IN THE DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
FIFTH DISTRICT
NOT FINAL UNTIL TIME EXPIRES TO
FILE MOTION FOR REHEARING AND
DISPOSITION THEREOF IF FILED
CHAD LORD,
Appellant,
v. Case No. 5D22-1648
LT Case No. 2018-CA-000428
FEDNAT INSURANCE COMPANY,
Appellee.
________________________________/
Opinion filed June 23, 2023
Nonfinal Appeal from the Circuit Court
for Flagler County,
Terence R. Perkins, Judge.
Matthew Struble, of Struble, P.A.,
Indialantic, for Appellant.
Lauren J. Smith, of Luks, Santaniello,
Petrillo, Cohen & Peterfriend, Stuart,
for Appellee.
HARRIS, J.
Appellant, Chad Lord, appeals the trial court’s non-final order denying
his motion for leave to amend his complaint to assert a claim for punitive
damages. Because Appellant has not demonstrated reversible error, we
affirm.
On July 9, 2017, Appellant’s house was struck by lightning, causing
significant damage to his home. That same day, he reported the claim to his
homeowner’s insurance company, FedNat Insurance Company (“FedNat”).
Over the next several weeks, FedNat ordered inspections of the property,
prepared numerous status reports, and provided an estimate for the structural
damage caused by the lightning strikes. However, two months after the
incident, FedNat had still not assessed the electrical component damages
claimed by Appellant. On October 20, 2017, Appellant filed a civil remedy
notice (CRN) of insurer violations against FedNat.
In November 2017, FedNat’s litigation manager noted that the claim
had been open for 120 days with no coverage determination, that there was
a CRN pending, and requested that FedNat’s adjuster review the file to
complete the claim evaluation. The following month, some payments were
made to Appellant, but FedNat acknowledged that the payments were not
issued within 90 days of the reported claim as required by law.
On June 1, 2018, an appraisal award was entered in favor of Appellant
for an amount significantly greater than the payments previously tendered by
FedNat. Appellant filed a complaint against FedNat for violations of section
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626.9541, Florida Statutes (2018), and in October 2021, he moved to amend
the complaint to add a claim for punitive damages. He argued that he was
entitled to assert a claim for punitive damages pursuant to section 624.155(5),
Florida Statutes (2021), because the acts giving rise to the alleged violations
occurred with such frequency as to indicate a general business practice and
these acts were in reckless disregard for the rights of the insured. Following
a hearing, the court denied Appellant’s motion, finding, inter alia, that
Appellant failed to present a sufficient proffer to constitute a general business
practice as required by section 624.155(5). We agree.
A trial court’s decision on a motion for leave to amend a complaint to
add a punitive damage claim is reviewed de novo. See Progressive Select
Ins. Co. v. Ober, 353 So. 3d 1190, 1192 (Fla. 4th DCA 2023). “In any civil
action, no claim for punitive damages shall be permitted unless there is a
reasonable showing by evidence in the record or proffered by the claimant
which would provide a reasonable basis for recovery of such damages.” §
768.72(1), Fla. Stat. (2021). “The claimant may move to amend her or his
complaint to assert a claim for punitive damages as allowed by the rules of
civil procedure.” Id.; accord Fla. R. Civ. P. 1.190(f).
In his complaint, Appellant alleged violations of section
626.9541(1)(i)(3)(a) and (c)—failure to implement standards for proper
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investigation of claims and failure to act promptly upon communications with
respect to claims. Section 624.155(5) allows for punitive damages if the
claimant can prove the acts giving rise to the violations occur with such
frequency as to indicate a general business practice and these acts are:
(a) Willful, wanton, and malicious;
(b) In reckless disregard for the rights of any insured; or
(c) In reckless disregard for the rights of a beneficiary under a
life insurance contract.
§ 624.155(5), Fla. Stat. (2021). Appellant only claims entitlement to punitive
damages under section 624.155(5)(b). Accordingly, he must make a
reasonable showing by evidence in the record or by proffer that the alleged
violations constitute a general business practice and that the acts are in
reckless disregard for his rights as an insured.
