19 Fla. L. Weekly Supp. 85a
Online Reference: FLWSUPP 1902HINCNOT FINAL VERSION OF OPINION
Subsequent Changes at 19 Fla. L. Weekly Supp. 86aInsurance — Property — Appraisal — Where insured elected to participate in mediation for resolution of disputed property insurance claim, but parties were unsuccessful in resolving claim, insured was authorized by administrative rule to proceed with litigation without being subjected to loss appraisal process — Trial court did not err in denying motion to dismiss or to stay and compel appraisal
STATE FARM FLORIDA INSURANCE COMPANY, Appellant, vs. UNLIMITED RESTORATION SPECIALIST, INC., a/a/o JAY HINCHMAN, Appellee. Circuit Court, 7th Judicial Circuit (Appellate) in and for Volusia County. Case No. 2010-10012-APCC. L.C. Case No. 2009-23065-CONS. May 9, 2011. Counsel: Elizabeth K. Russo, Killgore, Pearlman, Stamp, Ornstein & Squires, P.A., Orlando; and Russo Appellate Firm, P.A., Miami, for Appellant. Kevin B. Weiss, Weiss Legal Group, P.A., Maitland, for Appellee.
REVERSED. 37 Fla. L. Weekly D712bORDER
THIS MATTER came before this Court for review upon STATE FARM FLORIDA INSURANCE COMPANY’S (“Appellant”) appeal of the lower court’s ruling where Appellant’s “Motion to Dismiss and Compel Appraisal” was denied. The Court having reviewed the “Initial Brief of Appellant,” the Answer Brief of UNLIMITED RESTORATION SPECIALIST, INC., a/a/o JAY HINCHMAN, (“Appellee”), the “Reply Brief of Appellant,” the transcript of the February 16, 2010, hearing and being otherwise fully advised in the premises, finds as follows:
FACTUAL BACKGROUND
On, May 15, 2009, a plumbing leak occurred in the downstairs hallway bathroom at the home of Jay Hinchman (“Insured”) an insured of the Appellant. Prior to the dates of the incident, Appellant issued a policy of homeowners insurance, to the Insured, which provided coverage to protect the Insured against the loss at issue. The insurance policy was in full force and effect when the Insured’s damage occurred. There is no dispute that coverage was provided at the time of the loss. The property incurred water damage as a result of the water leakage. Appellee was retained, on May 20, 2009, to perform water extraction work. The services provided by Appellee included remediation, disinfection, and drying of the Insured’s damaged property. The Appellee obtained an assignment of benefits from the Insured and then, submitted its bill to Appellant for payment; thereafter, Appellant did not pay the amounts billed. On October 6, 2009, the parties participated in the State of Florida’s mediation program pursuant to Florida Statutes, section 627.7015, to resolve the disputed amount but reached an impasse. Consequently, on November 13, 2009, the Appellee filed suit against the Appellant in Volusia County Court. The initial complaint concerned the water extraction and Appellant’s belief that the charges claimed by Appellee were excessive. In response to the Complaint, the Appellant filed a “Motion to Dismiss, or in the Alternative, to Stay Proceedings and Compel Appraisal.” On April 8, 2010, the trial court denied the Appellant’s “Motion to Dismiss and Compel Appraisal1” and; this appeal followed.
ANALYSIS
This Court in its appellate capacity reviews the lower court’s interpretation of section 800.03, de novo. See Brass & Singer, P.A. v. United Auto. Ins. Co., 944 So.2d 252 (Fla. 2006) [31 Fla. L. Weekly S762a] quoting B.Y. v. Dep’t of Children & Families, 887 So.2d 1253, 1255 (Fla. 2004) [29 Fla. L. Weekly S659a] (“The standard of appellate review on issues involving the interpretation of statutes is de novo.”). “De novo means to try a matter anew, as though it had not been heard before and no decision has been rendered.” Lee v. St. Johns County Bd. of County Com’rs, 776 So.2d 1110, 1113 (Fla. 5th DCA 2001) [26 Fla. L. Weekly D428a]. “In determining the merits of a motion to dismiss, the court is confined to the four corners of the complaint, including the attachments thereto, the allegations of which must be accepted as true and considered in the light most favorable to the nonmoving party.” Marshall v. Amerisys, Inc., 943 So.2d 276, 278 (Fla. 3rd DCA 2006) [31 Fla. L. Weekly D2967c]. “The intent of the Legislature is the polestar of statutory construction . . . . To discern this intent, the Court looks “primarily” to the plain text of the relevant statute, and when the text is unambiguous; our inquiry is at an end.” E.A.R. v. State, 4 So.3d 614, 628 (Fla. 2009) [34 Fla. L. Weekly S120a]. “It is axiomatic that an administrative rule cannot enlarge, modify or contravene the provisions of a statute.” Willette v. Air Products, 700 So.2d 397, 401 (Fla. 1st DCA 1997) [22 Fla. L. Weekly D2092a] quoting State, Dep’t of Bus. Regulation v. Salvation Limited, Inc., 452 So.2d 65, 66 (Fla. 1st DCA 1984).
