American Reliance Ins. Co. v. Perez, 95-3415
| Citation | 689 So.2d 290 |
| Decision Date | 08 January 1997 |
| Docket Number | No. 95-3415,95-3415 |
| Parties | 22 Fla. L. Weekly D138 AMERICAN RELIANCE INSURANCE COMPANY, Appellant, v. Andres P. PEREZ and Basita Perez, individually and on behalf of all others similarly situated, Appellees. |
| Court | Court of Appeal of Florida (US) |
Bennell, Woulfe, Kirschbaum, Keller & McIntyre and Nancy W. Gregoire and D. David Keller, Ft. Lauderdale, for appellant.
Lidsky & Vaccaro, Hialeah; Podhurst, Orseck, Josefsberg, Eaton, Meadow, Olin & Perwin and Joel S. Perwin, Miami, for appellees.
Vincent J. Rio, III and Mark K. Delegal, Tallahassee and Marcy J. Levine, Miami, for State Farm Fire & Casualty Company as amicus curiae.
John P. Joy for Aetna Casualty and Surety Company as amicus curiae.
Before GERSTEN, GREEN and FLETCHER, JJ.
American Reliance Insurance Company [insurer] appeals a partial summary judgment on liability in favor of its insureds, Andres and Basita Perez. We reverse and remand for further proceedings.
Following Hurricane Andrew, the insureds made a claim for damage to their home pursuant to their policy which provided that coverage is limited to "actual cash value" of the damage unless actual repair and replacement is completed. If the damage is repaired or replaced, the policy provides that coverage is at "replacement cost without deduction for depreciation." Basically the dispute between insurer and insureds revolves around the meaning of "actual cash value."
The insurer concluded that the cost to replace the portion of the house damaged by the storm was $5,421.00. The insureds decided, however, not to repair or replace the damaged portion, but rather to be compensated for their loss. To do this they proceeded with their claim under a section of their policy which provides:
An insured making a claim pursuant to this language is entitled to "actual cash value" (whatever that is) if she or he does not repair or replace the damage, or is entitled to an additional sum, up to the "replacement cost," if repair or replacement is later made within 180 days after the loss. Payment on a replacement cost basis is thus expected to be more than payment on an actual cash value basis--which, as shall be seen, is the case.
Upon reviewing the claim, the insurer then paid $4,292.00, representing the cost of replacement less an amount ($1,128.00) for prior depreciation in value of the damaged portion. The insureds objected to the reduction for depreciation and filed suit individually and as a class action on behalf of all other Florida insureds who had depreciation deducted from their actual cash value settlements. Concluding that depreciation was not deductible, the trial court granted partial summary judgment in favor of the insureds.
The insurer contends that the policy language is unambiguous--that when an insured elects not to repair or replace damage to the insured building, then the insured is entitled to be paid only "actual cash value," i.e., an amount less a deduction for prior depreciation, because the damaged portion, not being new, had suffered actual physical depreciation before the hurricane damage. On the other hand, the insureds contend that the language of the policy section under which they made their claim makes no mention of depreciation from actual cash value, therefore the unambiguous language requires that there be no depreciation deduction. Alternatively, the insureds argue that the controlling language is ambiguous because there is no definition of actual cash value in the policy and, being ambiguous, the language must be construed against the insurer and in favor of coverage.
We find that the controlling...
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