Third District Court of Appeal
State of Florida
Opinion filed March 10, 2021.
Not final until disposition of timely filed motion for rehearing.
________________
No. 3D19-1614
Lower Tribunal Nos. 16-1435 & 16-1284
________________
Celerina Nunez,
Appellant,
vs.
Universal Property & Casualty Insurance Company,
Appellee.
An Appeal from the Circuit Court for Miami-Dade County, Michael A.
Hanzman, Judge.
Giasi Law, P.A., and Melissa A. Giasi and Erin M. Berger (Tampa), for
appellant.
Link & Rockenbach, PA, and Kara Rockenbach Link (West Palm
Beach); Kelley Kronenberg, and Alison J. Trejo and Jeffrey M. Wank (Fort
Lauderdale), for appellee.
Before EMAS, C.J., and SCALES and LOBREE, JJ.
EMAS, C.J.
Celerina Nunez (the insured below) appeals the trial court’s order (1)
granting the motion of Universal Property & Casualty Insurance Company
(the insurer below) for directed verdict on whether Nunez materially
breached the insurance contract by failing to attend an EUO, and (2) granting
a new trial, pursuant to our decision in American Integrity Insurance Co. v.
Estrada,
276 So. 3d 905 (Fla. 3d DCA 2019), to provide Nunez an
opportunity to show that her “breach of [this] post-loss obligation did not
prejudice” Universal. For the reasons that follow, we affirm the order
granting a new trial pursuant to Estrada, but reverse the order directing a
verdict on whether the insured materially breached the insurance contract.
Factual and Procedural Background
In April 2015, Nunez reported two water losses occurring days apart:
one due to a leak in the kitchen, and a second due to a leak in the bathroom.
The same day these claims were reported, Universal requested that Nunez
provide a sworn proof of loss. Nunez provided the sworn proof of loss
seventy-five days later (June 29), claiming $30,000 of damage to the kitchen
and $20,000 of damage to the bathroom. In the interim, the property was
2
inspected (on May 7) and Nunez provided an unsworn, recorded statement
by phone to Universal (on June 17).1
It is undisputed that, during the investigation of the claims, Universal
requested Nunez to attend an Examination Under Oath (EUO), and that
Nunez failed to appear. More specifically, Universal sent two letters (August
10 and 17, 2015) to Nunez’s attorney requesting to set a date for the EUO.
When counsel failed to respond, Universal sent a third letter (September 10)
unilaterally scheduling the EUO for October 1. After Nunez failed to appear
for her EUO, Universal denied both insurance claims based upon such
failure and upon her failure to provide certain documentation. Nunez sued
the insurer for breach of the insurance contract. 2
Prior to trial, Universal moved for summary judgment on the basis that
Nunez’s failure to attend the EUO was a material breach of the insurance
contract precluding recovery. The trial court denied the motion.
1
These dates are included because Nunez maintained below and on appeal
that (1) her failure to attend the Examination Under Oath (EUO) “was not
willful”; (2) Universal was not prejudiced by such failure; and (3) it was
unreasonable for Universal to demand an EUO because, in all other
respects, she complied with Universal’s investigation and Universal did not
request the EUO until August (months after she reported her claims).
However, and as Universal points out, while the claims were first reported in
April, Universal did not receive a sworn proof of loss until the end of June.
2
Two separate complaints were filed—one concerning the kitchen leak and
one concerning the bathroom leak. The cases were consolidated for
purposes of trial, and resulted in two separate verdicts in Nunez’s favor.
3
At trial, Universal’s primary defense was that, because Nunez had
failed to sit for an EUO, she forfeited her rights to receive insurance benefits.
Nunez, in response, generally argued that it was unreasonable for Universal
to request an EUO 110 days after the claims were reported. Both at the
close of the plaintiff’s case and at the close of all the evidence, Universal
raised the issue again, moving for a directed verdict on Nunez’s failure to
attend the EUO. The trial court denied these motions.
