Summary
In Glassmetics, LLC, 343 So. 3d 613, this court addressed the same issue and squarely rejected the arguments HIRC now makes.
Summary of this case from Progressive Am. Ins. Co. v. Hillsborough Ins. Recovery Ctr.Opinion
No. 2D21-488
05-20-2022
PROGRESSIVE AMERICAN INSURANCE COMPANY, Appellant, v. GLASSMETICS, LLC, a/a/o Devan Hammond, Appellee.
Alexandra Valdes and Kurt T. Koehler of Cole, Scott & Kissane, P.A., Miami, for Appellant. David M. Caldevilla of de la Parte & Gilbert, P.A., Tampa; Anthony T. Prieto of Morgan & Morgan, P.A., Tampa; and Christopher P. Calkin and Mike N. Koulianos of The Law Offices of Christopher P. Calkin, P.A., Tampa, for Appellee.
Alexandra Valdes and Kurt T. Koehler of Cole, Scott & Kissane, P.A., Miami, for Appellant.
David M. Caldevilla of de la Parte & Gilbert, P.A., Tampa; Anthony T. Prieto of Morgan & Morgan, P.A., Tampa; and Christopher P. Calkin and Mike N. Koulianos of The Law Offices of Christopher P. Calkin, P.A., Tampa, for Appellee.
SILBERMAN, Judge.
Glassmetics, LLC, a/a/o Devan Hammond, filed a small claims lawsuit in county court against Progressive American Insurance Company for the alleged underpayment of an insurance claim for repair of a damaged windshield. Progressive now challenges a nonfinal order that denies Progressive's amended motion to dismiss or, alternatively, motion to abate or stay and motion to compel appraisal.
The trial court refused to enforce the insurance policy's appraisal provision on a number of grounds, and Progressive raises multiple issues on appeal. We reverse the order because the trial court erroneously determined (1) that the appraisal provision was against the public policy underlying section 627.428, Florida Statutes (2016) ; (2) that the appraisal provision failed to provide sufficient procedures and methodologies; (3) that Progressive waived its appraisal right; (4) that the appraisal provision was unenforceable because Progressive failed to prove that the insured knowingly, voluntarily, and intelligently waived his rights of access to courts, to a jury trial, and to due process; and (5) that the appraisal provision contains an ambiguity. In light of our conclusions, we remand for further proceedings consistent with this opinion.
Based on our resolution, we need not address Progressive's argument that the trial court impermissibly rewrote the insurance policy by invalidating the appraisal provision.
I. FACTS AND PROCEDURAL HISTORY
This case involves a Progressive policy issued to Frank Hammond as the named insured. Devan Hammond is listed as a driver and resident relative. The effective date of the policy is September 16, 2016. The appraisal provision provides:
If we cannot agree with you on the amount of a loss, then we or you may demand an appraisal of the loss. Within 30 days of any demand for an appraisal, each party shall appoint a competent
and impartial appraiser and shall notify the other party of that appraiser's identity. The appraisers will determine the amount of loss. If they fail to agree, the disagreement will be submitted to an impartial umpire chosen by the appraisers, who is both competent and a qualified expert in the subject matter. If the two appraisers are unable to agree upon an umpire within 15 days, we or you may request that a judge of a court of record, in the county where you reside, select an umpire. The appraisers and umpire will determine the amount of loss. The amount of loss agreed to by both appraisers, or by one appraiser and the umpire, will be binding. You will pay your appraiser's fees and expenses. We will pay our appraiser's fees and expenses. All other expenses of the appraisal, including payment of the umpire if one is selected, will be shared equally between us and you . Neither we nor you waive any rights under this policy by agreeing to an appraisal.
Devan had Glassmetics repair a damaged windshield and assigned to Glassmetics his right to payment under the policy. On December 1, 2016, Glassmetics sent an invoice for $187.25 to Progressive. On December 12, 2016, Progressive issued a check for $64.20. After cashing the check, Glassmetics filed suit in county court on December 27, 2016, and alleged that Progressive had breached the insurance policy by failing to pay the full value of benefits under the policy. On February 16, 2017, Progressive filed a notice invoking the appraisal provision and its motion to dismiss or alternatively to stay and enforce appraisal. Glassmetics amended its complaint, and Progressive filed its amended motion to dismiss or, alternatively, motion to abate or stay and motion to compel appraisal (the amended motion).
