DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA

FOURTH DISTRICT

FIVE SOLAS, LLC and WILLIAM W. PRICE, P.A.,

Appellants/Cross-Appellees,

v.

RAM REALTY SERVICES, LLC and SODIX FERN, LLC

d/b/a ALEXANDER LOFTS,

Appellees/Cross-Appellants.

No. 4D19-2211

[May 26, 2021]

Appeal and cross-appeal from the Circuit Court for the Fifteenth 

Judicial Circuit, Palm Beach County; Cymonie S. Rowe, Judge; L.T. Case 

No. 502016CA004267.

Bard D. Rockenbach of Burlington & Rockenbach, P.A., West Palm 

Beach, for appellants/cross-appellees.

Todd R. Ehrenreich, David L. Luck, and Jenna L. Fischman of Lewis 

Brisbois Bisgaard & Smith, LLP, Coral Gables, for appellees/crossappellants.

ARTAU, J.

In 2016, a brick wall from a neighboring building collapsed, causing it

to fall upon a building owned by Five Solas, LLC (“owner”). The owner had

leased the building to its affiliated law firm, William Price, P.A. (“lessee”).

The collapse was so destructive that it rendered the building untenantable 

and displaced the lessee. The owner’s building was covered by a 

replacement cost insurance policy which the owner had purchased from 

Foremost Insurance Company (“insurer”). However, the policy was subject 

to a liability limit for the replacement cost and a corresponding deductible. 

The owner’s and lessee’s resulting claims against the parties responsible 

for the collapse of the neighboring building (“tortfeasors”) were determined

by jury verdict, with the trial court disposing of post-verdict set-off claims.

The owner and lessee have asserted five issues on appeal. The 

tortfeasors, for their part, asserted a cross-appeal, but did not pursue it in 

their answer brief. While we affirm without further comment as to the 
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cross-appeal and two of the issues asserted by the owner and lessee, we

reverse on the remaining three issues asserted by them and remand for 

the trial court to correct a scrivener’s error in the final judgment that

awards the entire recovery to the owner despite delineating $176,219.17 

of the recovery for the lessee.

First Issue: Replacement Costs Paid by Insurer

To compensate the owner, the insurer paid $430,518.25 (“building

payout”) representing the insurer’s maximum liability pursuant to the 

insurance policy for the replacement cost of the building after subtracting 

the applicable deductible.

Despite the building payout, the owner and lessee proceeded with their 

claims against the tortfeasors, asserting that their insurance proceeds did 

not make them whole for the losses they incurred.

After bringing its own claim against the tortfeasors, the insurer settled 

with them and agreed, as part of its settlement, to assign any of their 

subrogation rights to the tortfeasors who stand in the insurer’s shoes, so 

to speak, for purposes of this appeal. See Despointes v. Fla. Power Corp., 

2 So. 3d 360, 361 (Fla. 2d DCA 2008) (where the insurance company 

assigned its right of subrogation, the assignee “stepped into the shoes” of 

the insurer).

The jury determined that the replacement cost for the owner’s building 

was $943,829, and the fair market value of the building was $535,000. In 

determining the set-off claims, the trial court subtracted the difference 

between the building payout for the partial replacement cost—

$430,518.25—from the jury’s determination of $535,000 as the fair 

market of the damaged building. Thus, the tortfeasors were only required 

to pay the building owner $104,481.75.

The building owner argues that it should be placed back in the position 

it was in before the building damage, and that it is entitled to the benefit 

of its bargain for having purchased replacement cost insurance. 

Conversely, the tortfeasors contend the trial court was correct to set-off

the building payout from the jury verdict, without which the building 

owner would obtain a windfall or duplicative recovery.

This situation mimics the ancient parable of the blind men and the 

elephant. In this parable, blind men approach what they have heard is a 

strange animal in the center of town and begin to describe the creature. 

One touches the trunk and says that the animal must be like a thick 
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snake. Another touches a leg and says the animal must be like a tree 

trunk. Still another touches the tusk and thinks the animal must be like 

a spear. However, none of them see the whole picture, and consequently 

how all parts comprise the whole.

Both sides here point to different measures of damages, but each 

measure is a different part of the animal, as it were, while neither comprise

the animal in its full form.

