On May 17 of this year, Florida Governor Rick Scott signed into law Senate Bill 408, which, among other things, shortened the statute of limitations for property insurance claims in Florida to five years from the date of the loss. Under the earlier Florida Statutes § 95.11 and § 95.031, the statute of limitations did not expire until five years after a property insurer had breached the insurance policy. The Senate Bill 408 change came roughly five and a half years after Hurricane Wilma destroyed an enormous amount of Florida property, and the change left many questioning whether they could still seek redress for these claims.

These questions, mixed with legal arguments of retroactivity, have led to confusion as to which statute of limitations applies to a property insurance claim. Just over one month after Governor Scott signed Senate Bill 408, the Florida Supreme Court published an opinion that addressed the relationship between the insurance contract and statutes. In Florida Ins. Guar. Ass’n, Inc. v. Devon Neighborhood Ass’n, Inc., 36 Fla. L. Weekly S311 (Fla. June 30, 2011), the Florida Supreme Court reaffirmed its earlier decision in Menendez v. Progressive Exp. Ins. Co., Inc., 35 So.3d 873, 876 (Fla. 2010), which held, “we look at the date the insurance policy was issued and not the date that the suit was filed or the accident occurred, because ‘the statute in effect at the time an insurance contract is executed governs substantive issues arising in connection with that contract.’” (Emphasis added).

Applying this legal standard to Senate Bill 408, the old statute of limitations applies to insurance policies executed on or before May 16, 2011. The new statute of limitations applies to insurance policies executed on or after May 17, 2011.

Recently, the Southern District of Florida was faced with this statute of limitations issue in View West Condo. Ass’n, Inc. v. Aspen Specialty Ins. Co., No. 11-20423-CIV, 2011 WL 3704782 (S.D. Fla. Aug. 23, 2011). In View West, the plaintiff’s cause of action involved property damage from Hurricanes Katrina and Wilma. The plaintiff filed its action for Katrina damages more than five years after the date of the storm. Instead of looking to the statute that applied when the policy was issued as the Florida Supreme Court requires, the Court looked to the statute that applied at the time the cause of action was filed and dismissed the claim with prejudice. The Court stated:

After passage of SB 408, the limitations period unequivocally runs from the date of the loss. Here, the date of the loss was August 25, 2005. Plaintiff filed this lawsuit on October 23, 2010, and waited until July 11, 2011 to amend its complaint to add a claim for breach of property insurance contract based upon Hurricane Katrina damages. Because Plaintiff brought its Hurricane Katrina Claim more than five years after the date of the loss, the claim is barred by the statute of limitations.

This analysis runs contrary to the Florida Supreme Court’s rulings in Menendez and Devon Neighborhood.

From the opinion, the footnotes, and the memoranda filed in the case, it appears that statutory retroactivity and equitable tolling of the statute of limitations were considered by the View West parties and Court, but neither party cited the legal precedent recently reaffirmed by the Florida Supreme Court. Unfortunately, this opinion will likely lead to more confusion on the issue.

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