During a conference to discuss jury instructions and verdict forms, the
parties disagreed on whether and how the jury should be instructed
regarding Nunez’s failure to attend the EUO. The trial court determined the
jury would be instructed that if Nunez was able to meet her initial burden,
i.e., that she “sustained covered losses during the policy period,” “Universal
must prove by the greater weight of the evidence that [Nunez] failed to
comply with her obligations under the policy by not providing documentation
and not appearing for her examination under oath.” Consistent with this
ruling, and over Universal’s objection, the trial court determined the jury
would be required to answer the following question in its verdict:
Did Universal prove by the greater weight of the
evidence that Plaintiff unreasonably failed to
attend her Examination Under Oath on October 1,
2015?
(Emphasis added).
4
Consistent with the verdict form and jury instructions, the arguments
during closing centered upon the reasonableness or unreasonableness of
Nunez’s failure to attend the EUO. Nunez argued that it was unreasonable
for Universal to request an EUO 110 days after she reported her claims, and
Universal argued that it was reasonable because Universal did not receive
Nunez’s sworn proof of loss until early July (75 days after she reported the
claim and approximately thirty days before Universal sent out the first letter
requesting an EUO). Nunez, on rebuttal, again urged that it was
unreasonable for Universal to request the EUO 110 days after she reported
the claim, provided a recorded statement, and Universal inspected the
property.
The jury returned a verdict in Nunez’s favor on both the kitchen claim
($15,000) and the bathroom claim ($20,000). Universal moved for a
judgment notwithstanding the verdict based on Nunez’s failure to attend her
EUO. The trial court again rejected Universal’s argument explaining that
(given the totality of the circumstances) the jury did not find Nunez’s failure
to attend the EUO unreasonable.
Universal filed a renewed motion for directed verdict or, in the
alternative, motion for new trial. Universal argued (among other things) that
judgment should have been entered for Universal where it was undisputed
5
Nunez failed to appear for the EUO (i.e. an EUO “is a condition precedent to
suit” and a failure to attend is “a material breach of the terms and conditions
of the insurance contract”); and that the trial court erred “by elevating
Universal’s burden of proof” to establishing Nunez “unreasonably” failed to
attend her EUO. In sum, Universal argued that the jury instructions and
verdict forms were contrary to Florida law and that the verdict was against
the manifest weight of the evidence. The day before the hearing on the
renewed motion for directed verdict, this court released its opinion in
Estrada, 276 So. 3d at 905.
A successor judge presided over the hearing on Universal’s motion.
The successor judge determined that the jury had not been properly
instructed, and questioned whether there was “evidence of prejudice” to
Universal (due to Nunez’s failure to attend the EUO), and whether the fairer
approach would be to grant a new trial “under the construct” of Estrada.
The trial court later entered a detailed order, granting in part
Universal’s motion for directed verdict and ordering a new trial. It found,
among other things, that Nunez breached the contract when she failed to
appear for the EUO, and “the court erred when it placed upon Universal a
burden of establishing that this breach was ‘unreasonable.’” In directing a
verdict on the EUO issue and granting a new trial, the trial court reasoned:
6
Given that: (a) Universal’s unpled EUO defense was
obviously tried by consent[3], and (b) considerable
precedent at the time of trial supported the position
that a carrier could not avoid payment unless an
insured’s failure to attend an EUO caused prejudice,
Plaintiff had an obligation to request a jury instruction
on this issue, as well as an obligation to request that
the jury be asked the question of whether Universal
in fact was prejudiced by its failure to secure an EUO.
Because it did neither, this avoidance was arguably
waived, thereby entitling Universal to a directed
verdict. On the other hand, the trial court—without
hearing any substantive argument—did state on the
record that ‘there is no prejudice required,” arguably
making any attempt to request a jury
instruction/interrogatory futile. On top of that, the
EUO defense was never pled in the first place and—
as a result— never had to be avoided in a formal
pleading. Finally, neither party had the benefit of the
Third District’s [Estrada] decision which exhaustively
surveyed the law on this point and definitely settled it
in this district.