The trial court conducted a nonevidentiary hearing on the amended motion. In the order now on appeal, the court noted that Progressive had filed a copy of a presuit letter dated December 8, 2016, invoking its right to appraisal. The court found that a disputed issue of fact remained as to whether Progressive actually mailed or delivered the letter and properly invoked the appraisal provision before Glassmetics filed suit. The court then determined that apart from the presuit issue, Progressive waived its right to compel appraisal by challenging Glassmetics' standing in the amended motion, even though in that motion Progressive sought, in the alternative, to compel appraisal. The court then ruled that the appraisal provision was invalid because it violated the public policy underlying section 627.428 that provides for an award of attorney's fees to a prevailing insured. The court also ruled that the provision was invalid and unenforceable because it lacks procedures and methodologies to govern the appraisal process.
Further, the trial court ruled that the appraisal provision was ambiguous based on its view that the retained rights clause conflicts with the language that the determination of the amount of loss would be binding. The trial court construed the retained rights clause as preserving an "[i]nsured's contractual right to insist upon receiving full payment up to the maximum amount allowable" under the policy notwithstanding the provision that the appraisal determination would be binding.
Although in its order the trial court stated that it was denying Progressive's motion to compel appraisal without prejudice, the order was in effect a denial with prejudice because the court found the appraisal provision to be invalid and unenforceable. As a result, Progressive was precluded from invoking its contractual right to an appraisal. Progressive originally sought certiorari review of the order denying its right to an appraisal in the circuit court. The case was subsequently transferred to this court after the change in appellate jurisdiction. See ch. 2020-61, § 3, Laws of Fla. (effective Jan. 1, 2021). This court has jurisdiction of this appeal from a nonfinal order that determined Progressive's entitlement to appraisal under the insurance policy. See art. V, § 4(b)(1), Fla. Const.; Fla. R. App. P. 9.030(b)(1)(B) ; Fla. R. App. P. 9.130(a)(3)(C)(iv) ; Progressive Am. Ins. v. Broward Ins. Recovery Ctr., LLC , 322 So. 3d 103, 104 (Fla. 4th DCA 2021) (citing Mallory v. Brinckerhoff , 312 So. 3d 944 (Fla. 4th DCA 2021) ).
The trial court presumably characterized the denial as one without prejudice because the court found unresolved factual issues that prevented the court from compelling an appraisal without allowing the parties to conduct reasonable discovery and without holding an evidentiary hearing. For example, the court noted that evidence would be necessary to address the prohibitive cost doctrine. Progressive does not challenge this ruling on appeal, and we do not address it except to note that our opinion should not be construed as precluding the parties and the trial court from addressing this issue on remand.
II. ANALYSIS
A. Public policy and section 627.428
Progressive contends that the trial court erred in concluding that the appraisal provision violates the public policy underlying section 627.428. We agree.
In making this argument, Progressive asserts that it invoked appraisal via the letter of December 8, 2016, before Glassmetics filed suit. The trial court correctly recognized that Progressive needed to show the letter was sent but failed to do so. However, the court found that Progressive invoked the appraisal "process during the lawsuit by virtue of its alternative motion to compel appraisal."
The trial court determined that the appraisal provision violated public policy based on section 627.428, which provides insureds with an award of attorney's fees when they obtain a judgment against an insurance company that underpaid a claim. Section 627.428(1), provides as follows:
(1) Upon the rendition of a judgment or decree by any of the courts of this state against an insurer and in favor of any named or omnibus insured or the named beneficiary under a policy or contract executed by the insurer, the trial court or, in the event of an appeal in which the insured or beneficiary prevails, the appellate court shall adjudge or decree against the insurer and in favor of the insured or beneficiary a reasonable sum as fees or compensation for the insured's or beneficiary's attorney prosecuting the suit in which the recovery is had.
