KWAKU ADJEI v. FIRST COMMUNITY INSURANCE COMPANY

Third District Court of Appeal
State of Florida

Opinion filed October 19, 2022.
Not final until disposition of timely filed motion for rehearing.

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No. 3D21-1348
Lower Tribunal No. 19-36841
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Kwaku Adjei, et al.,
Appellants,

vs.

First Community Insurance Company,
Appellee.

An appeal from the Circuit Court for Miami-Dade County, Alan Fine,
Judge.

Font & Nelson, PLLC, Jose P. Font, and Christopher Herrera (Fort
Lauderdale), for appellants.

Cole, Scott & Kissane, P.A., and Mark D. Tinker (Tampa), for appellee.

Before LOGUE, MILLER, and BOKOR, JJ.

MILLER, J.
 Appellants, Jeremiah and Joel Adjei, as assignees of Kwaku and

Beatrice Adjei, challenge a final order dismissing their breach of contract

lawsuit against appellee, First Community Insurance Company, for lack of

standing. The primary issue on appeal is whether applying section

627.7152, Florida Statutes (2019), to the assignment of a claim for post-loss

insurance benefits under a policy issued prior to enactment of the statute is

constitutionally authorized.1 Concluding that applying the statute to the

assignment in this case does not constitute an impermissible retroactive

application, we affirm.

BACKGROUND

In 2016, First Community issued a residential homeowner’s policy to

the named insureds, Kwaku and Beatrice Adjei. After their property

sustained damage during Hurricane Irma, the named insureds submitted a

claim under the policy. First Community paid a portion of the claimed

damages. The named insureds filed suit against First Community but later

voluntarily dismissed the case.

1
We summarily reject the notion that section 627.7153, Florida Statutes
(2019), which governs anti-assignment provisions in insurance policies, has
any application to this case. The statute was enacted three years after the
policy issued, and the policy is devoid of any anti-assignment clause.
Moreover, we find no abuse of discretion in the dismissal “with prejudice.”

2
 On July 1, 2019, section 627.7152, Florida Statutes, took effect. Over

three months later, the named insureds assigned their benefits under the

policy to their children, appellants.2 The assignment stated in its entirety:

I, Beatrice Adjei and Kwaku Adjei, hereby assign Joel Adjei and
Jeremiah Adjei any and all rights and benefits that I have in
relation to any and all insurance policies that were maintained in
relation to the residence located at 17168 SW 144th Place,
Miami, FL 33177, including but not limited to the policy that was
maintained by First Community Insurance Company, and
identified by policy number 09-0011605944-4-02 in relation to
claim number 17-7275. This assignment as stated is in
consideration of the fact that the referenced residence has
served, and continues to serve as Joel and Jeremiah Adjei's
primary residence in relation to this agreement to insure
maintenance repairs and they have been agreed to maintain,
repair or otherwise take responsibility for the various others
obligations and they have liabilities associated with the
ownership of the residence.

Relying upon the assignment, appellants filed suit against First

Community. The trial court dismissed early iterations of the complaint,

without prejudice, on the basis the assignment failed to comply with the

requirements of section 627.7152, Florida Statutes. The named insureds

then attempted to file suit in their own names. The court dismissed that

claim, too, and appellants eventually filed a fourth amended petition for

declaratory relief. In the complaint, appellants sought a declaration as to

2
The assignment is undated, but the parties agree it was executed on
October 25, 2019.

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their rights and remedies under the policy. Part and parcel with their factual

allegations, appellants contended they were not service professionals but

rather the children of the named insureds.

First Community again sought dismissal on the basis that appellants

lacked standing because the assignment of benefits failed to conform with

section 627.7152, Florida Statutes. In furtherance of its motion, First

Community contended the assignment was noncompliant because it omitted

essential items, including the assignees’ signatures, a rescission provision,

a cost estimate, an indemnification clause, a boilerplate statutory notice

provision, and language confirming that the assignees would furnish the

insurer with a copy of the agreement within three business days after either

execution or commencement of work.

Appellants countered by arguing that the assignment was not subject

to the requirements of section 627.7152, Florida Statutes, because it did not

fall within the statutory definition of “assignment agreement,” and applying

the statute to the assignment of a claim under a 2016 policy constituted an

unconstitutional impairment of contract. After entertaining argument, the trial

court dismissed the case. Appellants unsuccessfully sought rehearing, and

the instant appeal ensued.

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 STANDARD OF REVIEW

“A de novo standard of review applies when reviewing whether a party

has standing to bring an action,” Boyd v. Wells Fargo Bank, N.A., 143 So. 3d

1128, 1129 (Fla. 4th DCA 2014), and the dismissal of a complaint with

prejudice, Sanchez v. County of Volusia, 331 So. 3d 853, 854 (Fla. 5th DCA

2021). Similarly, we review de novo whether applying section 627.7152,

Florida Statutes, to an assignment of benefits under a policy incepted prior

to the enactment of the statute is constitutionally permissible.

