NAVEEM SHIVDASANI v. UNIVERSAL PROPERTY & CASUALTY INSURANCE COMPANY

Third District Court of Appeal State of Florida Opinion filed August 26, 2020. Not final until disposition of timely filed motion for rehearing. ________________ No. 3D18-2148 Lower Tribunal No. 18-6635 ________________ Naveen, Prem and Nalini Shivdasani, Appellants, vs. Universal Property & Casualty Insurance Company, Appellee. An Appeal from the Circuit Court for Miami-Dade County, Abby Cynamon, Judge. Font & Nelson, PLLC, Jose P. Font and Jaime E. Martin (Fort Lauderdale), for appellants. Butler, Weihmuller, Katz, Craig, LLP, Curt L. Allen and Brian A. Hohman (Tampa); Russo Appellate Firm, P.A., Elizabeth K. Russo and Paulo R. Lima, for appellee. Before SALTER, LOGUE and GORDO, JJ. GORDO, J.  Naveen, Prem and Nalini Shivdasani (collectively, the “Insureds”), homeowners with a residential insurance policy, appeal a final summary judgment against them obtained by their insurer, Universal Property & Casualty Insurance Company. The Insureds sued Universal for breach of contract in connection with a loss to their condominium unit and for a declaratory judgment confirming coverage of the alleged loss, a waiver of certain conditions by Universal and other relief. After a hearing, the trial court granted Universal’s motion for summary judgment, denied a cross-motion for summary judgment filed by the Insureds and entered a final judgment for Universal. For the reasons explained below, we affirm the trial court’s ruling in part, reverse in part and remand for further consideration pursuant to American Integrity Insurance Co. v. Estrada, 276 So. 3d 905 (Fla. 3d DCA 2019).1 RELEVANT FACTUAL AND PROCEDURAL BACKGROUND The Insureds purchased a homeowners’ insurance policy with Universal for the subject property. Under that policy, the Insureds were required to comply with post-loss obligations prior to filing suit against Universal. Specifically, the policy stated: SECTION I – CONDITIONS ... 1 The Insureds’ motion for partial summary judgment claimed that Universal confessed judgment as to coverage when it paid $5,566.75 to the Insureds for mold remediation. This issue was not raised in the present appeal. Thus, the order denying that motion is not ripe for appellate consideration. 2  2. Your Duties After Loss. In case of a loss to covered property, you must see that the following are done: ... g. Send to us, within 60 days after our request, your signed, sworn proof of loss which sets forth, to the best of your knowledge and belief: (1) The time and cause of loss; (2) The interest of the “insured” and all others in the property involved and all liens on the property; (3) Other insurance which may cover the loss; (4) Charges in title or occupancy of the property during the term of the policy; (5) Specifications of damaged buildings and detailed repair estimates; (6) The inventory of damaged personal property described in 2.e. above; (7) Receipts for additional living expenses incurred and records that support the fair rental value loss; and (8) Evidence or affidavit that supports a claim under the Credit Card, Fund Transfer Card, Forgery and Counterfeit Money coverage, stating the amount and cause of loss. On October 31, 2017, the Insureds contacted Universal to report that the property sustained a water loss due to a plumbing leak in the bathroom. The Insureds alleged the loss occurred on October 27, 2017. As part of its investigation of the claim, Universal requested that the Insureds comply with their post-loss obligations, including providing a sworn proof of loss within 60 days of its request. On November 16, 2017, Universal sent the Insureds a letter requesting a sworn proof of loss, as well as several records and documents. Universal did not receive anything in response and again, on December 21, 2017, requested a completed sworn proof of loss from the Insureds. That same day the 3 Insureds’ property appraiser sent Universal two documents via email—a mold report and a leak report from the Insureds’ condominium association. The leak report identified a date of loss three weeks earlier than the one the Insureds originally reported. These documents were not signed by the Insureds and did not include any additional information required by the policy’s sworn proof of loss provision. In the months that followed, Universal requested a sworn proof of loss several more times but the Insureds never sent one. The Insureds’ public adjuster sent email communications to Universal between December of 2017 and February of 2018, advising that they were working on preparing the sworn proof of loss. The last email communication from the Insureds to Universal occurred on February 19, 2018. Then, on March 3, 2018, without submitting a sworn proof of loss, the Insureds filed the underlying suit. Six days after being served, Universal requested to take the Insureds’ depositions. On April 