Congratulations to Edison Insurance Company on a huge win on summary judgment! Pinellas County Circuit Court Judge Cynthia Newton entered judgment after Benchmark Consulting (Castle Roofing and Construction) failed to show how much money it “actually spent” on repairs – five years after it filed the lawsuit!
Regular readers recognize that Salmon & Salmon has been defeating plaintiffs on the issue of damages. Plaintiffs are unable to introduce their actual cash value damage estimates into evidence because the figures do not follow Florida law. This is an essential element of the case when repairs are not performed.
But what is plaintiff’s obligation when repairs are complete?
Determining the proper measure of damages involves the interpretation of policy of insurance and the applicability of the Replacement Cost Provision in the Conditions/Loss Settlement Clause.
In Benchmark Consulting Inc. d/b/a Castle Roofing and Construction v. Edison Ins. Co., the roofer made repairs. This fact makes estimates completely irrelevant because the Policy’s Replacement Cost Provision provides that replacement cost will be paid subject to the lesser of three amounts: (1) the limit of liability; (2) the replacement cost for like construction; and (3) the necessary amount actually spent to repair or replace the damaged building.
Benchmark provided multiple “estimates” of what the roof replacement was “projected” to cost. Benchmark provided a “final” estimate, in the amount of $16,882.27 after work was completed. Later, Benchmark attached an estimate in the amount of $22,301.89 to the Complaint. Finally, Benchmark provided an Affidavit of Cecil Cogar and estimate in the amount of $30,797.15 from Royal Palms Construction, LLC, in response to Defendant’s Motion for Final Summary Judgment. Mr. Cogar makes statements about what “should have been incurred” at the property as well as the amount to return he property to “pre-loss condition.” He never addresses the “necessary amount actually spent,” the measure of damages under the Policy.
Despite the repairs having been completed, Benchmark never provided the Court with any admissible evidence in opposition to the summary judgment to prove that the necessary cost of roof replacement “actually spent” was in excess of the amount the insurer paid.
James Lathrop testified 59 times that he does not have any financials or cost documentation for the roofing project. Plaintiff’s complete failure to provide any cost information relating to the roof replacement demonstrates a failure to address the damages as defined under the policy, an essential element of its case.
Kimberly Salmon defended Edison while attorney Brandon Fizer represented Benchmark.
Internal Seminar Offering
Salmon & Salmon has successfully excluded evidence of plaintiff’s damages at trial when repairs are not complete. The reason the evidence is excluded is because the insured’s estimate is a not a true actual cash value estimate. The Xactimate software program continues to use replacement cost less depreciation to calculate actual cash value even though this is no longer the law in Florida. Curiously, Florida insurance companies also rely on this outdated formula. Although there is no legal consequence of paying more where the policy and statute require that the insurer pay “at least actual cash value” of a covered loss, insurers are expending millions of dollars not due under the policy.
We believe it is important to share this information in an interactive setting. Conducting seminars throughout the state is an option but we think the best presentation is in your office with your people. We will provide the law and work our way through estimates to illustrate why traditional estimates no longer satisfy the actual cash value definition.
Please email David Salmon at dsalmon@salmon-salmon.com to request an internal seminar in your office.