The Length of Briefs

Regarding the appropriate length for appellate briefs, Judge Marstiller (First Distrct Court of Appeal) noted on Twitter that the "sizematters":

Not too short or simple though, exactly as short as possible.

Design for Startup: Everything about design for startups https://t.co/HopCqCVjg2 by @umitakcn pic.twitter.com/zBGMis0fCT

Product Hunt (@ProductHunt) December 13, 2015

Florida Statute That Taxed Cable And Satellite Service At Different Rate Violates Dormant Commerce Clause

In Directv Inc., et al v. Florida Department of Revenue, et al (1D13-5444 & 1D14-0292), a divided three judge panel of the First District Court of Appeal held that Florida's imposition of a higher tax on satellite customers than on cable customers violates the dormant Commerce Clause. The court began its opinion as follows:

This appeal arises from a final summary judgment finding that section 202.12(1), Florida Statutes, which imposes a higher tax rate on satellite services than on cable services, is constitutional. The Appellants, Directv, Inc. and Echostar, L.L.C. (“the satellite companies”), contend that the statute unconstitutionally discriminates against interstate commerce in both effect and purpose, which is in violation of the Commerce Clause. We agree and reverse.

Generally, the complaint arises from a legislative change, "the Communications Services Tax Simplification Law (“the CST”), which imposed a differential tax rate for cable and satellite services." When that law was enacted, codified at § 202.12(1), Fla. Stat. (2001), cable service began being taxed at 6.8 percent and satellite service at 10.8 percent. " (taxing cable service at 6.8 percent and satellite service at 10.8 percent). Currently, cable service is taxed at a rate of 6.65 percent, and satellite service is taxed at a rate of 10.8 percent."

"It is this difference in taxation rates that the satellite companies allege[d] violates the dormant Commerce Clause," and the court agreed.

The court first addressed the state's argument that "the satellite companies cannot seek a tax refund because they failed to exhaust the available administrative remedies." The court agreed that the satellite companies had failed to exhaust their administrative remedies but noted that "[i]f a taxpayer is seeking a refund pursuant to section 215.26, Florida Statutes, and the sole basis for the refund is that the statute imposing the tax is facially unconstitutional, the circuit court will have jurisdiction despite the taxpayer’s failure to exhaust administrative remedies. Sarnoff v. Fla. Dep’t of Highway Safety & Motor Vehicles, 825 So. 2d 351, 357 (Fla. 2002). This exception is known as the direct-file exception. Id."

The state argued that the direct-file exception, discussed above, did not apply because "this is not a facial challenge to the statute." The court disagreed, concluding that "[a] party can pose a facial challenge to a statute by arguing that there is no set of circumstances where it could apply constitutionally because of its discriminatory purpose or its discriminatory effect on interstate commerce."

To the merits of the dispute, the court stated that the "The Commerce Clause states, 'The Congress shall have power to . . . regulate Commerce with foreign Nations, and among the several states.' Article I, § 8, cl. 3, U.S. Const. Attendant with this grant of authority to Congress, the United States Supreme Court has recognized a dormant Commerce Clause, which limits the states’ power to regulate interstate commerce. Simmons v. State, 944 So. 2d 317, 329 (Fla. 2006). A state or local regulation violates the dormant Commerce Clause if the regulation treats out-of-state commerce differently from in-state commerce. Reinish v. Clark, 765 So. 2d 197, 211 (Fla. 1st DCA 2000)."

"There are three ways in which a statute can discriminate against out-of-state interests: (1) it may be facially discriminatory; (2) it may discriminate in its practical effect; or (3) it may have a discriminatory intent." Citing Amerada Hess Corp. v. Dir., Div. of Taxation, N.J. Dep’t of Treasury, 490 U.S. 66, 75 (1989).

Applying this test, the court disagreed with the trial court and concluded that the cable and satellite providers, stating:

Here, cable and satellite companies provide multichannel television programming to Florida subscribers. As such, they operate in the same market and are direct competitors within that market. They differ in the deployment of technology, the need for local infrastructure, and the additional services offered. However, mere differences in how a service is provided is not enough to overcome the fact that the companies compete in the same market and sell virtually identical products at retail. 

Next, the court turned to whether there were "in-state interests," stating that "[i]n addition to a finding the companies at issue are similarly-situated entities, courts must also find in-state interests to be present in order for the Commerce Clause to be implicated." The court stated that the "Commerce Clause analysis focuses not on the domiciles of particular corporations, but on whether a law results in differential treatment of in-state and out-of-state economic interests." In this case, "[b]ecause the sales tax portion of the CST burdens interstate commerce by imposing a higher tax rate on those communication companies that do not invest in local economies, it violates the Commerce Clause."

The court then turned to "effect case law," arguments concerning the "aggregate tax rate," and the state's arguments regarding operational differences. All three arguments made by the state were rejected, and the court concluded that "[b]ecause the CST has a discriminatory effect on satellite companies, it violates the Commerce Clause, and the trial court erred in finding otherwise."

After concluding that the legislation had a discriminatory effect, the court next analyzed whether the statute had a discriminatory purpose. "To determine whether there is discriminatory purpose, courts look to the language and the legislative history of the statute in question." Concluding that the trial court correctly limited its review to information in the actual legislative history, the court affirmed the conclusion that the record did not support a finding of discriminatory intent.

Based upon the finding of discriminatory effect, the court reversed the judgment of the trial court. The court's opinion was written by Judge Roberts, and Judge Swanson concurred. A dissenting opinion was filed by Judge Marstiller.

Judge Marstiller's dissenting opinion stated, in part, as follows:

I do not agree the satellite and cable providers are similarly situated entities for purposes of dormant Commerce Clause analysis; in my view, the majority opinion fails to fully consider all the differences between the two.3 Mainly, however, I disagree with the majority’s characterizing the cable providers’ use of local infrastructure, reliance on local rights-of-way and employment of Florida workers as in-state economic interests giving rise to the proscriptions of the dormant Commerce Clause. As the trial court found based on the undisputed facts brought out below, “[t]he cable companies may have more of a presence in the state because of the nature of the technology they utilize in providing their services, but the satellite companies have a significant presence in the state as well.” Indeed, DirecTV and Echostar filed verified statements below averring that each has employees based in Florida—DirecTV has independent contractors here, as well—who are responsible for “sale of its services and installation, servicing, and/or maintenance of its property.” I do not believe we can properly ignore or discount these facts. Inasmuch as the cable providers and the satellite providers both have human and physical assets in Florida which they use to provide services to their customers, they both have significant in-state economic interests. I fail to see how, under these facts, the cable providers have local economic interests, but the satellite providers do not. And I find nothing in dormant Commerce Clause jurisprudence that would justify invalidating Florida’s CST based on one group’s comparatively greater economic investment in the state where both groups have economic investment here.

