Hurricane Katrina caused wind damage to a Miami home on August 25, 2005. The homeowner filed a claim with his homeowner's carrier. The homeowner, who did not have legal counsel at the time, went to arbitration with his insurance company. And the homeowner won. A neutral Umpire and the insured's chosen appraiser rendered an appraisal award in the homeowner's favor on November 2, 2006. Sunshine State Insurance Co. v. Davide, 2013 WL 616226 *1 (Fla. 3d DCA February 20, 2013)(STATED SUBJECT TO REVISION OR WITHDRAWAL UNTIL RELEASED FOR PERMANENT PUBLICATION).
The Homeowner's Carrier's representatives said that the Carrier could not tell whether the Appraisal Award included a deduction for depreciation, however. It attempted to contact the Umpire more than once, without getting a reply. Sunshine State Insurance Co. v. Davide, 2013 WL 616226 *1 (Fla. 3d DCA February 20, 2013). At this point, the Carrier in this case had several options.
The Carrier could have asked its own chosen Appraiser whether the Appraisal Award included a deduction for depreciation. It did not ask. In fact, the Florida Appellate Court commented on this decision in a way which I do not recall ever seeing before in a reported opinion from any Court anywhere in the country. "We note that, and wonder why," said the Court in this case, "the record before this Court is devoid of any explanation from the insurer's appraiser as to this question." Sunshine State Insurance Co. v. Davide, 2013 WL 616226 *1 n.1 (Fla. 3d DCA February 20, 2013). [Emphasis added.]
The Homeowner's Carrier could also have sought declaratory or other relief from a Florida Court to resolve the depreciation deduction issue. It did not. See Sunshine State Insurance Co. v. Davide, 2013 WL 616226 *1 n.2 (Fla. 3d DCA February 20, 2013).
Instead, the Carrier "unilaterally" calculated what would be the amount of depreciation to deduct from the homeowner's claim. The Carrier then deducted that amount from the amount of the Appraisal Award and sent a check for that amount to the homeowner.
The homeowner retained a lawyer and filed suit against the Carrier on March 2, 2007. The homeowner's Complaint is in three counts for alleged Breach of Contract, Bad Faith, and to Confirm the Appraisal Award. Six days after filing the Complaint, the homeowner's lawyer sent the Carrier a copy of a letter along with a Motion to Amend the Complaint to add a Punitive Damages Claim against the Carrier. The letter was from the neutral Umpire to the homeowner's attorney "stating that depreciation had already been deducted from the final appraisal award." The homeowner's attorney, parenthetically, received the Umpire's letter approximately one week before the lawsuit was filed against the Carrier. Sunshine State Insurance Co. v. Davide, 2013 WL 616226 *1 (Fla. 3d DCA February 20, 2013).
To be continued ....
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