The Florida Court of Appeals recently interpreted the “concealment or fraud” clause that eliminates coverage where an insured makes “material false statements” as requiring willful deception, widening the division among Florida’s courts of appeals. in Vargas vs. SafePointe Ins. a company3D19-1656, 2022 WL 108428 (Fla. 3d DCA Jan. 12, 2022), a homeowner reported a water loss to her property insurance company after a plumbing leak. The insurance company immediately requested repair invoices from previous claims and photographs of the pre-loss condition of the property. However, the homeowner did not provide this information. Instead, she provided sworn evidence of the loss with a detailed estimate.
The insurance company then refused coverage and the homeowner in turn sued. In the discovery, the insurance company submitted interrogations asking about past claims, and the homeowner only disclosed a roof claim nearly a decade ago. In her testimony, she testified that she had not made any previous insurance claims related to plumbing leaks. However, this certificate appears to be incorrect. The insurer obtained the homeowner’s previous property insurer’s affidavit, which certified that the homeowner made a similar plumbing claim only a few years earlier, and that the earlier claim included damages in many of the same areas that are currently being claimed.
As a result of this testimony, the insurer filed for an expedited judgment, partially finding coverage void under the policy’s concealment or fraud clause:
3. Concealment or fraud.
With respect to all persons insured under this policy, we do not provide any coverage for loss if, either before or after the loss, one or more persons insured under this policy:
a. intentionally concealing or misrepresenting any material fact or circumstance;
B. engaging in fraudulent behaviour; or
c. He made false material statements regarding this insurance.
At the hearing on the application, the homeowner testified that she did not remember the previous allegation when answering interrogations and testified on filing.
On appeal, the court was asked whether the term “false statement” in the post-loss context meant: (1) an incorrect statement, or (2) a deliberately incorrect statement. The Court first analyzed competing definitions of the term “false,” which is sometimes defined as “inconsistent with truth or truth,” and other times as “willfully false.” Rely heavily on dictata in Anchor & Cas. additional. Co. against Trif, 322 then. 3d 664 (Fla. 4th DCA 2021), the Court concluded that in the legal context, the term “false” “carries the connotation of a deliberately deceptive statement.” However, the court acknowledged that this interpretation may render parts of the fraud concealment provision unnecessary. If subsection (c) has an intent requirement, it will do nothing more than repeat subsection (a). On the other hand, if subsection (c) does not have an intended component, then subsections (a) and (b) may be superfluous because mere proof of error would lose coverage.
Although the courts usually try to avoid interpretations that render parts of the text unnecessary, the court “rejects[d] To apply the rule in a way that is contrary to the common meaning of “false statement”. Instead, “the court explains[ed] The reference to “false statements” in the “concealment fraud” item under review would require an element of fraudulent intent.”
Accordingly, the court may have found that the subsections were irreconcilable because they focused only on the language of intent, and not on the differences between “the concealment or misrepresentation of facts or material circumstances” and “statements relating to such insurance.” However, it is not necessary to talk about a distortion. A misrepresentation can also be true but it is misleading. For example, if the homeowner states that she did not report any other claims because her insurance agent reported them to her, that statement may be true, but it is misleading.
I put my trust in Vargasin General prop and Cas. additional. company against johnson114, then. 3d 1031 (Fla. 1st DCA 2013), the Court refused to read the intent requirement and to interpret the term “false statement” in such a way that the rest of the concealment or fraud clause would be unnecessary because “there is a reasonable explanation not to do so.” Surprisingly, the Fourth Court of Appeals in Florida followed suit Johnson in Mezadieu v. SafePoint Ins. a company, 315 then. 3d 26 (Fla. 4th DCA 2021) just months before they were disqualified at trek. in Mezadieu, the homeowner referred to an estimate written by the public adjusting officer in explaining the damages sought, even though the estimate contained undisputed repairs unrelated to the loss. DCA IV clarified that “showing intent is not required under the concealment of the policy or fraud clause….simply, an insured cannot blindly rely on and adopt an estimate prepared by his or her loss advisor without consequences.”
priority value JohnsonAnd the MezadieuAnd the trek He was called to question. However, there appears to be conflict among the Florida Courts of Appeals over whether there is an element of intent to mislead included in the terms of the policy that invalidates coverage where the insured makes material false statements in a post-loss context.
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