Section 627.428's purpose "is to discourage the contesting of valid claims against insurance companies and to reimburse successful insureds for their attorney's fees when they are compelled to defend or sue to enforce their insurance contracts." Ins. Co. of N. Am. v. Lexow , 602 So. 2d 528, 531 (Fla. 1992). In addition to discouraging insurers "from withholding benefits on valid claims," the statute further serves to "make an already financially burdened insured whole again." Johnson v. Omega Ins. , 200 So. 3d 1207, 1209 (Fla. 2016). But section 627.428 also "discourage[s] litigation and encourage[s] prompt disposition of valid insurance claims without litigation." Goff v. State Farm Fla. Ins. , 999 So. 2d 684, 688 (Fla. 2d DCA 2008) (alterations in original) (quoting Jerkins v. USF & G Specialty Ins. , 982 So. 2d 15, 17 (Fla. 5th DCA 2008) ).
Under section 627.428, "an incorrect denial of benefits, followed by a judgment or its equivalent of payment in favor of the insured, is sufficient for an insured to recover attorney's fees." Johnson , 200 So. 3d at 1219 ; see also Barreto v. United Servs. Auto. Ass'n , 82 So. 3d 159, 162 (Fla. 4th DCA 2012) ("Here, because the insurer paid the full amounts claimed only after suit was filed, it essentially confessed judgment."). "It is only when the claims adjusting process breaks down and the parties are no longer working to resolve the claim within the contract, but are actually taking steps that breach the contract, that the insured may be entitled to an award [of] fees under section 627.428." Hill v. State Farm Fla. Ins. , 35 So. 3d 956, 960 (Fla. 2d DCA 2010) ; see also Goldman v. United Servs. Auto. Ass'n , 244 So. 3d 310, 311 (Fla. 4th DCA 2018) (quoting Hill , 35 So. 3d at 960 ). The right to a fee award "turns upon whether the filing of the suit served a legitimate purpose." Barreto , 82 So. 3d at 162 (quoting Lewis v. Universal Prop. & Cas. Ins. , 13 So. 3d 1079, 1082 (Fla. 4th DCA 2009) ).
For instance, in Goff the insureds were entitled to fees under section 627.428 when their action "forced State Farm to request an appraisal and to pay significant additional amounts." Goff , 999 So. 2d at 688. In contrast, when an insured filed suit after the insurer had initiated the appraisal process, the insured was not entitled to section 627.428 fees. See id. (citing Federated Nat'l Ins. v. Esposito , 937 So. 2d 199, 201-02 (Fla. 4th DCA 2006) ).
Resolving disputes without litigation is the goal of the appraisal process. SafePoint Ins. v. Hallet , 322 So. 3d 204, 207 (Fla. 5th DCA 2021) ; see also Esposito , 937 So. 2d at 201 (stating that "the laudable goal of the appraisal process" is "to resolve disputes without litigation"). The appraisal process does not entail "legal work arising from an insurance company's denial of coverage or breach of contract; it is simply work done within the terms of the contract to resolve the claim." Hill , 35 So. 3d at 961. A fee award under section 627.428 "should normally be limited to the work associated with filing the lawsuit after the insurance carrier has ceased to negotiate or has breached the contract and the additional legal work necessary and reasonable to resolve the breach of contract." Id.
Thus, section 627.428 and appraisal provisions both serve public policy goals. "Because we hold the freedom to contract in high regard, we carefully weigh the right to freely contract against the legislative intent and the public policy it seeks to enact." Hernandez v. Crespo , 211 So. 3d 19, 26 (Fla. 2016). "Contractual provisions which contravene a statute or legislative intent are injurious to the public good, violate public policy, and are therefore unenforceable." Id. at 25.
In Hernandez , the court determined that a medical malpractice arbitration agreement violated public policy when "it exclude[d] required provisions of the Medical Malpractice Act." Id. at 20-21. One of the provisions in the arbitration agreement was to share arbitration costs equally rather than have the defendants "assume most of the costs of arbitration as in the statutory scheme." Id. at 27 ; see also Gessa v. Manor Care of Fla., Inc. , 86 So. 3d 484, 493 (Fla. 2011) (concluding that provisions in an arbitration agreement that limited noneconomic damages and waived punitive damages violated public policy because they "directly frustrate the remedies created by statute"); Cincinnati Ins. v. Cannon Ranch Partners, Inc. , 162 So. 3d 140, 143 (Fla. 2d DCA 2014) (determining that a retained rights clause in favor of the insurer was permitted under Florida law and stating that the trial court "could not have found the appraisal clause to be unenforceable unless the clause violated either statutory law or public policy"). Here, the trial court relied upon Hernandez as well as other arbitration cases, such as Holt v. O'Brien Imports of Fort Myers, Inc. , 862 So. 2d 87, 90 (Fla. 2d DCA 2003), and Flyer Printing Co. v. Hill , 805 So. 2d 829, 832–33 (Fla. 2d DCA 2001). At oral argument, Glassmetics' counsel asserted that Holt and Flyer Printing control the present case.
