Marbella at Spanish Wells 1 Condominium Association, Inc. v. Empire Indemnity Insurance Company ( 2023 )

USCA11 Case: 22-11782 Document: 52-1 Date Filed: 06/12/2023 Page: 1 of 5
[DO NOT PUBLISH]
In the
United States Court of Appeals
For the Eleventh Circuit
____________________
No. 22-11782
____________________
MARBELLA AT SPANISH WELLS 1 CONDOMINIUM
ASSOCIATION, INC.,
Plaintiff-Appellee,
versus
EMPIRE INDEMNITY INSURANCE COMPANY,
Defendant-Appellant,
ZURICH AMERICAN INSURANCE COMPANY,
Defendant.
____________________
USCA11 Case: 22-11782 Document: 52-1 Date Filed: 06/12/2023 Page: 2 of 5
2 Opinion of the Court 22-11782
Appeal from the United States District Court
for the Middle District of Florida
D.C. Docket No. 2:21-cv-00641-SPC-MRM
____________________
Before WILLIAM PRYOR, Chief Judge, and LUCK and HULL, Circuit
Judges.
PER CURIAM:
Empire Indemnity Insurance Company appeals the district
court’s order granting Marbella at Spanish Wells 1 Condominium
Association, Inc.’s motion to compel appraisal of damage to its
buildings caused by Hurricane Irma. This appeal presents the same
jurisdictional issue as Positano Place at Naples I Condominium Associ-
ation, Inc. v. Empire Indemnity Insurance Co., --- F.4th ----, No. 22-
11059, 2023 WL 3730876 (11th Cir. May 31, 2023). Like in Positano,
we dismiss Empire’s appeal for lack of jurisdiction.
* * *
Marbella is a condominium association in Bonita Springs,
Florida. Empire issued Marbella a property damage insurance pol-
icy covering sixteen buildings. The policy contained an appraisal
provision identical to the policy provision in Positano. Under the
provision, if Empire and Marbella “[d]isagree[d] on the value of the
property or the amount of [a] loss, either [could] request an ap-
praisal of the loss, in writing.”
Marbella’s buildings were damaged during Hurricane Irma,
and, in January 2021, the association executed a sworn proof of loss
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22-11782 Opinion of the Court 3
asserting over $4 million in actual cash value damage, including
over half a million dollars for a “supplemental claim.” After its in-
spector found only about $1,500 in roof damage—an amount be-
low Marbella’s deductible—Empire, according to Marbella, “re-
fused to admit coverage and pay all insurance proceeds due and
owing for the loss.” So, in June 2021, Marbella sued for breach of
contract. When mediation failed, Marbella demanded appraisal in
July 2021.
Empire removed the action to federal court, then answered,
asserting four policy-provision defenses, failure to mitigate, and a
statute-of-limitations defense to Marbella’s supplemental claim.
Marbella moved to compel appraisal (and for a stay pending ap-
praisal), arguing that Empire didn’t wholly deny coverage and so it
was bound to submit the amount-of-loss question for appraisal.
Empire opposed appraisal as improper absent summary judgment
or injunctive relief; it also argued that the scope of appraisal should
exclude the untimely supplemental claim.
The magistrate judge recommended granting Marbella’s
motion. The magistrate judge concluded that Marbella didn’t need
to plead and prove entitlement to injunctive relief—or move for
summary judgment—because appraisal isn’t remedial and
wouldn’t dispose of any claims or defenses on the merits. The mag-
istrate judge also concluded that appraisal should include Mar-
bella’s supplemental claim, because the claim likely was timely and
because Empire could litigate its affirmative defense after appraisal.
Finally, the magistrate judge recommended staying the action
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4 Opinion of the Court 22-11782
because “appraisal may resolve a majority, if not all, of the parties’
dispute.”
Empire objected to the magistrate judge’s report, but the
district court overruled those objections, adopted the report, and
ordered the parties to appraisal. The district court ruled that, like
mediation, “the appraisal process is not remedial” but rather “one
step in th[e] process” of Marbella obtaining a money judgment. Be-
cause appraisal wouldn’t dispose of any claims or defenses—but in-
stead “suppl[ied] an extra-judicial mechanism to calculate the
amount of loss”—the district court declined to treat Marbella’s mo-
tion as one for summary judgment. The district court concluded—
based on its discretion to sequence appraisal before litigating de-
fenses—that the supplemental claim should be included in the ap-
praisal. Finally, the district court concluded that “a stay [wa]s ap-
propriate as appraisal may resolve the parties’ dispute,” noting that
otherwise “the stay [could] be lifted” post-appraisal because “the
[district c]ourt contemplates post-appraisal proceedings” to litigate
Empire’s defenses. In the meantime, the district court ordered the
parties to (1) file periodic joint reports on the status of appraisal,
and (2) file a joint notice, once appraisal was completed, indicating
“what issues, if any, remain for the [district c]ourt to resolve” and
“how th[e] action should proceed.”
Empire timely appealed the order compelling appraisal. In
response to our jurisdictional question, Marbella argued that nei-
ther 28 U.S.C. section 1291 nor section 1292(a)(1) confers appellate
jurisdiction and that the Federal Arbitration Act bars jurisdiction
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22-11782 Opinion of the Court 5
because an order compelling appraisal should be equated with an
unappealable order compelling arbitration.
We construed Marbella’s response as a motion to dismiss
the appeal and now conclude that its motion is due to be granted
in light of Positano. In Positano, we held that we lacked jurisdiction
to hear Empire’s appeal of the district court’s order compelling ap-
praisal. We concluded that the Positano order compelling appraisal:
(1) wasn’t final, because “the district court explicitly contemplated
further proceedings”; (2) wasn’t immediately appealable under sec-
tion 1292(a)(1), because the order neither had “serious, perhaps ir-
reparable, consequence” nor was “effectively challengeable only by
immediate appeal”; and, assuming appraisal was arbitration,
(3) wasn’t appealable under the Federal Arbitration Act, which ex-
pressly precludes immediate appeal of interlocutory orders com-
pelling arbitration and staying the case. 2023 WL 3730876, at *4–5,
7 (cleaned up). For the same reasons, we lack jurisdiction over the
largely identical appraisal order in this case. Accordingly, we dis-
miss Empire’s appeal for lack of appellate jurisdiction.
APPEAL DISMISSED.