Latest Developments – Appraisal in Tennessee, 2021 (Half 4) | Tennessee Insurance coverage Litigation Weblog


Final week, we checked out Justice of the Peace Decide York’s October 2021 opinion in Smith v. State Farm, during which State Farm was ordered to proceed with an appraisal of the loss as correctly invoked by Ms. Smith. As a refresher, Ms. Smith’s residence was broken by a March 3, 2020 storm, and State Farm agreed she suffered a lined loss and issued a fee to her. Ms. Smith disagreed with State Farm’s estimate of the loss and invoked the coverage’s appraisal clause. State Farm refused to proceed with an appraisal of the loss, and Ms. Smith filed go well with. In responding to Ms. Smith’s movement to compel appraisal, State Farm argued that there was solely a dispute concerning the “scope” of lined loss, not the quantity. Justice of the Peace Decide York discovered no significant distinction between “scope” and “quantity,” and thus ordered State Farm to proceed with an appraisal.  State Farm then sought evaluation by the District Decide.

On evaluation, Decide Breen affirmed Justice of the Peace Decide York’s ruling in all respects and located State Farm’s objections to Decide York’s order to be “solely unsupported.” Decide Breen’s opinion additionally highlighted the details of the case, noting:

State Farm sought denial of the appraisal demand on the grounds that the events’ disagreement went past the “quantity of loss” to incorporate a distinction of opinion as to the scope of the work to be carried out. Particularly, [State Farm] maintained that Smith was trying to acquire fee for remediation of areas of her property not broken by the storm, together with the alternative of plumbing fixtures within the rest room and kitchen and new water heater, furnace, and warmth pump. Decision of a dispute regarding the scope of labor or lined supplied by the insurance coverage contract couldn’t, State Farm insisted, type a correct foundation for an appraisal below the coverage provision. Within the different, if the Courtroom discovered appraisal applicable, [State Farm] requested that the appraisal be restricted to the scope of labor ready by the insurer which outlined the protection out there within the declare.

All of those arguments by State Farm have been rejected by the Courtroom, which additionally famous that State Farm provided no caselaw in help of its place that the applying of the appraisal clause to a scope of loss controversy is someway topic to a distinct normal if the “further loss” is a big one. To sum it up, Decide York’s Order was affirmed, appraisal was ordered to proceed, and the appraisal is now underway.

A duplicate of Decide Breen’s opinion might be accessed right here.

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