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Court: Citizens can face bad-faith lawsuit


 

PENSACOLA, Fla. – Jan. 24, 2014 – In a case stemming from hurricane damage in 2004, an appeals court ruled Thursday that the state-backed Citizens Property Insurance Corp. can face a “bad faith” lawsuit because of the way it handled a claim.

A three-judge panel of the 1st District Court of Appeal reversed a decision by Escambia County Circuit Judge Terry Terrell that said Citizens was immune from such a lawsuit. The Perdido Sun Condominium Association filed the case.

The appeals court, however, asked the Florida Supreme Court to take up the issue, a process known as certifying a question to the justices.

The dispute started when Perdido Sun was unhappy with the amount of Citizens’ payment of a claim and filed a breach of contract lawsuit to get additional money. The condominium association ultimately won that lawsuit and filed another case under a law dealing with insurers failing to settle claims in good faith.

The circuit judge dismissed the case, but appeals-court judges overturned that decision Thursday and sent the case back.

“Citizens’ immunity does not extend to the ‘willful tort’ of failing to attempt in good faith to settle claims as provided by (state law),” said the ruling, written by Judge Nikki Ann Clark and joined by judges James R. Wolf and William A. Van Nortwick.

Source: News Service of Florida

Related Topics: Property insurance