March 2011

In a recent opinion, a federal trial court reviewing Florida law ruled on the issue of whether a Complaint involving a condominium association stated a claim against insurers for breach of a fiduciary duty in adjusting a first-party claim for damages. Grandrimo v. Parkcrest Harbour Island Condo. Assoc., Inc., No. 10-964, 2011 WL 550579 (M.D. Fla. February 9, 2011). The claim involved significant water damage, requiring extensive repairs forcing the Plaintiff, a unit owner within the condominium association, to stay in a hotel. The Plaintiff filed suit against the condominium association and numerous insurer Defendants asserting, among other things, that the insurers breached a fiduciary duty in the handling of the claim.
Continue Reading Recent Ruling That There Is No Common Law Fiduciary Duty Between An Insurer And A Policyholder In A First-Party Claim In Florida

A hotly contested issue in all bad faith cases is the proper scope of discovery that a policyholder may obtain. As I discussed in Florida Southern District Court Upholds Condominium Association’s Right To Bad Faith Discovery:

For condominium associations in particular, many times attorneys become involved in an insurance claim from the very beginning. In many instances, the independent or insurance adjuster is moved to the side early in the process and replaced by the insurer’s attorney, who ends up directing the adjustment and making the final determination of coverage.

For many years, insurers have claimed that all of the work that these attorneys performed in the adjustment of the claim was privileged because of the work product and attorney-client privilege. When insurers acted in bad faith by denying valid claims, the insurer could refuse to produce relevant documents which reflected this improper behavior during the bad faith litigation.

Fortunately, Florida courts caught on to this tactic and have stopped the insurer’s attempts to improperly hide its bad faith conduct by invoking attorney-client and work product privilege on materials in the claim file.

The Florida Supreme Court’s ruling in Allstate Indemnity Co. v. Ruiz, 899 So. 2d 1121 (Fla. 2005) set the precedent in preventing insurer’s from concealing bad faith activities with claims of privilege. Specifically, Ruiz overruled previous case law and found that work product documents created in the breach of contract action were part of the claim file and must be turned over in subsequent bad faith litigation.

Continue Reading Florida Supreme Court Clarifies Attorney-Client Privilege In Bad Faith Cases

A new legislative season is upon us in Florida. This usually means big changes to Florida condominium law and Florida condominium insurance law. Some of 2010’s big legislative changes to condominium insurance in Florida can be found in my posts from last June, New Changes to Condominium Insurance Legislation and More on New Changes to Condominium Insurance Legislation.Continue Reading New Bills Before the Florida Legislature Could Change Florida Condominium Insurance Law

Previously, in Documentation of Prior Repairs Can Be Important, I wrote about the importance of keeping relevant information such as receipts and pictures from prior maintenance and repairs to support a future insurance claim. Aside from the work that your association does, another important source of information is your insurer’s underwriting and claims files. While most for-profit insurers will not easily part with these files, if you are insured by Citizens Property Insurance Corporation, you have a right to these files as a matter of law.Continue Reading A Public Records Request May Help Support Your Claim

During litigation in Florida first-party property insurance disputes, insurers often withhold their entire claims files from discovery by relying the work product doctrine. The claim file contains reports, estimates, photos and other information that is pertinent to the issues in a coverage dispute between a policyholder and its insurer. Insurers attempt to shield the entirety of the claim file from production in discovery where there should be disclosure between the parties. On the flip side, insurers often litigate issues regarding whether policyholders fully complied with their requests for documents and information in compliance with the policy of insurance. It would seem fair and logical that such disclosure would be a two way street, but insurers assert that it is definitely a one way street. When an insurer claims privilege to its entire claim file, the policyholder has no choice but to litigate that issue to obtain any information.Continue Reading The Game Of Cat And Mouse With Insurers In Florida Asserting That Their Claim File Materials Are Completely Protected From Disclosure

Last week on the Property Insurance Coverage Law blog, I wrote about new appeals that had been filed in Florida’s Third District Court of Appeal in Miami regarding insurance appraisals. Since November of 2010, three new cases regarding appraisal had come out of the Third District: Citizens Prop. Ins. Corp. v. Galeria Villas Condo. Ass’n, Inc., 48 So. 3d 188 (Fla. 3d DCA 2010), Citizens Prop. Ins. Corp. v. Maytin, No. 3D10-693, 36 Fla. L. Weekly D51 (Fla. 3d DCA Dec. 29, 2010), and Citizens Prop. Ins. Corp. v. Mango Hill Condo. Ass’n 12, Inc., No. 3D10-2014, 2011 WL 613518 (Fla. 3d DCA Feb. 9, 2011). As of last week’s blog post, four new appeals had been filed by Citizens, which makes a total of seven (7) appraisal appeals filed by Citizens in the Third District alone.Continue Reading Litigating the Right to Resolve Disputes Without Litigation

Every disagreement between a policyholder and its insurer is not necessarily due to bad faith on the insurer’s part. Many claims are settled promptly, fully, and fairly. That said, there are also instances where an insurer and its adjusters and representatives do not adjust and settle a claim with the policyholder’s best interests at heart. This is when bad faith allegations come into play.Continue Reading The Obligation Of Good Faith And Fair Dealing