5, 2018, Universal again requested to depose the Insureds, as well as their public adjuster and the records custodian and corporate representative of the public adjusting company. These depositions were not coordinated prior to the filing of Universal’s motion for summary judgment. On June 14, 2018, Universal served written discovery requests on the Insureds, including proposed subpoenas to be served upon the Insureds’ public adjuster and other companies involved in assessing and/or repairing the loss. The subpoena to the public adjuster 4 sought its entire file on the Insureds, as well as any correspondence regarding the damage or repairs to the insured property. Universal also submitted proposed subpoenas to the company that performed the mold assessment and to the Insureds’ plumber. Rather than produce estimates for repairs or give sworn information regarding the alleged loss, the Insureds filed an objection to the production from non-parties stating only that the notices were “vague, overbroad, harassing and violate[d] the [Insureds’] work product and attorney-client privilege.” On June 14, 2018, Universal filed its motion for summary judgment based on the Insureds’ “undisputed failure to satisfy post-loss contractual obligations.” Through the date of the filing of Universal’s motion, the Insureds never submitted a sworn proof of loss. Universal alleged that because of the Insureds’ failure to provide any of the requested documents, including the sworn proof of loss, it was relieved of its obligations under the policy. In response, the Insureds argued that by having provided the mold report and condominium leak report through their public adjuster, they had at least substantially complied with their post-loss obligations and Universal had failed to prove that it had been substantially prejudiced by their failure to comply with post-loss obligations. They did not dispute, however, that they had not submitted a sworn proof of loss. The trial court granted Universal’s motion based on the Insureds’ failure to provide a sworn proof of loss, citing Gonzalez v. State Farm Florida 5 Insurance Co., 65 So. 3d 608 (Fla. 3d DCA 2011) and Rodrigo v. State Farm Florida Insurance Co., 144 So. 3d 690 (Fla. 4th DCA 2014). LEGAL ANALYSIS “Summary judgment is correctly granted when the record evidence shows there is no genuine dispute of material fact and the moving party is entitled to judgment as a matter of law.” Edwards v. State Farm Fla. Ins. Co., 64 So. 3d 730, 732 (Fla. 3d DCA 2011) (citing Fla. R. Civ. P. 1.510(c)). Our standard of review is de novo. Id. (citing Bldg. Educ. Corp. v. Ocean Bank, 982 So. 2d 37, 40 (Fla. 3d DCA 2008)).2 The policy explicitly required the Insureds to submit to Universal a sworn proof of loss providing particular information “to the best of [their] knowledge and belief” within 60 days of Universal’s request. Universal requested the sworn proof of loss from the Insureds on at least four separate occasions, and the Insureds concede that they did not submit any sworn proof of loss. It is undisputed that the Insureds failed or refused to comply with this material, post-loss condition precedent to the filing of the lawsuit. There is no genuine issue of material fact on the record 2 We understand we must adhere to the standard of review and cannot prejudge the facts or address unripe legal conclusions. We are bound to the record before us. Our review of the facts and the conclusions drawn therefrom are based solely on that record. 6 before us regarding the Insureds’ substantial compliance with this post-loss obligation. 3 Florida law requires insurers to act in good faith when dealing with insureds and resolving their claims. § 624.155(1)(b)(1), Fla. Stat. (2019). In order to comply with this duty, insurers contract with insureds and policies often include material terms requiring insureds to comply with certain post-loss obligations. Universal and the Insureds explicitly agreed, as a term of the contract between them, that in the event of a loss the Insureds would be required to submit a sworn proof of loss. Courts cannot disregard such agreed-upon, contractual provisions between parties. To do so would be to strike the post-loss obligations from the contract “by way of judicial fiat and the bargained-for contractual terms would be rendered surplusage.” U.S. Fid. & Guar. Co. v. Romay, 744 So. 2d 467, 471 (Fla. 3d DCA 1999). Under Florida’s insurance code, the sworn proof of loss is the starting point in an insurer’s investigation of a claim. § 627.70131(3), Fla. Stat. (2019) (“Unless otherwise provided by the policy of insurance or by law, within 10 working days 3 It is unquestionable that in order for there to be substantial compliance, there must be evidence of some compliance. The contractual language requires a sworn proof of loss containing the information provided in section I.2.g.