CITIZENS PROPERTY INSURANCE CORPORATION v. AVILL JAMES

• Court: District Court of Appeal of Florida
• Decided: August 9, 2023
• Docket: 22-0595
• Status: Published

Opinion

Third District Court of Appeal State of Florida

Opinion filed August 9, 2023. Not final until disposition of timely filed motion for rehearing.

________________

No. 3D22-595 Lower Tribunal No. 16-11401 ________________

Citizens Property Insurance Corporation, Appellant,

vs.

Avill James, Appellee.

An Appeal from the Circuit Court for Miami-Dade County, Vivianne Del Rio and Samantha Ruiz Cohen, Judges.

Traub Lieberman Straus & Shrewsberry LLP, and C. Ryan Jones, Scot E. Samis and Brandon R. Christian (St. Petersburg), for appellant.

Perry & Neblett, P.A., and David Avellar Neblett, John A. Wynn and James M. Mahaffey, for appellee.

Before EMAS, LINDSEY and GORDO, JJ.

GORDO, J. Citizens Property Insurance Corporation (“Citizens”) appeals an order

of final judgment in favor of Avill James. We have jurisdiction. Fla. R. App.

P. 9.030(b)(1)(A). We affirm in all regards but reverse the trial court’s award

of prejudgment interest.

FACTUAL AND PROCEDURAL BACKGROUND

In October 2014, James, a Citizens insured, sustained water damage

to his home. James notified Citizens of the loss in March 2015. Four months

later, Citizens investigated the claim and timely issued a payment of

$27,776.33. James asserted that amount was inadequate and submitted a

competing repair estimate from his own public adjuster asserting the value

of the loss was $111,535.66. Citizens disagreed with James’ estimate and

did not issue further payment.

In May 2016, James filed a suit against Citizens. In August 2017,

James moved to compel appraisal pursuant to the appraisal provision of the

insurance policy asserting Citizens had “admitted liability and coverage for

this loss and simply dispute[d] the scope and valuation of the covered

damages.” Citizens agreed and the parties proceeded to appraisal. On

February 4, 2020, the appraisal panel entered an award of $59,919.27 for

James. Citizens paid the appraisal award amount two days later. Later that

2 month, Citizens filed a notice of stipulation that James was entitled to

reasonable attorney’s fees in connection with the litigation.

On May 28, 2020, James filed a motion for summary judgment.

Citizens filed a response in opposition. The trial court held a hearing on the

motion and subsequently entered final judgment in James’ favor, finding

James was entitled to prejudgment interest. Citizens filed a motion for

rehearing which was denied by the trial court. This appeal followed.

LEGAL ANALYSIS

“A trial court’s decision on whether or not to award prejudgment

interest is reviewed under the de novo standard.” Conway v. Conway, 111

So. 3d 925, 928 (Fla. 1st DCA 2013).

“An insurer is liable for prejudgment interest on the amount payable

for an insured . . . loss on the theory that failure to pay within the time frame

contemplated by the agreement constitutes a breach of a contract to pay

money.” Independent Fire Ins. Co. v. Lugassy, 593 So. 2d 570, 571–72 (Fla.

3d DCA 1992)). Because of this, an insured is entitled to prejudgment

interest “where the insurer denies coverage and later admits coverage or

coverage is later determined through litigation.” N. Pointe Ins. Co. v. Tomas,

16 So. 3d 977, 978 (Fla. 3d DCA 2009). “Once the insurer denies coverage,

it is deemed to have waived the policy provision for deferred payment and,

3 should it pay, becomes responsible for prejudgment interest from the date of

loss.” Id. at 978–79.

An insured, however, “is not entitled to prejudgment interest when an

insurer does not deny coverage, participates in the appraisal process, and

timely pays the appraisal award.” State Farm Florida Ins. Co. v. Silber, 72

So. 3d 286, 290 (Fla. 4th DCA 2011); see also Am. Reliance Ins. Co. v.

Devecht, 820 So. 2d 378, 379 (Fla. 3d DCA 2002) (“[P]rejudgment interest

may be awarded from the date of the appraisal award unless policy

provisions allow the insurer to pay the award within a certain period, and

payment was made within the allotted time.”); Jugo v. Am. Sec. Ins. Co., 56

So. 3d 94, 95–96 (Fla. 3d DCA 2011) (affirming the denial of prejudgment

interest and finding that the insurer had not denied coverage where “[t]he

dispute turned on quantifying the covered loss, not the existence of

coverage”).

Thus, in order to be entitled to prejudgment interest James was

required to show that Citizens denied his claim before later admitting

coverage. Here, James’ argument fails because Citizens did not deny

coverage. Based on the record and pleadings before us, the claim arose

because the parties disagreed over the amount to be paid under the policy

to satisfy James’ claim, not the existence of coverage. In fact, James’ motion

4 to compel arbitration even stated the parties solely disagreed as to the scope

and value of the loss.

As Citizens did not deny coverage, it was entitled to pay the arbitration

award pursuant to the insurance policy without being subject to prejudgment

interest. See Allstate Ins. Co. v. Blanco, 791 So. 2d 515, 517 (Fla. 3d DCA

2001) (finding “the insurance policy provisions allowed Allstate sixty days

within which to pay the appraisal award and Allstate made payment within

the allotted time. Thus, the Blancos are not entitled to receive any

prejudgment interest”); Allstate Ins. Co. v. Martinez, 790 So. 2d 1151, 1152

(Fla. 3d DCA 2001) (“The trial court erred when it ordered prejudgment

interest to be paid from the date of loss. Rather, if Martinez is entitled to

prejudgment interest it is to be calculated from the termination of sixty days

after the date of the appraisal award.”). The insurance policy provided that

Citizens had sixty days after the filing of the appraisal award to tender

payment. Here, it is undisputed that Citizens timely tendered payment to

James two days after the filing of the appraisal award. Accordingly, we

reverse the trial court’s award of prejudgment interest.

Affirmed in part; reversed in part; remanded for further proceedings

consistent with this opinion.