In asserting that FedNat’s violations of section 626.9541(1)(i)(3)(a) and
(c) were a general business practice, Appellant primarily relies on the
deposition from FedNat’s vice president of claims, Brian Turnau, taken in
2018 during a separate unrelated case. In that deposition, Turnau stated that
in 2015, he was unaware of any written guidelines related to settling a claim
after receiving a CRN. Appellant also relies on the deposition of FedNat’s
field adjuster who testified that he was not aware of any guidelines for the
adjustment of lightning strike claims at the time FedNat adjusted Appellant’s
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claim. Appellant argues that a jury could find that as a business practice,
FedNat failed to implement standards for the proper investigation of lightning
strike claims or that it at least failed to provide the guidelines to its adjusters.
To establish that an insurer committed violations with such frequency
as to indicate a general business practice, the insured must provide evidence
of violations beyond his own claim. See Jablonski v. St. Paul Fire & Marine
Ins. Co., No. 2:07-cv-00386, 2010 WL 1417063, at *1 (M.D. Fla. Apr. 7,
2010); see also Fox Haven of Foxfire Condo. IV Ass’n, Inc. v. Nationwide
Mut. Fire Ins. Co., No. 2:13-cv-399-FTM-29CM, 2015 WL 667935, at *6
(M.D. Fla. Feb. 17, 2015) (“Typically, a plaintiff establishes a general
business practice by demonstrating that the insurer also acted in [bad] faith
when evaluating numerous other claims.”); Shannon R. Ginn Constr. Co. v.
Reliance Ins. Co., 51 F. Supp. 2d 1347, 1353 (S.D. Fla. 1999) (“[I]t seems
clear that ‘general business practice’ means more than acting in the
proscribed manner in the plaintiff’s own claim.”). A claimant must show “other
acts” and not necessarily “other claims.” Jablonski, 2010 WL 1417063, at *1.
The only evidence to support a punitive damages claim provided by
Appellant is deposition testimony suggesting that FedNat had no specific
standards relating to settling claims after receiving a CRN or for adjusting a
lightning strike claim. Otherwise, the evidence established that the policies
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and procedures for investigating and adjusting claims were contained in
FedNat’s claims manual. We conclude that, even if failing to have policies
that are specific to these types of claims violates section 626.9541(1)(i)(3), it
does not demonstrate that the acts giving rise to the violations occur with
such frequency as to establish a general business practice.
Accordingly, we agree with the trial court that Appellant has not made
a reasonable showing that FedNat’s alleged violations of section
626.9541(1)(i)(3)(a) and (c) occurred with such frequency as to indicate a
general business practice. See Howell-Demarest v. State Farm Mut. Auto.
Ins. Co., 673 So. 2d 526, 528 (Fla. 4th DCA 1996) (explaining that insured
only established that insurer engaged in practice in insured’s case and three
other cases cited by insured, and that insured would need to demonstrate
insurer engaged in practice far more frequently than that); see also
Sandpiper Isle Condo. Ass’n v. Empire Indem. Ins. Co., No. 2:21-cv-105-
JLB-MRM, 2022 WL 2316999, at *1 (M.D. Fla. June 28, 2022) (finding
insured failed to plead general business practice because beyond its own
claim, insured only identified one other comparable instance); cf. Hogan v.
Provident Life & Accident Ins. Co., 665 F. Supp. 2d 1273, 1289 (M.D. Fla.
2009) (finding insured adequately pled claim for punitive damages by
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alleging that insurer committed similar acts of bad faith in more than 4,000
other claims).
Because we conclude that Appellant has not reasonably shown
evidence of other instances to establish a general business practice of
committing the alleged violations, we need not reach the next step of whether
he established the acts were in reckless disregard for his rights. The order
denying Appellant’s motion for leave to amend his complaint to assert a claim
for punitive damages is AFFIRMED.
EISNAUGLE and PRATT, JJ., concur.
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