{"id":900002,"date":"2022-06-07T15:16:56","date_gmt":"2022-06-07T21:16:56","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=900002"},"modified":"2022-06-07T15:26:22","modified_gmt":"2022-06-07T21:26:22","slug":"assignment-of-benefits-florida-contractors","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/assignment-of-benefits-florida-contractors\/","title":{"rendered":"Florida Contractor Group Already Files Suit Challenging New AOB Fee Restrictions"},"content":{"rendered":"\n

William Rabb | Insurance Journal<\/a><\/p>\n\n\n\n

A group of contractors wasted little time in challenging the constitutionality of a law approved at the Florida Legislature\u2019s special session last week, one the restoration companies argue singles them out and deprives them of attorney fees in assignment-of-benefits claims<\/a>.<\/p>\n\n\n\n

\u201cThe inability to recover prevailing party attorneys\u2019 fees will effectively shut the courthouse door to plaintiffs because it will be cost-prohibitive to pay an attorney for these types of of small claims,\u201d reads the complaint, filed in Leon County Circuit Court by Restoration Association of Florida and Air Quality Assessors.<\/p>\n\n\n\n

Senate Bill 2D, passed largely along party lines, bars assignees of benefits from collecting attorney fees, even if they prevail in court. Insurers have long complained that the fees, coupled with Florida\u2019s fee multiplier, is encouraging unnecessary claims litigation and is costing the industry huge sums every year.<\/p>\n\n\n\n

The lawsuit argues that \u201cdeprivation of this right is significant because SB 2D wrongfully treats contractors, as assignees, disparately from homeowners and insurers.\u201d<\/p>\n\n\n\n

Some lawmakers and insurance industry advocates at the special session predicted the bill would be challenged by contractors, just as 2021\u2019s Senate Bill 76 was challenged, then was temporarily suspended by a court. SB 76 sought to bar roofing contractors from soliciting homeowners and encouraging them to file insurance claims on roof damage. A federal judge has said the law may violate contractors\u2019 constitutional rights to free speech.<\/p>\n\n\n\n

Restoration Association did not bring that challenge, but it is no stranger to Florida insurers. The association\u2019s president is Richie Kidwell, who also owns Air Quality Assessors, a mold-remediation firm. He spoke forcefully against SB 2D at the May 23-25 special session. Kidwell and his group also recently filed suit against the Florida insurance commissioner and two carriers over their policy endorsements.<\/p>\n\n\n\n

One endorsement, by American Integrity Insurance, offers premium discounts for policyholders who agree to binding arbitration in claims disputes. Another, by Heritage Property & Casualty Insurance, states that the insurer won\u2019t pay contractors, but will only reimburse the insured for restoration work, effectively barring AOB claims.<\/p>\n\n\n\n

That suit and the May 31 challenge to SB 2D were filed by Boca Raton attorney Joshua Alper and the Center for Constitutional Litigation.<\/p>\n\n\n\n

A Florida law professor said neither suit stands much chance of succeeding.<\/p>\n\n\n\n

\u201cIn a word, this lawsuit isn\u2019t going anywhere,\u201d Robert Jarvis, a professor at Nova Southeastern School of Law, said about the challenge to SB 2D.<\/p>\n\n\n\n

He explained that it\u2019s very difficult to win a lawsuit based on the Florida Constitution\u2019s equal protection clause, Article I, Section 2. \u201cThat\u2019s because the clause only protects plaintiffs who are \u2018similarly situated\u2019 to people or groups that aren\u2019t impacted by the law the plaintiffs are challenging,\u201d Jarvis said. \u201cBut there\u2019s almost always some difference between the plaintiffs and non-plaintiffs.\u201d<\/p>\n\n\n\n

Jarvis said that in weighing the validity of an economics-regulation law, the courts use a \u201crational basis\u201d test. The defendants, in this case the Florida Department of Business and Professional Regulation, need only show that some rational basis exists for distinguishing the targets of the law \u2013 the assignees of benefits.<\/p>\n\n\n\n

\u201cThis is a very easy standard to meet\u2014there\u2019s almost always some rational basis that supports the law and the distinctions it draws,\u201d said Jarvis, who studies and teaches constitutional law and contract law. \u201cIn passing laws, the Florida Legislature is not required to address every ill. Thus, singling out just AOB contractors is a perfectly legitimate exercise of the Legislature\u2019s powers.\u201d<\/p>\n\n\n\n

The plaintiffs must also show that the law is clearly unconstitutional, but courts have generally found that, while they may disagree with a piece of legislation, they won\u2019t usually nullify it.<\/p>\n\n\n\n

\u201cJudges often opine that there was a better solution that the Legislature could and should have selected, but they won\u2019t strike down a law simply because it\u2019s not the best solution,\u201d Jarvis explained in an email. \u201cThey leave that to the Legislature (which can always see the error of its ways and enact a new law) and the people (who can always set things right by electing new legislators).\u201d<\/p>\n\n\n\n

<\/p>\n\n\n\n

When one of your cases is in need of a construction expert, estimates, insurance appraisal or umpire services in defect or insurance disputes – please call Advise & Consult, Inc. at 888.684.8305, or email experts@adviseandconsult.net<\/a>.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

William Rabb | Insurance Journal A group of contractors wasted little time in challenging the constitutionality of a law approved at the Florida Legislature\u2019s special session last week, one the restoration companies argue singles them out and deprives them of attorney fees in assignment-of-benefits claims. \u201cThe inability to recover prevailing party attorneys\u2019 fees will effectively… Continue reading Florida Contractor Group Already Files Suit Challenging New AOB Fee Restrictions<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[172],"tags":[9895,10229,528,94],"class_list":["post-900002","post","type-post","status-publish","format-standard","hentry","category-construction-law-2","tag-advise-consult","tag-assignment-of-benefits","tag-attorney-fees","tag-florida","entry"],"jetpack_publicize_connections":[],"yoast_head":"\nFlorida Contractor Group Already Files Suit Challenging New AOB Fee Restrictions - 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