Opinion ID: 1670168
Heading Depth: 1
Heading Rank: 3

Heading: agreement for appraisal

Text: The issue to be resolved is whether an unambiguous provision for appraisal may be construed as an agreement to arbitrate the underlying dispute. As we stated in Siegle v. Progressive Consumers Insurance Co., 819 So.2d 732 (Fla.2002): When an insurance contract is not ambiguous, it must be given effect as written. See State Farm Fire & Cas. Co. v. Oliveras, 441 So.2d 175, 178 (Fla. 4th DCA 1983). Id. at 735. Neither the trial court nor the Third District in Suarez found the appraisal clause in the homeowner's policy to be ambiguous, nor do we find any ambiguity in the clause. It is clear from a plain reading of the clause that an informal appraisal proceeding, not a formal arbitration hearing pursuant to section 682.06, Florida Statutes (1999), was intended and agreed upon by the parties in agreeing to the appraisal provisions of the policy. See Liberty Mut. Fire Ins. Co. v. Hernandez, 735 So.2d 587, 589 (Fla. 3d DCA 1999) ([T]he clause contemplates inspection and valuation by each appraiser individually, not a trial-type hearing.). We disapprove of the decisions in Sheaffer and Hoenstine, because the appraisal clauses in those cases were substantially similar to the one in the present case, and a plain reading of those clauses reveals that formal arbitration was not contemplated or agreed upon by the parties. In Sheaffer, the First District went beyond the plain meaning of the appraisal clause when it considered that the appraisers would have to exercise ... quasi-judicial authority to resolve the dispute. 687 So.2d at 1334. Further, we disapprove of the analysis that the appraisal provision neither excludes application of the Florida Arbitration Code, nor sets forth procedures inconsistent with the Arbitration Code. Id. at 1335 (citations omitted). Once a trial court has determined that the appraisal provisions of a contract of insurance have been properly invoked, further proceedings should be conducted in accord with those provisions, rather than by the wholly different proceedings contemplated by an agreement to arbitrate. [5] Thus, we agree with the Third District's conclusion in this case that the agreement specifically provides for an appraisal. It is difficult to imagine that a formal arbitration hearing was within the contemplation of the parties when entering into the agreement. Suarez, 786 So.2d at 647. Once the trial court in this case found that the Suarezes properly invoked the appraisal clause and directed the parties to appraisal proceedings, the umpire correctly followed the trial court's ruling by refusing to proceed under the formal procedures of the Arbitration Code. Accordingly, we approve the decision of the district court of appeal and disapprove the holdings in Sheaffer and Hoenstine. It is so ordered. ANSTEAD, C.J., and SHAW, WELLS, PARIENTE, LEWIS and QUINCE, JJ., concur. CANTERO, J., recused.