On September 9, 2020, Florida’s Fourth District Court of Appeal entered a groundbreaking and seminal opinion regarding the ‘No Supplemental Claim Defense’ in Brandon Goldberg v. Universal Prop. & Cas. Ins. Co., 2020 WL 5372305 (Fla. 4th DCA 2020). Ian Ronderos of Walton Lantaff served as the lead partner at the trial level. He argued and obtained final summary judgment on behalf of the insurer. Paulo Lima from the Russo Appellate Firm served as appellate counsel.
In Goldberg, the insurer inspected a Hurricane Irma claim at the insured’s condominium and issued a payment under Coverage A- Dwelling based on the insurer’s estimate. The insurer did not issue a payment under Coverage C contents as same were not covered unless there was a wind created opening. The opening in the Goldberg condominium was caused by the condominium itself inadvertently failing to secure a sliding glass door after a renovation.
The insured advised the insurer that he had a proposal higher than the insurer’s estimate. However, the insured never provided the insurer with an estimate, never asked the insurer to pay a specific amount, and never provided a personal property inventory form. The insured’s attorney sent correspondence to the insurer asking for documents, but not providing a supplemental claim or damage estimate. The insurer’s corporate representative testified that, in order for the insurer to have paid any additional amounts, the insurer would have had to guess at the amount claimed by the insured.
The insured sued the insurer, claiming underpayment. Walton Lantaff prepared the insurer’s answer and pled affirmative defenses, including that no supplemental claim was made prior to filing suit.
Walton Lantaff has developed a uniquely incisive approach to defending first party property insurance cases. While some practitioners and professionals (especially the plaintiffs’ bar) insist that all the leverage exists on the plaintiffs’ side of first party property insurance cases and that insurers have no choice but to pay what is demanded, Walton Lantaff rejects this contention. Insurers should prioritize defense of matters, not payment of tribute.
In order to stand up to the plaintiffs’ bar, insurers must have a concrete plan to reverse the leverage that the insureds take for granted, namely jury sympathy and bias. Walton Lantaff has developed exactly such a plan. Its strategy focuses on pleading incisive defenses designed to prevail based on the facts of the case and obtain judgment in the favor of the insurer. Walton Lantaff prides itself in its ability to bring to bear creative legal defenses derived from Walton Lantaff’s firm and facile grasp of the law. Once formulated, Walton Lantaff focuses its litigation plan in developing these defenses. In the Goldberg opinion, one will note that the Fourth DCA referenced the favorable testimony and evidence in the insurer’s favor. This was no accident. Walton Lantaff carefully and strategically prepared its case and developed the evidence so that it would support summary judgment.
Walton Lantaff does not believe in trying ‘price and scope’ cases, which tend to produce compromise verdicts and fee entitlement for the plaintiffs’ counsels. Walton Lantaff develops specific defenses that have the potential for attaining a judgment in the insurer’s favor. It has fine-tuned and honed these defenses into decisive weapons. One such defense is the ‘no supplemental claim defense’ that produced Goldberg.
In Goldberg, Walton Lantaff filed the insurer’s Motion for Summary Judgment on the grounds that the insured failed to make a supplemental claim and that the insurer would have had to guess at the value that the insured wanted to be paid to avoid a lawsuit. The trial court granted Walton Lantaff’s Motion for Summary Judgment on behalf of the insurer and issued final summary judgment.
The Fourth DCA affirmed in part and reversed in part. The Fourth DCA reversed the summary judgment as to the denied contents claim, because it ruled that an insurer cannot rely on conditions like the no supplemental claim defense when the claim has been denied. However, the Fourth DCA affirmed the summary judgment as to Coverage A- Dwelling, stating, “[b]ased on the policy language drawn from a Florida statute, we hold that Goldberg was required to file a supplemental claim setting forth those damages he sought in excess of what the insurance company had already paid.” Goldberg, WL 2020 5372305.
Succinctly, the Fourth DCA ruled that “[w]here Universal paid its own estimate of the actual cash value of the loss to the dwelling, Goldberg’s breach of contract action with respect to that loss was premature when he filed suit without having first submitted a supplemental claim, a competing estimate, or even a demand letter specifying the claim to inform Universal of the amount of additional benefits to which he believed he was entitled.” Id.
This is a holding of immense significance because it establishes that (especially for hurricane or windstorm claims) an insured cannot file a lawsuit without telling the insurer the amount that the insured claims prior to suit. Prior to Goldberg, a less-than-scrupulous but somewhat common practice existed where certain insureds or their representatives would employ a hide-the-ball strategy where the amount being claimed by the insured and any estimate supporting were withheld from the insurer. Then, the insureds and their representatives would file suit claiming that the insurer breached a policy by failing to pay the very amount that they concealed from the insurer prior to suit. Naturally, after suit, the insureds and their representatives would produce a detailed estimate and excessive demand for attorney’s fees. This practice was particularly common regarding hurricanes, as hurricane events tend to place additional stress on the claims system.
In Goldberg, the Fourth DCA ruled that this practice is not permissible in Florida and such hurricane or windstorm claims are subject to summary judgment as premature. The Goldberg Court stated that “to the extent Goldberg sought additional payment for his losses from the same hurricane after the adjustment of his initial claim the policy required him to submit a ‘supplemental claim,’ which is an ‘additional claim for recovery.’” Id. The Fourth DCA expressly spelled out what was needed: “[a] competing estimate by an insured’s independent adjuster, or by a prospective contractor, which is submitted to the insurer would fall within this definition of a ‘supplemental claim.’” Id. In other words, as Walton Lantaff has long argued, the insurer must be put on notice as to the specific amount the insured is claiming prior to suit.
The Goldberg insured argued that because it disagreed with the insurer’s estimate, the insurer did not pay the ‘actual cash value’ of the loss, which discharged the insured’s duty to provide a supplemental claim. The Fourth DCA rejected this argument.
It is important to note that Goldberg specifically addressed a hurricane claim, and the Fourth DCA relied heavily upon the fact that Florida Statute § 627.70132 requires a supplemental claim for hurricane or windstorm claims. The Goldberg policy tracked the statutory language of §627.70132 in its relevant policy provision. While Goldberg specifically addressed hurricane and windstorm claims, its reasoning can be applied to non-hurricane and non-windstorm claims, if an insurer’s policy terms are broad enough to require a supplemental claim akin to Goldberg. The Fourth DCA specifically rejected the insured’s reliance on Chavez v. Tower Hill Signature Ins. Co., 278 So. 3d 231 (Fla. 3d DCA 2019) and Milhomme v. Tower Hill Signature Ins. Co., 277 So. 3d 724 (Fla. 3d DCA 2017) on the grounds that those two cases had more limited definitions of supplemental claims describing additional claims made after the commencement of repairs. So long as a policy is not so limited (or better yet, if it expressly applies the §627.70132 language to all claims), Goldberg’s logic should apply. Insurers also may wish to consider re-drafting their policies to make explicit the requirement for supplemental claims for claims arising from all causes of loss.
Goldberg represents a tremendous victory for the insurance industry. It would not have been possible without Walton Lantaff’s dogged determination to pursue its strategy to seek decisive defenses in all cases and bring them to summary judgment hearings. As Vergil wrote in the Aeneid, fortune favors the bold. Walton Lantaff prides itself in asserting bold and creative legal defenses firmly based in Florida law to obtain positive results for its clients.
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