Sixth District Court of Appeal Reverses Directed Verdict for Insurer as Contractor Did Not Have Initial Burden to Determine Depreciation
By Irene Thaler
In SFR SERVICES, LLC A/A/O Michael Carbonara and Mary Carbonara vs. Tower Hill Prime Insurance Company, the newly created Sixth District Court of Appeal reversed a judgment of directed verdict for the insurer, finding that the insured’s contractor (as assignee) did not have the initial burden to prove the amount of depreciation within the context of an ACV requirement. In the case, the insureds submitted a claim to Tower Hill for roof damage caused by Hurricane Irma. Tower Hill assessed the cost of repair fell below the policy’s hurricane deductible, and thereafter the insureds assigned their claim to a contractor. The contractor submitted an estimate for $162,083.84. At the close of the contractor’s case, Tower Hill moved for directed verdict, arguing the cost estimate presented by the contractor was insufficient proof of “actual cash value” because it did not account for depreciation.
The Sixth District Court of Appeal analyzed the policy language and found “actual cash value” defined as follows: “[t]he cost to repair or replace covered property, at the time of loss or damage, whether that property has sustained partial or total loss damage, with material of like kind and quality, subject to a deduction for deterioration, depreciation and obsolescence as determined by us.’”
The Appellate Court determined the concluding phrase “as determined by us” meant the burden to establish depreciation was on the insurer, and therefore the contractor did not have the initial burden to prove the amount of depreciation. The Court did note under “different circumstances, Tower Hill’s point might be well-taken,” seemingly implying this case involved a particular subset of policy language and should be read in a narrow context.
Irene Thaler