***

I also believe the majority opinion, in focusing solely on the extent of instate economic investment by cable providers and disregarding in-state investment by satellite providers, misapprehends the purpose of the dormant Commerce Clause. Relying primarily on the fact that the cable providers use local rights-of way, the majority opinion discounts the decisions of the Sixth Circuit Court of Appeals, the Ohio Supreme Court and the North Carolina Court of Appeals holding that the pertinent distinction between satellite providers and cable providers is operational and not geographical. 

***

The bottom line is that the dormant Commerce Clause does not protect satellite TV providers from differential tax treatment simply because their technology is not land based. It does not protect “the particular structure or methods of operation in a retail market.” Exxon Corp., 437 U.S. at 127. The majority’s decision to invalidate Florida’s CST is inconsistent with this principle and contrary to dormant Commerce Clause jurisprudence. I understand the concern over a taxing scheme that appears to favor one group of industry competitors over another. But “‘applying the dormant Commerce Clause in cases that do not present the equivalent of a protective tariff’—i.e., where the tax does not draw geographic lines, favor local products, or promote local companies—[ ] ‘dramatically increase[s] the clause’s scope.’” Levin, 941 N.E.2d at 1194 (quoting Treesh, 487 F.3d at 481). The majority’s decision takes that dramatic step, and I  am not prepared to follow.

First District Explains New Mailbox Rule for Incarcerated Litigants

If you happen to be an incarcerated litigant, you should read the First District's opinion issued today in Roberto Rivera, M.D. v. Department of Health (1D15-0287). In that opinion, the First District states as follows:

We are concerned that incarcerated litigants may fail to understand the effect of the amendment and write to ensure that incarcerated litigants filing documents with the courts of this state are familiar with the recent amendment to rule 9.420(a)(2), and that they understand the burden the rule places on them to demonstrate timely filing. 

With regard to the amended rule, which is quoted in the opinion, the court stated:

As amended, the rule provides that when the institution has a system designed for legal mail that records the date a document is placed in the hands of an institution official for mailing and the inmate uses that system, then the date of filing will be presumed to be the date recorded by the institution’s legal mail system. If the inmate does not use the system designed for legal mail, the date of filing shall be presumed to be the date it is stamped for filing by the clerk of the court. If the institution does not have a legal mail system, or it has a legal mail system that does not record the date a document is placed in the hands of an institution official for mailing, then the date contained in the certificate of service is presumed to be the date of filing. 

Judgment Cannot Be Corrected To Clarify Status Of Parties Years After Entry

In Lorant v. Whitney National Bank (1D14-2757), the First District "consider[ed] whether Florida’s Rule of Civil Procedure allowing for corrections of 'clerical mistakes,' encompasses authorization to supplement a final deficiency judgment by clarifying the party defendants’ status in the litigation almost three years after the entry of the initial judgment."

After a foreclosure judgment was entered:

the court entered a final deficiency judgment as to Mr. Lorant and two other named defendants in favor of the bank. The bank then sought to domesticate the final deficiency judgment in Alabama against Mr. Lorant, but the Alabama courts did not allow it. Under Alabama law, the deficiency judgment had to reflect that Mr. Lorant was the sole remaining defendant and that all claims, rights, or liabilities of the other parties had been adjudicated. See Whitney Bank v. Lorant, 148 So. 3d 1077, 1078 n. 1 (Ala. 2014) (Moore, C.J., dissenting).

After the Alabama court's refused to domesticate the judgment, the lender "filed a motion to correct a final deficiency judgment pursuant to Rule 1.540(a)’s allowance for the correction of 'clerical mistakes.' The bank asked the court to modify its 2011 deficiency judgment to reflect that Mr. Lorant was the sole remaining defendant and that all claims, rights, or liabilities of the other parties had been adjudicated."

The court stated that:

Rule 1.540(a) specifically allows for the correction of “clerical mistakes” and “errors” in judgments “arising from oversight or omission” for an indefinite period of time. Rule 1.540(b), on the other hand, allows for the correction of other mistakes or inadvertence in a final judgment for “a reasonable time . . . not more than 1 year after the judgment[.]” The bank in this case filed its motion under Rule 1.540(a), requiring a “clerical mistake” as opposed to some other kind of mistake. Our court has recognized clerical mistakes include “only ‘errors or mistakes arising from an accidental slip or omission, and not errors or mistakes in the substance of what is decided by the judgment or order,’ the latter of which must be corrected pursuant to Rule 1.540(b).” .... A trial court “has no authority under Rule 1.540(a) to make substantive changes.” .... And relief under Rule 1.540(a) may not be appropriate where “[t]he proposed amendment of the judgment substantially change[s] its impact and effect.” 

Therefore, the court held that "[t]he mistake involved in this case resulted in the trial court 'supplementing' its initial final deficiency judgment in order to more definitively address the litigation status of the three party defendants. This correction and supplement to the previous final judgment represented a substantive change, not the sort of accidental slip or omission permitted to be corrected under Rule 1.540(a). In fact, nothing in the record indicates that a 'mistake' existed at all in the initial judgment; rather the bank’s issue was that Alabama required these matters to be addressed in a substantively different manner."

Dismissal With Prejudice Of Foreclosure Suit Does Not Prevent New Complaint Based Upon New Default

In PNC Bank, N.A. v. Neal (1D12-2544), a short opinion from the First District, the court affirmed a dismissal with prejudice entered in a foreclosure action filed by PNC. The court stated that:

We affirm but point out that the dismissal with prejudice of PNC Bank’s foreclosure action against the Neals does not preclude PNC Bank from instituting a new foreclosure action based on a different act or a new date of default not alleged in the dismissed action. See Star Funding Solutions, LLC v. Krondes, 101 So. 3d 403 (Fla. 4th DCA 2012) (citing Singleton v. Greymar Assocs., 882 So. 2d 1004, 1005 (Fla. 2004)).