ANALYSIS

First enacted in 2019, section 627.7152, Florida Statutes, regulates

certain assignment agreements “seek[ing] to transfer insurance benefits

from the policyholder to a third party.”3 Total Care Restoration, LLC v.

Citizens Prop. Ins. Corp., 337 So. 3d 74, 76 (Fla. 4th DCA 2022). The statute

applies to any assignment of post-loss benefits “to or from a person providing

services to protect, repair, restore, or replace property or to mitigate against

further damage to the property” executed on or after July 1, 2019. §

627.7152(1)(b), (13), Fla. Stat.

3
The 2019 version of section 627.7152, Florida Statutes, is the applicable
version in this case because that is the version of the statute that was in
effect when the assignment was executed. The statute has since been
amended, most recently in 2022. Ch. 2022-2-D, § 18, Laws of Fla.

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 The statute contains a “checklist” of terms that must be included within

any such assignment agreement. Included among the requirements is that

the assignment must be in writing, executed by and between the assignor

and the assignee, and contain several boilerplate provisions regarding

liability, rescission, and delivery of the agreement to the insurer. See §

627.7152(2)(a), Fla. Stat. Statutorily noncompliant assignment agreements,

without exception, are deemed “invalid and unenforceable.” §

627.7152(2)(d), Fla. Stat.

Appellants do not contend their assignment is statutorily compliant.

Rather, they claim their assignment is not subject to the reach of section

627.7152, Florida Statutes, because it was not “to or from a person providing

services to protect, repair, restore, or replace property or to mitigate against

further damage to the property.” § 627.7152(1)(b) Fla. Stat.

While not every assignment triggers the requirements of section

627.7152, Florida Statutes, here, the plain language of the assignment belies

appellants’ claim that they did not agree to restore or repair the property.

The assignment specifically provides that appellants warrant to “insure

maintenance repairs” and “agree[] to maintain, repair or otherwise take

responsibility for the various other obligations” of ownership. Consequently,

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the assignment, as drafted, implicates the statutory scheme. Thus, we turn

our examination to the constitutional concerns.

Article 1, Section 10 of the Constitution of the United States prohibits

any state from passing “a valid law or enactment impairing the obligation of

contracts.” State ex rel. Sovereign Camp, W.O.W. v. Boring, 164 So. 859,

865 (Fla. 1935). Correspondingly, article 1, section 10 of the Florida

Constitution provides that “No . . . law impairing the obligation of contracts

shall be passed.” Art. I, § 10, Fla. Const. Consistent with these provisions,

the Florida Supreme Court has construed contractual impairment as a “wall

of absolute prohibition.” State, Dep’t of Transp. v. Edward M. Chadbourne,

Inc., 382 So. 2d 293, 297 (Fla. 1980).

“Determining proper limitations on the temporal reach of statutes,”

however, “is a recurring problem in the law.” R.A.M. of S. Fla., Inc. v. WCI

Communities, Inc., 869 So. 2d 1210, 1215 (Fla. 2d DCA 2004). Ordinarily,

procedural statutes apply retroactively, while substantive measures are

presumed to apply prospectively. See Young v. Altenhaus, 472 So. 2d 1152,

1154 (Fla.1985). That is not to say that substantive statutes cannot apply

retroactively. Rather, they may be applied retroactively only if a two-prong

inquiry is satisfied:

[T]he court must first determine if there is “clear evidence of
legislative intent to apply the statute retrospectively.”

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 [Metropolitan Dade County. v. Chase Fed. Hous. Corp., 737 So.
2d 494, 499 (Fla. 1999)]. Once the first inquiry is made, and only
“[i]f the legislation clearly expresses an intent that it must apply
retroactively, then the second inquiry is whether retroactive
application is constitutionally permissible.” Id. (citing State Farm
Mut. Auto. Ins. v. Laforet, 658 So. 2d 55, 61 (Fla.1995)); see also
Florida Hosp. Waterman, Inc. v. Buster, 984 So. 2d 478, 487
(Fla. 2008) (“[A] retroactivity analysis is two-pronged, asking first
if the relevant provision provides for retroactive application, and
second if such application is constitutionally permissible.”).

Fla. Ins. Guar. Ass’n, Inc. v. Devon Neighborhood Ass’n, Inc., 67 So. 3d 187,

194 (Fla. 2011) (third and fourth alteration in original).

As reiterated recently by Justice Canady, “sometimes ‘[t]he distinction

between substantive and procedural law is neither simple nor certain.’” Love

v. State, 286 So. 3d 177, 183 (Fla. 2019) (alteration in original) (quoting

Caple v. Tuttle’s Design-Build, Inc., 753 So. 2d 49, 53 (Fla. 2000)). Despite

this lack of clarity, it is abundantly clear that laws that “would impair rights a

party possessed when he acted, increase a party’s liability for past conduct,

or impose new duties with respect to transactions already completed” are

substantive in nature. Landgraf v. USI Film Prod., 511 U.S. 244, 280 (1994).

Conversely, statutes that involve “the means and methods to apply and

enforce those duties and rights” are deemed procedural. Alamo Rent-A-Car,

Inc. v. Mancusi, 632 So. 2d 1352, 1358 (Fla. 1994). A retroactive application

of procedural statutes is permissible because “no one has a vested interest

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in any given mode of procedure.” State v. Kelley, 588 So. 2d 595, 597 (Fla.

