Court declines to apply “Slayton” argument to insureds’ breach T2

Jan 24, 2018


Here’s your update on Florida insurance-related legal developments from the Colodny Fass Insurance Litigation Practice.
Florida Insurance Matters is a monthly update on Florida insurance-related legal developments by the Colodny Fass Insurance Litigation Practice, recently recognized as the Insurance Litigation Department of the Year in South Florida by the Daily Business Review.

About the Author

Amy L. Koltnow, a Colodny Fass Shareholder, focuses her practice on representing insurance companies in complex insurance litigation and counseling insurers on claims resolution. She has represented insurers in connection with property damage and first-party coverage litigation, claims of “bad faith,” high-risk exposures, class actions and multi-district litigation.

For more information about Ms. Koltnow, click here.

The Third DCA has declined to apply the “Slayton” argument to summarily defeat an insured’s claim for breach of contract as a matter of law. The “Slayton” case, decided by the 5th DCA in 2012, has been used by carriers to support an argument that the carrier has not breached the policy if it paid the amount of the carrier’s own adjuster’s estimate and allows the insured to submit a “supplemental claim” if additional damages are discovered during the course of repairs.

Tower Hill filed a motion for summary judgment and relied on the “Slayton” case to support its position that it fully complied with the loss payment provisions of the policy and, therefore, cannot be liable for a breach of the policy. The trial court granted summary judgment in Tower Hills’ favor, but the appellate court reversed the judgement. The appellate court distinguished “Slayton” in light of the 2011 statutory amendment to 627.7011(3)(a), which requires the initial payment to be at least the actual cash value of the loss. The appellate court held there is no law to support the proposition that the insurer is able to unilaterally determine, as a matter of law, actual cash value or replacement cash value.

Seigel v. Tower Hill, 3d DCA, Aug. 30. 2017.

In yet another Third DCA case, the appellate court again declined to apply the “Slayton” argument to defeat an insured’s claim for breach of contract. The appellate court cited to two recent Tower Hill cases, (Seigel and Francis),which distinguished the facts of “Slayton” and held that an inadequate initial claim payment may form the basis of a claim for breach of contract.

Milhomme v. Tower Hill, 3d DCA, Sept. 20, 2017.

  • The Third DCA essentially has eliminated the “Slayton” argument to defeat an insured’s claim for breach of contract as a matter of law when the parties disagree over the amount of the initial claim payment.
  • An insured can sue for breach of contract based on a disagreement with the carrier’s initial claim payment and is not required to first repair or replace the damaged property or make a “supplemental claim” for payment.
  • Insurers should promptly address all disputes over the value of a covered loss and request a property reinspection if necessary.

In a fee dispute between a public adjuster and insureds, after litigating the case for 4 years, the public adjuster agreed to settle the dispute for $3,000, while the parties continued to litigate over entitlement and the amount of the plaintiff’s attorney’s fees. The PA’s attorney sought more than $90,000 (based on over 300 billable hours) for his fees. The trial court awarded the PA’s attorney $29,000 in fees based on the calculated lodestar amount (hours x rate). The 4th DCA reversed the fee award acknowledging that the plaintiff’s counsel grossly overbilled the case and achieved limited success. The appellate court directed the trial court to reduce the fee award based on the “results obtained factor” so that the fee awarded is proportional to the amount recovered.

Peterson v. Hecht Consulting Corp., 4th DCA, Aug. 9, 2017.

This case can be used to defeat exorbitant fee claims by attorneys after settling a lawsuit exclusive of fees, or if the insured obtains a judgment for a small amount or for less than what was originally offered to resolve the case.

To our friends, colleagues and clients affected by Hurricane Irma: We hope the worst is behind you and that you and your families are well.
For those working around the clock to handle the onslaught of claims, we thank you and your families for your personal sacrifices to help get our fellow Floridians on the road to recovery.
Please know that our attorneys at Colodny Fass are here for you if you need claims handling guidance, input on a policy interpretation or coverage question, or assistance with dispute resolution. We welcome your questions and look forward to being of service.

For over 40 years, Colodny Fass has represented insurers in complex and high-risk litigation including class actions, bad faith, insurance fraud, multi-jurisdictional cases, coverage matters, and fact-intensive, multi-party lawsuits. The Daily Business Review has recognized Colodny Fass as having the Insurance Litigation Department of the Year in South Florida.

About Amy L. Koltnow

Amy L. Koltnow, a Colodny Fass Shareholder, focuses her practice on insurance disputes from trial through appeals. She has represented insurance companies in federal and state courts, as well as in mediation and administrative forums. Ms. Koltnow oversees complex litigation matters and has successfully defended numerous class actions and insurance bad faith cases. She is a member of the Claims and Litigation Management Alliance, a national, invitation-only organization committed to furthering high standards of litigation and claims management in pursuit of client defense.

To view Ms. Koltnow’s complete professional biography, click here.

Contact Amy at or (954) 492-4010.