In Holt , a provision on attorney's fees in the arbitration agreement was contrary to statutes under which the car buyers sued that provided a right to attorney's fees if they prevailed. See 862 So. 2d at 90. This court stated that "even if the Buyers prevail on their claims they could be taxed with O'Brien Imports' attorney's fees because O'Brien Imports obtained a court order compelling arbitration." Id. Based in part on the attorney's fee provision, this court determined that the arbitration agreement was unenforceable. See id. at 89-90.
In Flyer Printing , this court determined that an arbitration agreement that required an employee to shoulder half the costs and fees associated with the arbitration was unenforceable. See 805 So. 2d at 833. This court explained that the arbitration "agreement contravened [the employee's] statutory right to seek a full award of her fees and costs" and therefore defeated the remedial purposes of the statutes at issue. Id.
In contrast, Progressive's appraisal provision contains no language concerning attorney's fees. As Progressive argues, there is no right to attorney's fees in appraisal, even under section 627.428, because there are no attorneys involved in appraisal and there is no final judgment or its equivalent in the appraisal process. In determining that Progressive's appraisal provision violated the public policy of section 627.428, the trial court noted the small amount in dispute in this case, $123.05. The trial court reasoned that windshield shops must rely on contingency fee contracts to pursue litigation for underpaid claims and are made whole by an award of fees under section 627.428 when they prevail. Progressive notes that if Glassmetics litigated and lost, even under a contingency agreement, the litigation costs would exceed the appraisal costs.
In Progressive American Insurance v. SHL Enterprises, LLC , 264 So. 3d 1013, 1017-18 (Fla. 2d DCA 2018), this court found no merit in the argument that requiring a party to pay appraisal costs violated the public policy of section 627.7288, which prohibits imposing a deductible on a claim for windshield damage. Here, Progressive recognizes that a "de facto deductible" is not at issue; rather, it contends that appraisal costs are part of the claims process and also do not constitute de facto attorney's fees. The cost of appraisal is "a cost of doing business, i.e., a fee paid to a neutral third party who is hired to help resolve a dispute about the amount of the total loss." Id. at 1017. Like section 627.7288 in SHL Enterprises , section 627.428 "contains no express prohibition against requiring an insured to pay his or her own appraisal costs where there is a dispute over windshield repair/replacement costs." Id. This court concluded that when "the contracting parties have freely contracted for" a provision that requires "each party to bear its own appraisal costs in an insurance payment dispute," then "they or their assignees may not rely on section 627.7288 to avoid their responsibility to pay such costs." Id. at 1018.
Unlike arbitration cases that the trial court relied upon, Progressive's appraisal provision does not address attorney's fees. We conclude that the appraisal provision does not violate the public policy behind the attorney's fee statute in section 627.428. Therefore, the trial court erred in finding the appraisal provision invalid and unenforceable on that basis. The statute's purpose is not only to discourage the withholding of benefits on valid claims and to make the insured whole but also to discourage litigation. Appraisal provisions also serve the goal of reducing litigation.
We recognize the concern that the cost of the appraisal process appears to far exceed the $123.05 at issue, and no economical solution exists for windshield shops if insurance companies underpay claims. But as noted in SHL Enterprises , "[i]f the legislature intends for insurers to solely bear the costs of appraisal in windshield damage claims, it knows how to express that intention." Id.
B. Lack of procedures and methodologies
The trial court ruled in its conclusion that the appraisal provision "is otherwise invalid and unenforceable due to its lack of any procedures and methodologies governing the appraisal process and the determinations of the appraisers and the umpire." The trial court's ruling appears to invalidate Progressive's appraisal provision in all cases. The trial court did not otherwise discuss the lack of procedures and methodologies in the body of its order, other than to cite two arbitration cases for the proposition that arbitration agreements must provide the procedures for the arbitration process: Greenbrook NH, LLC v. Estate of Sayre , 150 So. 3d 878, 881 (Fla. 2d DCA 2014), and Premier Real Estate Holdings, LLC v. Butch , 24 So. 3d 708, 711 (Fla. 4th DCA 2009).
