Court Opinion

ID: 4776045
Source: CourtListenerOpinion
Date Created: 2021-08-18 15:06:56.549824+00
Date Added: 2024-06-11T08:09:32.010296
License: Public Domain

Third District Court of Appeal
                               State of Florida

                        Opinion filed August 18, 2021.
       Not final until disposition of timely filed motion for rehearing.

                            ________________

                             No. 3D20-1469
                        Lower Tribunal No. 20-4561
                           ________________

      Heritage Property & Casualty Insurance Company,
                                  Appellant,

                                     vs.

   Condominium Association of Gateway House Apts. Inc.,
                                  Appellee.

     An appeal from a non-final order from the Circuit Court for Miami-Dade
County, Mark Blumstein, Judge.

     Link & Rockenbach, P.A., Kara Rockenbach Link, and David A. Noel
(West Palm Beach); Rubinton Simms, P.A., Jeffrey A. Rubinton, and
Veronica Dossat (Hollywood), for appellant.

     Kula & Associates, P.A., Elliot B. Kula, W. Aaron Daniel, and William
D. Mueller; Berger Singerman LLP, Michael J. Higer, Gina Clausen Lozier,
and Christopher B. Choquette, for appellee.

Before HENDON, MILLER, and BOKOR, JJ.
      MILLER, J.

      Appellant, Heritage Property & Casualty Insurance Company

(“Heritage”), challenges an order granting a motion to compel appraisal filed

by its insured, the Condominium Association of Gateway House Apartments,

Inc. (the “Association”). On appeal, Heritage asserts the trial court erred in

finding the Association complied with all relevant post-loss provisions of the

operative commercial property insurance policy, including a requirement it

produce its “books and records” for copying and inspection. Discerning no

such error, we affirm.

                              BACKGROUND

      After two of its buildings sustained hurricane-related damage, the

Association filed a first-party property claim against Heritage. By means of

a letter, Heritage “determined that the claimed damage was caused by [a

hurricane], for which the policy provide[d] coverage,” but, the damages fell

below the applicable deductible.      The Association then submitted two

supplemental claims and requested appraisal, as provided for in the policy.

      Relying upon the following post-loss conditions, Heritage requested

condominium board meeting minutes for the preceding five-year period:

      3. Duties in the Event of Loss or Damages

      a. You must see that the following are done in the event of loss
      or damage to Covered Property:

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      ...

      (6) As often as may be reasonably required, permit us to . . .
      examine your books and records . . . and permit us to make
      copies from your books and records.

Although the Association furnished over 2,500 pages of requested

documents during the claims process, it did not produce meeting minutes.

      The claims went unpaid, and over two years after reporting the initial

loss, the Association filed suit in the circuit court. In a dual-count complaint,

it sought to compel appraisal and recover damages for breach of the

insurance contract. Heritage opposed appraisal, asserting the failure to

produce meeting minutes was fatal to coverage under the policy.             The

Association countered by proffering its membership was comprised primarily

of elderly residents. Consequently, it failed to achieve a quorum and had no

meeting minutes. The trial court duly convened an evidentiary hearing on

the issue, at the conclusion of which it rendered an order determining the

Association’s pivotal witness was credible, the board failed to conduct

meetings due to an inability to obtain quorum, no meeting minutes were

recorded, and all post-loss conditions were otherwise satisfied. The instant

appeal ensued.

                          STANDARD OF REVIEW

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      We review the factual findings in an order compelling appraisal for

competent, substantial evidence and the application of law to those facts de

novo. See Fla. Ins. Guar. Ass'n, Inc., v. Hunnewell, 173 So. 3d 988, 991

(Fla. 2d DCA 2015); Kennedy v. First Protective Ins. Co., 271 So. 3d 106,

107 (Fla. 3d DCA 2019).

                                 ANALYSIS

      Before a court is authorized to compel appraisal under an insurance

policy, it must make a preliminary determination as to whether the demand

for appraisal is ripe. Citizens Prop. Ins. Corp. v. Mango Hill Condo. Ass'n 12

Inc., 54 So. 3d 578, 581 (Fla. 3d DCA 2011). In this vein, until post-loss

conditions “are met and the insurer has a reasonable opportunity to

investigate and adjust the claim, there is no ‘disagreement’ . . . regarding the

value of the property or the amount of loss” subject to appraisal. Citizens

Prop. Ins. Corp. v. Galeria Villas Condo. Ass'n, Inc., 48 So. 3d 188, 191 (Fla.

3d DCA 2010).

      Here, the central dispute is whether the court erred in determining the

Association fully complied with its post-loss requirement to furnish its books

and records for copying and inspection. Two principal sources of authority

guide our analysis. The first is the policy of insurance and the second is the

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Florida Condominium Act (the “Act”), codified in chapter 718, Florida

Statutes.

