSo your a South Florida Homeowner who just sustained property damage as a result of a Hurricane or severe windstorm, you make a claim to your insurance company, and they either delay your claim, provide a low offer or estimate, or they deny your claim all together. As a result, you reach out to a Miami Hurricane and Storm insurance claim lawyer, asking how long do you have to file a lawsuit for breach of your insurance contract.  The answer is not so clear, although the cases referenced below suggest the statute that applies is the one in effect at the time that the policy was executed (which seemingly would be prior to the date of the loss).

As I discussed in my previous post regarding the changes in Florida law in 2011, the statute of limitations and statutory notice requirements changed for property damage and/or Hurricane/windstorm losses that occurred after May 17, 2011.  According to the current version of Florida Statute §95.11(2)(e), if you sustain a property loss on or after May 17, 2011, the Statute of Limitations for filing lawsuits on all property insurance claims (for breach of insurance contracts) is five (5) years from the date of the property loss.  Before this law went into effect, under §95.11(2)(b) a Florida homeowner could bring a lawsuit within five years from the date the last element of their breach of insurance contract cause of action accrued, ie., at the time the insurance company wrongfully denied the claim (via a denial letter) or when an undervalued/low-ball estimate was given.  Sometimes, a denied claim could have occurred over five years after the loss, wherein under the old statute, you could still file a breach of contract claim against your property insurer so long as it was filed within five years of the breach.

After the statute of limitations law changed in 2011, a number of lawsuits have been filed since then wherein the suit was filed more than five years after the property damage occurred.  In these suits, the insurance company moved to dismiss the claim based on an argument that the the new statute applied, ie., the one which says a lawsuit must be filed within five years of the Hurricane loss. However, in these cases, the court concluded that the new statute would not apply retroactively, and thus for storm losses such as Hurricanes Katrina, Wilma, Jeanne, Charlie and Frances, the statute that applied was §95.11(2)(b) (statute in effect at the time the applicable policy was executed) which provided that suit for breach of an insurance contract was to be brought within five years of the breach.

The most recent case to come out is Olear Organization, Inc. v. North Pointe Ins. Co., 2012 WL 5471789 (M.D. Fla. November 9, 2012).  In this case, an Orlando, Florida, homeowner sustained property damaged by Hurricane Charley on August 13, 2004, as well as by Hurricane Frances on September 5, 2004. The insurance company acknowledged coverage for both Hurricanes, and made partial payments under each claim under separate claim numbers. The plaintiff homeowner, however, claimed that two policy limits are available for two separate losses and that the defendant insurer has breached the policy by failing to pay for all of the losses. The homeowner thus brought suit for declaratory relief, breach of contract, etc. The insurance company moved to dismiss the Hurricane claims based on the fact that these claims were brought more than five years after the loss, ie., under the current limitations period applicable to property damage losses. The Middle District of Florida ruled that Florida Statute §95.11(2)(e), which now requires suits to be brought within five years of the date of loss (ie., the date a Hurricane strikes), was enacted on May 17, 2011, and is not to be applied retroactively. The Middle District noted that the statute to apply was the one in effect at the time the applicable policy was executed, ie., the policy in effect at the time of the loss.  See, e.g., Menendez v. Progressive Exp. Ins. Co., Inc., 35 So.3d 873, 876 (Fla. 2010)(“We look at the date the insurance policy was issued and not the date that the suit was filed or the accident occurred, because `the statute in effect at the time an insurance contract is executed governs substantive issues arising in connection with that contract.'”).  The Middle District based its decision off a couple previous decisions, one of which was a Southern District Court decision named West Palm Gardens Villas Condominium Ass’n, Inc. v. Aspen Specialty Ins. Co., 2012 WL 3017083 (S.D. Fla. June 25, 2012).