$80 Million Punitive Award Unconstitutional; $10 Million Compensatory Award Affirmed In Smoker Case

In R.J. Reynolds Tobacco Company v. Townsend (1D10-4585), the First District upheld a jury verdict against the R.J. Reynolds Tobacco Company for $10.8 million in compensatory damages (prior to deducting due to the 49% of fault attributed to the smoker) but rejected an $80 million punitive damage award as being excessive. Judge Van Nortwick wrote the majority opinion and Judge Marstiller. Judge Wetherell wrote an opinion concurring in part and dissenting in part. The court stated:

The Supreme Court has been “reluctant to identify concrete constitutional limits on the ratio between harm . . . to the plaintiff and the punitive damages award,” State Farm, 538 U.S. at 424. Nevertheless, it has identified a circumstance in which caution is required: “When compensatory damages are substantial, then a lesser ratio, perhaps only equal to compensatory damages, can reach the outermost limit of the due process guarantee.” State Farm, 538 U.S. at 425. As the Supreme Court noted in Gore, however, there is no “simple mathematical formula” that marks the constitutional line. Gore, 517 U.S. at 582. See also State Farm, 538 U.S. at 425 (“We decline again to impose a bright-line ratio which a punitive damages award cannot exceed.”); Martin, 53 So. 3d at 1072 (rejecting RJR’s argument that the United States Supreme Court adopted a bright-line 1 to 1 ratio as a limit on punitive damages).

***

Here, the $10.8 million compensatory damage award—which is substantial by any measure—justifies a lower ratio than 3.7 to 1. Although we find the $40.8 punitive damage award excessive under the Gore and State Farm criteria, a 1 to 1 ratio is unwarranted, however, because the evidence of the extreme reprehensibility and wantonness of RJR’s conduct was substantial. See Gore, 517 U.S. at 575 (noting that “the most important indicium of the reasonableness of a punitive damages award is the degree of reprehensibility of the defendant’s conduct”).

In sum, applying the Gore and State Farm criteria, in view of the substantial compensatory damages awarded here, we agree with RJR that the $40.8 million punitive damage award in this case is constitutionally excessive. Thus, it was error to deny RJR’s motion for new trial or remittitur. Accordingly, we reverse and remand the punitive damages award for the limited purpose of permitting Appellee to choose between a new jury trial solely to determine punitive damages or acceptance of a remittitur judgment on the punitive damages award to be established by the trial court.

Judge Wetherell agreed with the majority as to three challenges not discussed here but would have also reversed the $10.8 million compensatory damages award which was solely comprised of non-economic pain and suffering damages. 

First DCA Certifies Question About Constitutional Guarantee To Adequate Education

In Haridopolos, et al v. Citizens for Strong Schools, Inc., et al (1D10-6285), a divided First District, sitting en banc, denied a petition for writ of prohibition. However, both the majority opinion and the dissent agreed that the following question should be certified to the Supreme Court of Florida as one of great public importance:

DOES ARTICLE IX, SECTION 1(A), FLORIDA CONSTITUTION, SET FORTH JUDICIALLY ASCERTAINABLE STANDARDS THAT CAN BE USED TO DETERMINE THE ADEQUACY, EFFICIENCY, SAFETY, SECURITY, AND HIGH QUALITY OF PUBLIC EDUCATION ON A STATEWIDE BASIS, SO AS TO PERMIT A COURT TO DECIDE CLAIMS FOR DECLARATORY JUDGMENT (AND SUPPLEMENTAL RELIEF) ALLEGING NONCOMPLIANCE WITH ARTICLE IX, SECTION 1(A) OF THE FLORIDA CONSTITUTION?

Chief Judge Benton wrote the majority opinion which was joined by Judge Davis, Judge Van Nortwick, Judge Padovano, Judge Lewis, Judge Clark, and Judge Marstiller. Judge Wolf filed an opinion specially concurring with the majority opinion. Judge Roberts wrote a dissenting opinion which was joined by Judge Hawkes, Judge Thomas, Judge Wetherell, Judge Rowe, Judge Ray, and Judge Swanson.

Majority Opinion

The majority opinion began:

After the trial judge denied their motion to dismiss respondents’ amended complaint for declaratory and supplemental relief, the President of the Florida Senate, the Speaker of the Florida House of Representatives, the Commissioner of Education, and the State Board of Education filed a petition for writ of prohibition, initiating original proceedings here in an effort to bring further proceedings in the circuit court to a halt. Because the present case lies at the intersection of well established rules governing writs of prohibition and significant, but unsettled, questions about Florida’s “paramount duty” to provide “for the education of all children residing within its borders,” Art. IX, § 1(a), Fla. Const., we deny the petition for writ of prohibition, but certify a question of great public importance to the Supreme Court of Florida.....

In the course of its 135 paragraphs, respondents’ amended complaint alleges a failure to make adequate provision “for a uniform, efficient, safe, secure, and high quality system of free public schools” by, e.g., providing insufficient funding for public education, shifting responsibility for educational funding to local governments, providing inadequate resources for teachers’ salaries in particular, and adopting a so-called accountability policy that is an obstacle to high quality. 

The amended complaint alleges that Florida’s public schools are not safe and secure, that graduation rates are too low, that student promotion and retention policies are ineffective, that results of achievement tests reveal various inadequacies, and much more. Petitioners moved to dismiss the amended complaint, relying on Coalition for Adequacy and Fairness in School Funding, Inc. v. Chiles, 680 So. 2d 400, 407 (Fla. 1996), for the proposition that the amended complaint raises only nonjusticiable “political” questions, see Baker v. Carr, 369 U.S. 186, 209 (1962), questionswhich the trial court—and, indeed, any court (according to the petitioners)—lacks jurisdiction to entertain. Rejecting petitioners’ argument that it lacked jurisdiction to decide any facet of any one of the respondents’ claims, the trial court denied the motion to dismiss.

Because “‘In this state, circuit courts are superior courts of general jurisdiction, and nothing is intended to be outside their jurisdiction except that which clearly and specially appears so to be.’”.....The petitioners’ apprehension at the prospect of burdensome discovery demands unduly discounts the protections they and all litigants will enjoy because any discovery that may occur will take place under the supervision of the able trial judge, if and as needed. More fundamentally, the petitioners’ asserted concerns about discovery do not speak to the only issue that is germane in prohibition proceedings: the nature and extent of the lower tribunal’s jurisdiction. A court of general jurisdiction, the circuit court has statutory authority to entertain claims for declaratory judgment." [emphasis is mine]. 