In light of these considerations, the trial court concluded “that the more
appropriate remedy [was] to grant a new trial and direct a verdict in
Universal’s favor on the discrete issue of whether [Nunez] breached the
contract by failing to attend an EUO.” The court concluded that, at the new
trial, the jury would be instructed accordingly. Nunez moved for
reconsideration arguing primarily that the trial court exceeded its authority as
3
While the affirmative defense pertaining to post-loss obligations was
asserted in the bathroom leak cause of action, it was not asserted in the
kitchen leak cause of action.
7
successor judge by reversing the exact same ruling made by the
predecessor judge who presided over the trial, without any intervening
change in circumstances to warrant such an action. The successor judge
denied the motion, and this appeal followed.
Standard of Review
We apply a hybrid standard of review on appeal from an order granting
a new trial:
An order granting a new trial is generally reviewed for
an abuse of discretion. An erroneous view of the law
can constitute an abuse of discretion. Moreover,
appellate courts apply a de novo standard of review
to a trial court's legal conclusions in an order granting
a new trial.
Kratz v. Daou,
299 So. 3d 442, 444 (Fla. 3d DCA 2019) (citations omitted).
Nunez, on appeal, contends that the trial court “erroneously granted directed
verdict in favor of [Universal] because there was evidence that [Nunez’s]
failure to sit for an EUO was not willful and there was no evidence that
[Universal] was prejudiced,” meaning a new trial on prejudice is
unnecessary. This contention goes to whether the verdict was supported by
the evidence and, therefore, the appropriate standard of review is abuse of
discretion; to the extent the directed verdict and new trial were based on
legal questions, however, we apply a de novo standard of review.
8
At the same time, because the ruling on the motion for directed verdict
was made by a successor judge, it “is not entitled to the same deference on
appeal as the ruling of a presiding judge.” Nat'l Healthcorp Ltd. P'ship v.
Cascio,
725 So. 2d 1190, 1193 (Fla. 2d DCA 1998); Gemini Inv'rs III, L.P. v.
Nunez,
78 So. 3d 94, 97 (Fla. 3d DCA 2012) (holding that “while a successor
judge has the authority to correct any errors in prior interlocutory rulings on
matters of law, a successor judge should give credence to a predecessor's
rulings on issues of law. Generally, the rotation of judges from one division
to another should not be an opportunity to revisit the predecessor's rulings.”)
(citations omitted); Gen. Hosp. of Greater Miami, Inc. v. Gager,
160 So. 2d
749, 751 (Fla. 3d DCA 1964) (noting: “[T]he granting of a new trial . . . does
not come to the appellate court clothed with the same weight as such an
order entered by the judge who tried the case. This is true because we may
not say that the trial judge had the great advantage of observing the
witnesses and the conduct of the trial”) (citing Wolkowsky v. Goodkind,
153
Fla. 267 (Fla. 1943)).
Discussion
9
Although the successor judge correctly granted the motion for new
trial, he erred in directing a verdict 4 on the question of whether Nunez
materially breached the contract where the jury was never instructed on the
issue. We therefore remand for a new trial on whether Nunez materially
breached the insurance policy by failing to attend the EUO and, if necessary,
on whether such breach prejudiced Universal. This result is controlled by
our decision in Estrada which addressed, as an issue of first impression in
this District, “whether, after a finding has been made that an insured
materially breached a post-loss policy provision, a further finding must also
be made that the insured's non-compliance caused prejudice to the insurer.”
Estrada, 276 So. 3d at 914-15. In that case, Maria Estrada filed an insurance
4
The predecessor judge’s order denying Universal’s motion for directed
verdict was an interlocutory order of which the successor judge had the
“authority” and “obligation” to consider and to correct if it was premised on
an incorrect interpretation of the law. Otis Elevator Co. v. Gerstein,
612 So.
2d 659, 659-60 (Fla. 3d DCA 1993) (holding: “[A] successor judge has the
authority to rule upon a motion for a new trial in a jury case.”); Raymond,
James & Assocs., Inc. v. Zumstorchen Inv., Ltd.,
488 So. 2d 843, 845 (Fla.
2d DCA 1986) (holding: “[A] successor judge has the obligation to correct
any error in a prior interlocutory ruling on matters of law.”). See also Atl.
