Opinion ID: 4553195
Heading Depth: 2
Heading Rank: 1

Heading: National flood insurance

Text: The National Flood Insurance Act, 42 U.S.C. § 4001 et seq., established the NFIP to provide flood insurance at affordable rates. See Ferraro v. Liberty Mut. Fire Ins. Co., 796 F.3d 529, 531 (5th Cir. 2015). FEMA operates the program and issues policies directly or through private insurers called WYO carriers, such as Wright, that are fiscal agents of the United States. § 4071(a)(1); Ferraro, 796 F.3d at 531–32. All SFIP policies are issued in a standard form, which cannot be altered or waived without the written consent of the Federal Insurance Administrator (“FIA”). Marseilles Homeowners Condo. Ass’n Inc. v. Fidelity Nat’l Ins. Co., 542 F.3d 1053, 1055 (5th Cir. 2008); 44 C.F.R. § 61.13(d). “An SFIP is a regulation of FEMA, stating the conditions under which federal flood-insurance funds may be disbursed to eligible policyholders.” Id. at 1054 (citation omitted). Because all claims for all policies issued under this program are paid directly from the federal treasury, the provisions of the SFIP policies must be strictly construed and enforced. Gowland v. Aetna Flood Ins. Program, 143 F.3d 951, 954 (5th Cir. 1998). An SFIP policyholder may not sue to recover losses covered under the SFIP unless the policyholder first “complied with all the requirements of the policy.” 44 C.F.R. § 61, app. A(1), art. VII(R). II. Clark’s April and December 2016 POLs’ compliance with the SFIP All the arguments for review arise from the district court’s grant of a summary judgment. We review a summary judgment de novo, applying the same standard as the district court. Austin v. Kroger Tex., L.P., 864 F.3d 326, 4 Case: 19-30334 Document: 00515515323 Page: 5 Date Filed: 08/04/2020 No. 19-30334 328 (5th Cir. 2017). “The court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” FED R. CIV. P. 56(a). “A genuine issue of material fact exists when the evidence is such that a reasonable jury could return a verdict for the non-moving party. . . . All evidence is viewed in the light most favorable to the nonmoving party and all reasonable inferences are drawn in that party’s favor.” Austin, 864 F.3d at 328–29. Clark and Pearl first argue that their 2016 POLs complied with the SFIP. The SFIP required Clark, the policyholder, to send Wright a “signed and sworn to” POL within 60 days of each loss. 44 C.F.R. § 61, app. A(1), art. VII(J)(4). A policyholder’s failure to provide a compliant POL “relieves the federal insurer’s obligation to pay what otherwise might be a valid claim.” Gowland, 143 F.3d at 954. Substantial compliance is not sufficient. Id. Here, the FIA expressly granted a limited waiver extending the 60-day deadline for filing POLs for both the March and August 2016 floods. Both the April 2016 POL for the March 2016 flood and the December 2016 POL for the August 2016 flood were timely. At issue is whether these POLs satisfied the SFIP’s “sworn-to” requirement. According to Clark and Pearl, the declaratory statement in the 2016 POLs — “I hereby declare and attest that the information contained in this letter is true and correct to the best of my knowledge” — satisfies the SFIP’s sworn-to requirement. The district court, however, concluded that the statement does not satisfy the SFIP’s sworn-to requirement because the POLs were not notarized and they did not include the phrase “under penalty of perjury.” Clark and Pearl contend that their declarations satisfied the sworn-to requirement because they declared and attested that the information was true and correct. They argue that sufficed because the SFIP does not define the term “sworn” and does not require the phrase “under penalty of perjury” or 5 Case: 19-30334 Document: 00515515323 Page: 6 Date Filed: 08/04/2020 No. 19-30334 notarization. Also, as policyholders, they had not been referred to some statute, court opinion, or other source explaining what it means to swear to the information. Finally, the NFIP Claims Handbook does not state that the POL must be notarized or include the phrase “under penalty of perjury.” The SFIP does not define “sworn.” See 44 C.F.R. §§ 59.1, 61.2. While the NFIP Claims Handbook states that POLs must be signed and must meet the requirements of the SFIP, it does not state that POLs must be notarized or must include the specific phrase “under penalty of perjury.” 