Key Points

  • Section 627.70152, Florida Statutes (2021), which requires presuit notice to the Department of Financial Services, does not apply retroactively to suits for breach of property insurance policies issued before July 1, 2021.
  • Under the Menendez two-step test, neither the statute's 'all suits' language nor its condition-precedent language is a clear legislative command for retroactivity, and the statute's effective date cuts against retroactive application.
  • The court rejected Universal's argument that the notice requirement is procedural, holding that the statute viewed as a whole is substantive because it imposes dismissal, affected fee recovery, gives insurers a safe harbor and more time to pay, and delays the right to sue.
  • The court approved the Sixth District's decision in Hughes and disapproved the Fourth District's decision in Cole.
  • Justice Tanenbaum concurred, reasoning that section 624.21 requires insurance-code amendments to operate prospectively absent specified contrary intent.

The Florida Supreme Court ruled Thursday that a 2021 law requiring property owners to notify a state agency before suing their insurers does not apply to policies issued before the law took effect. The decision resolves a split among six of the state's district courts of appeal over part of the Legislature's 2021 rewrite of property-insurance law.

The unanimous ruling went to Rebecca Hughes, a homeowner whose suit against Universal Property & Casualty Insurance Co. had been dismissed because she sued without giving the notice. Chief Justice Couriel wrote for the court, joined by Justices Labarga, Muñiz, Grosshans, Francis and Barrios. Justice Tanenbaum concurred separately.

The court approved a 2023 decision of the Sixth District Court of Appeal in Hughes's favor and disapproved the Fourth District's contrary decision in Cole v. Universal Property & Casualty Insurance Co. Under the ruling, the notice statute, section 627.70152, does not govern suits on policies issued before July 1, 2021.

The statute makes written notice of intent to litigate a "condition precedent" to suing under a property insurance policy. The claimant must send the notice to the Department of Financial Services, which then notifies the insurer, at least 10 business days before filing suit. A court "must dismiss without prejudice any claimant's suit relating to a claim for which a notice of intent to initiate litigation was not given," the law says.

The Supreme Court quoted the Sixth District's description of the change. "After section 627.70152's enactment, an insurer now has a second opportunity to evaluate and pay a claim and to prevent the insured from asserting a cause of action for breach of the insurance policy," that court wrote.

Hughes held a Universal homeowners policy from April 24, 2019, to April 24, 2020. She filed a claim for water damage on May 29, 2019. Universal paid it, but Hughes called the amount insufficient and, relying on three bids for the work, demanded more. She sued on Aug. 4, 2021, about a month after the statute took effect, without filing the notice. The Collier County trial court granted Universal's motion to dismiss without prejudice, and the Sixth District reversed.

While her appeal was pending, the Fourth District held in Cole that the Legislature had clearly signaled that the notice requirement reaches existing policies. It relied on the statute's statement that it applies to "all suits" arising under property policies and on the condition-precedent language. "[I]f the legislature had intended to limit this presuit notice provision to policies issued after the statute's effective date, the legislature would have included language stating so," the Fourth District reasoned. The Third District later agreed with Cole; the First, Second and Fifth Districts sided with the Sixth.

The Supreme Court began from the rule that "the statute in effect at the time an insurance contract is executed governs substantive issues arising in connection with that contract." Because the parties agreed that the operative date was April 24, 2019, when the policy was issued, Universal conceded that it sought retroactive application. Under the court's 2010 decision in Menendez v. Progressive Exp. Ins. Co., which held that a presuit notice requirement for auto insurance claims did not apply to earlier policies, a statute applies retroactively only if the Legislature clearly expressed that intent.

Couriel found no such expression. The "all suits" phrase identifies the kinds of cases the law covers, the chief justice wrote: suits on residential or commercial policies not brought by assignees. "The fact that the Legislature used the phrase 'all suits' in this context does not transform this subsection into a clear command to apply section 627.70152 retroactively," the opinion said.

The court also rejected the Fourth District's reliance on the absence of language limiting the statute to new policies. "Like the Sixth District, we reject this analysis, which turns our precedent on its head," Couriel wrote, adopting the Sixth District's formulation that "clear evidence must consist of more than silence." The statute's effective date, the court added, is itself evidence against retroactive application. "The correct answer is to respect the Legislature's choice not to clearly require retroactive application of the statute," the opinion said.

Universal had argued that the retroactivity test did not apply at all because the notice requirement is procedural rather than substantive. "If the presuit notice requirement stood by itself, Universal might have a point," the court wrote. But viewed as a whole, the court said, the statute imposes dismissal as a penalty, gives insurers a safe harbor and more time to pay, and delays an insured's right to sue, and a since-repealed subsection barred fee recovery for work done before a dismissal. The court left undisturbed the Sixth District's conclusion that the law "significantly alters an insurer's obligation to pay and an insured's right to sue under a property insurance policy."

Tanenbaum would have rested the decision on a different statute, section 624.21, which directs that each amendment to the insurance code "shall be construed to operate prospectively, unless a contrary legislative intent is specified." "Menendez is not needed to answer the question here," Tanenbaum wrote. Without an express command, the concurrence said, the provision "applies only prospectively, to policies issued after the provision's effective date, as the Legislature has directed."

Groups including the Florida Justice Reform Institute, the American Property Casualty Insurance Association, the National Association of Mutual Insurance Companies and United Policyholders filed friend-of-the-court briefs.

Lawyers for Universal included Dinah S. Stein of Hicks, Porter, Ebenfeld & Stein, P.A. Hughes was represented by Matthew R. Danahy of Danahy & Dunnavant, P.A. Joseph W. Jacquot of Gunster Yoakley & Stewart, P.A., represented the Federal Association for Insurance Reform as amicus curiae.

The opinion leaves in place the Sixth District's reversal of the dismissal of Hughes's complaint, which the high court approved to the extent it is consistent with Thursday's ruling. The decision is not final until the time to file a rehearing motion expires and any such motion is decided.