23 Fla. L. Weekly Supp. 972a
Online Reference: FLWSUPP 2309MAHAInsurance — Automobile — Coverage — Prevailing competitive price — Where applicable policy provisions state that cost of repair is based on prevailing competitive price and define prevailing competitive price as price charged by majority of repair market in area as determined by survey made by insurer, and insurer made payment based on cost-estimating method and price reported by majority of area repair facilities surveyed, insurer is entitled to summary judgment
COASTLINE AUTO, INC., a/a/o HARRYNARINE MAHARAJ, Plaintiff(s), v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant(s). County Court, 17th Judicial Circuit in and for Broward County. Case No. COCE12-020313(54). February 1, 2016. Stephen J. Zaccor, Judge. Counsel: Martin Mehan, Gordon & Doner, P.A., Palm Beach Gardens, for Plaintiff. Johanna W. Clark and Joshua D. Moore, Carlton Fields, Orlando, for Defendant.
ORDER ON CROSS MOTIONSFOR SUMMARY JUDGMENT
THIS CAUSE coming on for consideration of the parties cross-motions for summary judgment relative to the meaning of a term within an insurance policy, and the Court having reviewed the motions, the relevant legal authority, the record, hearing argument from counsel, and being otherwise fully advised in the premises, makes the following findings and conclusions of law:
Coastline Auto (hereinafter the Plaintiff), made repairs to Harrynarine Maharaj’s (hereinafter the Insured) vehicle. The Insured was covered by a policy issued by State Farm (hereinafter the Defendant). The Defendant failed to pay the full amount charged by the Plaintiff for the repairs. The Insured assigned his rights under the policy to the Plaintiff who brought suit.
The Plaintiff alleges in its complaint the Insured incurred reasonable expenses to restore his vehicle to pre-accident condition and the Defendant failed to make full payment. The Defendant based its payment on upon the “prevailing competitive price.” The Defendant determined the “prevailing competitive price” by conducting a survey of the major repair facilities in the area where the car was repaired. The portion of the insurance policy that provides for “prevailing competitive price” is at issue here.
The issue before the court involves the construction of an insurance policy, which presents a question of law to be decided by the court. Nat’l Union Fire Ins. Co. of Pittsburgh, PA v. Underwriters at Lloyd’s, London, 971 So. 2d 885, 888 (Fla. 3d DCA 2007) [32 Fla. L. Weekly D2827b]. The policy at issue provides:
The cost of repair or replacement is based upon the following:
1. The cost of the repair or replacement agreed upon by you and us;
2. A competitive bid approved by us; or
3. An estimate written — based upon the prevailing competitive price. The prevailing competitive price means prices charged by a majority of the repair market in the area where the car is to be repaired as determined by a survey made by us.
There was no agreement between the parties, nor was there a competitive bid approved by the Defendant, therefore options one and two above do not apply. Option three unequivocally states the cost of repair is based upon a written estimate predicated on the prevailing competitive price (hereinafter PCP). PCP is defined as the “prices charged by a majority of the repair market in the area where the car is to be repaired as determined by a survey made by us.” The undisputed evidence is the survey made by the Defendant revealed a “majority of the repair market” does not use a paint calculator1, and charges twenty-four dollars or less per hour for paint and materials.
The Plaintiff takes issue with how the Defendant interprets the data contained in the survey and argues there is an ambiguity in the language of the contract. “If the relevant policy language is susceptible to more than one reasonable interpretation, one providing coverage and the [other] limiting coverage, the insurance policy is considered ambiguous.” Swire Pac. Holdings, Inc. v. Zurich Ins. Co., 845 So. 2d 161, 165 (Fla. 2003) [28 Fla. L. Weekly S307d]. An ambiguous policy term must be construed in favor of coverage, or against limiting coverage. Id.
According to the survey, the highest rate charged by a facility within the repair market is thirty-six dollars, and the lowest rate charged is eight dollars2. The Plaintiff maintains their charge of thirty-one dollars and thirty-two cents falls within the definition of the policy because it is less than thirty-six dollars. The Plaintiff argues that due to the ambiguity of the term “prices charged by a majority of the repair market,” the court should construe the policy in their favor and find their rate falls within the majority. The Plaintiff’s argument must fail. There is no ambiguity in the insurance contract. PCP is specifically defined as being determined “by a survey made by us.” The insurance contract gives the Defendant tremendous discretion in how to conduct its survey. The survey was compiled by the repair facilities filling out a questionnaire provided by the Defendant. The questionnaire asks various questions, including as pertinent to the case at bar:
Part III – Repair Pricing Information
4. Do you use an automated paint and materials rate calculator?
___ Yes ___ No
If no, what is the rate charged for paint and materials?
$_____
Nine-hundred and forty-eight facilities voluntarily responded to the survey. Four-hundred and eighty-six facilities (more than half) reported a paint and materials rate of twenty-four dollars or less. Even more than that reported that they do not use a paint and materials rate calculator. Therefore, the PCP for paint and materials is twenty-four dollars.
CONCLUSION
There is no ambiguity in the contract for insurance as to the definition of the Prevailing Competitive Price, therefore:
It is ORDERED AND ADJUDGED that the Plaintiff’s Motion for Summary Judgment is DENIED and the Defendant’s Motion for Partial Summary Judgment is GRANTED.
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1A Paint Calculator is an alternative method to estimating the costs of repairs and the one used by the Plaintiff.
2Those two rates are statistical outliers within the survey.
