Florida Insurance Law Blog

Neutral Evaluation Statue Found Constitutional

In two recent decisions rendered on June 29, 2012 and on July 11, 2012, the Second DCA held that Florida Statute Section 627.7074 - the Sinkhole Neutral Evaluation Statute - was constitutional.  The two cases are entitled State Farm Florida Insurance Company v. Buitrago, ____ So.3d ____ (Fla. 2nd DCA 2012) and Sunshine State Insurance Company v. Benjamin, ____ So.3d ____ (Fla. 2nd DCA 2012). 

In Buitrago, State Farm had request sinkhole neutral evaluation.  The insured homeowners objected, claiming that the neutral evaluation statute was unconstitutional because if violated the separation of powers doctrine by usurping the circuit court's authority to adjudicate the disputed insurance issues.  the homeowners also contended that subsection (13) of the statute, which required that the neutral evaluator's written recommendation be admissible in their action, violated their due process rights by requiring the circuit court to consider a report that did not necessarily comply with the Florida Evidence Code. 

The circuit court found that section 627.7074 unconstitutionally encroached upon the judiciary's powers and, as such, directed the Department of Financial Services to cease and desist from taking any further action on the neutral evaluation regarding the homeowner's claim. 

On appeal, the 2nd DCA held that the neutral evaluation statute was constitutional.  Thus, the parties were required to participate in the neutral evaluation process.  The Court also addressed the bigger question concerning the admissibility/impact of the Neutral Evaluator's recommendations.  On that issue the Court noted that:  

section 627.7074(13) merely states that the neutral evaluator's written recommendation is admissible in a subsequent action. The subsection does not require the circuit court to be bound by the neutral evaluator's recommendation, nor does it require the circuit court to place greater weight on the recommendation than on any other evidence. Moreover, the subsection does not deprive the circuit court of the ability to consider the admissibility of the neutral evaluator's recommendation within the confines of chapter 90, Florida Statutes (2010). For example, the circuit court must still determine preliminary questions concerning the admissibility of the recommendation pursuant to section 90.105, and the court may consider possible exclusion on the grounds of prejudice or confusion pursuant to section 90.403.

Thus, there are still ways to keep the NE's opinion out, or to limit the homeowner's insurance company to choosing to call either their own retained expert or the NE, but not both. 

In prior blogs, I've discussed the fact that the jury is not to be advised of any presumption of correctness concerning the neutral evaluator's opinions.

 

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Mark Nation of The Nation Law Firm
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