Neither party cites a case in the appraisal context on what is required to be spelled out in an appraisal provision. Glassmetics relies upon arbitration cases and cases from other areas of the law. For instance, Glassmetics states the need for "identifiable and enforceable rules governing a dispute resolution process" and cites to Zelman v. Zelman , 175 So. 3d 871, 878 (Fla. 4th DCA 2015), but that case dealt with due process in guardianship proceedings before a judge.
Glassmetics contends that nothing in Progressive's policy provides any procedural or substantive rules that will govern the appraisal process. At the hearing, Glassmetics argued that the appraisal provision leaves numerous questions unanswered. Glassmetics summed up the alleged deficiencies as follows:
It doesn't explain, you know, even how we're going to challenge if this second appraiser that they have identified is biased or we have a problem with that appraiser, maybe not competent or biased, what have you. How do we go about challenging that? What rules and procedures are going to govern once we're in their appraisal process? Do we get to submit evidence? Do we get to be heard? Do we have notice? Do the appraisers get to talk to each other? Do they get to do their own independent investigation? Is it completely ex parte? Is it not ex parte? We don't know. Are there any ethical standards? It's not stated in Progressive's policy. There's not a single rule about it. We don't even know if the rules of evidence apply. We don't know if there's any kind of process for appeal. We don't know if the decisions have to be supported by any evidence whatsoever or whether they have to employ any type of methodology for reaching that conclusion. We know nothing about that process.
Progressive argued that the appraisal provision sets forth "the relevant information that's necessary to go through the appraisal process." Progressive distinguished an informal appraisal proceeding from a formal arbitration hearing, relying upon Allstate Insurance v. Suarez , 833 So. 2d 762 (Fla. 2002), and Citizens Property Insurance v. Mango Hill # 6 Condominium Ass'n , 117 So. 3d 1226 (Fla. 3d DCA 2013).
In Suarez, the Florida Supreme Court determined that an appraisal provision could not be construed as an arbitration agreement so as to require a formal arbitration hearing. 833 So. 2d at 765-66. The court explained, "It is clear from a plain reading of the clause that an informal appraisal proceeding, not a formal arbitration hearing pursuant to section 682.06, Florida Statutes (1999), was intended and agreed upon by the parties in agreeing to the appraisal provisions of the policy." Id. at 765. The Suarez court concluded, "Once a trial court has determined that the appraisal provisions of a contract of insurance have been properly invoked, further proceedings should be conducted in accord with those provisions, rather than by the wholly different proceedings contemplated by an agreement to arbitrate." Id.
In Mango Hill , the court explained the differences between arbitration and appraisal:
The differences between arbitration and appraisal are well defined in this state. First and foremost, while an agreement to arbitrate ordinarily encompasses the disposition of the entire controversy between the parties, an agreement for appraisal extends merely to the resolution of the specific issues of actual cash value and "amount of loss." Second, the appraisal process is an informal one. There is no requirement that appraisers be sworn. Appraisers generally are chosen for and expected to act on their own skill and knowledge relating to the matters being appraised. There is no obligation for appraisers to give formal notice of their activities to the parties or counsel, or to hear evidence. They even may engage in ex parte investigation, so long as they ultimately meet in good faith for the purpose of ironing out individual differences. Finally, all issues other than those contractually assigned to the appraisal panel are reserved for determination in a plenary action.
Arbitrations, on the other hand, are quasi-judicial proceedings. Although not conducted with the same degree of formality as a judicial proceeding, arbitration proceedings are impressed with the same procedural safeguards. These safeguards are codified in substantial part in the Florida Arbitration Code. Under the Florida Arbitration Code, each party is entitled to a full hearing in the presence of every other party, unless such right is waived by agreement or conduct. The arbitrators must meet together in each session, and may not engage in independent investigation of the thing in issue. The Arbitration Code guarantees to each party not only the right to notice of each hearing session, but also the right to counsel, the opportunity to present evidence, and the right to cross-examine witnesses. Finally, unlike appraisal, the arbitration panel may adjudge the case only on what is presented to them in the course of the proceeding.
