Florida Appeals Court Orders New Trial After Improper Claims Handling Evidence Taints Verdict in Breach of Contract Case

In June 2025, the Fourth District Court of Appeal reversed a final judgment in favor of the insured and remanded for a new trial after concluding that the trial court improperly admitted irrelevant and prejudicial claims handling evidence.

West Naze filed a breach of contract action against Universal Property & Casualty Insurance Company after his property sustained water damage. Universal denied liability, arguing that Naze failed to satisfy a condition precedent by not providing all requested documentation. Although bad faith was not pled, the insured introduced substantial evidence and testimony relating to the insurer’s internal claims handling processes, including communications delays, failure to assign an adjuster in a timely manner, and lack of follow-up from the insurer. Universal repeatedly objected to this evidence. Despite these objections and motion work, the verdict was entered in favor of the insured for $47,006.80. Universal moved for mistrial, asserting that these references prejudiced the jury and amounted to improper insinuations of bad faith.

The Fourth District Court of Appeal agreed, finding that the evidence and comments regarding Universal’s handling of the claim went beyond what was necessary to rebut the insurer’s affirmative defense. The court explained that the jury could have ruled in favor of Naze based solely on the perception that the insurer mishandled the claim, rather than whether the claim fell within the policy’s coverage terms. The court referenced Citizens Prop. Ins. v. Mendoza, 250 So. 3d 716 (Fla. 4th DCA 2018), as controlling precedent.

While the trial court attempted to distinguish the evidence as relevant to “negligence and omission,” the appellate court held that these concepts fell within the realm of improper bad faith or claims handling evidence that should not be introduced in a simple breach of contract case. Accordingly, the District Court reversed the judgment and remanded for a new trial, holding that the trial court abused its discretion by admitting irrelevant and prejudicial evidence that undermined the fairness of the proceedings.

Judge Levine concurred. Judge Artau dissented, arguing the trial court properly exercised its discretion because the evidence was relevant to refuting Universal’s defenses and did not amount to bad faith. 

_{Legal Update for Florida Coverage & Property Litigation – June 2025 is prepared by Marshall Dennehey to provide information on recent legal developments of interest to our readers. This publication is not intended to provide legal advice for a specific situation or to create an attorney-client relationship. We would be pleased to provide such legal assistance as you require on these and other subjects when called upon. ATTORNEY ADVERTISING pursuant to New York RPC 7.1 Copyright © 2025 Marshall Dennehey, all rights reserved. No part of this publication may be reprinted without the express written permission of our firm. For reprints or inquiries, or if you wish to be removed from this mailing list, contact tamontemuro@mdwcg.com.}