Replacement cost is what the building owner contracted for, but the 

insurance policy only covered a portion of the replacement cost because of 

the policy’s liability limits. See Prudential Prop. & Cas. Ins. Co. v. Swindal, 

622 So. 2d 467, 470 (Fla. 1993) (“Insurance contracts are construed in 

accordance with the plain language of the policies as bargained for by the 

parties.”).

On the other hand, the fair market value of the damaged building is 

what the tortfeasors must pay. See Davey Compressor Co. v. City of Delray 

Beach, 613 So. 2d 60, 61 (Fla. 4th DCA 1993) (“As a general rule, damages 

for injury to real property cannot exceed the value of the property.”); see 

also Trinidad v. Fla. Peninsula Ins. Co., 121 So. 3d 433, 438 (Fla. 2013) 

(“In contrast to a replacement cost policy, actual cash value is generally 

defined as ‘fair market value[.]’”).

‘“Replacement cost insurance is designed to cover the difference 

between what property is actually worth and what it would cost to rebuild 

or repair that property.’” Trinidad, 121 So. 3d at 438 (quoting State Farm 

Fire & Cas. Co. v. Patrick, 647 So. 2d 983, 983 (Fla. 3d DCA 1994)). 

Replacement cost covers the cost to replace the damaged structure on the 

same premises. Id. “In other words, replacement cost policies provide 

greater coverage than actual cash value policies because depreciation is 

not excluded[.]” Id. (citing Goff v. State Farm Fla. Ins. Co., 999 So. 2d 684, 

689 (Fla. 2d DCA 2008)).

Thus, the replacement cost was contractually obtained here to cover 

much more than the value of the prior structure. It covers the cost of 

replacing the old depreciated structure with a new building.

While the tortfeasors are correct that the building owner should not 

receive a windfall or duplicative recovery, the building owner is also correct 

that it is entitled to the benefit of its bargain from its purchase of the 

replacement cost insurance. Although the building owner could not be 

awarded more than the fair market value of the building from the 

tortfeasors, the owner was entitled to the benefit of its bargain from its 
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insurer because it purchased replacement cost insurance which pays to 

replace the building, rather than the value of the existing structure. See 

Swindal, 622 So. 2d at 470 (“Florida law has long followed the general rule 

that tort law principles do not control judicial construction of insurance 

contracts.”); see also Fla. Farm Bureau Ins. Co. v. Martin, 377 So. 2d 827, 

829 (Fla. 1st DCA 1979) (subrogation is not available simply because the 

insured had ‘“the foresight to obtain, and had paid the expense of 

procuring, insurance for his protection;’” it is only available ‘“after the 

insured has been fully indemnified.’” (quoting DeCespedes v. Prudence 

Mut. Cas. Co. of Chicago, Ill., 193 So. 2d 224, 227 (Fla. 3d DCA 1966)).

Florida adheres to the common law rule that an insurer does not have 

a right to subrogation against an insured who has not been made whole. 

E.g., Humana Health Plans v. Lawton, 675 So. 2d 1382, 1384 (Fla. 5th 

DCA 1996). In other words, Florida follows the general rule of subrogation 

that an insurer ‘“may recover from insured only the excess, which insured 

has received from the wrongdoer causing the loss, remaining after insured 

is fully compensated for his [or her] loss and the cost and expenses of the 

recovery thereof.’” Martin, 377 So. 2d at 829 (quoting Cent. Nat’l Ins. Grp. 

v. Hotte, 312 So. 2d 235, 237 (Fla. 1st DCA 1975)).

Accordingly, the trial court erred in limiting the jury’s award against 

the tortfeasors to $104,481.75, by awarding a set-off for the difference 

between the building payout for its partial replacement cost—

$430,518.25—and the jury’s award of the fair market value of the 

building—$535,000.

These amounts were not awarded to compensate for the same damages. 

Instead, the insurer paid the construction cost of replacing the old 

structure with a new building, while the fair market value awarded against 

the tortfeasors only compensates for the damage to the old depreciated

building.

Because it was incorrect to conflate the two different measures of 

damages, and the owner was entitled to be made whole under the common 

law rule before a subrogation right can inure to the insurer, the tortfeasors

are only entitled to a set-off or subrogation claim as the insurer’s assignees 

for any amounts exceeding the greater of the two measures of recovery.

