Tara Faenza, trial attorney with Insurance Litigation Group, in North Miami Beach.

The first party property claims community is reeling from a recent Third DCA decision that slayed the Slayton argument routinely cited in defense motions for summary judgment over the last few years. Despite that fact Slayton v. Universal Property And Casualty Insurance was in the Fifth DCA, not binding authority, courts in the tri-county area intermittently and routinely granted defense motions for summary judgment under its authority. Many plaintiffs attorneys argued that defense attorneys continuously contorted Slayton’s holding to reach an impermissible conclusion: that an insurer’s estimate superseded a public adjuster’s estimate and so long as they paid at least their own estimate for damages (minus the deductible), the insurer satisfied its policy obligations.

In Slayton, Universal argued it was entitled to a direct verdict under its policy, because it paid its estimate for repairs, and that any additional costs were considered a supplemental claim under the policy. Certainly, a lack of clarity remained as to what this meant when payment of an insurer’s estimate failed to adequately pay for the original scope of damages resulting from a covered loss. This placed the issue squarely before the Slayton court of what happens when the insured does not repair the damages first.

Surely the plaintiff should have prevailed in Slayton, with common sense and Florida statute to back her up. Puzzled plaintiffs lawyers questioned how the court could deny the insured’s argument. The court in Slayton did NOT deny that argument—rather the court could not legally address it. The court held: “We decline to address Slayton‘s argument because the limited record provided to us reflects that this argument was not preserved below.” While the plaintiff in Slayton should have prevailed, the argument was not preserved for appeal.

The effect of the court not addressing Slayton led the insurers to continue to inappropriately rely upon Slayton to the insureds detriment, and the plaintiffs attorneys to argue that the case did not hold that an insurer’s estimate trumped the insured’s public adjuster estimate. Until recently, this question continued to remain unanswered by the court.

However, on Aug. 30, 2017, mere days before Hurricane Irma would rock most of Florida and beyond, the Third DCA answered the question pending since Slayton.

In Siegel v. Tower Hill Signature Insurance, the court could rule because the issue was properly preserved. Like Slayton, in the Siegel case, two conflicting estimates for repair existed. The insurer in Siegel paid its own estimate, citing Slayton. The Siegel‘s case was dismissed on a motion for summary judgment. The Siegels appealed. The Third DCA noted that Slayton did not address the payment requirement under 627.7011 because the issue was not preserved for appeal. In Siegel, Tower Hill argued that payment of their estimated “replacement cost value” was paying more than required, arguing it is greater than what 627.7011 now requires, “For a dwelling, the insurer must initially pay at least the actual cash value of the insured loss, less any applicable deductible. The insurer shall pay any remaining amounts necessary to perform such repairs as work is performed and expenses are incurred.” In Siegel, the court did not decide that the public adjuster’s estimate would prevail over the insurance company’s estimate. Instead, the court considered that Tower Hill, in violation of its policy, required the Siegels to initiate repairs and make supplemental claims to receive additional payments.

The court properly ruled that whether or not the initial payment was the actual cash value of the insured loss is a material question of fact for the jury to consider.

The Siegel case is important for the insurance industry and the legal community. First, it identifies the importance of preserving key issues for appeal. Second, it highlights the need to appeal when case law has been improperly cited, even if one or several courts have granted motions on that basis. Third, Siegel literally came not a moment too soon. The ruling came down mere days before Hurricane Irma devastated many parts of Florida, particularly the Keys. Siegel leveled the playing field and brought jurors back in the room to decide whether an insurance company paid enough on an initial payment. Slayton has been limited to, frankly, what it originally stood for, nothing more and nothing less. This concept, in order to argue a position on appeal, needs to be preserved in the lower courts. Siegel, in essence, isn’t pro-plaintiff or pro-plaintiffs attorneys or even pro-public adjuster. Siegel is a return to the strict application of case law and a return to permitting juries—not public adjusters or insurance adjusters—to decide key issues of fact as it relates to damages. In the wake of Siegel, insurer and insured have much work to do to tackle the monster ahead—Irma claim litigation.

With the issues of initial payments, estimates, and “supplemental claims” now clarified by the Third DCA, Siegel ushers in a wave of estimates, damage disputes, and coverage issue disputes allowing for the jury to be the final arbiter and not the insurance company.

Tara Faenza is a trial attorney with Insurance Litigation Group, a North Miami Beach boutique, first party property insurance law firm that represents residential and commercial property owners, restoration companies and public adjusters in disputes with insurance companies.