Recently, the Florida Supreme Court accepted jurisdiction in Parrish v. State Farm Florida Insurance Company, SC21-172, to decide whether “a public adjuster who has a contingency fee interest in an insured’s appraisal award or represents an insured in an appraisal process can serve as a ‘disinterested appraiser’ under a policy’s appraisal provision.” State Farm Fla. Ins. Co. v. Parrish, 312 So. 3d 145, 151 (Fla. 2d DCA 2021). The Florida Supreme Court is now positioned to resolve the certified conflict on this issue between the Second District Court of Appeal’s decision in Parrish and the Third District Court of Appeal’s decision in Brickell Harbour Condominium Association, Inc. v. Hamilton Specialty Insurance Company, 256 So. 3d 245, 249 (Fla. 3d DCA 2018).
Florida’s appellate courts are currently split on the interpretation of policy language requiring “disinterested” or “impartial” appraisers to determine the amount of loss under property insurance policies. The Third District’s long-standing precedent provides that “direct or indirect financial or personal interest in the outcome of the [appraisal] does not require the disqualification of the party appointed appraiser.” State Farm Ins. Co. v. Sanders, 327 So. 3d 342, 344 (Fla. 3d DCA 2020) (quoting Rios v. Tri-State Ins. Co., 714 So. 2d 547, 550 (Fla. 3d DCA 1998)); see also Galvis v. Allstate Ins. Co., 721 So. 2d 421, 421 (Fla. 3d DCA 1998).
However, in December 2019, the Fourth District Court of Appeal held that an insured’s retained public adjuster could not be “a qualified, disinterested appraiser” due to the public adjuster’s financial interest in the outcome of the appraisal. State Farm Fla. Ins. Co. v. Valenti, 285 So. 3d 958, 959-60 (Fla. 4th DCA 2019). And in February 2020, the Fifth District Court of Appeal aligned itself with the Fourth District in State Farm Florida Insurance Company v. Crispin, 290 So. 3d 150, 152 (Fla. 5th DCA 2020), and State Farm Florida Insurance Company v. Cadet, 290 So. 3d 1090, 1090 (Fla. 5th DCA 2020). In those cases, the Fifth District held that an appraiser is not “disinterested” if the appraiser is entitled to a percentage of the recovery from the insurance claim.
In April 2020, the Third District re-examined its precedent in the context of a petition for writ of certiorari seeking review of an order allowing a public adjuster to serve as a “disinterested appraiser.” Sanders, 327 So. 3d at 342. Having initially granted the writ of certiorari, the court withdrew its opinion on a motion for rehearing on grounds that the requisite departure from the essential requirements of the law supporting certiorari relief could not be established where the court’s existing precedent in Rios and Galvis supported the trial court’s ruling. In its opinion on rehearing, the Third District certified conflict with the Fourth District’s decision in Valenti and the Fifth District’s decisions in Cadet and Crispin.
In January 2021, the Second District in Parrish adopted the majority position that a public adjuster with a contingency interest cannot be deemed a disinterested appraiser. 312 So. 3d at 151. This leaves the First District as the only Florida appellate court that has not yet weighed in on the matter.
The Florida Supreme Court is now poised to resolve this issue in Parrish. In doing so, the Court will decide whether a retained public adjuster can serve as an insured’s “disinterested” appraiser, allowing for consistent treatment on this important issue throughout the state.