33 Carpenters Construction, Inc. v. IMT Insurance Company ( 2020 )

IN THE SUPREME COURT OF IOWA
No. 19–0678
Filed February 14, 2020
33 CARPENTERS CONSTRUCTION, INC.,
Appellant,
vs.
IMT INSURANCE COMPANY,
Appellee.
Appeal from the Iowa District Court for Scott County, Mary E.
Howes, Judge.
Residential contractor lacking public adjuster license appeals
summary judgment dismissing its breach of contract claim against
homeowners’ insurer. AFFIRMED.
Edward F. Noethe of McGinn, Springer & Noethe PLC,
Council Bluffs, for appellant.
William H. Larson of Klass Law Firm, L.L.P., Sioux City, for appellee.
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PER CURIAM.
On March 6, 2017, a windstorm and hailstorm hit Brandon
Gordon’s home in Davenport. Gordon had a homeowners’ insurance
policy with IMT Insurance Company (IMT). On March 20, Gordon reported
to IMT that roof shingles suffered storm damage. After inspecting the roof,
IMT responded a few weeks later with a repair estimate of $2362.67, and
after subtracting Gordon’s deductible, enclosed a check for $1362.67.
On May 1, Gordon and a representative from 33 Carpenters
Construction, Inc. (33 Carpenters), Dustin Murphy, signed documents
titled “Insurance Contingency,” 1 “Agreement,” and “Assignment of Claim
and Benefits.” Under these documents, 33 Carpenters agreed to repair
the storm damage in exchange for Gordon’s insurance proceeds. The
Insurance Contingency authorized 33 Carpenters to “meet with and
discuss hail and wind damage” to Gordon’s property with IMT and required
Gordon to acknowledge that “33 Carpenters Construction will act as their
General Contractor to obtain appropriate property damage adjustments.”
The Agreement stated Gordon retained 33 Carpenters to “settle [his] claim
and complete the repairs.” The “Assignment of Claim and Benefits”
specified,
FOR VALUE RECEIVED, the Assignor [Brandon
Gordon] hereby sells and transfers to the Assignee [33
Carpenters] and its successors, assigns and personal
representatives, any and all claims, payment drafts, demands,
and cause or causes of action of any kind whatsoever which
the Assignee [33 Carpenters] has or may have against IMT
(insurance company), arising from the following claim [for
storm (wind and hail) damage.]
This document further stated that “all future payments or settlements for
the above referenced claim” should be made directly to 33 Carpenters.
1Only Gordon signed the Insurance Contingency document.
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On February 28, 2018, IMT retained Cullen Claims to reevaluate the
claim. Cullen Claims estimated $7475.24 as the replacement cost value
for the dwelling and $4560.50 as the actual cash value. It determined the
net claim was $6475.24 after the deductible, and the net claim for the
separate garage was $1249.48. On April 9, Gordon signed another
document authorizing 33 Carpenters to “speak with [his] mortgage
company, release claim information, request inspections, and work
directly with in connection with all aspects of processing of the claim,
including disbursement of claim funds.” The next day, 33 Carpenters
issued a “roof production form” that listed the cost of repair as $13,016.72.
IMT denied the claim.
On May 24, 33 Carpenters, claiming rights by Gordon’s assignment,
filed this civil action alleging IMT breached Gordon’s insurance policy by
“failing to pay ‘33 Carpenters’ all benefits due and owing under the policy.”
On June 21, IMT filed an answer denying the allegations and raising
affirmative defenses.
On February 12, 2019, IMT filed a motion for summary judgment.
IMT asserted the assignment contract was void because 33 Carpenters
violated Iowa Code sections 507A.3, 507A.5, and 522C.4 (2017) by acting
as an unlicensed public adjuster. 33 Carpenters responded by asserting
the Iowa Insurance Commissioner has the sole authority to enforce the
provisions of Iowa Code chapter 522C such that IMT cannot offensively
use the statute to invalidate the assignment. Alternatively, 33 Carpenters
argued its conduct did not violate Iowa Code chapters 522C or 507A.
On April 4, the district court granted IMT’s motion for summary
judgment. The district court, quoting section 522C.2(7)(a), concluded that
it is clear 33 Carpenters was acting as an unlicensed public
adjuster by “acting for or aiding [Gordon] in negotiating for or
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effecting the settlement [with IMT] of a first-party claim for
loss or damage to real . . . property of [Gordon].”
The district court rejected 33 Carpenters’ argument that the Iowa
Insurance Commissioner is solely authorized to consider whether it was
operating as an unlicensed public adjuster. The district court relied on
the court of appeals decision in 33 Carpenters Construction, Inc. v.
Cincinnati Insurance in rejecting the same argument and holding an
equivalent assignment to 33 Carpenters is unenforceable. No. 17–1979,
2019 WL 478254 (Iowa Ct. App. Feb. 6, 2019). 33 Carpenters appealed,
and we retained the appeal.
We adjudicated the validity of such an assignment in a decision we
also file today, 33 Carpenters Construction, Inc. v. State Farm Life &
Casualty Co., ___ N.W.2d ___, ___ (Iowa 2020). There, we held that an
assignment contract entered into by a residential contractor acting as an
unlicensed public adjuster was void under Iowa Code section 103A.71(5).
For the reasons set forth in that opinion, we hold that the assignment
contract at issue here is void and unenforceable under section 103A.71(5),
and we reject the argument that the Iowa Insurance Commissioner has
sole authority to enforce the licensing requirements for public adjusters.
Therefore, we affirm the district court’s summary judgment.
AFFIRMED.
This opinion shall be published.