In a recent ruling, the Third District Court of Appeal in Florida dismissed a petition filed by National Fire & Marine Insurance Company and Certain Underwriters at Lloyd’s London. The case, docket number 3D21-0120, involved an insurance dispute stemming from losses incurred during the COVID-19 pandemic. The court ruled that the insurance company could not demonstrate irreparable harm, which is a necessary condition for certiorari review.
This decision impacts Infinity Biscayne Myrtle Members, LLC, a commercial landlord that filed a lawsuit against the insurance companies seeking to recover lost revenue due to government-mandated closures related to the pandemic. The case highlights ongoing legal battles over insurance claims arising from COVID-19 shutdowns, which have affected many businesses across the country.
Background
The parties involved in this case are National Fire & Marine Insurance Company and Certain Underwriters at Lloyd’s London as the petitioners, and Infinity Biscayne Myrtle Members, LLC as the respondent. Infinity Biscayne, acting as a commercial landlord, filed a multicount complaint against the insurance companies after its tenants were forced to limit their operations due to pandemic-related shutdowns.
The complaint contained five counts: anticipatory breach of contract, breach of contract, breach of contract related to civil authority coverage, breach of covenant of good faith and fair dealing, and bad faith. The insurance companies moved to dismiss the anticipatory breach count, arguing it was not a valid claim under Florida law. They also contended that the claims for breach of good faith and bad faith were premature because coverage issues had not yet been resolved.
The trial court denied the motion to dismiss, leading the insurance companies to seek certiorari review from the appellate court. The court’s decision to dismiss the petition was based on established legal precedent that requires a showing of irreparable harm for certiorari jurisdiction.
The Ruling
The court ruled that the anticipatory breach claim was a viable cause of action and noted that “the law permits a plaintiff to allege alternative theories.” The judges on the panel included Judges Miller, Gordo, and Bokor. They found no error in the trial court's decision to deny the motion to dismiss the anticipatory breach claim.
Regarding the breach of good faith and fair dealing claim, the court pointed out that Infinity Biscayne's allegations suggested the insurance companies “unreasonably withheld a formal coverage decision in bad faith.” However, the court stated that this claim appeared to be a disguised bad faith claim, which is governed by Florida statutes and requires a determination of coverage before it can proceed.
The judges concluded that the insurance companies could not demonstrate irreparable harm, stating, “a trial court order denying a motion to dismiss an allegedly-premature bad faith claim would not, without more, satisfy the ‘irreparable harm’ requirement for certiorari.” They referenced several prior cases that supported this conclusion, emphasizing that the alleged injury could be remedied on direct appeal.
Impact
This ruling has significant implications for businesses seeking insurance claims related to COVID-19 losses. It reinforces the idea that claims for bad faith must be properly established and cannot proceed until coverage determinations are made. The decision also highlights the challenges faced by businesses in navigating insurance claims during the pandemic.
The dismissal of this petition may discourage other insurance companies from seeking certiorari in similar cases without first demonstrating irreparable harm. This could lead to more cases proceeding through the lower courts, allowing businesses to seek the compensation they believe they are owed.
What's Next
Infinity Biscayne has abated its bad faith claim following the trial court's decision. Details were not available in the court filing regarding whether the insurance companies plan to appeal the ruling or if there are related cases pending.