1st DCA 1991).

In accord with these principles, “it is generally accepted that the statute

in effect at the time an insurance contract is executed governs substantive

issues arising in connection with that contract.” Hassen v. State Farm Mut.

Auto. Ins. Co., 674 So. 2d 106, 108 (Fla. 1996). Here, rather than address

the omission of the “checklist” within the assignment agreement, appellants

rely upon the Florida Supreme Court’s decision in Menendez v. Progressive

Express Insurance Co., 35 So. 3d 873 (Fla. 2010), for the proposition that

portions of the statute not implicated in this case—a pre-suit notice

requirement and fee shifting provision—impair substantive contractual rights.

We decline the invitation to render an advisory opinion as to the retroactivity

of these two provisions and instead confine our analysis, as we must, to the

issue at hand—namely, whether requiring the inclusion of the statutory

“checklist” in the instant assignment runs afoul of constitutional concerns.

It is axiomatic that a Florida policyholder is ordinarily authorized to

freely assign a post-loss insurance claim. See § 627.422, Fla. Stat. (2022);

Citizens Prop. Ins. Corp. v. Ifergane, 114 So. 3d 190, 195 (Fla. 3d DCA 2012)

(“Post-loss insurance claims are freely assignable without the consent of the

insurer.”); Bioscience W., Inc. v. Gulfstream Prop. & Cas. Ins. Co., 185 So.

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3d 638, 643 (Fla. 2d DCA 2016) (same); see also Raven Env’t. Restoration

Servs., LLC v. United Nat’l Ins. Co., 489 F. Supp. 3d 1372, 1377 n.2 (S.D.

Fla. 2020) (“Florida law permits a policyholder of an authorized insurance

policy to freely assign post-loss insurance claims.”). This is because

“[g]enerally, rights under a contract are assignable.” Pro. Consulting Servs.,

Inc. v. Hartford Life & Accident Ins. Co., 849 So. 2d 446, 447 (Fla. 2d DCA

2003). This may be the case even if the policy contains an anti-assignment

clause. § 627.422(2), Fla. Stat.; Extreme Emergency Fire & Water

Restoration LLC v. Certain Underwriters at Lloyd’s of London, 314 So. 3d

559, 560 (Fla. 3d DCA 2020).

Further, as appellants correctly observe, the policy in this case does

not purport to prohibit or restrict the right of an insured to assign a post-loss

claim. As a result, at the time the policy issued, the named insureds were

free to execute a post-loss assignment.

At first glance, the “checklist” in section 627.7152, Florida Statutes,

might appear to curtail that right. A closer reading, however, yields the

inescapable conclusion that this portion of the statute merely regulates the

contents of any assignment agreement by requiring the contracting parties

to include certain language. Had the legislature wished to do so, it

indubitably could have designated certain claims unassignable, prohibited a

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class of potential assignees from accepting an assignment, limited the

circumstances under which an insured might legally assign a claim, or

imposed any other substantively restrictive measures. Consequently,

insofar as it merely requires the inclusion of certain words, we conclude the

statute solely “affect[s] rights under the assignment of benefits, not

substantive rights under the insurance policy.” SFR Servs., LLC v. Indian

Harbor Ins. Co., 529 F. Supp. 3d 1285, 1290 (M.D. Fla. 2021). Thus,

applying the provisions to assignments executed after its effective date does

not “impair rights a party possessed when he acted, increase a party’s

liability for past conduct, or impose new duties with respect to transactions

already completed.” Landgraf, 511 U.S. at 280.

This conclusion is consistent with several decisions by our sister

courts. See Kidwell Grp., LLC v. Olympus Ins. Co., 47 Fla. L. Weekly D1571,

D1571 (Fla. 5th DCA July 22, 2022) (“[B]ased on the plain language of

[section 627.7152, Florida Statutes], the trial court properly applied section

627.7152 prospectively to the assignment agreement in this case.”); Total

Care Restoration, LLC, 337 So. 3d at 77 (“This case does not involve the

application of a statute to a preexisting insurance policy; it concerns a

statute’s application to an assignment created after the effective date of the

statute. Thus, section 627.7152—the law in effect at the time the assignment

11
of benefits was executed—was properly applied to the assignment in this

case.”); see also SFR Servs., LLC, 529 F. Supp. at 1289–90 (maintaining

section 627.7152, Florida Statutes, did not affect substantive rights under

insurance policy and only established procedural requirements for effective

formation of an assignment of benefits); JPJ Servs. LLC v. N.H. Ins. Co., No.

21-14329-CIV, 2022 WL 1908970, at *4–5 (S.D. Fla. June 3, 2022) (applying

section 627.7152, Florida Statutes, to an assignment agreement created in

2020 of an insurance policy issued prior to enactment of section 627.7152,

Florida Statutes). Accordingly, we impute no error to the order on appeal,

and we affirm in all respects.

Affirmed.

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