Public Adjuster Cannot Serve As Disinterested Appraiser

    The Florida Supreme Court found that the president of a public adjusting firm, which was to be compensated on a contingency basis for its adjusting services, could not subsequently serve as a “disinterested” appraiser pursuant to the policy language. Parrish v. State Farm Fla. Ins. Co., 2023 Fl. LEXIS 261 (Feb. 9, 2023). 

    Jon Parrish was insured under a policy issued by State Farm Florida Insurance Company. When his home was damaged by Hurricane Irma in September 2017, he filed a claim and hired Keys Claims Consultants, Inc. (KCC) to provide public adjusting services. Mr. Parrish agreed to pay KCC a contingency fee equal to ten percent of whatever amount he eventually recovered from State Farm. 

    There was disagreement between State Farm’s estimate of the loss and that of KCC. Mr. Parrish demanded that the appraisal process set forth in the policy be implemented. Mr. Parrish informed State Farm that George Keys, the president of KCC, would serve as Mr. Parrish’s appraiser. 

    The policy required each party to “select a qualified, disinterested appraiser” when invoking the appraisal provisions of the policy. State Farm requested that Mr. Parish appoint an appraiser other than Mr. Keys, whom State Farm contended could not be considered a “disinterested” appraiser since his firm was already serving as Mr. Parrish’s public adjuster.

    State Farm petitioned a trial court to compel Mr. Parrish to enter appraisal with a disinterested appraiser. The trial court denied State Farm’s petition, but the Second District Court of Appeals reversed. It found that “disinterested” was not ambiguous, and the requirement that the appraisers be “disinterested” plainly excluded any appraiser who held an interest in the outcome of the appraisal process. 

   On appeal, the Florida Supreme Court affirmed the Second District. Dictionary definitions confirmed that a “disinterested” person could not, consistently with the generally understood meaning of that word, have a pecuniary interest in the matter at hand. The contingency fee arrangement agreed to between Mr. Parrish and KCC gave Mr. Keys, as president of KCC, a pecuniary interest in Mr. Parrish’s claim. The more Mr. Parrish recovered, the more KCC would collect; and the more KCC collected, the likelier it was that Mr. Keys would himself be in a position to be paid, or that his interest in KCC would be valuable. 

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