Order Compelling Appraisal Is Not Final Appealable Order

    The Eleventh Circuit determined that the district court’s order compelling an appraisal was not an appealable order under 28 U.S.C. 1291. Positano Place at Naples I Condominium Assoc., Inc. v. Empire Indem. Ins. Co., 2023 U.S. App. LEXIS 13416 (11th Cir. May 31, 2023). 

    Empire issued a policy to Positano for five buildings. The policy provided for an appraisal if the parties disagreed on the amount of loss. 

    On September 10, 2017, Hurricane Irma hit Naples, Florida. Seven months later, Positano notified Empire of storm damage. The parties disagreed on the amount of covered losses. Positano sent a written request for appraisal to Empire. After Empire failed to respond, Positano filed suit, asserting claims for (1) specific performance; (2) breach of contract; and (3) declaratory judgment. As to specific performance, Positano alleged that the policy’s appraisal provision demonstrated the parties’ intention to have disputes related to causation, scope and loss be resolved through the appraisal process upon either party’s demand. It alleged the dispute was not a coverage dispute but a dispute over the amount of loss. 

    Positano moved to compel appraisal and to stay the proceedings pending completion of appraisal. The magistrate judge issued a report recommending that the district court grant Positano’s motion, finding that Empire did not dispute Positano’s assertion that a “dispute has arisen over the scope and amount of its damages” and requiring the parties to engage in appraisal was therefore appropriate. The district court accepted and adopted the report and recommendation in full. 

    An appeal followed. The Eleventh Circuit issued a jurisdictional question asking the parties to review the order compelling appraisal as well as whether an order compelling appraisal was treated the same as an order compelling arbitration for purposes of appellate jurisdiction.

    The Eleventh Circuit  concluded that the order compelling appraisal was not a final order appealable under 28 U.S.C. 1291. In its order, the district court explicitly contemplated further proceedings, explaining that the appraisal would not dispose of any of the claims in the case. Further, in Florida, appraisal existed for a limited purpose of determining the amount of the loss. While the appraisal process was binding on the parties as to the amount of the loss, Empire could still pursue its defences of coverage denials as a whole and to specific buildings owned by Positano in the district court once the appraisal process concluded. 

    Nor was the order compelling appraisal appealable under the Federal Arbitration Act. The FAA required a final decision. A final decision ended the litigation on the merits and left nothing more for the court to do but execute a judgment. 

    Therefore, the appeal was dismissed.