In West Palm Gardens Villas Condominium Association, the condominium sustained property damage in Hurricane Wilma.  After the insurance company felt that the damage was below the condo’s deductible, the condominium association disputed that the damages were below their deductible and invoked the insurance policy’s appraisal clause in order to resolve the apparent disagreement over the actual amount of the loss. The appraisal clause allegedly requires Aspen to take certain actions in compliance with the clause within twenty days of its invocation in order to finalize the appraisal process, which Aspen allegedly failed to do. Specifically, West Palm alleged that Aspen failed to name its appraiser and proceed with the appraisal process, all allegedly in breach of the Policy. The condo association subsequently brought suit for declaratory relief and breach of the insurance contract,  alleging that Aspen failed to comply with the appraisal process and that they denied coverage for the loss on October 13, 2011. Of note, the suit was brought on October 31, 2011, within five years of the alleged breach of contract.  The insurance company claimed that the claims were barred by the current statute of limitations applicable to property loss claims, namely Florida Statute §95.11(2)(e), which requires lawsuits to be brought within five years of the loss. The Southern District held that Florida Statute §95.11(2)(e) does not apply retroactively, and that §95.11(2)(b) applied at the time of this loss (which required suits to be brought within five years of the breach of contract).

Moral of the Story: Whether you are a homeowner that lives in Ocala, Delray Beach, Vero Beach, Stuart, Boynton Beach, Naples, Port Charlotte, Venice, New Port Richie, Clearwater, Punta Gorda, Fort Pierce or an area within Miami, Fort Lauderdale or Palm Beach, after a Hurricane, windstorm or other property damage loss (does not matter if it is fire, sinkhole, lighting, electrical, etc.) that occurs after May 17, 2011, if your policy of insurance was executed after that date, know that you only have five years from the date of loss to file a lawsuit.  If your policy of insurance was executed/issued prior to May 17, 2011, no matter when your loss occurs,  it appears that Florida Statute §95.11(2)(b) would be applicable, thus providing a five year statute of limitations from the date of breach of the insurance policy.  

Florida Hurricane Insurance Claims – The Need to Immediately Notify Your Insurance Carrier of the Windstorm Loss Under the Policy

Florida hurricane insurance claims_fightsforyou.netIn one of my previous posts, I discussed the amount of time an insured actually has to provide notice to their insurance company regarding a Hurricane damage claim (per the insurance policy provisions), after they have been the victim of a property damage loss.  See my post titled Florida Hurricane/Storm Damage Insurance Claims – How Long Do I Have to Provide Notice to My Insurer Under My Insurance Policy?

Recently, another case came out of the Fourth District Court of Appeals (governs the Palm Beach County area) which reinforces the importance of a homeowner’s immediately putting on notice their insurance carrier given the post-loss policy provision obligation that generally requires that the insurer immediately be notified after a Hurricane damage loss.  In Slominski v. Citizens Prop. Ins. Corp., 2012 WL 4511322 (Fla. 4th DCA 2012), a homeowner that sustained damage due to Hurricane Wilma made minimal repairs that came in below their policy’s deductible. Three and a half years later, the homeowner filed a claim with Citizens based on wind and water damage to their home — they waited to file a claim due to their belief that the damage sustained fell below the policy’s deductible. Citizens investigated the claim, whereby they concluded that “the damages reported cannot be attributed to Hurricane Wilma due to the amount of time that has transpired since the purported date of loss to the present date.” Citizens further noted the homeowner’s failure to comply with post-loss duties, a condition precedent to reimbursement of a claim, pursuant to the policy. The policy stated that they were to “[g]ive prompt notice to [Citizens].”

In response to Citizens’ denial of their claim (likely by way of a denial letter), the homeowner apparently sought the assistance of a Palm Beach County Hurricane/storm damage insurance claim lawyer to assist them in recovering moneys to fix their property given the insurance claim dispute regarding coverage under their policy. After suit was filed  filed suit, Citizens moved for summary judgment alleging that the homeowner “breached the post loss policy conditions by failing to promptly notify Citizens of the loss which in turn would have allowed Citizens to timely investigate this matter within a reasonable time frame after the loss,” thus prejudicing Citizens and relieving Citizens of its duty to provide coverage for the loss. The trial court granted Citizens’ motion for summary judgment, to which the Forth District Court of Appeal Affirmed.  The Fourth District noted that in delayed notice cases, “while prejudice to the insurer is presumed, if the insured can demonstrate that the insurer has not been prejudiced thereby, then the insurer will not be relieved of liability merely by a showing that notice was not given ‘as soon as practicable.’ ”  Once delayed notice is raised by the insurance carrier, the burden shifts to “the insured to show lack of prejudice where the insurer has been deprived of the opportunity to investigate the facts.”