In this case, the majority denied the writ of prohibition because "Prohibition lies to redress an inferior tribunal’s usurpation of jurisdiction, but it does not lie to prevent mere error in the exercise of the inferior tribunal’s jurisdiction.....Prohibition is unavailable to divest a lower tribunal of jurisdiction to hear and determine its own jurisdiction, or to test the correctness of a jurisdictional determination that depends on fact finding the lower tribunal is charged with making.....The writ is narrow in scope, is to be employed with great caution, and, our supreme court has even said, is to be utilized only in 'emergencies.'” [emphasis is mine]. That being said, the majority concluded "There is no emergency here." There is no emergency, according to the majority, because "the trial court has been asked to construe the Florida Constitution, not the constitution of any other state. But analogous questions have arisen under the constitutions of other states, and the majority rule is that educational adequacy provisions in state constitutions are judicially enforceable."

Judge Wolf, Specially Concurring

Judge Wolf wrote an opinion specially concurring with the majority opinion that began:

This is a difficult case because it involves a clash of two extremely important precepts: the concept of separation of powers enumerated in article II, section 3 of the Florida Constitution, and the right of the people to have their will concerning the adequacy of the state’s education system, as expressed in an amendment to article IX, section 1 of the constitution, implemented....On the other hand, the Florida Constitution is a document of the people......The people’s will is expressed through the adoption of constitutional language. The difficult issue is when do the people have a right to enforce their will, as it is expressed in the constitution, through the court system.

Judge Wolf concluded: "In the instant case, the allegations of the complaint, taken as true, indicate a clear failure of the Legislature over a reasonable period of time to assure the fundamental values identified within the amendment were being met. While the remedy suggested by this opinion was not specifically requested by the respondents, they did ask for any other 'relief the court deems proper.' In addition, the complaint requested the adoption of a “remedial plan . . . which includes necessary studies to determine what resources and standards are necessary to provide a high quality education to Florida students.' A request for implementing legislation is necessarily contained within these requests for relief."

Dissenting Opinion

The dissent began: "In Coalition for Adequacy & Fairness in School Funding, Inc. v. Chiles, 680 So. 2d 400, 402 (Fla. 1996), the plaintiffs filed a complaint seeking declaratory relief challenging the funding of the state school system of K-12 education. They alleged that the funding and policies adopted by the legislature did not meet the requirements of article IX, section 1 of the Florida Constitution. They asked the trial court to declare that an adequate education was a fundamental right under the Constitution and that the state had failed to make adequate provision for a uniform system of free public schools as provided for in the Constitution. The trial court dismissed the complaint with prejudice finding that, to grant relief, it would have to usurp or intrude upon the appropriation power exclusively reserved to the legislature. The trial court also found that the complaint presented a non-justiciable political question. Id. On appeal, the Florida Supreme Court affirmed the trial court’s dismissal. Id. at 402, 408."

Later, the dissent stated:

Further, the respondents seek a declaration that would mandate a change in educational policy consistent with their policy views. In their amended complaint, they allege that the state’s current accountability policy is an obstacle to obtaining a high quality education. Education policy matters such as the state’s accountability policies involve thousands of interested persons, including parents, teachers, administrators, and locally elected officials. As in matters of appropriations, under our constitution’s strict separation of powers, only the legislature is properly equipped to balance the competing interests involved in education debates, in addition to other vitally important issues such as criminal justice, health care, economic and environmental regulation, and other matters. Thus, it is solely in the legislative branch that the constitutional values of an “efficient, safe, secure and high quality” school system can be constitutionally defined and implemented. In other words, this question is quintessentially political and thus not justiciable, and the writ of prohibition must issue as the trial court did not have jurisdiction to consider this question.....See generally, The Fla. Senate v. Fla. Public Employees Council 79, 784 So. 2d 404 (Fla. 2001). In Florida Senate, the court recognized that the judiciary has no power to encroach on the legislative process and stated that it is the “final product” of legislation that is subject to judicial review. Id. at 408. Here, however, the respondents seek a declaratory judgment to order the legislature to make policy and appropriation changes in futuro. Thus, while the respondents purport to challenge present appropriations and policies, their prayer for relief seeks to order the legislature to enact policies and increase appropriations, and such relief cannot be granted without interfering in internal legislative affairs, by necessity.

Trial Court Loses Jurisdiction After Judgment Entered - Order Enforcing Settlement Agreement Quashed

In HSBC Bank USA, N.A. v. Reed (1D10-6209), the First District quashed an order entered by the Circuit Court enforcing a settlement agreement. In this mortgage foreclosure case, "trial court entered a final judgment in mortgage foreclosure in favor of Appellant, which included an award of attorney's fees and costs....Twenty days after the entry of the final judgment...the trial court entered an order purportedly requiring post-judgment mediation. During the post-judgment mediation, the parties signed what is now the disputed Settlement Agreement."

"Appellees filed a Motion to Enforce Settlement Agreement, asserting that the parties reached a final settlement at the mediation conference and that the proposed Modification Agreement deviated from the parties' Settlement Agreement on a number of terms." Ultimately, the trial court granted the motion to enforce the settlement agreement.

The First District concluded:

Although not raised by either party, the Order On Motion To Enforce Settlement, entered after entry of the final judgment, is not a valid order. “Once a final judgment has been rendered and the time for filing a petition for rehearing or motion for new trial has passed the court loses all jurisdiction over the cause other than to see that proper entry of the judgment or decree is made and the rights determined and fixed by it are properly enforced.” Seddon v. Harpster, 438 So. 2d 165, 168 (Fla. 5th DCA 1983); see also Pruitt v. Brock, 437 So. 2d 768, 772-773 (Fla. 1st DCA 1983) (holding that "'[i]t is the established law of this state that a trial court loses jurisdiction of a case at the expiration of the time for filing a petition for rehearing . . .'") (citation omitted)). Although from the record it appears that the trial court was attempting to correct the parties" failure to attend mandatory mediation, it was without jurisdiction to issue the order requiring post-judgment mediation and the Order On Motion To Enforce Settlement Agreement, because it had not vacated the final judgment entered on June 9, 2010.

"Ethics And Professionalism On Appeal"

Judge Webster wrote THIS article in the Florida Bar Journal titled "Ethics and Professionalism on Appeal."