(1)–(8) of the policy. This is not a case where the Insureds failed to provide a particular form of sworn proof of loss. Rather, this case is about the Insureds’ complete and total failure to comply with a material, agreed-upon term of their insurance policy with Universal by failing to submit any sworn proof of loss whatsoever, which is undisputed on the record before us. Where the insured does not provide a sworn proof of loss at all, it is obvious there cannot be substantial compliance. 7 after an insurer receives proof of loss statements, the insurer shall begin such investigation as is reasonably necessary unless the failure to begin such investigation is caused by factors beyond the control of the insurer which reasonably prevent the commencement of such investigation.”). 4 The sworn proof of loss allows the insurer to ascertain information that is critical to determine how to proceed in good faith with the insured. “The purpose of a proof of loss provision is to inform the insurer of facts surrounding the loss, and to afford the insurer an adequate opportunity to investigate, prevent fraud, and form an intelligent estimate of its rights and liabilities before it is obliged to pay.” Allstate Floridian Ins. Co. v. Farmer, 104 So. 3d 1242, 1246 (Fla. 5th DCA 2012) (citing 13 Lee R. Russ & Thomas F. Segalla, Couch on Insurance § 186.22 (3d ed. 2011)). “It has also been noted that the ‘purpose of a provision for notice and proofs of loss is to enable the insurer to evaluate its rights and liabilities, to afford it an opportunity to make a timely investigation, and to prevent fraud and imposition upon it.’” Laster v. U.S. Fid. & Guar. Co., 293 So. 2d 83, 86 (Fla. 3d DCA 1974) (citations omitted). The policy between Insureds and Universal clearly delineated the information required to be furnished to Universal within 60 days of its request. Because it is the 4 Although the Legislature does not mandate that the proof of loss be in any particular form, the Insureds agreed, as a term of the insurance policy, to submit a sworn form that includes certain information within a specified period of time as a condition precedent to filing suit. 8 starting point of the insurer’s investigation, the provision does not require that the Insureds provide final estimates of all damages, charges, specifications and receipts. The policy simply requires a good faith, sworn statement from the Insureds, containing the categories of information listed in section I.2.g.(1)–(8) of the policy, to the best of their knowledge and belief, within 60 days following a reported loss. The dissent mentions the fact that the Insureds initially did not have access to the common areas abutting their condominium unit in order to perform a full assessment of the loss. This perceived delay, however, did not excuse the Insureds from furnishing Universal with a sworn proof of loss including an assessment to the best of their knowledge and belief within 60 days of Universal’s request. 5 Neither did the provision of a mold report and a condominium leak report by the Insureds’ public adjuster excuse the Insureds from providing a sworn proof of loss containing the information required under section I.2.g.(1)–(8) prior to filing suit. 6 By failing to submit a sworn proof of loss to Universal, the Insureds deprived Universal of the “opportunity to make a timely investigation, and to prevent fraud 5 Even so, the Insureds did eventually access and inspect all abutting areas for potential damage, and still failed to provide a sworn proof of loss to Universal prior to filing suit. 6 The mold report and a condominium leak report—which contained a date of loss three weeks earlier than the date reported by Insureds—did not give Universal information necessary to properly adjust the claim. The limited documents provided by the Insureds included contradictory dates of loss, thus, the Insureds failed to even accurately report the time of loss to Universal. 9 and imposition upon it.” Id. Not only did the Insureds fail to provide the information required under the policy, but they also objected to Universal obtaining information from their public adjuster via subpoena and failed to coordinate any depositions prior to the filing of and hearing on the motion for summary judgment. As a result of the Insureds’ failure to submit a sworn proof of loss at any point in time prior to the trial court’s entry of summary judgment, the trial court correctly found, based on this record, that the Insureds materially breached a post-loss contractual condition precedent to the commencement of a lawsuit against Universal. We affirm the trial court’s finding on the Insureds’ lack of compliance with their post-loss obligations because the Insureds failed to provide Universal with a sworn proof of loss prior to filing suit and failed to provide any evidence sufficient for a jury to find that they had substantially complied with that requirement.7 7 We note that the key issue briefed and decided by the trial court at summary judgment was the Insureds’ lack of compliance, substantial or otherwise, with the policy’s post-loss obligations, namely, the requirement to provide a sworn proof of loss. This issue was also fully briefed and argued before this Court. Therefore, it is neither premature nor dicta. Estrada established a two-prong analysis for trial courts when the insurer alleges that the insured has failed to comply with post-loss obligations. First, the trial court must consider whether the insured complied or substantially complied with the terms of the insurance policy. 