Understanding the Appraisal Process: Disinterested Appraiser

The Florida Supreme Court’s decision, after briefing and oral argument, to dismiss an appeal has left the issue of what constitutes a “disinterested” appraiser unresolved at a statewide level. This decision affects insurers and policyholders and underscores the complexity inherent in navigating insurance appraisal processes across different judicial districts within Florida.

Legal Landscape Across Florida’s Appellate Districts

Florida’s appellate courts have grappled with defining the term “disinterested” in various contexts, leading to differing opinions and rulings that impact insurance claims. Here’s a breakdown of how different Florida appellate districts interpret the term:

Second District Court of Appeal 1

In State Farm Fla. Ins. Co. v. Parrish (2021), 2 the court clarified that a public adjuster with a contingent interest in an insured’s appraisal award cannot be considered a “disinterested appraiser.” This ruling highlights the stringent criteria in these districts regarding the impartiality required from appraisers.

Fourth District Court of Appeal 3

In State Farm Fla. Ins. Co. v. Valenti (2019), 4 the court reinforced that public adjusters with a financial stake in an insured’s recovery cannot serve as disinterested appraisers. This district’s stance emphasizes the need for neutrality in the appraisal process.

Fifth District Court of Appeal 5

Here, attorneys are prohibited from acting as their clients’ disinterested appraisers, as established in precedents like Fla. Ins. Guaranty Ass’n v. Hanse (2014). 6 Additionally, any appraiser entitled to a percentage of the insured’s claim recovery is deemed partial and cannot serve as a disinterested appraiser 7

Third District Court of Appeal 8

Contrary to other districts, the 3rd DCA ruled in Brickell Harbor Condo. Ass’n, Inc. v. Hamilton Specialty Ins. Com. (2018) 9 that direct or indirect financial interests do not automatically disqualify an appraiser from being considered disinterested. Disclosure of any such interests suffices for participation in the appraisal process.

Impact of the Florida Supreme Court’s Decision

With the Florida Supreme Court declining jurisdiction to review State Farm v. Sanders, 10 the definition of a disinterested appraiser remains fragmented across the state. This means that appraisers must now be well-versed in the specific district’s interpretations and rulings to determine their eligibility and impartiality in any given insurance dispute.

1 (Pinellas, Pasco; 10th Judicial Circuit: Hardee, Highlands, Polk; 12th Judicial Circuit: Desoto, Manatee, Sarasota; 13th Judicial Circuit: Hillsborough; 20th Judicial Circuit: Charlotte, Collier, Glades, Hendry, Lee)
2 State Farm Fla. Ins. Co. v. Parrish, 312 So.3d 145 (Fla. 2d DCA 2021).
3 (15th Judicial Circuit: Palm Beach; 17th Judicial Circuit: Broward; 19th Judicial Circuit: Indian River, Martin, Okeechobee, St. Lucie)
4 State Farm Fla. Ins. Co. v. Valenti, 285 So.3d 958 (Fla. 4th DCA 2019).
5 (5th Judicial Circuit: Citrus, Hernando, Lake, Marion, Sumter; 7th Judicial Circuit: Flagler, Putnam, St. Johns, Volusia; 9th Judicial Circuit: Orange, Osceola; 18th Judicial Circuit: Brevard, Seminole)
6 Fla. Ins. Guaranty Ass’n v. Hanse, 150 So.3d 1272 (Fla. 5th DCA 2014).
7 State Farm Fla. Ins. Co. v. Crispin, 290 So.3d 150 (Fla. 5th DCA 2020).
8 (11th Judicial Circuit: Miami-Dade; 16th Judicial Circuit: Monroe)
9 Brickell Harbor Condo. Ass’n, Inc. v. Hamilton Specialty Ins. Com., 256 So.3d 245 (Fla. 3d DCA 2018).
10 State Farm Fla. Ins. Co. v. Sanders, 327 So. 3d 342, 343 (Fla. 3d DCA 2020), case dismissed, No. SC20-596, 2021 WL 4824155 (Fla. Oct. 18, 2021).