FPCA Homeowners Division: Florida Supreme Court Decision in Warfel Holds That The Presumption Of Correctness Of The Insurer’s Expert Report In A Sinkhole Claim Is Not An Evidentiary Presumption

Jan 27, 2012


Maria Elena Abate

Above:  Maria Elena Abate.


Florida Property and Casualty Association Homeowners Division Members:


Florida Supreme Court Decision in Warfel Holds That The Presumption Of Correctness Of The Insurer’s Expert Report In A Sinkhole Claim Is Not An Evidentiary Presumption

By Maria Elena Abate, Esq., Shareholder
Colodny Fass


Michael Warfel made a claim to his insurance company, Universal, for benefits under a homeowner’s policy providing coverage for “sinkhole loss.” After his claim was denied, Mr. Warfel brought suit.  At trial, Universal’s expert (SDII) presented testimony that the damage to Warfel’s home was not caused by a sinkhole, and Mr. Warfel’s experts testified that the damage was caused, at least in part, by a sinkhole.

Section 627.7073(1)(c), Fla. Stat. provides that: “[t]he respective findings, opinions, and recommendations of the engineer and professional geologist as to the verification or elimination of sinkhole loss . . . shall be presumed correct.” 

The trial judge instructed the jury to presume that the opinions and findings of SDII’s report are correct, and that “[t]he plaintiff has the burden of proving by a preponderance of the evidence that the findings, opinions, and conclusions of the report are not correct.” Warfel v. Universal Ins. Co. of North America, 36 So.3d 136, 138 (Fla. 2d DCA 2010).   After deliberation, the jury returned a verdict for Universal.

On appeal, the Second DCA explained that a presumption will only affect the burden of proof if the presumption is implemented to affect public policy.  The court held that the trial court erred and the presumption at issue affected only the burden of producing evidence, because “there was no legislative expression that public policy compels a homeowner to shoulder the burden to disprove the report and opinions of the insurer’s engineers and geologists.” Id.

The question certified to the Supreme Court was whether the presumption created by Section 627.7073(1)(c), Fla. Stat. is a presumption affecting the burden of proof or merely the burden of producing evidence.  Universal Ins. Co. of North America v. Warfel, Case No. SC10-948 (decided January 26, 2012)(emphasis added). However, surprisingly, the court’s holding did not turn on whether the presumption affected the burden of proof or the burden of production.  Instead the court held that the statute’s presumption was not intended to apply to the litigation context at all:

If anything, the presumption of correctness attached to the report appears to be aimed at shielding the engineer or professional geologist from liability for title defects and the insurance companies from claims of improper denials of claims. Accordingly, because the sinkhole statutes do not apply to the litigation context, the trial court’s application of section 90.304 to section 627.7073(1)(c) and the treatment of this statute as evidentiary in nature in this case was incorrect. On this basis alone, we reverse and remand for further proceedings consistent with the decision we reach here today.

Id. (emphasis added).

Nonetheless, the court went on to discuss whether the presumption would affect the burden of proof or the burden of production, in the event that it was applicable in litigation.  Finding that that the language of the statute did not did not indicate a clear intent to advance a particular public policy, and did not clearly state the type of presumption that was intended, the court concluded the presumption would only effect the burden of production.  Id.

More recent amendments to the sinkhole statute, which were not at issue in Warfel, provide far stronger support for the argument that the statute is intended to further a particular public policy. According to the court’s Warfel analysis, the 2005 amendments to the sinkhole investigation process were intended to protect the insured, by assuring that carriers do not deny claims without sufficient investigation. The 2011 amendments make clear that the opposite is true.  According to the 2011 amendments, these revisions were intended to curtail rampant abuse of sinkhole insurance, and to reduce the number of sinkhole claims and associated costs.  

However, because the court held that this presumption is not even applicable in the litigation context, these arguments will likely be moot. The court does suggest that the statutory presumption serves as “protection” for an insurance company’s good faith reliance on the professional engineer or geologist’s report in denying a claim.



Should you have any questions or comments, please contact Maria Elena Abate (mabate@cftlaw.com) at Colodny Fass.