276 So. 3d at 914. Second, if the trial court determines that the insured has failed to comply with post- loss policy obligations, Estrada imposes a burden shift wherein prejudice to the insurer is presumed, and the insured then has an opportunity to rebut that presumption and prove that the insurer was not prejudiced. Id. at 916. Here, after considering a fully developed record and hearing argument on summary judgment, the trial court determined that the Insureds did not substantially comply with their post-loss policy obligations. We review that determination de novo and find that 10  A panel of this Court recently held, “when an insurer has alleged, as an affirmative defense to coverage, and thereafter has subsequently established, that an insured has failed to substantially comply with a contractually mandated post-loss obligation, prejudice to the insurer from the insured’s material breach is presumed, and the burden then shifts to the insured to show that any breach of post-loss obligations did not prejudice the insurer.” Estrada, 276 So. 3d at 916 (certifying conflict with Rodrigo v. State Farm Fla. Ins. Co., 144 So. 3d 690 (Fla. 4th DCA 2014) and Goldman v. State, 660 So. 2d 300 (Fla. 4th DCA 1995)). We are bound by that decision. At the time the trial court heard and ruled on Universal’s motion for summary judgment, this Court had not issued its opinion in Estrada. The record on appeal, therefore, does not contain any discussion of the shifting burden of proof and whether Universal was prejudiced by the Insureds’ failure to submit any sworn proof of loss. Lacking the subsequently provided analysis in Estrada, the trial court cannot be faulted for ending its analysis at summary judgment as to whether the insured complied or substantially complied with the post-loss obligations. Under Estrada— determination supported by the record evidence. It is likewise proper for us to remand for consideration of the prejudice prong of Estrada because the trial court never considered the issue of prejudice and the Insureds preserved their right to have it considered. 11 applicable to this appeal, which was pending at the time of Estrada’s release—trial courts are required to analyze whether the insurer was prejudiced by the insured’s failure to comply prior to determining that the insured forfeited coverage by the breach. Thus, we reverse and remand to permit the parties to make supplemental filings and for the trial court to consider and analyze the question of prejudice, as set forth in Estrada. Affirmed in part, reversed in part and remanded for further proceedings. LOGUE, J., concurs. 12  Shivdasani v. Universal Property & Casualty Ins. Co. Case No. 3D18-2148 SALTER, J. (Concurring in part, dissenting in part). I concur in the majority opinion reversing and remanding the final summary judgment obtained in the trial court by the appellee, Universal Property & Casualty Insurance Company (“Universal”). I write separately to set forth my view of our affirmance in part of “the trial court’s finding on the Insureds’ lack of compliance” with a post-loss contractual condition. This partial summary judgment is approved by the majority “because the Insureds failed to provide Universal with a sworn proof of loss prior to filing suit and failed to provide any evidence sufficient for a jury to find that they had substantially complied with that requirement.” I respectfully dissent from the majority’s conclusion that the Insureds have not provided any evidence of substantial compliance with the proof of loss requirement. That issue has been pled, and an assessment of the extent of compliance and affirmative defenses regarding that question may yet persuade a jury that the Insureds were attempting to comply and were impeded by other factors, including Universal’s adjuster’s failure or refusal to return phone calls. The Insureds did not dispute that they did not deliver a sworn proof of loss to Universal before filing their lawsuit. But the as yet unanswered question (and genuine issue to be determined at trial) is whether this fact is a springboard to Universal’s claim that it warrants a forfeiture of coverage and denial of the Insureds’ 13 claim. Under our decision in American Integrity Insurance Co. v. Estrada, 