Appellant asserts that the clear wording of section 627.7015, Florida Statutes does not dictate that the Department of Financial Services (“DFS mediation”) be a substitute for appraisal. Appellant further states that by the express terms of the statute, Appellee is precluded as the Insured from invoking appraisal after an unsuccessful mediation because: (1) Appellant did notify the Insured of the mediation program; and (2) Appellant itself did not request the mediation.
The interpretation and application of section 627.7015, Florida Statutes, and rule 69O-166.031, Administrative Code, is the central issue for this Court to decide. The purpose and scope of Section 627.7015, sets forth a non-adversarial alternative dispute resolution procedure for a mediated claim because the majority of homeowners and commercial residential insurance policies require an insured to participate in a costly and time-consuming adversarial loss appraisal process. (2005). This Section is available prior to commencing the appraisal process, or commencing litigation. Further, specifically section 627.7015, sub-section (7), of this Statute, sets out two ways that an insured would not be subject to a loss appraisal process. Sub-section (7) indicates that: If an insurer fails to notify an insured of their rights to mediation; or (2) if the insurer requests mediation and either party rejects the mediation results, then, the insured is not required to participate in any contractual loss appraisal process as a precondition to legal action for breach of contract. FLA. STAT. § 627.7015 (2005).
Whereas, the purpose and scope of rule 69O-166.031, Florida Administrative Code, serves to carryout section 627.7015, Florida Statutes; it is also available prior to commencing the appraisal process. The language stated in rule 69O-166.0311 (10) (c), Florida Administrative Code addresses post mediation options. The Rule indicates that: (1) if the insured chooses not to participate in medication; or (2) if a medication result is unsuccessful, then the insured may choose to continue with a loss appraisal process or by litigation, or any other dispute resolution procedure. (2000).
Here, Appellee provided water damage restoration to the Insured’s home. After an assignment of benefits was signed by the Insured to Appellee, Appellee submitted its bill for $1,827.00 to Appellant for reimbursement. Appellant sent a check payment in the amount of $797.33. Appellant also notified Appellee and the Insured that “based upon the review of the work performed . . . no additional payment will be made.” In the letter, Appellant further noted that if Appellee or the Insured disagreed with the payment and did not invoke the “option to demand mediation . . . we hereby demand appraisal.” Appellant emphasized in the letter that “[Appellant] is not requesting mediation.” (emphasis added). Additionally, Appellant enclosed a brochure on how Appellee could proceed with medication. Thereafter, Appellee replied in a letter indicating, “I agree to participate in the 627.7015 mediation program.” (emphasis added). This Court’s review begins with applying this sequence of events to section 627.7015, Florida Statutes. First, Appellant complied with the first part of sub-section (7) by providing Appellee with the required DFS mediation information. Second, the latter portion of sub-section (7) states that “or if the insurer requests the mediation.” (emphasis added). As a result of reading the “if,” it is clear that since the Appellant did not request the mediation, the remaining portion of the sentence in sub-section (7) does not apply. Therefore, Appellee’s, reliance upon the administrative rule as an alternative was permissible.