      It is axiomatic an insurance policy is an agreement and, in the absence

of an applicable statute, subject to the construction principles that apply to

any other species of contract. See Principal Life Ins. Co. v. Halstead, 310

So. 3d 500, 502 (Fla. 5th DCA 2020). Thus,

      The intent of the parties governs, but “[c]ourts should resort to
      complex rules of construction to determine coverage or the
      applicability of exclusions only when the language used in the
      policy is ambiguous or otherwise susceptible of more than one
      meaning. Absent such factors courts should apply the plain
      meaning of words and phrases used in a policy of insurance.”

State Farm Fla. Ins. Co. v. Phillips, 134 So. 3d 505, 507 (Fla. 5th DCA 2014)

(citation omitted).

      Under the instant policy, the insured is contractually obligated to allow

the inspection and copying of its existing books and records. The plain

language requires no more. Heritage contends, however, that because the

words “books and records” are undefined in the policy and the insured

operates under a statutory duty to preserve meeting minutes, the policy

provision implies such minutes must be produced as a precondition to

coverage. In support of its position, it relies upon section 718.111(12)(a)(6),

Florida Statutes, which requires a condominium association to maintain “[a]

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book or books that contain the minutes of all meetings” as part of its official

records within the state for at least seven years.

      Although the policy does not expressly reference the Act, under Florida

law, “insurance policies are deemed to incorporate applicable statutes, and

conflicting policy provisions must give way.” Fla. Farm Bureau Cas. Ins. Co.

v. Cox, 943 So. 2d 823, 832 (Fla. 1st DCA 2006), quashed on other grounds,

967 So. 2d 815 (Fla. 2007) (citations omitted). Pursuant to “this presumption

of incorporation, valid applicable laws existing at the time of the making of a

contract enter into and form a part of the contract as fully as if expressly

incorporated in the contract.” 11 Richard A. Lord, Williston on Contracts §

30:19 (4th ed. 2021) (footnotes omitted). Contractual language is therefore

interpreted in view of existing statutes, irrespective “of whether the

agreement refers to the governing law.” Id. (footnote omitted).

      This line of authority does not, however, displace the well-established

principle that “[w]hen a policy provision remains undefined, common

everyday usage determines its meaning.” Sec. Ins. Co. of Hartford v. Com.

Credit Equip. Corp., 399 So. 2d 31, 34 (Fla. 3d DCA 1981) (citations omitted).

Hence, the incorporation presumption “is generally applied in connection

with contract ‘construction’ (determining the legal effect of a contract) rather

than contract ‘interpretation’ (determining the meaning of words used in a

                                       6
contract),” and Heritage offers no support for the proposition that an

undefined term should be construed against the insured based on a statutory

“definition” that is neither incorporated into the policy nor found in any

applicable insurance statute. 11 Lord, supra (footnote omitted); see also

Container Corp. of Am. v. Maryland Cas. Co., 707 So. 2d 733, 736 (Fla.

1998) (Where “policy language is susceptible to differing interpretations, it

. . . should be construed in favor of the insured.”) (citation omitted).

      Further, like the policy, the relevant portion of the Act is clear. 1 The

preservation of condominium association meeting minutes is mandated for

a seven-year period. In this regard, the cited provision presupposes the

existence of minutes, but is silent as to any duty to record minutes in the

absence of a quorum.       Thus, it cannot be used to engraft a post-loss

obligation to produce nonexistent meeting minutes upon the policy.

      Lastly, to the extent there is a dispute as to fact, deferring to the

superior vantage point of the trial court in assessing witness credibility, as

1
  Heritage also argues section 718.112(2)(d)(1), Florida Statutes, requires
unit owners to convene an annual meeting. This argument, not asserted
below and raised for the first time on appeal in the reply brief, is unpreserved,
thus, beyond our purview. See Manning v. Tunnell, 943 So. 2d 1018, 1020
(Fla. 1st DCA 2006) (“As a general rule, an appellate court cannot address
claims raised for the first time on appeal.”) (citation omitted); see also
Hoskins v. State, 75 So. 3d 250, 257 (Fla. 2011) (“[A]n issue not raised in an
initial brief is deemed abandoned and may not be raised for the first time in
a reply brief.”) (citation omitted).

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we must, and remaining mindful that the scope of our review does not entail

reweighing the evidence or substituting our judgment, we deem the findings

below supported by competent, substantial evidence. See Williams v. Nuno,

239 So. 3d 153, 156 (Fla. 3d DCA 2018); Evans v. Thornton, 898 So. 2d 151,

152 (Fla. 4th DCA 2005); Sinclair v. Sinclair, 804 So. 2d 589, 592 (Fla. 2d

DCA 2002). Thus, our analysis yields a single conclusion. Had Heritage

wished to require the Association to record meeting minutes as a condition

of coverage, it could have easily so provided. Accordingly, we decline to

disturb the order under review.

     Affirmed.

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