First District Holds That Public Adjuster Solicitation Ban Is Unconstitutional

In Kortum v. Sink (1D10-2459), the First District reversed the trial court's decision and held that section 626.854(6), Florida Statutes (2008) "unambiguously bans all solicitation for 48 hours and that this restriction on commercial speech violates Article I, § 4 of the Florida Constitution under the standards of Central Hudson Gas & Electric Corp. v. Public Service Commission of New York, 447 U.S. 557 (1980)."   The statute at issue "bans solicitation by public adjusters for a period of 48 hours."  The court stated:

During its 2007 special session, the Florida Legislature created the Task Force on Citizens Property Insurance Claims Handling and Resolution (Task Force) to make recommendations regarding the 2004-2005 hurricane claims of Citizens Property Insurance Corporation.  During its work, the Task Force became aware of the impact that public adjusters have on the insurance claims process following a hurricane. The Task Force identified abuses on the part of certain public adjusters and proposed legislation to revise the statutes governing public adjusters. Pertinent to this appeal, with respect to solicitation by public adjusters, the Task Force recommended that the legislature enact the following statutory provision:

A public adjuster shall not directly or indirectly through any other person or entity engage in face-to-face or telephonic solicitation or enter into a contract with any insured or claimant under an insurance policy until at least 72 hours after the occurrence of an event that may be the subject of a claim under the insurance policy unless contact is initiated by the insured or claimant.

The language of the statute enacted by the legislature, see § 626.854(6), Florida Statutes (2008), differed from the recommendation and provides as follows:

A public adjuster may not directly or indirectly through any other person or entity initiate contact or engage in face-to-face or telephonic solicitation or enter into a contract with any insured or claimant under an insurance policy until at least 48 hours after the occurrence of an event that may be the subject of a claim under the insurance policy unless contact is initiated by the insured or claimant.

(emphasis added). The legislature changed the language recommended by the Task Force by adding the phrase “initiate contact or” and reducing the temporal length of the solicitation restriction from 72 to 48 hours.

Kortum, a public adjuster, filed a complaint for declaratory and injunctive relief alleging that section 626.854(6) violates his constitutional rights to free speech, equal protection of the laws, and to be rewarded for his industry. Because we agree with Kortum that section 626.854(6) unconstitutionally burdens the commercial free speech rights of public adjusters, we do not address his further contention that the statute violates his right to equal protection of the law or his right “to be rewarded for industry” guaranteed by Article I, § 2 of the Florida Constitution.

Finally, the Court concluded as follows:

In sum, we are persuaded that the Department has failed to prove that section 626.854(6) is narrowly tailored to meet the state’s objectives. “While a statute regulating commercial speech need not be the least restrictive means of achieving the state’s asserted goal objective, it must be narrowly tailored to achieve the desired objective.” Cronin, 774 So. 2d at 875. The Department has not demonstrated that prohibiting property owners from receiving any information from public adjusters for a period of 48 hours is justified by the possibility that some public adjuster may unduly pressure traumatized victims or otherwise engage in unethical or unprofessional behavior. Nor has the Department demonstrated that the other provisions of section 626.854 and the Rules of Professional Conduct and Ethics governing the Florida Association of Public Insurance Adjusters governing public adjusters are insufficient to regulate unduly coercive or misleading solicitation by public adjusters.

You can view the briefs filed in this case by clicking on the following links:

• Initial Brief;
• Answer Brief;
• Amicus Brief filed by Florida Property and Casualty Association;
• Amicus Brief filed by Property Casualty Insurers Association of America;
• Reply Brief;

Order Denying Motion To Vacate Judgment Reversed & Remanded For Evidentiary Hearing

In Palacio v. Alaska Seaboard Partners Limited Partnership, et al (1D10-2690), the First District reversed the trial court's order denying a motion to set aside judgment and remanded the case so that the trial court can conduct an evidentiary hearing.

Appellants were served with a foreclosure complaint in February 2009, to which they did not file a response due to what they understood to be assurances by the loan servicer representative.  Appellants alleged they contacted  the loan servicer representative  immediately after being served with the complaint.  Appellants  were assured  by the loan service representative  that the foreclosure proceeding would be abated pending application for, and approval of, a loan modification agreement.  Appellants alleged that they faxed the application for the loan modification agreement on April 7, 2009.  In support of this assertion, Appellants attached affidavits and the facsimile cover sheet  to their motion  to set aside and vacate a default judgment.

The court held that those facts were sufficient to require an evidentiary hearing.  The court stated:

It is the trial court’s failure to conduct an evidentiary hearing that warrants reversal of the denial of Appellants’ motion to set aside the default judgment.  This court has held that a trial court is required to conduct an evidentiary hearing before entering an order denying a motion to set aside a judgment.  See Seal v. Brown, 801 So. 2d 993, 994-95 (Fla. 1st DCA 2001).  Furthermore, if a moving party’s allegations raise a colorable entitlement to relief, a formal evidentiary hearing and appropriate discovery is required.  Id.  at 995.

As in the proceedings below, Appellees do not contest Appellants’ factual assertions; rather,  they  essentially  argue that Appellants’ allegations  are facially insufficient to warrant entitlement to setting aside a default judgment.  We disagree.  Appellants’ allegations and supporting documents make a colorable case for their assertion that their failure to respond to the foreclosure complaint was due to their settlement negotiations and complying with what they understood to be a modified mortgage agreement, all of which may reasonably have led them to believe that the foreclosure action was abated. 

Judge Thomas wrote the opinion and Judge Hawkes concurred.  Judge Davis concurred in the result only.

Conflict Certified To Supreme Court On Interlocutory Jurisdiction To Consider Citizens Bad Faith Issue

In Citizens Property Insurance Corporation v. San Perdido Association, Inc. (1D09-6183), a divided panel of the First District both certified conflict and certified the case as one of great public importance.  The majority concluded:

Citizens’ petition for prohibition or certiorari is denied, and pursuant to Florida Rule of Appellate Procedure 9.030(a)(2)(A)(v) and (vi) this court certifies conflict with the fifth district decisions in Garfinkel and La Mer Condominium Assoc., and further certifies the following question of great public importance:

Whether, in light of the supreme court’s ruling in Department of Education v. Roe, 679 So. 2d 756 (Fla. 1996), review of the denial of a motion to dismiss based on a claim of sovereign immunity should await the entry of a final judgment in the trial court?

The Garfinkel decision was discussed in a prior post at THIS link and the briefs and oral argument were posted at THIS link. 

