Stay of Trial Court Was Proper in Breach of Contract Case Where Appraisal Was Ongoing

Subirats v. Fidelity Nat’l Prop. (Fla. 3d DCA 2013)

This case concerned an appeal from a non-final order in which a trial court stayed a breach of contract action pending completion of appraisal in connection with a claim for water damage to a residential home. The insureds argued on appeal that the trial court had erred in ordering the stay since the insurer had waived its right to appraisal by failing to notify the insureds of the right to mediation within five days from the date the claim was filed.

The insured’s argument was premised upon (i) Florida Statute section 627.7015(7), which provides that failure to give notice excuses an insured from participating in any contractual loss appraisal process and (ii) Florida Administrative Rule 69J-166.031(4)(a)(1), a rule promulgated by the Florida Department of Financial Services (the “Department”) pursuant to section 627.7015(4), which stated that “within five days of the insured filing a first-party claim which falls within the scope of this rule, the insurer shall notify the insured of their right to participate in this program.”

The court rejected the insureds’ argument and affirmed the stay, explaining that the Department exceeded its rulemaking authority in adopting the five-day rule: “[W]here a statute does not contain a specific grant of legislative authority for a certain rule, any such rule is an invalid exercise of delegated legislative authority. The most casual perusal of section 627.7015(4) reveals the Department was not granted the authority to promulgate a deadline for notifying an insured of the right to mediation. In so doing, the Department impermissibly modified and enlarged the scope of the statute.”

Explore posts in the same categories: New Florida Insurance Coverage Cases

Tags: Stay of Litigation

You can comment below, or link to this permanent URL from your own site.