By: Oliver B. Clark
The above cause came before the Southern District of Florida’s Miami Division upon Defendant, Scottsdale’s, Motion for Summary Final Judgment against Plaintiff, LMP Holdings. The Court entered summary final judgment in favor of Defendant for the following reasons.
Plaintiff, LMP Holdings, Inc., filed suit against its insurer, Scottsdale Insurance Company, for breach of contract and declaratory judgment, seeking payment and benefits under a commercial insurance policy extant between the Parties. Plaintiff alleged that its property had sustained covered damage as a consequence of Hurricane Irma on or about September 10, 2017. Following the loss but prior reporting the loss to Scottsdale, Plaintiff’s handyman, Angel Del Oro, visited the subject property, mitigating those observed to the roof, A/C unit about same, and the water damage sustained to the property’s interior. Approximately six months after Hurricane Irma, the Plaintiff noticed additional interior water damages, which persisted unreported to Defendant into 2019. Plaintiff finally reported its claim to Defendant on December 10, 2019. Defendant’s adjuster inspected the property, and on July 10, 2020, Defendant denied coverage to Plaintiff for failure to timely report the damages. Plaintiff then filed suit. Primarily in issue before the Court was whether Plaintiff had violated its post-loss duty under the subject policy to give Defendant “prompt” notice of its claim prior to filing suit.
The Court’s analysis began with its cementing that the purpose of a notice provision in an insurance policy is to “allow the insurer to “evaluate its rights and liabilities, [and] to afford it an opportunity to make a timely investigation.” Gemini II Ltd. v. Mesa Underwriters Specialty Ins. Co., 592 Fed. App’x 803, 806 (11th Cir. 2014). “Under Florida law, a failure to provide timely notice of loss in contravention of a policy provision is a legal basis for the denial of recovery under the policy.” Mid-Content Cas. Co. v. Basdeo, 742 F. Supp. 2d 1293, 1335 (S.D. Fla. 2010. “Late notice creates a rebuttable presumption of prejudice to the insurer.” Id., 742 F. Supp. 2d at 1336. Thus, the insured has the burden of rebutting this presumption by presenting competent evidence that the insurer has not been prejudiced by the late notice. Bankers Ins. Co. v. Marcias, 475 So.2d 1216, 1217–18 (Fla. 1985).
As to whether timely notice was given on the instant facts, the Court interpreted the requirement to mean that notice must have been given “with reasonable dispatch and within a reasonable time in view of all the facts and circumstances of the particular case.” Yacht Club on the Intracoastal Condo. Ass’n, Inc. v. Lexington Ins. Co., 599 Fed. App’x 875, 879 (11th Cir. 2015). Given the aforementioned examination and repair of the damages claimed prior to Plaintiff’s reporting this claim, and the over twenty-seven months which passed between discovery of said damages and their report, the Court deemed notice to have not been given with “reasonable dispatch.” Plaintiff’s contention that it failed to report because it did not know if the value of the damages would exceed the policy deductible was not persuasive. Further, given the “burden shifting” referenced above, the Court noted that Plaintiff had offered insufficient evidence to rebut the presumption that its late reporting of the instant claim had prejudiced Defendant. Plaintiff’s pushing only that both Parties’ experts had proffered different opinions as to the causation of the damages sustained failed to create a genuine issue of material fact to rebut the presumed prejudice to Defendant and overcome summary final judgment. Instead, the Court held that Plaintiff’s late notice “frustrated the purpose of the notice requirement, which goes beyond mere causation and is meant to “enable the insurer to evaluate its rights and liabilities, to afford it an opportunity to make a timely investigation, and to prevent fraud and imposition upon it.” Thus, the Court granted the carrier’s Motion for Summary Final Judgment.