In this First District action, Judge Clark wrote the majority opinion and was joined by Judge Davis. Judge Wetherell wrote a dissenting opinion.  The majority described the facts as follows:

This case arises from a claim by San Perdido under a windstorm insurance policy with Citizens, after Hurricane Ivan caused substantial property damage in 2004. Citizens persistently refused to fully pay its obligation under the terms of the insurance policy, requiring San Perdido to file a circuit court action to compel such payment, and then defend that award in Citizens’ appeal to this court. The circuit court ruling was upheld by this court, in Citizens Property Insurance v. San Perdido Assoc., 22 So. 3d 71 (Fla 1st DCA 2009), and San Perdido thereafter filed its section 624.155 bad faith action in the circuit court. Citizens responded with a motion to dismiss, asserting that the action is barred by the immunity conferred on Citizens in section 627.351(6), Florida Statutes. Citizens argued that this statutory provision grants it sovereign immunity.

***

In its section 624.155 action, San Perdido alleged that Citizens engaged in a series of bad faith practices in its handling of San Perdido’s insurance claim, and that such conduct was both a breach of contract and a willful tort under section 624.155. In denying Citizens’ motion to dismiss, the trial court reasoned that San Perdido’s section 627.155 lawsuit is within the section 627.351(6)(s)(1) exceptions to Citizens’ immunity. Although Citizens could challenge that ruling after an adverse judgment if San Perdido should prevail on the merits of its lawsuit at trial, Citizens now seeks an immediate writ of prohibition or certiorari, and asks this court to preclude any further proceedings in the trial court.

With regard to the legal issue, the court stated:

Contrary to the supreme court’s pronouncements in Roe, the fifth district has issued writs of prohibition where Citizens claimed sovereign immunity in response to a section 624.155 lawsuit for bad faith insurance practices. See Citizens Property Insurance v. Garfinkel, 25 So. 3d 62 (Fla. 5th DCA 2009); see also Citizens Property Insurance v. La Mer Condominium Assoc., 37 So. 3d 988 (Fla. 5th DCA 2010). Like the present case, in those instances Citizens’ motions to dismiss the section 624.155 action were denied by the trial court. In undertaking immediate review of those rulings, the fifth district referred to the supreme court’s earlier decision in Circuit Court of Twelfth Judicial Circuit v. Department of Natural Resources, 339 So. 2d 1113 (Fla. 1976), and treated the matter as a question of the trial court’s subject matter jurisdiction. But the fifth district did not refer to or otherwise acknowledge the supreme court’s more recent ruling in Roe, which characterized the jurisdictional theory in Circuit Court of Twelfth Judicial Circuit as an approach which pertained "at one time," but which no longer applied. As Roe suggested, there is no irreparable harm in requiring that appellate consideration of the sovereign immunity claim await the entry of a final judgment.

Without the irreparable harm required for certiorari, and given the supreme court’s repudiation of the Circuit Court of Twelfth Judicial Circuit theory of jurisdiction in Roe, Citizens is not entitled to immediate interlocutory review of the denial of its motion to dismiss San Perdido’s section 624.155 lawsuit.

The dissent began:

I respectfully dissent from the decision to dismiss Citizens’ "Petition for Writ of Prohibition, and Alternatively, Petition for Writ of Certiorari." I would grant the petition and quash the trial court’s order denying Citizens’ motion to dismiss because, as the Fifth District correctly held in Garfinkel, "Citizens is immune from first-party bad faith claims pursuant to Section 627.351(6)([s])1." See 25 So. 3d at 69.

I agree with the majority that prohibition is not the appropriate remedy in this case because Citizens’ claim of immunity does not implicate the trial court’s subject-matter jurisdiction. But I disagree that we lack jurisdiction to consider Citizens’ alternative petition for writ of certiorari. In my view, not only do we have jurisdiction pursuant to Florida Rules of Appellate Procedure 9.030(b)(3) and 9.100 to consider the petition, but it is incumbent upon us to do so at this time because the trial court’s erroneous order denying Citizens immunity from Respondent’s suit will cause material injury to Citizens that cannot be fully remedied upon plenary appeal. Nothing in Roe compels the decision reached by the majority.

***

I recognize that the injury that Citizens will suffer in this particular case is diminished somewhat by the likelihood that the merits of the immunity issue will be back before this court in relatively short order. Indeed, if and when the issue is raised again by Citizens at the trial court (either through a renewed motion to dismiss or a motion for summary judgment), the court will be obligated to follow the holding in Garfinkel and dismiss Respondent’s bad faith suit against Citizens.

(Emphasis added).  The oral argument in this case was held on May 19, 2010 and will be posted below later today:

Petitioner's Argument

Respondent's Argument

Petitioner's Rebuttal Argument

After the oral argument, the Court entered an order requiring supplemental briefing.  That order is copied below:

Supplemental briefing is hereby requested from the appellant on the question of whether this court may properly consider the merits of the appellant's petition for a writ of prohibition or certiorari, in light of the supreme court's reasoning in Dep't of Education v. Roe, 679 So. 2d 756 (Fla. 1996), and the approval in that case of this court's decision in Dep't of Education v. Roe, 656 So. 2d 507 (Fla. 1st DCA 1995). See also, e.g., School Board of Miami-Dade County v. Leyva, 975 So. 2d 576 (Fla. 3d DCA 2008). The appellant's supplemental brief should be filed within 15 days from the date of this order. The appellee may file a supplemental answer brief on this question, and if it does so that brief should be filed within 10 days of the appellant's service of its supplemental brief.

Summary Judgement In Foreclosure Action Reversed

In Kontos v. American Home Mortgage Servicing, Inc. (1D09-2803), the First District reversed a summary judgment in a foreclosure proceeding.  The Court stated:

As all parties acknowledge, however, the uncontested facts of record do not establish that appellee is presently entitled to foreclose because the record contains no evidence of any assignment or comparable transaction.

Court Sanctions Party & Counsel For Filing Rehearing Motion That Lacked Merit

In Unifirst Corporation v. City of Jacksonville, Tax Collectors Office (1D09-0820), the First District sanctioned a party and its counsel for filing a motion for rehearing when the appellant "knew or should have known that the motion lacks legal merit and violates the legal principles and rules of appellate procedure."  The court stated:

Section 57.105(4) provides that the party seeking sanctions must serve the opposing party with a copy of the motion, but may not file it with the court “unless, within 21 days after service of the motion, the challenged paper, claim, defense, contention, allegation, or denial is not withdrawn or appropriately corrected.” Florida Rule of Appellate Procedure 9.330(a), however, allows a party only ten days to respond to motions for rehearing. Thus, as Appellee acknowledges, it was unable to comply with section 57.105(4) and also timely respond to Appellant’s motion for rehearing. Although Appellee’s motion for attorney’s fees and sanctions was improperly filed, for the reasons explained below, this court, on its own initiative, awards Appellee attorney’s fees. See § 57.105(1), Fla. Stat. (2009) (providing the court may award fees on its own initiative).

