Court: Insureds’ public adjuster may not serve as ‘disinterested’ appraiser
A fiduciary could not serve as the insureds' disinterested appraiser, despite agent-principal relationship, Florida court says.
A Florida appeals court has ruled that a fiduciary, such as a public adjuster, with whom insureds had a contractual agent-principal relationship could not serve as their disinterested appraiser as a matter of law.
The case
After Charles and Diana Sanders’ home was damaged by Hurricane Irma, they sued their homeowners’ insurance carrier, State Farm Florida Insurance Company, for breach of contract, alleging that State Farm had not provided coverage for the loss.
In response, State Farm moved to invoke appraisal.
The parties entered into an agreed order granting State Farm’s motion. Among other things, the order required the insureds to designate their “qualified, disinterested appraiser,” as stated in State Farm’s policy.
The insureds selected Gian Franco Debernardi of 911 Claims Corporation as their appraiser.
Debernardi was the insureds’ agent pursuant to their contract with 911 Claims Corporation, which stated that he would be their “agent and representative, under the insurance contract by State Farm Insurance . . . to adjust, appraise, advise and assist in the settlement of the loss.” In addition, the contract assigned 10 percent of the amount recovered to 911 Claims Corporation. Previously, Debernardi had inspected the insureds’ property, reported the insurance claim to State Farm, and prepared the $88,536.41 estimate that was the subject of the dispute between State Farm and the insureds.
The insureds asked the court to allow appraisal to move forward with Debernardi as their appraiser. State Farm argued that Debernardi was not “disinterested” because of his agent/principal relationship with the insureds, his contingency fee, and his prior estimate of damages.
The trial court entered an order permitting Mr. Debernardi to act as the insureds’ “disinterested” appraiser, and State Farm asked an appellate court to quash that order.
The appellate court’s decision
The appellate court granted State Farm’s request to quash the trial court’s order.
In its decision, the appellate court explained that, under Florida law, appraisals were “creatures of contract” and the subject or scope of the appraisal depended on the contract. Therefore, the appellate court continued, State Farm and the insureds were free to contract for the qualifications of their appraisers.
Here, the appellate court observed, the parties contracted for each other’s appraiser to be “disinterested.” Because the contract between the insureds and 911 Claims Corporation made Debernardi the insureds’ agent, and because as a result he owed the insureds a fiduciary duty, he was not “disinterested,” the appellate court held.
The appellate court added that Debernardi also was not disinterested because he had a financial interest in whether or not the insureds recovered from State Farm and how much they recovered.
The case is State Farm Florida Ins. Co. v. Sanders, No. 3D19-927 (Fla. Ct. App. July 24, 2019). Attorneys involved include: Link & Rockenbach, P.A., Kara Berard Rockenbach and David A. Noel (West Palm Beach), for petitioner. Marin, Eljaiek, Lopez & Martinez, P.L., Steven E. Gurian and Joe De Prado, for respondents.
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