Coast Line R. Co. v. Boone,
85 So. 2d 834, 840 (Fla. 1956) (recognizing that
an order denying a motion for directed verdict is “interlocutory in nature”).
See also Fla. R. Civ. P. 1.480(c) (providing: “A motion for a new trial may be
joined with [a motion for directed verdict] or a new trial may be requested in
the alternative. If a verdict was returned, the court may allow the judgment
to stand or may reopen the judgment and either order a new trial or direct
the entry of judgment as if the requested verdict had been directed.”)
10
claim due to a home burglary, and the insurer, American Integrity,
commenced an investigation and requested Estrada to comply with several
post-loss obligations. The claim, however, was denied after Estrada
allegedly failed to submit to an EUO and provide a sworn proof of loss.
Id.
at 907. Estrada filed a breach of contract action upon her claim being denied.
A primary issue at trial was the extent of Estrada’s compliance with her
post-loss obligations prior to filing her lawsuit. In proving their cases, each
party presented evidence on whether or not Estrada “substantially complied
with her post-loss obligations.”
Id. at 909. At the close of the evidence,
Estrada moved for a directed verdict on various affirmative defenses,
including American Integrity’s defense related to post-loss obligations,
arguing that “in order for there to be a valid coverage defense with respect
to an insured’s post-loss obligations in a homeowner’s insurance policy, . . .
the insurer must plead and prove it was prejudiced by the insured’s non-
compliance.”
Id. Agreeing with Estrada, the trial court directed a verdict on
the insurer’s affirmative defenses pertaining to failure to comply with post-
loss obligations. Because all of American Integrity’s coverage defenses
were stricken, the only issue left for the jury to consider was the amount of
damages to award Estrada.
Id. After the jury awarded damages for Estrada,
final judgment was entered, and the insurer appealed.
11
On appeal, we reversed the trial court’s order directing a verdict in
favor of Estrada, and addressed each party’s burden as it relates to post-
loss obligations:
[F]or an insurer to successfully establish a coverage
defense based upon an insured's failure to satisfy
post-loss obligations such that an insured forfeits
coverage under a policy, the insurer must plead and
prove that the insured has materially breached a
post-loss policy provision. If the insurer establishes
such a material breach by the insured, the burden
then shifts to the insured to prove that any breach did
not prejudice the insurer.
Id. at 912 (emphasis added). We further explained:
[F]or there to be a total forfeiture of coverage under
a homeowner's insurance policy for failure to comply
with post-loss obligations (i.e., conditions precedent
to suit), the insured's breach must be material. See
Drummond, 970 So. 2d at 460 (concluding that the
insured's failure to comply with a post-loss obligation
“was a material breach of a condition precedent to
[the insurer's] duty to provide coverage under the
policy”) (emphasis added); Starling, 956 So. 2d at
513 (“[A] material breach of an insured's duty to
comply with a policy's condition precedent relieves
the insurer of its obligations under the contract.”)
(emphasis added); Goldman v. State Farm Fire Gen.
Ins. Co.,
660 So. 2d 300, 303 (Fla. 4th DCA 1995)
(“An insured's refusal to comply with a demand for an
examination under oath is a willful and material
breach of an insurance contract which precludes the
insured from recovery under the policy.”) (emphasis
added); Stringer v. Fireman's Fund Ins. Co.,
622 So.
2d 145, 146 (Fla. 3d DCA 1993) (“[T]he failure to
submit to an examination under oath is a material
breach of the policy which will relieve the insurer of
12
its liability to pay.” (quoting 13A Couch on Insurance
2d (Rev. 3d) § 49A:361 at 760 (1982) (footnote
omitted) (emphasis added))).
