Citizens Faces Redo of Hole-in-Roof Claim Denial It Won on Hearsay

Citizens Property Insurance Corp. will face a new trial on a roof claim because its win in the first trial was compromised by reliance on hearsay evidence.

A three-judge appeals panel has ordered a retrial because in the previous proceeding in Miami-Dade County circuit court, the judge let a Citizens employee with no personal knowledge of the property damage testify on the property insurer’s field adjuster’s report.

The Citizens policy has a provision excluding coverage for a loss caused by rainwater unless a covered peril first damaged the home causing an opening in the home’s roof through which the rainwater entered.

The primary issue at the trial was whether, on July 16, 2017, wind (the covered peril) had created an opening in the insured home’s roof through which rainwater then entered and caused damage to the home of Maria Mesa and Roxana De Leo.

At trial, Citizens and the insureds both presented expert testimony from a meteorologist and an engineer. The insureds also presented the testimony of their public adjuster, who had inspected the property nearly two years after the loss.

Citizens’ field adjuster did not testify at trial and Citizens did not seek to introduce the field adjuster’s report into evidence as a business record. Rather, Citizens presented the testimony of an employee who identified herself as “the corporate representative for Citizens.” She testified that she had reviewed the field adjuster’s photos and findings and she told the jury that Citizens had agreed with the field adjuster’s determination that “during his inspection, he didn’t find any covered loss to the roof.”

The trial court permitted the witness to testify on the field adjuster’s report over the insureds’ objection that she did not have personal knowledge.

The jury sided with Citizens and agreed that the insureds’ rainwater damage was not covered. The trial judge denied the insureds’ request for a new trial and the homeowners appealed based on their contention that the trial court should not have allowed the hearsay testimony.

Now a Florida district court of appeal has said it agrees with the insureds that the trial court abused its discretion by permitting what was clearly inadmissible hearsay testimony from the Citizens’ corporate representative. The appeals court has remanded the case for a retrial.

The appeals found that Citizens’ primary evidence supporting the jury’s verdict was the inadmissible hearsay testimony from a Citizens’ corporate representative who, admittedly, had no personal knowledge of the facts about which she was allowed to testify. Also the appeals court said that because it was unable to conclude that such error was harmless, it reversed the judgment and remanded for a new trial.

The appeals court noted that it is “well established that a trial court reversibly errs by allowing a witness to testify as to the contents of a business record when the business record itself is not entered into evidence.”

Because Citizens’ never introduced its field adjuster’s report at trial as a business record, the witness was only competent to testify from her personal knowledge of the condition of the home’s roof, according to the court.

The court added that Citizens also never offered an argument suggesting that the erroneous admission of the hearsay testimony was harmless in light of the insureds’ evidence. That, the court said, left it to conclude that the erroneous admission of the hearsay testimony was not harmless.