Florida Supreme Court Hears Oral Arguments in Case Challenging Public Adjuster Law

Sep 9, 2011


The Florida Supreme Court heard oral arguments today, September 9, 2011, in the case of Atwater v. Kortum, which challenges the constitutionality of a 2008 Florida law regarding how and when public insurance adjusters may contact property owners following a disaster.

A report from The News Service of Florida is reprinted below.

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THE CAPITAL, TALLAHASSEE, September 9, 2011……A poorly written 2008 law that restricts public adjusters from contacting clients immediately after a disaster blew into the Florida Supreme Court Friday, after state regulators appealed a lower court ruling that the law infringed on commercial free speech.

Attorneys for an Oviedo public adjuster argue that a provision barring all contact between public adjusters and potential clients within the first 48 hours after a disaster is a violation of the First Amendment.

Attorneys for the Department of Financial Services, though, argued that the 1st District Court of Appeal erred when it struck down the law.

The agency contends the statute bars only personal or telephonic contact between public adjusters and potential clients. Mailers and non personal solicitations are still permitted, attorney Michael Davidson argued. That makes the statute constitutional, he said.

During oral arguments Friday, justices repeatedly said that despite well-documented intentions, the law was written so ambiguously that it doesn’t clearly mean what lawmakers wanted it to do; a point even the state’s own attorney appeared to concede.

“They should have said you can do this and you can’t do that,” acknowledged Davidson, who represents CFO Jeff Atwater in the case. “But they didn’t do it.”

Following the 2004 and 2005 hurricane seasons, Florida lawmakers looked at ways to reduce the cost drivers that insurance companies said were leading to skyrocketing premiums. Insurers have cited cases where they’ve had to pay out on some dubious claims – and blamed public adjusters for persuading homeowners to pursue them.

So lawmakers decided to limit contact between customers and public adjusters, who critics argue have a financial incentive to raise claim amounts.

Lawmakers wrote a statute saying: “A public adjuster may not directly or indirectly through any other person or entity initiate contact or engage in face-to-face or telephonic solicitation or enter into a contract with any insured or claimant under an insurance policy until at least 48 hours after the occurrence of an event.”

That second half of the statute – saying that adjusters can’t enter into a contract until at least 48 hours after an event is a problem, said public adjuster Frederick Kortman, who challenged the law. It bans all types of communication during that time period, regardless of whether lawmakers intended an all-out ban or not, and that, he argued, doesn’t fall under the circumstances under which the government can limit speech.

“The issue here is commercial free speech,” said Wilbur Brewton, Kortman’s attorney. Generally the courts have said that most commercial speech, like most other speech, is protected from unwarranted government regulation.

But the trial court sided with the state, which argued that the statute language did not clearly ban all communication, only personal and telephone contact. The 1st DCA reversed the ruling, saying the plain language of the statute would lead anyone to believe that all communication between adjusters and clients was barred.

On Friday, Supreme Court justices appeared to mostly agree, saying the law as written bears little resemblance to what lawmakers claimed they wanted to accomplish.

“It strains credulity that that is what it says,” said Chief Justice Charles Canady in response to the assertion that the law didn’t aim to cut off speech. “That is what they might have meant, but I don’t think we should do something based on what we think they meant.”

“We could all write this to say what it means,” said Justice Barbara Pariente.

Canady, a former state representative and congressman, said the case brought to light the difficulties that arise when lawmakers, however well-intentioned and succinct in their own minds, draft poorly written, ambiguous laws.

“We are not dealing with eloquent language,” Canady said. ” If we were, it would not reach the Supreme Court.”


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