Further, while the interpretation of the terms of an
insurance contract normally presents an issue of law,
the question of whether certain actions constitute
compliance with the contract often presents an issue
of fact. See State Farm Fla. Ins. Co. v. Figueroa,
218
So. 3d 886, 888 (Fla. 4th DCA 2017) (“Whether an
insured substantially complied with policy obligations
is a question of fact.”) (emphasis added); Solano v.
State Farm Fla. Ins. Co.,
155 So. 3d 367, 371 (Fla.
4th DCA 2014) (“A question of fact remains as to
whether there was sufficient compliance with the
cooperation provisions of the policy to provide State
Farm with adequate information to settle the loss
claims or go to an appraisal, thus precluding a
forfeiture of benefits owed to the insureds.”)
Id. at 914 (emphasis added).
Importantly, and given that the parties and the trial court in Estrada did
not have the benefit of our pronouncement on this issue of first impression
prior to the trial in that case, our reversal was accompanied by an instruction
that the trial court on remand grant American Integrity leave to amend
“affirmative defenses alleging Estrada failed to materially satisfy any
contracted-for post-loss obligations,” id. at 917, and to grant Estrada leave
to file appropriate replies. We further held that, if the insurer thereafter
established a material breach, the burden would then shift to Estrada to
establish the insurer was not prejudiced by the breach. Id.
13
The analysis and holding of Estrada are fully applicable here, and lead
us to the same result. In the instant case, the jury verdict asked: “Did
Universal prove by the greater weight of the evidence that plaintiff
unreasonably failed to attend her Examination Under Oath?” 5 The jury was
also instructed that, if Nunez proved by the greater weight of the evidence
that she sustained covered losses during the covered period, the burden was
on Universal, who “must prove by the greater weight of the evidence that the
plaintiff failed to comply with her obligations under the policy” by not
appearing for her EUO. Nowhere in the verdict form or the jury instructions
was the jury instructed to consider whether, in light of the evidence
presented, Universal established that Nunez materially breached the
contract by failing to appear for her EUO. Nor was there any corollary
instruction or provision in the verdict form for the jury to consider (assuming
proof of a material breach) whether Nunez established that Universal was
not prejudiced by the breach.
5
During oral argument, counsel for Nunez explained that the
“reasonableness” language was meant to track the insurance policy. But this
interpretation—that the EUO request must be reasonable—is not consistent
with the policy’s plain meaning: “In case of a loss to covered property, you
must see that the following are done: . . . As often as we reasonably
require: . . . Submit to examination under oath, while not in the presence of
any other ‘insured,’ and sign the same.”
14
Consistent with our holding in Estrada, we affirm the trial court’s order
granting a new trial, but reverse the trial court’s order directing a verdict in
favor of Universal on the materiality of the breach. Further, and consistent
with our remand instructions in Estrada (and in light of the fact that the parties
in this case likewise did not have the benefit of our holding in Estrada at the
time of trial)6 we remand the cause for a new trial at which the factfinder can
consider and determine whether Universal proved Nunez’s failure to attend
the EUO was a material breach of the contract and, if so, whether Nunez
then proved that this material breach did not prejudice Universal. The parties
should be granted leave to amend the pleadings as appropriate and
necessary in light of this opinion and Estrada.
Conclusion
We affirm the trial court’s order granting a new trial, but reverse the
trial court’s order directing a verdict, and remand for a new trial and for further
proceedings consistent with this opinion.
6
In our recent decision in Universal Property & Casualty Ins. Co. v. Horne,
__ So. 3d __, 46 Fla. L. Weekly D201 (Fla. 3d DCA Jan. 20, 2021), an
unrelated appeal involving a strikingly similar procedural posture and legal
issue, we noted: “The opinion in Estrada was released six weeks after the
jury rendered its verdict below. Thus, neither the parties nor the trial court
had the benefit thereof at the time of trial.” Id. at *4 n.7. We reversed and
remanded “for the parties to present their cases under the framework
established in Estrada.” Id. at *4.
15