Id. at 1229-30 (citations omitted).
Cases recognize that "appraisal clauses are often treated similarly to arbitration clauses." Webb Roofing & Constr., LLC v. FedNat Ins. , 320 So. 3d 803, 806 (Fla. 2d DCA 2021) (applying the reasoning from an arbitration case and determining that a postloss assignee of an insurance policy was bound to comply with the appraisal conditions in the insurance contract). However, this court also recognized that "appraisal and arbitration differ in some important respects," id. at 805, and that unlike the informal process of appraisal, "arbitration is a quasi-judicial proceeding with a degree of formal safeguards," id. at 805 n.3 (citing Mango Hill , 117 So. 3d at 1229-30 ).
Based on Mango Hill , Progressive argued that appraisal is an informal process that "is not bound by a set of rules" and that the appraisal provision gave the necessary details to complete the process. For instance, the appraisal provision sets forth how appraisal is invoked, how each party is to select a "competent and impartial" appraiser with notice to the other party, how an impartial and competent umpire who is a "qualified expert in the subject matter" is selected if the appraisers disagree as to the amount of loss, how any such disagreement as to the amount of loss is resolved, and how the appraisal costs are divided. The provision also limits the scope of appraisal to the amount of loss and states that it is a binding determination.
A requirement for more explicit rules in the appraisal provision is unnecessary for a process that the Florida Supreme Court has called an informal one and when case law appears to answer many of the questions Glassmetics contends are unanswered. We conclude that the procedures for arbitration are not applicable to appraisal based on Suarez and the differences between arbitration and appraisal as set out in Mango Hill . And although it may be helpful to provide more detail in an appraisal provision, we are unable to conclude that the absence of such detail makes the provision unenforceable. Thus, the trial court erred in finding the appraisal provision to be invalid and unenforceable based on the lack of procedures and methodologies.
C. Waiver of appraisal right
Glassmetics argued in the trial court that a waiver of the appraisal right occurred because Progressive sought "dismissal of the complaint for lack of standing and for failure to state a cause of action." The court stated that by challenging standing, Progressive was "requesting relief that is within the exclusive province of a court to provide, and that relief is inconsistent with [Progressive's] 'alternative' request to compel the appraisal remedy." The trial court concluded that these actions waived Progressive's right to compel appraisal.
After Glassmetics filed its original complaint, Progressive filed a notice of invoking its appraisal provision and a motion to dismiss or, alternatively, to stay and enforce appraisal. In response to Glassmetics' amended complaint, Progressive filed the amended motion. The amended motion sought dismissal in paragraph 13 based on Glassmetics' failure to comply with the appraisal provision. In paragraph 14, Progressive also sought dismissal for "lack of standing, failure to state a cause of action/failure to comply with Florida Civil Rules of Procedure 1.130 or Small Claims Rules 7.050(a)(1)." Progressive alternatively sought an order compelling appraisal and abating or staying the proceedings.
At the hearing on the amended motion, Progressive argued for dismissal based on the failure to comply with the appraisal provision. Later, in commenting on its presuit letter that demanded appraisal and reserved the right to assert defenses, Progressive stated, "[A]s we are here today, we are not arguing over standing, which of course, is different from coverage."
The determination of whether a party's litigation activity is sufficient to waive its right to demand an appraisal is "on a case-by-case basis, focusing on whether the party acted inconsistently with this right." Heritage Prop. & Cas. Ins. v. Superior Contracting & Env't Specialties, LLC , 314 So. 3d 743, 746 (Fla. 2d DCA 2021). In Heritage , this court determined that the insured's assignee waived the right to appraisal when it "filed a complaint and contemporaneously sought extensive discovery related to the same issues that would be addressed in an appraisal" and when it replied to the insurer's answer and affirmative defense after the trial court had entered a stay. Id. This court concluded that the assignee's conduct was inconsistent with the appraisal process and that the assignee was "affirmatively participating in the litigation." Id.