276 So. 3d 905 (Fla. 3d DCA 2019),8 the Insureds’ affirmative defenses and summary judgment evidence presented a genuine issue as to material facts regarding the Insureds’ claim of loss and their effort to find and communicate information regarding that loss. In my view, this precluded the entry of a final summary judgment for Universal in this case. My concern is that the majority opinion’s account of the record and application of Estrada invite the trial court on remand to reject summarily the issues raised by the Insureds, by applying the majority’s own interpretation of Estrada to the record before us. “Substantial compliance” with a contractual condition sounds like a factual issue, and it is exactly that on the record before us. The Insureds’ policy was in force at the time of the allegedly covered water damage, October 27, 2017. The Insureds notified Universal of the claimed loss only four days later. As Universal stated in paragraphs 5 and 6 of its motion for summary judgment: 5. On October 27, 2017, reportedly, [the Insureds] sustained some kind of “water loss,” allegedly caused [by a] plumbing leak in the bathroom. 8 Estrada was decided by this Court after the trial court entered the final summary judgment. I concur, of course, that the trial court cannot be faulted for failing to consider an appellate decision that had not yet issued. My concern is whether the majority should begin to apply Estrada to the record before us in its opinion before the trial court has an opportunity to do so on remand. 14  6. On October 31, 2017, finally, [the Insureds] reported the supposed loss to Universal, by and through their public adjuster.[FN] [FN] [The Insureds] reported the loss after work had begun to perform repairs, and, after hiring a public adjuster. Thereafter, the Insureds and their public adjuster, Peak Public Adjusters (“Peak”), communicated with the claims adjustment staff for Universal. The affidavit in support of summary judgment relied upon by Universal includes three written requests for a sworn proof of loss. The affidavit opposing summary judgment was executed by Sergio Arce, the owner of Peak. That affidavit attached email correspondence indicating submissions of water damage remediation documents, photos, and requests for a time for the Insureds to provide a recorded statement regarding the details of the loss. Peak’s line-item estimates of damages caused by the water were attached to an earlier affidavit of Arce filed by the Insureds. Consisting of 19 pages of estimates for labor and materials in each room of the Insureds’ condominium, Peak computed an actual cash value of the claim at $95,148.44, as stated in Arce’s affidavit. But that document was not in final form—Peak maintained that it was not allowed into common areas abutting the Insureds’ condominium unit to address the full extent of mold and water damage. 9 Documents were exchanged in January and February of 2018, but Arce’s affidavit and the emails to Universal attached to that affidavit 9 Universal paid $5,566.75 of the mitigation costs for some of the cleanup. 15 repeatedly ask Universal’s named claims representatives to call for the recorded statement of the Insureds, to no avail. At that point, the Insureds (one of whom was pregnant and concerned about mold) turned over the matter to their counsel, who filed the circuit court lawsuit. The Insureds’ pleadings in opposition to Universal’s affirmative defense based on the breach of the post-loss policy condition to file a proof of loss alleged, consistent with Arce’s affidavits and attachments, that Universal waived the defense by its actions, inaction, or representations. The Insureds further pled that they had substantially complied with Universal’s requests for documents and information about the loss. They also maintained that there was a “genuine issue of material fact as to whether [Universal] was prejudiced by any material breach of the post-loss obligations.” The Insureds did not disavow their obligation to provide a sworn proof of loss in the future or state that they would never do so. Rather, the Insureds promptly reported their loss, according to their summary judgment evidence. Thereafter, the affidavits and communications submitted by the Insureds in opposition to Universal’s motion for summary judgment establish that the Insureds and their adjuster encountered difficulty in getting access to areas of damage abutting their condominium unit and (allegedly) in getting return phone calls from Universal’s 16 adjuster. Those communication issues, according to the Insureds and their adjuster, persuaded them to file their lawsuit without further ado. I agree with the majority’s statement that our standard of review applicable to a summary judgment is de novo. I would add that in conducting that review in this case, we must indulge all inferences from the summary judgment evidence in the light