Background
Wild Oak Bay Owners Association reported a Hurricane Irma property-damage claim to American Coastal Insurance Company on July 29, 2020, nearly three years after the hurricane made landfall. Wild Oak Bay later assigned its policy benefits to SFR Services, which submitted an estimate covering roof replacements for forty-eight buildings and sued American Coastal for breach of contract.
American Coastal moved for summary judgment, arguing that Wild Oak Bay failed to give prompt notice and that the delay and intervening repairs prejudiced its investigation. The circuit court agreed, finding no meaningful evidence overcoming the prejudice caused by the 1,053-day delay. The court also struck SFR’s attempt to accept American Coastal’s statutory presuit settlement offer after summary judgment had been entered.
The Court’s Holding
The Second District agreed that Wild Oak Bay failed to provide prompt notice as a matter of law. Undisputed evidence showed displaced or damaged roofing materials immediately after Hurricane Irma and nine roof leaks reported by November 2017, including flashing leaks believed to have resulted from wind-driven rain. Those facts would have led a reasonable person to believe that a claim might arise.
The court nevertheless reversed summary judgment on prejudice. Because the policy stated that American Coastal had no duty to provide coverage if noncompliance with the listed post-loss duties was prejudicial to it, the policy placed the burden on American Coastal to prove actual prejudice and displaced the common-law presumption of prejudice. The court certified conflict with the Third District’s decision in Arce v. Citizens Property Insurance Co.
The trial court also improperly weighed SFR’s engineering evidence at summary judgment by characterizing the expert’s analysis as conclusory and “preposterous.” The expert’s inspection, weather data, pressure calculations, and analysis of storm-specific damage patterns created a factual dispute over prejudice and would have rebutted a presumption even if one applied. The appellate court separately affirmed the order striking SFR’s attempted settlement acceptance because entry of summary judgment terminated the pending offer.
Key Takeaways
- Wild Oak Bay’s knowledge of roof damage and suspected wind-driven rain shortly after Hurricane Irma made its nearly three-year-delayed notice untimely as a matter of law.
- Policy language conditioning denial of coverage on prejudice required American Coastal to prove prejudice rather than relying on a common-law presumption.
- A court may not weigh competing expert evidence or make credibility determinations when deciding summary judgment.
- SFR could not accept American Coastal’s settlement offer after the court had entered summary judgment against it.
Why It Matters
The decision makes the wording and structure of an insurance policy central to allocating the burden of proving prejudice from late notice. In the Second District, an insurer using this language must affirmatively establish prejudice, even though Florida common law generally presumes prejudice when notice is untimely.
The certified conflict with Arce highlights a district split over whether comparable policy language displaces that presumption. The ruling also confirms that sufficiently supported expert evidence concerning causation and the continuing ability to investigate can prevent summary judgment despite a substantial reporting delay.