***

Appellant filed a motion seeking rehearing or clarification and rehearing en banc. In it, Appellant addressed the merits of the lower court’s final judgment allowing certain documents into evidence and the general sufficiency of the evidence. These arguments were raised in Appellant’s Initial Brief and extensively addressed during oral argument; rearguing these points was improper.

***

Florida Rule of Appellate Procedure 9.330(1) has been interpreted to mean that “[a] motion for rehearing shall not reargue the merits of the court’s order.”...Appellant compounded its error by including in its motion new arguments related to an issue already addressed in its briefs and at oral argument. “[L]egal arguments . . . must be made between the parties before a judicial decision is rendered; not between one litigant and a tribunal which has already ruled.”...To illustrate the egregiousness of Appellant’s violation of this principle, Appellant dedicated less than one page of its Initial Brief to this issue, and cited no cases, either in its briefs or during oral argument; yet in its rehearing motion, Appellant devoted over five pages to the issue and, for the first time, cited and discussed several cases.

Both Florida Rule of Appellate Procedure 9.330 and the cases we have cited existed at the time Appellant filed its motion; thus, Appellant’s attorney knew or should have known that the motion would not be supported by the application of the law to the material facts of this case. Consequently, a sanction of attorney’s fees pursuant to section 57.105(1)(b) is warranted. 

In its motion for rehearing, Appellant also requested a written opinion, arguing that this court’s per curiam affirmance conflicts with an opinion issued by the Third District Court of Appeal and that clarification “would provide a legitimate basis for Supreme Court review.” It is meritless to argue that an opinion which says nothing more than “Affirmed” conflicts with a written opinion issued by another district court.

Court Erred In Denying Appraisal & Appraisal Premature For Items Not Yet Adjusted

In American Capital Assurance Corporation v. Courtney Meadows Apartment, L.L.P. (1D09-2940), the First District agreed both with the insurance company on appeal and the insured on cross-appeal.  The court stated:

the insurer argues the trial court erred in denying a portion of its motion to compel appraisal because its demand was untimely. The insured argues on cross-appeal that the trial court erred in granting appraisal of four items that had not been adjusted. We agree with both parties and reverse and remand.

The facts were described as follows:

On June 1, 2008, a microburst hail storm caused damage to the complex, after which the insured filed a claim. In July 2008, the parties met to discuss the extent of damage to the complex. The insurer believed a majority of the complex’s damaged roofs could be repaired, but the insured believed the same needed replacing.

***

In a November 18, 2008, letter to the insured, the insurer demanded appraisal. On December 23, 2008, the insured filed a complaint, which was subsequently amended, seeking declaratory relief and alleging numerous breaches of contract. The insurer in turn moved to dismiss and/or abate the action and to compel appraisal, arguing that it had properly invoked the appraisal process under the terms of the policy.

***

The trial court agreed that the appraisal demand was untimely, finding that, when an insurer admits liability and coverage for loss, formal proof of loss is waived and the time in which the insurer is required to demand appraisal under the terms of the policy begins to run from its admittance of liability and coverage....The trial court further found sections E.4.a.(3) and E.4.c. of the policy required the insurer to notify the insured of its intention to seek appraisal within 30 days after this date, such that the insurer’s November 18, 2008, demand for appraisal was untimely. Accordingly, the trial court denied the motion to compel appraisal of the items included the final estimate, but granted the motion to compel appraisal of the additional items of loss in the insured’s November 11, 2008, correspondence (the trash compactor area, the garage fascia, pillar damage, and interior apartment damage).

The First District reversed the trial court and held:

The underlying insurance policy does not set forth a time limit for demanding appraisal....There is no indication that this provision extends to the time in which the insurer must demand appraisal....The instant case is distinguishable because there is no language in the policy that requires appraisal to be invoked, if at all, within any set time from receiving or waiving the sworn proof of loss. Thus, under the terms of the instant policy, the insurer’s demand for appraisal was not untimely. Furthermore, the insurer has not waived its right to appraisal as it has not acted inconsistently with that right from the time of demand....Accordingly, because the insurance contract provided for appraisal, the insurer’s demand for such was not untimely, and the insurer did not waive its right to appraisal, the trial court erred in partially denying the motion to compel appraisal.

Additionally, because appraisal is premature if a portion of a claim had not been previously adjusted, the court reversed the portion of the order requiring appraisal of previously unclaimed items.  The court stated:

Furthermore, granting appraisal of the items of loss in the insured’s cross-appeal was premature as those items had yet to be adjusted. Without adjustment, it is impossible to know whether the parties disputed the amount of loss to warrant appraisal. See United States Fidelity & Guar. Co. v. Romay, 744 So. 2d 467, 469-70 (Fla. 3d DCA 1999).

The briefs filed in the First District can be viewed at the links below:

*Initial Brief;
*Answer Brief;
*Reply Brief.

No Insurance Coverage For Accident When Rental Car Driven By Non-Renter

In Geico Indemnity Company v. Shazier, et al (1D09-2595), the First District reversed the trial court's order because "there was no coverage under the policy because the rental car did not qualify as a 'temporary substitute auto'" because the renter let someone else drive the rental car.  The court stated:

Kutasha Shazier owned a Ford Expedition. The Ford Expedition was covered under the policy issued by Geico to Shazier and her husband.  The policy contained a standard “temporary substitute auto” provision which also extended coverage to: [a temporary car if you were authorized to drive it].

***

When the Ford Expedition began experiencing transmission problems, Shazier rented a Hyundai Sonata (“the rental car”) from Avis Rent-A-Car System, LLC (“Avis”). Pursuant to the rental agreement, Shazier was the only person authorized to drive the rental car...Subsequently, the rental car was involved in an accident while being driven by Tercina Jordan, an unauthorized driver.

***

Under the policy, in order for coverage to attach in this case, the “temporary substitute auto” must have been used with the permission of Avis. As the owner, Avis had the authority to define the scope of permissible use of the rental car....As evidenced by the rental agreement, Avis did just that. Avis granted Shazier permission to use the rental car so long as she was the only person who did so. Jordan’s use of the rental car automatically revoked the permission granted to Shazier by Avis. Therefore, because it was not being used with Avis’s permission, the rental car did not qualify as a “temporary substitute auto” and no coverage existed under the policy.

