ECONOMIC LOSS RULE: A CHANGE IN FLORIDA LAW
Posted By Givens Givens Sparks || Jun 19, 2013
The Florida Supreme Court has recently upended prior rulings on the application of Florida’s Economic Loss Rule. In general, the Economic Loss Rule was a rule born out of judicial doctrine at the trial court level which set forth the circumstances where separate tort actions were prohibited when the only damages were economic losses.
In short, this meant that the parties to the litigation were limited to the remedies available in the contract from which the dispute arose. This had a limiting effect, in that the Parties were prevented from bringing additional supplemental actions found in tort law.
A recent decision from the Florida Supreme Court has changed the standard and narrowed the application of the economic loss rule. In the case of Tiara Condominium Assoc. v. Marsh & McLennan Companies, Inc. So3d, 38 FLW S151 (Fla. 3-7-2013) the Fla. Supreme Court held that the application of the economic loss rule is now limited only to product liability cases. The Court held that in the Tiara Condo case the economic loss rule did not bar an insured’s suit against an insurance broker where the parties are in contractual privity with one another and the damages are solely for economic losses.
This recent decision is set to have a major impact in many areas of law, and particularly with respect to insurance litigation and insurance bad faith. In the event you have a question regarding an insurance dispute we welcome you to contact Givens Givens Sparks, PLLC for a free case evaluation.