By: Oliver B. Clark
–So.3d –, 2021 WL 45659 (Fla. 2nd DCA 1/6/2021)
In this case Florida’s Second District Court of Appeal considered whether Appellee’s Public Adjuster could serve as a disinterested appraiser and concluded he could not.
In 2017, Appellee, Jon Parrish, made a claim to Appellant, State Farm, under his homeowner’s insurance policy, for Hurricane Irma damage to his house. He retained public adjusting company Keys Claims Consultants, Inc. (KCC) to represent his interests in the claim. Parrish and KCC executed a representation agreement in which Parrish assigned ten percent of his insurance recovery to KCC. State Farm made a payment following its investigation of the claim. In response, KCC prepared a damage estimate on Parrish’s behalf (with which State Farm disagree) and requested appraisal. KCC designated its president George Keys as Parrish’s disinterested appraiser. State Farm objected to Mr. Keys’ designation and, after appointing its own disinterested appraiser, “initiated an action of some sort.” (The Second DCA noted that the procedural posture of this case is abnormal). The trial court ruled that Mr. Keys could serve as Parrish’s disinterested appraiser “despite his company’s contractual relationship with Mr. Parrish and the ten percent contingency fee KCC would earn from any payment Mr. Parrish received from his claim.”
In considering the Circuit Court’s order, the Second DCA conducted a plain-language analysis of the word “disinterested” to ascertain its meaning within the context of the insurance policy. See Allstate Ins. Co. v. Orthopedic Specialists, 212 So. 3d 973, 975-76 (Fla. 2017) (“Where the language in an insurance contract is plain and unambiguous, a court must interpret the policy in accordance with the plain meaning so as to give effect to the policy as written.” Applying this test, the Second DCA reasoned: “the term ‘interested’ is an adjective describing an appraiser who holds an interest—that is, a stake of some sort, whether pecuniary, proprietary, or personal—in the outcome of the appraisal process. The prefix “dis” connotes its negative—so “disinterested” means an appraiser who does not hold an interest in the outcome of the policy’s appraisal process.” Given that Mr. Keys had, by his contract with Parrish, a “contingency stake in a potential monetary award” (an award which may be given at appraisal), he had a pecuniary interest in the appraisal’s outcome. Indeed, Keys had a vested interest in obtaining the highest possible appraisal award, as his compensation “depend[ed] on it.” Therefore, Keys could not be a “disinterested” appraiser. Further, besides Keys and KCC’s contingent, pecuniary interest, the Second DCA acknowledged that KCC and Keys were contractually bound to negotiate the underlying claim with State Farm with “due diligence and dispatch” so as not to prejudice Parrish; Keys was thus not an “independent adjudicator.” Given the foregoing, it was difficult for the Court to imagine a more “self-evidently” interested person than Mr. Keys and Circuit Court’s Order was reversed.