A federal appeals court Friday affirmed a jury award in favor of an Axa SA unit in litigation largely related to a Hurricane Irma claim.

The 11th U.S. Circuit Court of Appeals in Atlanta affirmed the Orlando, Florida, jury verdict in favor of Axa unit Indian Harbor Insurance Co. in a lawsuit filed by an Orlando real estate firm, SB Holdings I LLC, according to Friday’s ruling in SB Holdings I, LLC v. Indian Harbor Insurance Co.

The firm had sought $292,230.28 in connection with an August 2017 pipe leak, for which the insurer had paid $100,000, and an additional $2.3 million claim for a roof replacement and interior damages related to September 2017’s Hurricane Irma, according to court papers.

In upholding the November 2020 jury verdict in the insurer’s favor, a three-judge appeals court panel said SB Holdings had contended the district court erred by denying its motion to compel arbitration and allowing the case to proceed to trial.

Under Florida law, appraisal requirements in an insurance contract, which the coverage in question required, are treated as arbitration provisions, the ruling explained.

This was not a matter to be arbitrated, the appeals panel said.  Florida courts have held that, when an insurance policy includes an appraisal requirement, any dispute regarding the amount of covered loss is a matter to be determined by an appraisal panel, “but a challenge to coverage itself remains a matter ‘for determination by a court,’” it said.

The district court did not err in refusing to compel an appraisal because Indian Harbor “has maintained throughout this litigation that there was no covered loss,” it said.

“Second, regardless of whether there was a covered loss, Indian Harbor also defended on the grounds that SB Holdings failed to comply with its post-loss obligations under the policy. This too was a coverage question for the court, not an amount-of-loss question that would have required an appraisal,” it said. 

The panel also affirmed the lower court’s decision to prohibit two witnesses from offering their expert opinions.

Attorneys in the case did not respond to requests for comment.

In January, a Zurich Insurance Group Ltd. unit prevailed in litigation against a construction company over compensation for damage to a condominium caused by Irma.