In contrast, this court held in an arbitration case that the filing of a motion to dismiss "directed to deficiencies in the complaint" did not constitute "such an active participation in the lawsuit as to" waive the right to compel arbitration. Prudential-Bache Sec. v. Pauler , 488 So. 2d 894, 895 (Fla. 2d DCA 1986) ; see also Houchins v. King Motor Co. of Fort Lauderdale, Inc. , 906 So. 2d 325, 328 (Fla. 4th DCA 2005) ("[T]he filing and hearing on the motion to dismiss directed to the sufficiency of the allegations of the complaint did not constitute a waiver of the right to arbitrate.").
Further, in an appraisal case the Fourth District determined that FIGA did not act inconsistently with its appraisal rights where "FIGA asserted the right to an appraisal in its original motion to dismiss and in all subsequent pleadings and at hearings." Fla. Ins. Guar. Ass'n v. Castilla , 18 So. 3d 703, 704 (Fla. 4th DCA 2009). "Asserting that the insured meet all other conditions precedent to claiming a loss is not inconsistent with demanding an appraisal. Claiming that the loss is not covered is also not inconsistent with a demand for an appraisal." Id. at 705.
Here, it appears that Progressive sought dismissal in paragraph 14 of its amended motion based on Glassmetics' failure to attach documents to its pleading. See Fla. R. Civ. P. 1.130(a) (requiring certain documents to be incorporated in or attached to pleadings); Fla. Sm. Cl. R. 7.050(a)(1) ("If the claim is based on a written document, a copy or the material part thereof shall be attached to the statement of claim."). In addition, Progressive did not argue for dismissal on the ground in paragraph 14 at the hearing. Rather, Progressive sought dismissal based on Glassmetics' failure to comply with the appraisal provision or, in the alternative, to stay the case and compel appraisal. Under these circumstances, the inclusion of paragraph 14 in Progressive's amended motion did not waive Progressive's right to an appraisal.
Glassmetics also contended in the trial court that Progressive waived its right to an appraisal by failing to select an impartial appraiser. "Even if the insured is correct that the insurer appointed an appraiser who was not competent, that is not conduct which is inconsistent with the right to appraisal, and there is no legal basis for asserting that the insurer had waived the right to appraisal." Travelers of Fla. v. Stormont , 43 So. 3d 941, 945 (Fla. 3d DCA 2010). Thus, the fact that Glassmetics contended that Progressive's initially chosen appraiser was not impartial does not waive Progressive's right to appraisal.
Therefore, the trial court erred in determining that Progressive waived its right to an appraisal.
D. Waiver of rights of access to courts, jury trial, and due process
Progressive contends that the trial court also erred in determining that it was "unable to enforce the appraisal provision at this juncture" when Progressive had yet to present evidence that the insured knowingly, voluntarily, and intelligently waived his rights of access to courts, to a jury trial, and to due process. Progressive also contends that the trial court erred in concluding that since Devan Hammond was not the named insured, but rather a listed driver, there was insufficient evidence to establish that the named insured was authorized to waive these rights on behalf of the listed driver.
We disagree with these determinations by the trial court. "[T]he rights of access to courts and trial by jury may be contractually relinquished subject to general contract defenses ...." Hobby Lobby Stores, Inc. v. Cole , 287 So. 3d 1272, 1275 (Fla. 5th DCA 2020) (citing Glob. Travel Mktg., Inc. v. Shea , 908 So. 2d 392, 398 (Fla. 2005) ). In addition, the insured did not completely waive the right to a jury trial or the right of access to courts. The waiver applies only to the amount of loss. This is in contrast to Seifert v. U.S. Home Corp. , 750 So. 2d 633, 642 (Fla. 1999), upon which the trial court relied. In Seifert , the arbitration agreement in a contract between a home builder and buyer did not expressly provide for arbitration of tort claims. Id. The supreme court determined that to deprive the buyer of trial by jury, due process, and access to courts "simply because she and her husband signed a contract which contained an arbitration provision, the language of which provides no indication that tort claims arising under the common law were contemplated or included, would clearly be unjust." Id.
Here, the appraisal provision contains a retained rights clause that states, "Neither we nor you waive any rights under this policy by agreeing to an appraisal." But the appraisal provision specifically sets forth when appraisal is required and that "[t]he amount of loss agreed to by both appraisers, or by one appraiser and the umpire, will be binding." In addition to stating that the amount of loss determined in appraisal is binding, the policy further provides, "We may not be sued unless there is full compliance with all the terms of this policy." Thus, the insured waived his right to sue unless he complied with all policy terms, which includes a binding determination on the amount of loss when appraisal is invoked.
