Slip-sliding away: Insured seeks coverage for subsurface repair
After noticing damages to their house in 2008, James and Rhonda Case filed a claim with their homeowners insurer, Tower Hill Prime Insurance Company, which then hired an engineering firm, Rimkus Consulting Group, Inc., to evaluate the property. The engineer reported sinkhole damage and recommended subsurface compaction grouting at an estimated cost of $91,000. Tower Hill acknowledged coverage for the damages under the policy but refused to pay until the Cases entered into a contract for remediation of the damage, in accordance with a policy term that so provided.
The Cases hired their own engineer, Biller Reinhart, to evaluate the property, and that firm concluded that in addition to subsurface compaction grouting, underpinning also was necessary and that the total cost of subsurface repair was $250,000 to $267,000.
In view of the parties’ differences over the method of repair, Tower Hill invoked the neutral evaluation process in June 2010. The neutral evaluator, SDII Global, found that compaction grouting was adequate to remediate the subsurface repair at an estimated cost of $113,372. Tower Hill notified the Cases of the neutral evaluator’s assessment and again informed them that they were required to enter into a contract for the repairs before it would be required to pay.
The Cases filed an action for declaratory judgment against Tower Hill in January 2011, seeking a determination of the proper method of repair. In June 2011, the Cases retained yet another engineering firm, KCI Technologies, to evaluate the property. That firm concluded that compaction grouting alone was not sufficient and recommended a hybrid system of grouted injection piers, pressure grouting points, and interior chemical injection points at a cost of $174,000. The Cases also had Biller Reinhart conduct a second evaluation of the property in August 2013, and the engineer concluded that further sinkhole damage had occurred and that the underpinning and grouting necessary to repair the damage had increased to an estimated cost of $371,372 to $391,222.
Tower Hill moved for summary judgment, arguing that the terms of the policy established that it was required to pay only for the plan recommended by its expert. The Cases responded that based on the evaluations they had obtained, there was a material issue of fact regarding how to stabilize the subsurface property and that summary judgment was therefore inappropriate. The trial court granted Tower Hill’s motion for summary judgment, concluding that the terms of the policy were “clear and unambiguous and [that] the only issue remaining is an issue of fact, i.e., damages for the breach.”
On appeal, the Cases contended that a declaratory judgment was not appropriate in this case because they were in doubt regarding the proper method of subsurface repair under the terms of the policy and that summary judgment was improperly granted because there was a disputed issue of fact regarding the proper method of subsurface repair. Tower Hill conceded error on the basis of this court’s holdings in previously decided cases.
Relying on this case law, the appellate court held that the questionof which recommended method of subsurface repair was sufficient to repair the home owner’s damage was a question for the jury. The court reversed the final summary judgment and remanded the case for further proceedings.
Case vs. Tower Hill Prime Insurance Company-Court of Appeals of Florida, Second District-May 11, 2016- No. 2D15–2225.