This is the third in a series of cases we have evaluated on this blog analyzing the types of litigation activities that constitute a waiver of the right of an insured to demand appraisal. The prior cases along with this case are all 5th DCA decisions, so they provide a cross-section of fact patterns that demonstrate the factors that constitute a waiver of a policyholder’s appraisal rights. The case of FIGA v. Rodriquez, which is discussed in the this blog post, provides another example of a case where the court found the insured waived any rights to appraisal under the policy by engaging in litigation activity.
The policyholders sustained significant damage to their home that was caused by sinkhole activity in February 2010. HomeWise, the original insurer that would later become insolvent, conceded that the loss was covered sinkhole damage during the month the loss was incurred. However, the parties disputed the nature of repairs and agreed to a neutral evaluation. The homeowners were unhappy with the expert report that was completed in February 2011, so they filed a breach of contract lawsuit that did not mention appraisal. At the time the lawsuit was filed by the policyholders, they also propounded multiple discovery requests, including interrogatories, document production demands and requests for admissions.
The case was stayed in November 2011 after HomeWise became insolvent, and FIGA was activated in June 2012. The homeowners filed an amended complaint replacing HomeWise with FIGA. The amended filing was accompanied by additional discovery requests. FIGA filed its answer to the lawsuit on July 30, 2012, admitting to coverage.
In evaluating the facts, the court first observed that an insured waives the right to appraisal when the party engages in conduct inconsistent with appraisal or actively participates in a lawsuit. As in prior cases discussed in this blog from the 5th DCA, the court indicated that the question of the waiver of appraisal rights is not exclusively an issue of delay or the number of filings. Instead, the focus is on whether the insured engaged in activity that is inconsistent with appraisal rights.
In this case, the court pointed out that FIGA acknowledged that the loss was covered in February 2010. However, the homeowners waited three years before asserting their right to appraisal under the policy. Although the litigation was stayed for nearly a year when FIGA was activated, the court found that the significant discovery activity and significant passage of time between the insured conceding coverage and the demand for appraisal constituted a waiver. Unlike prior cases finding a waiver, this case involved almost exclusively discovery activity by the insured rather than the filing of motions or noticing of the case for trial. Although the information obtained through discovery can provide valuable information in an appraisal, the process of seeking the information can result in the loss of the policyholder’s rights to take advantage of the appraisal process.
If you have questions about the appraisal process or waiver issues, we may be able to answer your questions. If you have questions about Miami-Dade insurance claims, you are welcome to contact my Florida insurance claims dispute law firm. My law firm represents policyholders in claims disputes in Miami and throughout Florida. The Law Firm of J.P. Gonzalez-Sirgo, P.A. offers free consultations and case evaluations. No Recovery, No Lawyer Fees. Call 305-461-1095 or Toll Free 1-866-71-CLAIM.