The Battle Over Retroactive Statutes in Homeowners Insurance
49 Fla. L. Weekly D1850b
Insurance – Homeowners – Retroactive Application of Statute
2nd District Court of Appeal, September 6, 2024
Case No. 2D2023-0655
Judge: John Carasass
Garrett and Misty Buis, homeowners from Pinellas County, Florida, found themselves embroiled in a legal battle after their action against Universal Property & Casualty Insurance Company was dismissed by the trial court. The issue at hand was whether they had met the presuit notice requirements set forth in a new Florida statute, section 627.70152(3), Florida Statutes (2021), which mandates that insured individuals must provide written notice of intent to litigate before filing suit. The Buises’ case was dismissed because they had not met this requirement.
However, the twist in this case came from the fact that the Buises’ insurance policy was issued before the enactment of section 627.70152. Was it fair, then, to apply this new statute retroactively to policies that were in place before the law existed? That was the question posed to the 2nd District Court of Appeal, which ultimately ruled in favor of the Buises, reversing the dismissal.
The Legal Context: Retroactive Statutes and Insurance Claims
Section 627.70152(3), Florida Statutes (2021), requires that claimants seeking to file suit under a property insurance policy must first provide written notice to the Florida Department of Financial Services. This presuit notice is meant to give insurance companies the opportunity to address claims before being drawn into litigation. However, this statute became effective on July 1, 2021, long after Garrett and Misty Buis had obtained their homeowners’ insurance policy from Universal Property & Casualty Insurance Company.
The trial court dismissed the Buises’ claim for failure to comply with this presuit notice requirement, even though their policy predated the statute. The trial court’s decision was based on the assumption that the new law applied retroactively to all insurance policies, regardless of when they were issued.
The Buises appealed the trial court’s ruling, arguing that section 627.70152 should not apply to their case because their policy had been issued before the statute’s effective date. They relied on longstanding Florida legal principles, such as those set forth in Hassen v. State Farm Mutual Automobile Insurance, which generally hold that the statute in effect at the time an insurance contract is executed governs any disputes that arise under the contract.
The Appeals Court’s Decision: Can a New Law Apply Retroactively?
The 2nd District Court of Appeal conducted a de novo review of the case, which means they evaluated the legal issues from scratch, without deferring to the trial court’s decision. In their review, the appellate court applied a well-established two-pronged test to determine whether a statute can be applied retroactively:
Did the legislature clearly intend for the statute to apply retroactively?
If retroactive intent is expressed, would retroactive application violate any constitutional principles, such as impairing a vested right or creating new legal obligations?
In this case, the court found no clear legislative intent indicating that section 627.70152 was meant to apply retroactively. The statute itself was silent on whether it should apply to policies issued before its effective date. Additionally, the court noted that the statute contained an effective date (July 1, 2021), which tends to imply that it applies prospectively, not retroactively.
The court also rejected Universal Property & Casualty Insurance Company’s argument that the statute’s reference to “all suits” signaled an intent for retroactive application. Universal had pointed to the statute’s language, which states that it applies “exclusively to all suits” involving residential or commercial property insurance policies. However, the court interpreted this language more narrowly. It found that the phrase “all suits” referred to the types of suits covered by the statute—namely, those involving residential and commercial insurance policies, but not necessarily suits arising from policies issued before the statute was enacted.
By rejecting Universal’s argument and finding no clear legislative intent for retroactivity, the appellate court concluded that section 627.70152 could not be applied to the Buises’ case. This meant that the presuit notice requirement, introduced after the Buises’ insurance policy was issued, could not be enforced against them.
Broader Implications: The Debate Over Retroactive Application
The court’s decision aligned with the 6th District Court of Appeal’s prior ruling in Hughes v. Universal Property & Casualty Insurance. In that case, the court similarly held that section 627.70152 lacked the necessary legislative intent to be applied retroactively. On the other hand, the 3rd and 4th District Courts of Appeal had ruled differently, finding that the statute could apply retroactively in certain circumstances. The 2nd District’s decision in this case certified a conflict between the districts, which may eventually need to be resolved by the Florida Supreme Court.
The broader issue raised by this case is whether new statutes should apply retroactively to existing contracts, such as insurance policies. Retroactive application of laws is generally disfavored unless the legislature clearly expresses that intent, as it can interfere with individuals’ vested rights and create new obligations or penalties. In this case, the court found that retroactive application would be unfair to the Buises because they could not have anticipated or complied with the new presuit notice requirement when they obtained their policy.
What Happens Next?
With the appellate court’s reversal of the trial court’s dismissal, Garrett and Misty Buis will now be able to pursue their claim against Universal Property & Casualty Insurance Company without the presuit notice barrier. The case has been remanded for further proceedings, meaning it will return to the lower court for continued litigation on the merits of the claim.
Additionally, by certifying a conflict with rulings from the 3rd and 4th Districts, this case opens the door for further legal developments. The Florida Supreme Court may ultimately weigh in to resolve the conflicting interpretations of section 627.70152 and decide whether this statute can apply retroactively across the state.
The case of Garrett Buis and Misty Buis v. Universal Property & Casualty Insurance Company underscores the complexities involved when new laws intersect with pre-existing contracts. In this instance, the court held that a statute requiring presuit notice could not be applied retroactively, offering a victory for homeowners like the Buises who find themselves caught between evolving legal standards and long-standing agreements. The outcome not only impacts the Buises but also sets the stage for further debate about the retroactive application of laws in Florida.
Thought for the Day:
“Change is the law of life. And those who look only to the past or present are certain to miss the future.”