As Citizens Property Insurance, Florida’s state-created insurer of last resort, works to reduce its exposure, officials there may take heart from three court rulings handed down this week. A fourth decision, however, could end up costing the insurer significantly.
In Maria Muguercia v. Citizens, Florida’s 3rd District Court of Appeal affirmed a Miami-Dade County Circuit Court decision. The court held that the insurer had produced sufficient evidence to show that certain types of property damage were excluded from the policy, and the policyholder did not prove otherwise.
In a closely watched assignment-of-benefits case, Union Restoration vs. Citizens, the court found that a questionable document did not divert insurance payments to the construction firm. Union Restoration, like hundreds of restoration firms have done in Florida in recent years, had filed suit against the insurer after Citizens refused to pay directly to the contractor.
The appeals court affirmed a Miami-Dade Circuit Court decision and noted that a Union principal had “altered the written assignment by changing the date of the claimed loss, changing the number of the claim several times, and adding the insured’s initials to the alterations.”
Under the circumstances, “we have no difficulty in upholding the summary judgment for Citizens,” appeals court Judge Thomas Logue wrote in the opinion.
In another ruling, the appeal court affirmed the lower court ruling in favor of Citizens, in Danay Rivero vs. Citizens. The court’s per curiam decision did not go into detail about the case.
In a fourth decision, however, the court did not see things Citizens’ way in a $112,000 claim. The case examines the simmering issue of insurance adjuster versus public adjuster.
In 2015, the Miami-area homeowners, Odalys Alvarez and Jorge Garcia, found a leak in a water supply line and filed a claim with Citizens, the court’s opinion explained. The Citizens’ adjuster maintained that the damage was limited to little more than a few floor tiles and paid the insureds about $7,100.
The homeowners hired a public adjuster and engineer, who performed a “tapping test” on floor tile throughout the house. Based on the hollow sound, he concluded that many tiles had debonded or loosened from the concrete slab and needed replacing. The homeowners filed a subsequent claim for $111,600.
Citizens denied the claim and the insureds filed suit for breach of contract. Citizens challenged some of the engineer’s conclusions, and the trial court in Miami-Dade County granted summary judgment in Citizens’ favor.
The court of appeal noted that the engineer in the case was the same one whose reports had been largely discredited in a 2019 case in Miami. In Gonzalez vs. Citizens, concerning a roof leak, it was shown that the engineer, Alfredo Brizuela, had made the “bald assertion” that the roof damage was from a windstorm, but he had never inspected the property, appeal court Judge Edwin Scales wrote.
“While we recognize in the instant case that there might be inconsistencies in Brizuela’s affidavit and deposition testimony that undermine his conclusions, we also recognize that, unlike in Gonzalez, there is a fact-based rationale to Brizuela’s opinion: the hollow sound from a tapping test that might indicate tile porousness and debondment,” Scales wrote. Citizens argued that most of the floor tiles did not show other signs of being loose or damaged.
Citizens had not addressed the debondment issue at the trial court level but raised other questions that placed the parties’ evidence in conflict. The trial court weighed the evidence but did not determine whether a genuine issue of material fact existed, the DCA found.
The appeal court reversed and remanded to Miami-Dade Circuit Court for further proceedings.
Citizens, created by the Florida Legislature in 2002, has seen the number of policyholders balloon in recent years, as private carriers have abandoned the state or have raised premiums. With policyholders expected to top one million next year, up from 487,000 a year ago, the corporation has been trying to depopulate its rolls, reduce claims and reduce exposure before another major hurricane hits, officials have said.
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