Ashley J. Johns

The appellant, People’s Trust Insurance Company (hereinafter “People’s Trust” or “Appellant”) appealed the trial court’s order denying its motion to compel appraisal. On September 8, 2022, the Appellees, Cesar Fernandez and Luz Fernandez (hereinafter “Fernandez” or “Appellees”), filed an insurance claim with People’s Trust for damages sustained to their roof and bathroom. After an inspection of the property on October 7, 2022, People’s Trust issued a coverage determination extending coverage for the roof but denying coverage for the bathroom ceiling. As a result, People’s Trust estimated the replacement cost for the repairs to be $947.51. As the amount fell below Fernandez’s $1,000 deductible, no payment was issued.

Over two years later, Fernandez obtained an estimate for repairs that determined the cost of repairs to be $149,866.98. Despite standing by its initial coverage decision, People’s Trust made a $100 settlement offer in response to Fernandez’s Notice of Intent to Initiate Litigation, “without waiving its right under the insurance policy to seek legal remedies to enforce [the] insurance policy.” Fernandez filed suit against People’s Trust on April 15, 2025 for breach of contract. In response to the complaint, on May 21, 2025, People’s Trust filed its Answer and Affirmative Defenses asserting the “policy’s appraisal provision was the appropriate mechanism for resolving scope disputes between parties” as its third affirmative defense. Six days later, on May 27, 2025, People’s Trust filed a Motion to Compel Appraisal, which the trial court denied. The trial court specifically found that the actions of People’s Trust, including maintaining its coverage position and responding to the Notice of Intent to Initiate Litigation with a settlement offer was inconsistent with their right to invoke appraisal, which therefore waived its right.

Here, the court addresses the potential requirement of having to invoke appraisal prior to a lawsuit being filed. The court determined that Florida Courts have consistently held that an appraisal clause may be invoked for the first time after a lawsuit has been commenced. “The operative legal standard to determine whether an insurer waived appraisal is whether the insurer actively participated in the lawsuit or engaged in conduct inconsistent with the right to appraisal.” The court specifically states that Appellant’s settlement offer in response to the Notice of Intent to Initiate Litigation alone was not a waiver of its right to appraisal, but a mere first step in resolving the matter.

Appellant’s actions in this case were not inconsistent with its right to appraisal as it filed its affirmative defenses invoking appraisal, as well as filed a motion to compel appraisal promptly thereafter. Thus, the court ruled that Appellant did not waive its right to appraisal. Thus, the trial court erred in denying Appellant’s motion to compel appraisal.