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Law360 (April 21, 2021, 5:11 PM EDT) -- A Florida commercial landlord can proceed with its suit against National Fire & Marine Insurance Co. and underwriters at Lloyd's London for $900,000 in lost revenue from the COVID-19 pandemic, a state appeals panel affirmed Wednesday, saying a lower court didn't err in denying dismissal.
The Third District Court of Appeal followed its own precedent and declined to take up the insurers' petition to review whether Infinity Biscayne Myrtle Members LLC can continue with claims for anticipatory breach of contract, breach of covenant of good faith and fair dealing and bad faith.
In December, Judge Veronica Diaz of the Miami-Dade County Circuit Court, without explanation, refused to dismiss Infinity's suit for $900,000 in losses from pandemic-related government orders that forced tenants at its Miami commercial property to halt their retail and fitness businesses.
National Fire and the underwriters had pushed for dismissal, arguing there wasn't any physical loss or damage to the property triggering coverage. The government orders suspended the tenants' businesses, not Infinity's, and any loss of income came from the tenants' failure to pay rent, according to the insurers.
In Wednesday's ruling, the appellate court found no reason to disturb the lower court's decision.
The appellate panel said the breach of good faith and fair dealing claim "appears to be merely a cloaked claim for bad faith." But despite the prematurity of that claim, the panel said there is a large body of precedent precluding a finding of irreparable harm to the insurers at the current stage of the suit.
Judges Bronwyn C. Miller, Alexander S. Bokor and Monica Gordo sat for the panel.
While agreeing with the outcome, Judge Gordo separately wrote to say there is harm as the insurers were forced to litigate the bad-faith claim, which was filed too early. The panel's decision not to take up the petition was partially based on Infinity's agreement not to pursue the claim, according to Judge Gordo.
But Judge Gordo said National Fire and the underwriters have already been forced to take a binding position on Infinity's premature bad-faith claim. The trial court's denial of dismissal but grant of discovery on the bad-faith claim further caused harm to the insurers, according to Judge Gordo.
"Judicial estoppel would prevent National Fire from later taking a different position than it took at a time before the claim had even accrued," Judge Gordo wrote.
Counsel for the parties didn't respond to requests for comment on Wednesday.
Infinity is represented by Colby G. Conforti, Robert F. Salkowski and Robert Zarco of Zarco Einhorn Salkowski & Brito PA.
The insurers are represented by Mihaela Cabulea, John V. Garaffa and William R. Lewis of Butler Weihmuller Katz Craig LLP.
The case is National Fire & Marine Insurance Co. et al. v. Infinity Biscayne Myrtle Members LLC, case number 3D21-0120, in the Third District Court of Appeal of the State of Florida.
--Editing by Vincent Sherry.
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