Sebo v. AHAC - Concurrent Cause Doctrine

The Florida Supreme Court ruled on Dec. 1, 2016 in Sebo v. American Home Assurance Co. in favor of homeowner and insured John Sebo. 

Mr. Sebo purchased his home in April 2005 and secured homeowner’s insurance from AHAC. Shortly thereafter, the home sustained serious water intrusion issues whenever it rained.  This led to the discovery that the home’s structure had significant design and construction defects. The house then suffered more damage during Hurricane Wilma.  As a result, the home was eventually torn down.

Subsequently, Mr. Sebo filed a law suit against the sellers of the property, the architect, and the general contractor responsible for construction.  These parties settled with Mr. Sebo.  Later, Mr. Sebo added  AHAC as a defendant and sought a court ruling that the insurance policy provided coverage for his damages. A jury found in favor of Mr. Sebo. 

AHAC filed an appeal with the Florida 2nd District Court of Appeals. The issue on appeal was which damages doctrine was to be applied to the case under the subject insurance policy:  the efficient proximate cause doctrine or the concurrent cause doctrine.

The “efficient proximate cause” doctrine can be defined as stating that where there is a combination of different perils, some covered under the policy and some excluded under the policy, contributing to the damages, the loss is covered only if the covered peril was the most responsible peril for the loss. 

The “concurrent cause” doctrine can be defined as stating that where there is a combination of different perils, some covered under the policy and some excluded under the policy, contributing to the damages, the loss is covered even when the covered peril is not the most responsible peril for the loss. 

The 2nd District reversed the lower court decision and remanded the case for a new trial, “in which the causation of Sebo’s loss is examined under the efficient proximate cause theory.” 

The Florida Supreme Court disagreed  stating "we conclude that when independent perils converge and no single cause can be considered the sole or proximate cause, it is appropriate to apply the concurring cause doctrine".

The question moving forward will be whether insurers in Florida will look to insert anti-concurrent causation language into new and renewal policies to avoid the effect of the Sebo ruling.

You can reach Miami Insurance Claims Attorney J.P. Gonzalez-Sirgo by dialing his direct number at (786) 272-5841, calling the main office at (305) 461-1095, or Toll Free at 1 (866) 71-CLAIM or email J.P. directly at [email protected].

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