Kelley Kronenberg Secures Appellate Affirmance of Dismissal in Appraisal Case

Kelley Kronenberg Partner Kim Fernandes secured an appellate victory when the Third District Court of Appeal affirmed the trial court’s dismissal with prejudice of a first-party property insurance action, eliminating exposure of approximately $100,000.00 for Castle Key Indemnity Company. 

The underlying dispute arose from the insureds’ breach of contract claim against Castle Key. Rather than litigate the merits, Castle Key invoked the appraisal provision in the insurance policy—a contractual mechanism designed to efficiently resolve disputes over the amount of loss without court intervention. The trial court entered an order compelling the parties to proceed to appraisal. 

Under the appraisal process, each party selects a competent and impartial appraiser, and the two appraisers then select an umpire. For the process to commence, both parties must timely provide their appraiser selections. Here, the insureds failed to comply with this fundamental requirement. 

Despite the clear directive in the trial court’s order, the insureds failed to provide their selected appraiser’s contact information to Castle Key for more than a year after the order was entered. This was not a case of brief delay or inadvertent oversight. Castle Key documented six separate instances over the course of more than twelve months in which it notified the insureds’ counsel that it had not received the required appraiser information. 

These repeated notices—conveyed through multiple channels and over an extended period—established both direct and imputed knowledge that the insureds were not complying with the court’s order. The insureds’ counsel proved unable to refute this documented pattern of noncompliance. 

Faced with this ongoing obstruction of the appraisal process, Castle Key filed a Motion to Dismiss the lawsuit as a sanction for the insureds’ failure to comply with the court order. Florida courts possess inherent authority to enforce compliance with their orders through sanctions, including the ultimate sanction of dismissal when a party demonstrates willful or contumacious disregard for court directives. 

The trial court agreed that dismissal was warranted under the circumstances. After considering the extended timeline of noncompliance, the multiple notices provided by Castle Key, and the insureds’ failure to provide any justification for their inaction, the court granted the Motion to Dismiss and dismissed the insureds’ complaint with prejudice. 

The insureds appealed to the Third District Court of Appeal, challenging the dismissal as an abuse of discretion. Kim prepared a comprehensive answer brief demonstrating that the trial court properly exercised its discretion in imposing dismissal as a sanction for the extended pattern of noncompliance with a clear court order. 

The answer brief methodically established the record showing: (1) the unambiguous nature of the trial court’s order compelling appraisal; (2) the simple, ministerial act required for compliance—merely providing contact information for the insureds’ selected appraiser; (3) the extraordinary length of time the insureds failed to comply—over one year; (4) the six documented instances in which Castle Key notified opposing counsel of the missing information; and (5) the absence of any justification or excuse for the noncompliance. 

Kim’s briefing emphasized well-established Florida precedent recognizing that trial courts have broad discretion to impose sanctions, including dismissal, for failure to comply with court orders. The answer brief distinguished cases where dismissal was reversed, showing that those involved isolated incidents or ambiguous orders, unlike the clear and repeated noncompliance established here. 

The appellate panel—consisting of Chief Judge Scales and Judges Logue and Miller—agreed with the defense position. On appeal, the Court issued a per curiam affirmance without a written opinion, indicating the Court found no reversible error in the trial court’s ruling and no need for extended discussion of settled legal principles. 

A per curiam affirmance represents a particularly strong form of appellate validation, signaling that the trial court’s ruling was correct as a matter of law and the appeal lacked sufficient merit to warrant detailed analysis. This form of affirmance provides finality while conserving judicial resources on straightforward cases where existing precedent clearly supports the lower court’s decision. 

This appellate victory eliminates all exposure from the underlying breach of contract claim and reinforces important principles regarding compliance with appraisal orders. For insurance carriers, this case demonstrates that trial courts will enforce appraisal orders through sanctions when insureds obstruct the contractual appraisal process, and that appellate courts will uphold such enforcement when the record demonstrates clear and extended noncompliance. 

The decision serves as a strong deterrent against dilatory tactics designed to avoid or delay appraisal and confirms that parties cannot ignore court orders with impunity. The affirmance validates the use of dismissal sanctions where, as here, a party demonstrates willful disregard for clear court directives over an extended period despite repeated notices. 

Learn more about the firm’s First-Party Property and Coverage Division; click here: https://www.kelleykronenberg.com/our-practices/first-party-insurance-defense-coverage-bad-faith/  

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