Florida adopted a stringent, five-part definition of what constitutes a covered sinkhole loss in 2011, but many policies continue to employ the 2005 statutory formulation which merely defined “sinkhole loss” as “structural damage to the building, including a foundation, caused by sinkhole activity” and importantly left the term “structural damage” undefined. The result was that Florida courts split into conflicting camps with respect to how such a contract of insurance should be read; the Middle District for example, held for policyholders in two cases and for the carrier in a third, as reported in a prior post that can found here. When one of the former decisions recently reached the Eleventh Circuit, the Court of Appeals determined that the language…
Monthly Archives: August 2014
Texas Court Lays Out a Useful Roadmap of the Defenses to a Hailstorm Claim
Hailstorm claims for damage to roofs often involve belated notification that an already old or damaged structure has been further compromised. In a recent Texas case, the court provided a primer for carriers confronting such claims, addressing a trifecta of defenses available – lack of causation, late notice, and prejudice. The case is Hamilton Properties v. American Insurance Company, 2014 WL 3055801, 2014 U.S. Dist. LEXIS 91882 (N.D.Tex., July 7, 2014). Plaintiff Hamilton Properties acquired the Dallas Plaza Hotel in 2006 and mothballed the structure in February of 2009. The hotel was insured by American Insurance Company (AIC) from February through September of 2009. In 2012, the policyholder notified AIC that it was making claim for roof and water damage…
South Carolina: Admission of Cause & Origin Testimony by Fire Chief Was Prejudicial Error
In James D. Fowler v. Nationwide Mutual Fire Ins. Co., 2014 WL 3844215, 2014 S.C. App. LEXIS 209 (S.C. App., Aug. 6, 2014), South Carolina’s Court of Appeals recently held that it was prejudicial error to allow the jury to consider either the report of a volunteer fire chief or his testimony on the issue of cause and origin if he does not qualify as an expert. The take away is that if a firefighter can’t testify as an expert, any opinion he or she has on causation is simply not a datum that the fact-finder is entitled to know about. The insured’s home was destroyed by fire in January of 2007. His homeowner’s carrier, Nationwide Mutual Fire Insurance Company,…
Posted in Arson, Arson and Fraud, Experts, Fire, Investigation
Vermont: There is No Cause of Action for Negligence in Adjusting a Property Loss
Last week, the Vermont Supreme Court firmly rejected the notion that an insured can bring a cognizable claim for negligence against his or her carrier in connection with the inspection and handling of a first-party property insurance claim. In Helena G. Murphy v. Patriot Ins. Co., 2014 VT 96, 2014 WL 3965639, 2014 Vt. LEXIS 101 (Vt., Aug. 14, 2014), the court recognized that the relationship was “fundamentally contractual” in nature and that a policyholder’s rights flowed solely from the insurance policy and the covenant of good faith and fair dealing implied in that instrument. In July of 2007, the insured, Helena Murphy, reported damage to the roof of her house and interior water damage to her homeowner’s carrier, Patriot…
Florida Insurer Waives Two-Year Requirement by Waiting That Long to First Raise It
In Axis Surplus Ins. Co. v. Caribbean Beach Club Assn., 2014 WL 2900930 (Fla.Dist.Ct.App., June 27, 2014), a Florida court recently held that the insurer could not rely on a policy requirement that conditioned recovery of the cost of complying with current building codes during reconstruction on having completed the work within two years of the loss. The insurer waived the two-year requirement by failing to raise it until the entire two years had elapsed and choosing to spend that time cooperating with the policyholder’s efforts to determine the necessary scope of repair instead. The insured, Caribbean Beach Club Association, owned a time-share condominium building in Fort Myers that was heavily damaged by fire in April 2003. It had property…