most favorable to the Insureds: Because summary judgment tests the sufficiency of the evidence to justify a trial, it “is proper only if, taking the evidence and inferences in the light most favorable to the non-moving party, and assuming the jury would resolve all such factual disputes and inferences favorably to the non-moving party, the non-moving party still could not prevail at trial as a matter of law.” Moradiellos v. Gerelco Traffic Controls, Inc., 176 So. 3d 329, 334–35 (Fla. 3d DCA 2015). “At both the trial and appellate level, all evidence and inferences from the evidence must be taken in the light most favorable to the non-moving party.” Id. at 334. Perez-Gurri Corp. v. McLeod, 238 So. 3d 347, 349 (Fla. 3d DCA 2017). Under this rigorous standard, I cannot agree that, as a matter of law on this particular record, the Insureds’ failure to deliver a sworn proof of loss to Universal was a material post-loss condition precedent to the commencement of this lawsuit. A jury could reasonably conclude that the Insureds and their adjuster had submitted what they had and could not get Universal to call them back to schedule the Insureds’ recorded statement regarding the amount of the loss ascertained to that point. 17  This conclusion buttresses the now-required view of an insured’s actions and the materiality of a sworn proof of loss in our district under American Integrity Insurance Co. v. Estrada, 276 So. 3d 905 (Fla. 3d DCA 2019).10 Upon the issuance of Estrada, that decision is timely, effective, and applicable to this pending appeal. Whenever a court announces a new rule of law the question arises as to who is subject to or who may take advantage of the new rule. A new rule is applied either prospectively only, prospectively and retrospectively to certain nonfinal cases, or prospectively and retrospectively to all cases, even final cases on collateral review. Normally, a new rule which is not a fundamental change in the law, but merely an evolutionary refinement is generally applied prospectively to most cases, retrospectively to certain nonfinal cases (“pipeline” cases), but never to final cases. Mitchell v. Moore, 786 So. 2d 521, 529 (Fla. 2001) (original emphasis). The analysis in Estrada is not a fundamental change in law, and the present case is not final, so the analysis is applicable following our remand. But that does not mean that this Court should give the trial court the appellate panel’s various views on the application of Estrada to the record before us. The trial court record before us may not be the record subsequently developed on remand and ultimately considered by the trial court or a jury. 10 This Court certified conflict between Estrada and a case relied upon by the trial court in granting Universal’s motion for summary judgment, Rodrigo v. State Farm Florida Insurance Co., 144 So. 3d 690 (Fla. 4th DCA 2014). Neither party petitioned for the Florida Supreme Court to consider and resolve the conflict. 18  My concern is with the notion that an insurer can acknowledge a prompt claim of loss, demand a sworn proof of loss several times, but then fail to take note of emails, telephone calls, and information regarding an insured’s delays in getting the information for the sworn proof of loss. I do not conclude that this is what happened, but it is what has been alleged in the summary judgment evidence opposing Universal’s motion. I believe that Estrada requires a trial court to engage in a more nuanced assessment of the pleadings and summary judgment evidence before invoking the cudgel of a summary determination that the insured has breached the policy (a circumstance resulting in a loss of coverage for the claim). In support of its motion for summary judgment, Universal filed 49 “other decisions,” 260 pages of judgments in favor of an assortment of insurers from an assortment of Florida circuit courts over a course of many years. None had the benefit of the reasoning or decision in Estrada or, so far as the judgments indicate, any comparability to the record in this case. For these reasons, I concur with the majority opinion reversing the final summary judgment in favor of Universal and remanding the case to the trial court for further proceedings. Although I also concur that the trial court correctly found that the Insureds had not submitted a sworn proof of loss to Universal before filing a suit regarding their allegedly-covered loss, I believe the majority’s extensive discussion of pre-Estrada case law and opinions sustaining summary judgments on 19 different records is premature and dicta with respect to this case as remanded to the trial court. For these reasons, I respectfully dissent from the partial affirmance of a trial court finding on the Insureds’ alleged failure to provide any evidence of substantial compliance; I would reverse on that point as well as the balance of the final summary judgment. 20