In this case, the homeowner submitted affidavits from a contractor and engineer in opposition to Citizens’ motion for summary judgment, although these affidavits apparently contradicted the deposition testimony of the respective individuals (they originally testified that they could not conclusively establish if the damage was caused by Hurricane Wilma, whereas the affidavits did say the damage was caused by Wilma).  As such, the Court rejected the affidavits and ruled for Citizens given the lack of evidence in opposition to their summary judgment.  The Fourth District distinguished this case from Stark v. State Farm Fla. Ins. Co., 95 So.3d 285 (Fla. 4th DCA 2012), another late notice case (notified State Farm about three and a half years after the fact) where the insured submitted affidavits of an engineer and public adjuster indicating that the damage to the insureds’ roof was caused by Hurricane Wilma.  On summary judgment, the trial court ruled that State Farm was “presumed to be prejudiced” by the untimely notice.  The Fourth District reversed, finding that there were issues of fact as to whether State Farm was prejudiced in their inability to investigate the loss.

A case also recently came out of the Southern District of Florida on this “late notice” issue.  In Aspen Speciality Ins. Co. v. River Oaks of Palm Beach Homeowner’s Ass’n, Inc., 2012 WL 3260398 (S.D. Fla. 2012), the Homeowner’s association sustained roof damage due to Hurricane Wilma as a result of wind. They put Aspen on notice fairly quickly, although the loss was apparently below the deductible.  Five years later, Aspen retained a separate adjusting company that adjusted the roof loss at 7.5 million dollars, and later submitted a revised loss estimate at 13.5 million dollars.  After the homeowner’s association filed a declaratory action to determine coverage under the policy, Aspen maintained that they were barred from coverage under the policy for violating the policy’s post-loss provision — namely, to provide prompt notice of the loss or damage, including a description of the property involved; give a description of how, when and where the loss or damage occurred; at Aspen’s request, the insured was to give a complete inventory of the damaged and undamaged property including quantities, costs, values and amount of loss claimed; permit an inspection of the property, books and records; and to cooperate in the investigation or settlement of the claim. The Aspen Court cited to Haiman v. Federal Ins. Co., 798 So.2d 811 (Fla. 4th DCA 2001) for the premise that “[a] total failure to comply with policy provisions … may constitute a breach precluding recovery from the insurer as a matter of law. If, however, the insured cooperates to some degree or provides an explanation for its noncompliance, a fact question is presented for resolution by a jury.”

This “partial compliance” test seems to be one of the standards a court will look to in deciding whether an insured has breached their post loss obligations under their policy, in addition to analyzing whether the insurer has been prejudiced by late notice of the Hurricane loss (ie., whether the passage of time will prevent the insurance company from analyzing the cause of the loss).

All homeowners should note that these cases above, and the cases discussed in my previous post on this subject, are related to Hurricane Wilma losses or before.  For analysis of statute of limitations and statutory notice requirements related to property damage and Hurricane/windstorm losses after May 17, 2011, see my previous post regarding the changes in Florida law in 2011.

Moral of the Story: Whether you are a homeowner that lives in Coral Springs, Cooper City, Hallandale, Boca Raton, Homestead, Key Biscayne, Weston, Pompano Beach, Tamarac, Plantation, Delray, Deerfield Beach or another area within Miami, Fort Lauderdale or Palm Beach, after a Hurricane or windstorm, make sure to immediately inspect your property to determine if any damage was caused by the storm, especially the roof, walls and windows.  In being proactive, you will be able to comply with the post-loss notice and condition precedent requirements under your insurance policy and hopefully avoid an insurance coverage dispute or Hurricane damage insurance lawsuit as referenced in the cases above.