Is A Policyholder’s Non-Compliance A Defense To A Breach Of Contract Lawsuit?
Insurance policies are contracts. As such, when an insurer fails to pay a valid claim, it is subject to suit for breach of that contract. But this works both ways. If the policyholder fails to live up to their contractual obligations, that can supply the insurer a valid defense to any alleged breach. A recent decision from the Florida Third District Court of Appeal, Nunez v. Universal Property Casualty Insurance Company, provides a helpful illustration. In this case, the plaintiff insured her home with the defendant. The plaintiff reported a claim in 2015 over purported water damage from two leaks in her kitchen and bathroom, respectively. She later submitted written proof of loss, asserting $50,000 in total damages. The defendant investigated the claims. As part of the investigation, the defendant requested the plaintiff attend an Examination Under Oath (EUO), which is a common procedure in resolving insurance claims. The plaintiff refused to appear. Indeed, she declined to respond to multiple EUO requests. Accordingly, the defendant denied the plaintiff’s water damage claims. She, in turn, filed a breach of contract lawsuit. At trial, the defense argued the plaintiff’s failure to attend the EUO was itself a “material breach of the insurance contract” preventing her from recovering any damages. The trial judge instructed the jury that it had to find that the defendant proved the plaintiff “unreasonably failed to attend her” EUO to sustain this defense. The jury ultimately rejected the defense and returned a verdict for the plaintiff. Sometime after the trial, the Third District issued an opinion in another case, American Integrity Insurance Company v. Estrada, that held when an insurance company establishes that a policyholder has “failed to materially satisfy any contractually mandated post-loss obligations, then the burden shifts” to the policyholder to establish their breach did not prejudice the insurer’s rights. Based on the Estrada decision, the defendant in Nunez argued it was entitled to a new trial. The trial court granted that motion. Indeed, the judge issued a directed verdict holding that the plaintiff breached the insurance contract. The judge then ordered a new trial to determine whether the defense was prejudiced by this breach. The plaintiff appealed, hoping to reinstate the original jury verdict, but the Third District affirmed the trial judge’s decisions. The appellate court pointed out that unlike the earlier Estrada case–where there was a genuine factual dispute over whether the policyholder complied with the insurance contract–here the plaintiff’s noncompliance was not in dispute. Instead, the plaintiff argued during the original jury trial that the defendant’s request for an EUO was itself unreasonable. But the Third Circuit said that was a legally irrelevant argument. Speak with a Florida Insurance Attorney Today Insurance litigation often involves a number of technical and fact-specific issues. That is why it is important to work with an experienced Tampa mold and water damage attorney who understands the process and can work with you to secure the most favorable outcome. Contact HD Law Partners today to schedule a consultation. Source: scholar.google.com/scholar_case?case=813-253-5333871577193 Posted in Uncategorized | No Comments » Connect with us Archives May 2026 April 2026 March 2026 February 2026 January 2026 December 2025 November 2025 October 2025 September 2025 July 2025 June 2025 January 2025 January 2024 December 2023 November 2023 October 2023 September 2023 August 2023 July 2023 June 2023 May 2023 April 2023 March 2023 February 2023 January 2023 December 2022 November 2022 October 2022 September 2022 August 2022 July 2022 May 2022 April 2022 March 2022 November 2021 October 2021 September 2021 August 2021 July 2021 May 2021 April 2021 March 2021 February 2021 January 2021 December 2020 November 2020 October 2020 August 2020 July 2020 June 2020 May 2020 April 2020 March 2020 February 2020 January 2020 December 2019 November 2019 October 2019 September 2019 August 2019 July 2019 June 2019 May 2019 April 2019 March 2019 February 2019 January 2019 December 2018 November 2018 October 2018 September 2018 August 2018 July 2018 June 2018 May 2018 April 2018 March 2018 February 2018 January 2018 December 2017 November 2017 October 2017 September 2017 August 2017 July 2017 June 2017 May 2017 April 2017 March 2017 February 2017 January 2017 December 2016 November 2016 October 2016 November 13 Categories Alimony Appellate Arbitration Auto Accidents Auto Insurance Business Corporate Business Insurance Law Child Custody Child Support Criminal Law Divorce Family Law FEMA Insurance Payments Florida’s Mandatory 2‑Hour Legal Professionalism CLE: Foreclosure Defense Fort Myers Hurricane Insurance Attorney General Guardianship HD Law Partners Service HOA/Property Management Homeowners Association Homeowners Insurance Hurricane Claims Hurricane Insurance Insurance Bad Faith Insurance Claims Insurance Defense Insurance Litigation Landlord Tenant Law Enforcement Liability Loan Modifications Mold Water Damage Parental Rights Paternity Personal Injury Premises Liability Law Prenuptial Agreements Private Security Property Distribution Property Owner Law Sarasota Insurance Litigation Attorney Slip Fall Tampa Business and Corporate Attorneys tampa family attorney Tampa Insurance Attorneys Timeshare Timesharing Uncategorized HD Law Partners is proud to be your trusted full-service law firm Quick Links Property & Casualty Business & Corporate Litigation Family Law Contact Us Careers Get In Touch 2002 North Lois Avenue Suite 510 Tampa, FL 33607 813-253-5333 Contact Us