People’s Trust Insurance Company v. First Call 24/7, Inc.

By: David A. Mervine

333 So.3d 1144
4th DCA Fl. App., 2022

This matter was appealed to the 4th District Court of Appeals, from a trial court order entering summary final judgment for the Plaintiff AOB vendor, First Call 24/7. The insured suffered a loss to property and reported their claim to People’s Trust (the Insurer). The Insurer investigated the claim and found covered damage. However, the Insurer’s policy contained an endorsement enabling it to invoke a right to repair in lieu of making payment to the policyholder. Initially, the homeowner retained the services of First Call 24/7 to perform emergency repairs at the insured property, and the insurer paid $6,800.00 for performance of the same. But during the claims process it invoked the right to repair and asked repeatedly the insured to sign a work authorization. The insured did not sign the work authorization as requested. First Call 24/7 then completed the alleged repairs and submitted a bill for $19,863.96. The Insurer did not pay the invoice, asserting the homeowner was in breach of contract for not allowing the work to commence under the right-to-repair endorsement. First Call sued. Upon competing motions for summary final judgment, the Insurer’s motion was denied by the trial court and the Plaintiff AOB’s motion was granted. The Insurer appealed.

The appellate court noted that once an insurer invokes the endorsement, it creates a separate contract binding the homeowner and obligating the Insurer’s preferred contractor to perform repairs within a reasonable time. First Call and the homeowner argued that First Call should be entitled to the amount that the Insurer would have paid its preferred contractor. The appellate court held that the Insured was in breach of the contract by not signing the work authorization after the right to repair was invoked. The court determined that the policy did not authorize the AOB contractor to circumvent the right to repair endorsement.

The court stated that to obtain money damages for repairs, the trial court must find either that People’s Trust improperly exercised the right to repair or that the endorsement is otherwise invalid, and that People’s Trust breached the insurance contract. Based on the unambiguous language of the policy, the appellate court ordered reversal of the money judgment for First Call 24/7 and remanded for entry of judgment for People’s Trust.

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