100 So. 3d 1155
Fla. Dist. Ct. App.2012Background
- Trafalgar’s Gulf Coast shopping center damaged by Hurricane Wilma; insured claim with Zurich; Zurich reserves $1.5M, later partial payments totaling under $642k before appraisal.
- Zurich invoked appraisal after dispute on loss amount; appraisal process required two appraisers and an umpire if needed.
- September 2007 appraisal awarded Trafalgar $1,504,663.10; Zurich paid within 30 days, deducting prior payments and deductible.
- Trafalgar sought to confirm appraisal and for attorney’s fees; Zurich sought summary judgment on breach of contract and bad faith claims.
- Trial court granted Zurich summary judgment on breach of contract and Trafalgar’s bad faith claim was dismissed as premised on no favorable resolution; court reversed on bad faith theory and remanded for trial.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether appraisal award is a favorable resolution for bad faith. | Trafalgar argues appraisal resolves loss amount favorably to insured. | Zurich contends summary judgment barred bad faith absent favorable resolution. | Yes; appraisal qualifies as favorable resolution allowing bad faith action. |
Key Cases Cited
- Vest v. Travelers Ins. Co., 753 So.2d 1270 (Fla.2000) (prematurity rule for first-party bad faith claims requiring resolution of liability and damages)
- Blanchard v. State Farm Mut. Auto. Ins. Co., 575 So.2d 1289 (Fla.1991) (insured must obtain favorable resolution of liability/damages before bad faith accrues)
- Dadeland Depot, Inc. v. St. Paul Fire & Marine Ins. Co., 945 So.2d 1216 (Fla.2006) (arbitration award can satisfy favorable resolution prerequisite)
- Imhof v. Nationwide Mut. Ins. Co., 643 So.2d 617 (Fla.1994) (no need for trial/arbitration; resolution of some kind in insured’s favor suffices)