Here, the jury found that the greater of the two measures of recovery 

was the replacement cost of $943,829. Because the combined amounts

received from the tortfeasors and the insurer exceeded the total 

replacement cost determined by the jury by $21,689.25, the tortfeasors

were only entitled to a set-off for that amount.
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Therefore, we reverse the set-off which credited the replacement cost 

paid by the owner’s insurer against the fair market value awarded against 

the tortfeasors by the jury. We remand for a set-off and judgment 

consistent with this opinion.

Second Issue: Lost Rental Income

The second issue pertains to the trial court’s set-off or reduction of 

$127,200 received by the lessee in business interruption damages from 

the $302,400 awarded by the jury for the building owner’s lost rental 

income.

The $127,200 was paid to the displaced lessee by the insurer to cover 

the maximum amount allowed under the policy to cover the expense of 

renting a substitute leasehold from another landlord.

The building owner argues that while its lessee was reimbursed for 

some of the amounts it had to pay to another landlord to rent substitute 

space, the owner lost its rental income while the building was rendered 

untenantable.

The tortfeasors argue that because the building owner and the lessee 

have common ownership, the building owner did not ultimately lose any 

rental income. They allege an alter ego theory should entitle them to pierce 

the corporate veil because of the common ownership and affiliation 

between the building owner and the lessee.

We agree with the building owner’s argument.

For the corporate veil to be pierced, a litigant would have to

demonstrate the existence of improper conduct in the formation or use of 

the entity in question. 111 Props., Inc. v. Lassiter, 605 So. 2d 123, 125 

(Fla. 4th DCA 1992). Sole ownership interest of a corporate entity does 

not entitle a claimant to pierce the corporate veil, absent some fraudulent 

purpose or conduct. Rashdan v. Sheikh, 706 So. 2d 357, 357-58 (Fla. 4th 

DCA 1998).

A hallmark of corporate law is the feasibility, legality, and propriety of 

different entities for separate business or economic purposes. See 

generally Burnet v. Clark, 287 U.S. 410, 415 (1932) (“A corporation and its 

stockholders are generally to be treated as separate entities.”); see also

Am. States Ins. Co. v. Kelley, 446 So. 2d 1085, 1086 (Fla. 4th DCA 1984) 

(“The general rule is that corporations are legal entities separate and 
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distinct from the persons comprising them. Absent fraud, the corporate 

veil is not pierced.” (citation omitted)).

The tortfeasors here did not present any competent, substantial

evidence of any fraudulent purpose or conduct that would overcome the 

benefit of the bargain which the building owner had with its affiliated 

lessee, nor was that issue presented for a jury determination. See Church 

of Scientology of Cal. v. Blackman, 446 So. 2d 190, 192 (Fla. 4th DCA 1984) 

(“Normally, the question of whether a corporation is an instrumentality or 

an alter ego of another corporation is an issue of fact for the jury.”).

Accordingly, the trial court erred in setting off the jury award of lost 

rental income based on the amount which the insurer paid to rent a 

substitute leasehold from another landlord for the displaced lessee. While 

the amount which the insurer paid for a substitute leasehold compensated 

the lessee for part of its damages, it did not make the building owner whole

for the lost income it suffered while its building remained untenantable.

Therefore, we reverse the set-off or reduction of the lost rental income 

awarded by the jury to the building owner, and remand for entry of

judgment consistent with this opinion.

Third Issue: Prejudgment Interest

As to the third issue, the parties agree that the trial court should have 

awarded prejudgment interest because the loss here was that of a vested 

property right as of a date certain. See Argonaut Ins. Co. v. May Plumbing 

Co., 474 So. 2d 212, 215 (Fla. 1985) (prejudgment interest is properly 

awarded in a case involving the negligent destruction of a building by fire 

on a date certain).

“Once a verdict has liquidated the damages as of a date certain, 

computation of prejudgment interest is merely a mathematical 

computation. There is no ‘finding of fact’ needed. Thus, it is a purely 

ministerial duty of the trial judge or clerk of the court to add the 

appropriate amount of interest to the principal amount of damages 

awarded in the verdict.” Id.

We agree with the parties and remand the denial of prejudgment 

interest for the trial court to make the appropriate computation.

Affirmed in part, reversed in part, and remanded for further proceedings 

consistent with this opinion and correction of the scrivener’s error.
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WARNER and MAY, JJ., concur.

* * *

Not final until disposition of timely filed motion for rehearing.