Although, a statute takes precedence over a rule, as long as the administrative rule does not enlarge, modify, or contravene the provisions of a statute, the administrative rule is applicable. First, the initial part of rule 69O-166.031 (10) (c), Florida Administrative Code is not at issue here, since, it is applicable only “if the Insured decided not to participate” in mediation. (emphasis added). Here, the Insured did participate in the DFS mediation. Next, reading the latter part of sub-section (10) (c), “if the parties are unsuccessful at resolving the claim, the Insured may choose to proceed under the appraisal process . . . or by litigation . . . . (emphasis added). Therefore, pursuant to rule 69O-166.031 (10) (c), Florida Administrative Code, Appellee was authorized to proceed with litigation, by the filing of a complaint, without being subjected to a loss appraisal process since mediation had failed.
This Court agrees with the trial judge, in that, the statute is meant as a way to force mediation and to provide an even playing field. This Court further agrees with the trial judge in that to interpret section 627.7015, Florida Statutes as Appellant suggests would allow Appellant to always request a loss appraisal, which would force the claimant to request mediation; and, Appellant would have no incentive to mediate fairly, since, if an impasse results, and Appellant never requested mediation, Appellant could still proceed with requiring a loss appraisal process. (emphasis added). This in effect would “effectively eviscerate the purpose of the statute,” as indicated by the trial judge. In interpreting the statute’s stated purpose, it was designed as a way of providing alternatives that are effective and fair and providing an informal and nonthreatening forum.
Finally, as to Appellee’s “Motion to Tax Appellate Attorney Fees and Cost,” this Court is guided by the Florida Supreme Court’s interpretation of the legislature’s enactment of section 627.4282, Florida Statute. Florida Supreme Court has noted that,
“when a dispute arises between an insurer and an insured, and judgment is entered in favor of the insured, he or she is entitled to attorney’s fees . . . . It is clear to us that the purpose of this provision is to level the playing field so that the economic power of insurance companies is not so overwhelming that injustice may be encouraged because people will not have the necessary means to seek redress in the courts.” Ivey v. Allstate Ins. Co., 774 So.2d 679, 684 (Fla. 2000) [25 Fla. L. Weekly S1103a].
However, Florida Rule of Appellate Procedure 9.400 (b) requires that a motion for attorney fees be filed no later than the time for service of the reply brief. Additionally, section 9.400 (a), Florida Rule of Appellate Procedure, provides that cost shall be taxed by the lower tribunal on motion served within 30 days after the mandate issues. In the instant case, Appellant filed the initial brief on July 23, 2010 and the Appellee’s answer brief was filed on September 20, 2010,3 more than 20 days after service of the initial brief4. Thus, Appellee’s motion for attorneys’ fees is denied as untimely. [Editor’s note: court’s ruling on this issue was was changed on rehearing. 19 Fla. L. Weekly Supp. 86a] Lobel v. Southgate Condo. Aso. Inc., 436 So.2d at 170 (Fla. 4th DCA 1983).
As such,
(1) the lower court’s order denying Appellant’s “Motion to Dismiss or, in the Alternative, to Stay Proceedings and Compel Appraisal” is AFFIRMED,
(2) Appellee’s request for Attorney fees are DENIED, and
(3) Appellee’s request for Cost is remanded to the lower court to determine as permitted according to Florida Rule of Appellate Procedure 9.400 (a).
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1The nature of the order is non-final.
2Attorney’s fee — “Upon the rendition of a judgment or decree by any of the courts of this state against an insurer and in favor of any named or omnibus insured or the named beneficiary under a policy or contract executed by the insurer, the trial court or, in the event of an appeal in which the insured or beneficiary prevails, the appellate court shall adjudge or decree against the insurer and in favor of the insured or beneficiary a reasonable sum as fees or compensation for the insured’s or beneficiary’s attorney prosecuting the suit in which the recovery is had.” [Editor’s note: court’s ruling on this issue was was changed on rehearing. 19 Fla. L. Weekly Supp. 86a.]
3This Court notes the lower court’s order “Granting Appellee’s Second Motion for Extension of Time.” The lower court extended the date of service of Appellee’s Answer Brief to October 9, 2010.
4Section 9.210 (f), Florida Rule of Appellate Procedure provides that “the answer brief shall be served within 20 days after service of the initial brief; the reply brief, if any, shall be served within 20 days after service of the answer brief; . . . .”
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