LoBello v. State Farm Florida Insurance Co., 152 So. 3d 595

Background

Anthony and Patricia LoBello noticed cracking in their 2002 home beginning in late 2004; they initially treated cracks as ordinary settlement and repaired them.
After consulting a public adjuster, they submitted a sinkhole claim to State Farm on February 20, 2008; EUOs were taken in July 2008 and State Farm denied coverage in November 2008 for late notice and asserted prejudice.
The LoBellos sued in May 2009 alleging breach of contract and failure to perform required sinkhole testing; State Farm asserted untimely notice as an affirmative defense.
The circuit court twice found genuine issues of material fact as to when the LoBellos should have known a claim would arise and granted partial summary judgment to the LoBellos on State Farm’s investigative duties.
Later, relying on Kroener and Hochberg, the circuit court granted State Farm a final summary judgment dismissing the LoBellos’ claim; the LoBellos appealed.
The appellate court reversed, holding that a factual issue on timeliness remained and that the court must apply the two-step Macias prejudice analysis if notice is found untimely.

Issues

Issue	LoBello's Argument	State Farm's Argument	Held
Timeliness of notice under "immediate notice" policy clause	Notice was not required in 2004 because the LoBellos reasonably believed cracking was ordinary settlement; timeliness is fact-dependent	Cracking first appeared in 2004 so notice was untimely (multi-year delay) and as a matter of law barred the claim under Kroener/Hochberg	Material fact exists whether notice was timely; jury must decide timeliness; summary judgment on timeliness improper
Effect of untimely notice — need to prove prejudice	If notice untimely State Farm must still show prejudice; insured may rebut presumed prejudice	Kroener purportedly bars late claims without addressing prejudice	Court requires two-step Macias analysis: if notice untimely prejudice is presumed but insured can rebut; circuit court erred by skipping prejudice analysis
Reliance on Kroener/Hochberg as controlling law	Those cases are distinguishable and cannot override controlling Supreme Court and district precedent requiring fact-specific timeliness inquiry	Kroener/Hochberg provide rule supporting summary judgment for delay	Court rejects State Farm’s broad reading of Kroener/Hochberg; those cases do not create a bright-line bar and cannot override controlling precedent
Final judgment after interlocutory rulings	Earlier interlocutory orders left timeliness a genuine factual dispute and granted partial relief to LoBellos; final judgment inconsistent	Final judgment based on later-cited authorities resolves case as matter of law	Appellate court held trial court improperly entered final summary judgment without resolving factual disputes; reversal and remand required

Key Cases Cited

State Farm Mut. Auto. Ins. Co. v. Ranson, 121 So.2d 175 (Fla. 2d DCA 1960) (purpose of notice/proof provisions and insurer's right to timely investigation)
Am. Fire & Cas. Co. v. Collura, 163 So.2d 784 (Fla. 2d DCA 1964) ("immediate notice" read as "as soon as practicable"; reasonableness depends on circumstances)
Ideal Mut. Ins. Co. v. Waldrep, 400 So.2d 782 (Fla. 3d DCA 1981) (timeliness of notice is fact-specific; notice required when occurrence should lead reasonable person to believe a claim would arise)
Bankers Ins. Co. v. Macias, 475 So.2d 1216 (Fla. 1985) (untimely notice gives rise to presumption of prejudice, which insured may rebut)
Kroener v. Fla. Ins. Guar. Ass’n, 63 So.3d 914 (Fla. 4th DCA 2011) (district court decision referenced by parties; later limited by subsequent authority)
Hochberg v. Thomas Carter Painting, Inc., 63 So.3d 861 (Fla. 3d DCA 2011) (construction-defect decision cited by State Farm for inference of notice on manifestation)
1500 Coral Towers Condo. Ass’n v. Citizens Prop. Ins. Corp., 112 So.3d 541 (Fla. 3d DCA 2013) (applies two-step timeliness–prejudice framework)