1 Nevertheless, as we pointed out earlier, issued under this program are paid directly from the federal treasury, SFIP policy provisions must be strictly construed, and that would include the sworn-to requirement. Gowland, 143 F.3d at 954. To understand the phrase “sworn to” in a federal regulation, we rely on a statute explaining that when under any federal regulation a matter is required to be sworn to in writing, it may be supported by an unsworn, signed writing declaring the matter to be “true under penalty of perjury,” in a form substantially similar to “I declare (or certify, verify, or state) under penalty of perjury that the foregoing is true and correct. Executed on (date).” 28 U.S.C. § 1746. FEMA’s model POL form includes an attestation whereby policyholders “declare under penalty of perjury” that the information in their POL is “true and correct. 2 Section 1746 prohibits use of an unsworn declaration to satisfy a sworn-to requirements for depositions, oaths of office, or other oaths required to be taken by a “specified official.” § 1746. The statute makes clear that a “specified official” does not included a notary public. Id. 1 See NFIP Claims Handbook, https://www.fema.gov/media-librarydata/1508950641147-55cd79e196bc6ea15aba1c69bb9f1cef/FINAL_ClaimsHandbook.pdf (FEMA form F-687). 2 See Proof of Loss form, https://www.fema.gov/media-library-data/153307301525361a3c8a1dce7231a63f4c466a43615a8/FEMA_Form_086-0-09_8-1-2017_proof_of_loss.pdf (FEMA form 086-0-09). 6 Case: 19-30334 Document: 00515515323 Page: 7 Date Filed: 08/04/2020 No. 19-30334 Strictly construing the SFIP, we conclude that “sworn to” requires either notarization or a declaration substantially similar to “I declare (or certify, verify, or state) under penalty of perjury that the foregoing is true and correct. Executed on (date).” § 1746. Neither of Clark’s 2016 POLs satisfy the SFIP’s sworn-to requirement because neither POL was notarized nor included the phrase “under penalty of perjury.” The district court did not err in concluding the same. Because Clark’s 2016 POLs failed to comply with the SFIP’s swornto requirement, the 2016 POLs cannot support a claim for breach of contract. 44 C.F.R. § 61, app. A(1), art. VII(R); Gowland, 143 F.3d at 954. Clark and Pearl also argue the district court erred in finding that Clark’s December 2016 POL for the August 2016 flood failed to state an amount claimed as required by the SFIP. We need not consider this alternative basis for concluding the December 2016 POL failed to comply with the SFIP because we have already concluded that the December 2016 POL failed to comply with the SFIP’s sworn-to requirement and any SFIP noncompliance obviates a policyholder’s right to recover losses. 44 C.F.R. § 61, app. A(1), art. VII(R); Gowland, 143 F.3d at 954. III. Timeliness of Clark’s January and February 2018 POLs Next, we consider Clark and Pearl’s argument that the district court erred in finding Clark’s January 2018 POL for the March 2016 flood and February 2018 POL for the August 2016 flood untimely. The district court held that the 2018 POLs were untimely because they were submitted after FEMA’s extension deadlines. The district court further found “no basis to hold that plaintiffs’ initial, noncompliant proofs of loss allow Wright to accept their untimely proofs of loss.” As noted above, Clark filed timely POLs in April 2016 for the March 2016 flood and in December 2016 for the August 2016 flood, but these POLs were 7 Case: 19-30334 Document: 00515515323 Page: 8 Date Filed: 08/04/2020 No. 19-30334 unsworn and thus failed to comply with the SFIP. Clark subsequently filed POLs that were sworn for purposes of the SFIP, however, these POLs were not filed until January and February 2018, after the expiration of FEMA’s extended deadlines for filing POLs for the March and August 2016 floods. Clark and Pearl rely on unpublished district court decisions for the proposition that untimely POLs may be considered along with a timely POL if the supplemental POL is not attempting to claim wholly new losses. See Stogner v. Allstate Ins. Co., No. 09-3037, 2010 WL 148291 (E.D. La. Jan. 11, 2010); Smith v. American Bankers Ins. Co. of Fla., No. 13-5684, 2014 WL 2155030 (E.D. La. May 22, 2014). Although these cases are non binding, we acknowledge that this court has not held to the contrary. Nevertheless, even accepting this proposition as true, Clark’s 2018 supplemental POLs may not be considered along with the timely 2016 POLs because the 2016 POLs were noncompliant with the SFIP. We hold that untimely supplemental POLs that are not attempting to claim wholly new losses may not be considered along with timely POLs that are otherwise noncompliant with the SFIP. Gowland, 143 F.3d at 954–55. The district court did not err in holding the 2018 POLs untimely.