Carolin A. Pacheco

The plaintiff’s case arose out of an assignment of insurance benefits agreement executed by the insured-assignor and the plaintiff-assignee on April 19, 2022, which was attached to the plaintiff’s complaint as an exhibit, along with numerous estimates and invoices for various services rendered by the plaintiff. The complaint alleged breach of contract and breach of contract with implied equitable assignment of benefits in the alternative. The plaintiff’s assignment of benefits agreement was subject to section 627.7152, which applies to assignment agreements executed on or after July 1, 2019, through May 25, 2022.

Notably, the defendant’s motion asserted that the plaintiff’s assignment of benefits agreement was invalid and unenforceable for improperly containing an administrative fee, in violation of section 627.7152(2)(b)4, and because emergency services were provided under the assignment agreement and said services exceeded $3,000, in violation of section 627.7152(c). While the court disagreed with the “administrative fee” portion of the argument, the court agreed that the assignment failed to comply with § 627.7152, which provides the following limitations for a valid and enforceable assignment:

If an assignor acts under an urgent or emergency circumstance to protect property from damage and executes an assignment agreement to protect, repair, restore, or replace property or to mitigate against further damage to the property, an assignee may not receive an assignment of post-loss benefits under a residential property insurance policy in excess of the greater of $3,000 or 1 percent of the Coverage A limit under such policy. For purposes of this paragraph, the term “urgent or emergency circumstance” means a situation in which a loss to property, if not addressed immediately, will result in additional damage until measures are completed to prevent such damage.

Section 627.7152(2)(c), Fla. Stat.; see also § 627.7152(2)(d), Fla. Stat. (providing that “[a]n assignment that does not comply with this subsection is invalid and unenforceable”).

In making its determination, the court noted that the plaintiff’s own complaint alleged that “emergency water removal services” were provided to the insured, and it further conceded during the motion hearing that at least some services were provided under emergency circumstances. Yet, the total amount of the estimate and invoices submitted in support of the assignment far exceeded the statutory requirement, including the self-labeled invoice with the “emergency service call” line item, totaled $12,116.50.

In response to the plaintiff’s argument that § 627.7152(2)(c) merely limits the amount an assignee can recover for emergency services and the entire assignment agreement should not be deemed invalid and unenforceable despite the total amount charged for both emergency and non-emergency services exceeding $3,000, the court once again disagreed. The court reasoned that it must, instead, consider whether the plaintiff received an assignment agreement under an emergency circumstance for an amount that exceeded the limit imposed by section 627.7152(2)(c) to “protect . . . property or to mitigate against further damage to the property,” which are purposes that may fall under the statute’s express definition of “urgent or emergency circumstance.” 

The court ruled the statute does not delineate which services (emergency or non-emergency) rendered under the assignment agreement cannot exceed the statutory limit; rather, the statute simply provides that “an assignee may not receive an assignment of post-loss benefits under a residential property insurance policy in excess of” the statute’s limit.

The trial court recognized the precedent established in Restoration Team v. S. Oak Ins. Co., 357 So. 3d 236, 241 (Fla. 3d DCA 2023) [48 Fla. L. Weekly D335a], which affirmed dismissal of the assignment of insurance benefits suit with prejudice because, among other reasons, the assignment agreement for emergency services exceeded the limit allowed under section 627.7152(2)(c). 

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