Sunshine Law Gives Right To Attend Public Meeting, Not Speak At Them

In Keesler et al. v. Community Maritime Park Associates, Inc. (1D09-1659), the First District held "that section 286.011(1), Florida Statutes (the Sunshine Law), gives Appellants the right to be present but not to speak at CMPA meetings."  Articles can be found in the Tallahassee Democrat, Miami Herald and the Pensacola News Journal.

Order Requiring Disclosure Of Salary Paid To Florida Power Executives Reversed

In Florida Power & Light Company, et al v. Florida Public Service Commission (1D09-4779), the First District reversed a decision of the Florida Public Service Commission requiring Florida Power to disclose the salary of certain of its executives.  The Court stated:

The Commission’s order denied Petitioners’ request to treat certain employee compensation information as confidential and exempt from public disclosure under Florida’s Public Records Law. Florida Power & Light Company (Florida Power) also petitions for a writ of certiorari to quash a similar order entered by the Commission regarding its employees’ compensation information. Florida Power’s employees petition for a writ of mandamus to prevent the disclosure of their compensation information, arguing such disclosure would violate their right to privacy guaranteed by Article I, section 23 of the Florida Constitution.

Progress Energy and Florida Power included employee compensation as costs associated with the increased rate change. Information relating to the rates or costs of services is relevant in a ratemaking proceeding for discovery purposes. § 366.093(2), Fla. Stat. Discovery in a ratemaking proceeding is governed by Florida Rule of Civil Procedure 1.280. See id.

Due to the request for a rate increase that was partially based upon salaries:

the Commission’s staff issued a series of interrogatories requesting the following information for all Progress Energy and Florida Power employees who earned $165,000 or more per year: name and title; base salary; overtime; bonuses; stock options; option awards; non-equity incentive plan compensation; all other compensation; total compensation; amount of total compensation allocated to the utility; and amount of total compensation included in adjusted jurisdictional other operation and management expenses.

The commission filed motions to compel the information, hearings were held and the commission ordered the companies to produce the information.  The First District reversed, stating:

The Commission denied Progress Energy’s and Florida Power’s confidentiality requests after construing sub-subsection (f) to expressly exclude compensation information from the definition of proprietary confidential business information. The Commission found the statute was unambiguous, but went on to find that even if the statute were ambiguous, the specific provisions of sub-subsection (f) prevailed over the general definition in subsection (3). As explained below, the Commission’s interpretation of section 366.093(3)(f) is clearly erroneous; therefore, we must depart from the Commission’s construction. See PW Ventures, Inc. v. Nichols, 533 So. 2d 281, 283 (Fla. 1988) (explaining the Commission’s construction of statute it is charged with enforcing is entitled to great deference and the court will not depart from such construction unless clearly erroneous).

“Usual and Customary Provider Charges”

In Baker County Medical Services v. Aetna Health Management, LLC (1D08-0067), the First District addressed the following issues:

Baker County Medical Services, Inc. (BCMS), appeals a final judgment interpreting section 641.513(5)(b), Florida Statutes (2006). BCMS raises two issues on appeal. First, BCMS argues that the trial court erred in ruling that the term “provider” in section 641.513(5)(b) is not limited to any specific type of provider. We disagree and affirm on the first issue. Second, BCMS argues that the trial court erred in ruling that the phrase “usual and customary provider charges” in section 641.513(5)(b) includes consideration of the amounts billed by providers, as well as the amounts accepted by providers as payment. We agree in part and reverse with directions on the second issue.

The court held that the amount to be paid by an HMO to an emergency facility it does not have an agreement with should be determined by the fair market value and not based upon the amount charged.  The court stated:

BCMS asserts that the “usual and customary charges” include only the amounts billed or the charge master rates. The term “charges” is not defined in section 641.513(5). When a statute does not define a term, we rely on the dictionary to determine the definition. See Green v. State, 604 So. 2d 471, 473 (Fla. 1992). “Charge” is defined as a “[p]rice, cost, or expense.” BLACK’S LAW DICTIONARY 248 (8th ed. 2004). In paragraph (5)(a), the term “charge” is modified by the terms “usual” and “customary.” “Usual” is defined as “[o]rdinary; customary” and “[e]xpected based on previous experience.” Id. at 1579. “Customary” is defined as “[a] record of all of the established legal and quasi-legal practices in a community.” Id. at 413. In the context of the statute, it is clear what is called for is the fair market value of the services provided. Fair market value is the price that a willing buyer will pay and a willing seller will accept in an arm's-length transaction. See United States v. Cartwright, 411 U.S. 546, 551 (1973).

The oral argument that took place in the case on January 20, 2009 is below:

*Disclaimer: GrayRobinson, P.A. was involved in this action.

Receipt Of Funds By Insurer's Bank Binds Policy Even When Not Yet Credited To Insurer

In Nationwide Mutual Fire Insurance Company v. Smith (1D08-4761), the First District applied the “tipsy coachman” rule to affirm a summary judgment against Nationwide.  Nationwide provided a grace period for the payment of overdue premiums, in this case until 12:01 a.m. on Sunday, September 25, 2005.  The trial court concluded that since the deadline fell on a Sunday it was automatically extended until Monday "by operation of Florida Rule of Civil Procedure 1.090(a)."  The First District stated:

The only applicable statute in this case is section 627.728(3)(a), Florida Statutes (2005), which requires an insurer to give its insured 10 days’ notice before cancelling a policy for nonpayment of premium. Because the statute does not require the insurer to allow the insured to make an overdue premium payment before the cancellation date in order to avoid cancellation of the policy for nonpayment of premium, the time computation provisions of rule 1.090(a) are not applicable in this case.

By extending the payment deadline to the next business day, the trial court stacked “grace” upon “grace,” which cannot be done by implication under contract law.

However, the trial court's decision was still affirmed.  While the opinion does not provide the facts, it appears prior to the deadline the insured had transferred funds from its bank account to the bank of the insurer. Apparently, the insurer's bank had not credited the funds to the insurer by the deadline.  The court stated:

even if the payment deadline was not extended, the trial court properly entered summary judgment for the insured because appellant’s bank received the insured’s electronic payment file before the cancellation date and the delay in the deposit of the payment into appellant’s bank account was due to processing delays by appellant’s bank.

It would be interesting to know how the transfer was made and when it was made.  If it was an online payment, there are usually terms and conditions when you make the payment and, usually, those terms and conditions would prevent a result based upon a delay in crediting the funds.