As to whether Devan Hammond waived rights concerning the amount of loss, the policy also provides, "The action of one named insured will be binding on all persons provided coverage under this policy." Thus, Devan Hammond is bound by any actions taken by the named insured, Frank Hammond, under the policy. As Progressive argues, to determine otherwise would allow any listed drivers to not comply with the terms of the policy and yet still receive benefits, despite that the named driver who is responsible for the premium would be bound by all terms.
In addition, Glassmetics is bound by the appraisal provision as assignee. See Webb Roofing , 320 So. 3d at 807 ("Webb Roofing received an assignment that entitled it to receipt of payment from the insurance carrier, and concomitant with that right was its duty to comply with the conditions of the contract that afforded it payment. Therefore, we conclude that the assignment in this case did not eliminate the duty of compliance with the conditions imposed by the insurance contract, including appraisal, and the trial court did not err in granting the motion to compel appraisal.").
E. Clauses on retained rights and binding amount of loss
Progressive contends that the trial court erred in concluding that the appraisal provision is ambiguous based on the retained rights clause and the clause stating that the amount of loss determined in appraisal is binding. Citing cases concerning "one-way" retained rights clauses, Progressive argues that a retained rights clause does not render an appraisal provision ambiguous or unenforceable. See State Farm Fire & Cas. Co. v. Licea , 685 So. 2d 1285, 1288 (Fla. 1996) ("[W]e interpret the clause as retaining only the right to dispute the issues of coverage as to the whole loss, or whether the policy conditions have been violated as specified above."); Cannon Ranch , 162 So. 3d at 143 (determining that a retained rights provision did not render the appraisal clause unenforceable).
Here, the trial court found, "On one hand, the appraisal provision states that the appraisal process 'will be binding' but on the other hand, the last sentence states neither party waives any right under the insurance policy by agreeing to an appraisal." The trial court found that the binding loss and retained rights clauses rendered the appraisal provision ambiguous and then stated that ambiguous provisions are construed against the drafter. The trial court ruled:
[A]ssuming arguendo the appraisal provision is enforceable and lawfully invoked, these two conflicting provisions of the appraisal provision must be construed as preserving (and not waiving) the Insured's contractual right to insist upon receiving full payment up to the maximum amount allowable under the other terms and conditions of the insurance policy.
We cannot agree that the appraisal provision is ambiguous; instead, the two clauses can be harmonized. See Shelby Mut. Ins. Co. of Shelby, Ohio v. Smith , 556 So. 2d 393, 396 (Fla. 1990) (determining that because two subsections of a statute could "be harmonized, there is no ambiguity on the face of the statute"); Dodge City, Inc. v. Byrne , 693 So. 2d 1033, 1035 (Fla. 2d DCA 1997) ("[W]here one or more provisions of a contract conflict, ‘they should be construed so as to be reconciled, if possible.’ " (quoting Seabreeze Rest., Inc. v. Paumgardhen , 639 So. 2d 69, 71 (Fla. 2d DCA 1994) )).
Because the clauses can be harmonized, the binding appraisal process remains enforceable while still allowing the parties to enforce such other rights as they may have under the policy. For example, to the extent the appraisal process results in a determination that Progressive underpaid Glassmetics, Glassmetics would be entitled to pursue any rights it may have against Progressive due to the underpayment in accordance with the provisions of the policy and the applicable law.
III. CONCLUSION
For the foregoing reasons, we reverse the trial court's order and its conclusions (1) that the appraisal provision was against the public policy underlying section 627.428 ; (2) that the appraisal provision failed to provide sufficient procedures and methodologies; (3) that Progressive waived its appraisal right; (4) that the appraisal provision was unenforceable because Progressive failed to prove that the insured knowingly, voluntarily, and intelligently waived his rights of access to courts, to a jury trial, and to due process; and (5) that the appraisal provision contains an ambiguity.
Reversed and remanded for further proceedings.
BLACK, J., and CASE, JAMES R., ASSOCIATE SENIOR JUDGE, Concur.