Court Opinion

ID: 67627
Source: CourtListenerOpinion
Date Created: 2010-04-26 06:23:49+00
Date Added: 2024-06-11T17:20:56.969458
License: Public Domain

[DO NOT PUBLISH]

             IN THE UNITED STATES COURT OF APPEALS

                     FOR THE ELEVENTH CIRCUIT                    FILED
                      ________________________          U.S. COURT OF APPEALS
                                                          ELEVENTH CIRCUIT
                                                              JUNE 18, 2009
                             No. 09-10588
                                                           THOMAS K. KAHN
                         Non-Argument Calendar                  CLERK
                       ________________________

                   D.C. Docket No. 08-80598-CV-KLR

LEON SEGAL,
SHARON SEGAL, his wife,

                                                     Plaintiffs-Appellants,

                                  versus

HARTFORD INSURANCE COMPANY OF THE MIDWEST,

                                                     Defendant-Appellee.

                       ________________________

                Appeal from the United States District Court
                    for the Southern District of Florida
                      ________________________
                              (June 18, 2009)

Before BIRCH, HULL and COX, Circuit Judges.

PER CURIAM:

     Leon and Sharon Segal own a house in Boca Raton, Florida. In 2005,

Hurricane Wilma damaged their house, and they filed a claim under their
homeowner’s insurance policy issued by Hartford Insurance Company of the

Midwest. The Segals believed that Hartford’s handling of the claim breached the

insurance policy, and sued. Hartford moved to dismiss the Complaint with prejudice,

and the district court granted the motion. The Segals now appeal.

      The district court dismissed the breach of contract claim because it concluded

the insurance policy included a depreciation holdback clause, and nothing in the

contract eliminated that clause. Thus Hartford’s performance pursuant to that clause

was not a breach. (R.1-12 at 6-7.)

      Florida Statute § 627.7011(3), which prohibits insurers from holding back the

depreciation in value of damaged property covered by a policy, became effective after

the Segals’ policy was signed by the parties, but prior to the damage caused by

Hurricane Wilma. The parties agree the statute does not apply retroactively to

existing insurance policies. (Appellant’s Br. at 12.) The Segals argue, therefore, that

Hartford’s performance pursuant to the depreciation holdback clause is a breach of

the policy for two reasons. First, the Segals argue that the policy’s liberalization

clause incorporates Fla. Stat. § 627.7011(3) into the policy, and thus the depreciation

holdback clause is written out of the policy. Second, the Segals argue that Hartford

has changed its behavior and no longer applies a depreciation holdback to insureds,

                                          2
and thus the liberalization clause has incorporated that change in Hartford’s practices

into the Segals’ policy.

      First, the liberalization clause did not incorporate into the policy the changes

effected by Fla. Stat. § 627.7011(3). Contracts for insurance in Florida “are construed

in accordance with the plain language of the policies as bargained for by the parties.”

Prudential Prop. & Cas. Ins. Co. v. Swindal, 622 So. 2d 467, 470 (Fla. 1993). Here,

the liberalization clause states:

             If we make a change which broadens coverage under this
             edition of our policy without any additional premium
             charge, that change will automatically apply to your
             insurance as of the date we implement the change in your
             state . . .

(R.1-1, Ex. A, Complaint-Class Representation at 2.) The clause unambiguously

covers changes made only by Hartford. The liberalization clause states, as the district

court noted, “If we make a change. . . .” (Id.) (emphasis added). It cannot be said that

Fla. Stat. §627.7011(3) was a change made by Hartford. Rather, it was a change

made by the Florida Legislature that does not apply retroactively to the policy held

by the Segals.

      Second, although the Segals also argue that the liberalization clause has

incorporated Hartford’s changed practices with regard to depreciation holdbacks –

namely that Hartford no longer applies them to insureds – the Segals did not allege

                                           3
any such change by Hartford in their Complaint. Accordingly, the district court did

not err in dismissing the Complaint with prejudice for failure to state a claim.

      The district court’s dismissal with prejudice was proper, and we affirm.

      AFFIRMED.

                                          4