RICHARD A. LAZZARA, District Judge.
On September 29, 2011, Plaintiffs, Augustin and Martha Morejon, filed this lawsuit in the Circuit Court of the Thirteenth Judicial Circuit, in and for Hillsborough County, Florida, against Defendant, American Security Insurance Company, for its alleged failure to pay for covered sinkhole damage to property located at 948 Allegro Lane, Apollo Beach, Florida 33603 (the "Property") under a homeowner's insurance policy. On November 4, 2011, pursuant to 28 U.S.C. §§ 1332 and 1446, Defendant timely removed the action to this Court on the basis of diversity jurisdiction.
In investigating Plaintiffs' sinkhole damage claim, Defendant received reports from two separate engineering firms indicating that sinkhole activity was not present at the Property. Plaintiffs also hired an engineering firm to investigate the property and that firm concluded that sinkhole activity was the primary cause of damage at the Property. Plaintiffs ultimately filed this lawsuit, which was served upon Defendant on October 20, 2011. On November 7, 2011, Defendant invoked the neutral evaluation process pursuant to section 627.7074 of the Florida Statutes.
In accordance with section 627.7074, Defendant now seeks to stay this action pending the resolution of the neutral evaluation process. Section 627.7074(4) provides that:
(emphasis added). Moreover, section 627.7074(10) expressly provides that:
(emphasis added).
As Defendant asserts, the Florida Legislature explicitly enacted the neutral evaluation process to efficiently resolve sinkhole disputes, in order to accelerate the timeline by which sinkhole activity is mitigated, where verified at the property, and to minimize, if not avoid, the costs associated with unnecessary litigation. See Fla. Stat. § 627.7074, n. 1. Allowing a case to proceed without a stay during neutral evaluation would not serve the legislative purpose underlying the statutory requirement of neutral evaluation since it will make it more, not less, expensive to resolve a claim. Cf. Edelson v. Soricelli, 610 F.2d 131, 135 (3d Cir.1979) (enforcing state's arbitration requirement as a condition precedent to federal action based in diversity); Clark v. Sarasota County Public Hosp. Bd., 65 F.Supp.2d 1308, 1313-14 (M.D.Fla.1998) (holding that conditions precedent to adjudication of a medical malpractice action were to be followed in a diversity action in federal court). As such, section 627.7074, when invoked, mandates the completion of the neutral evaluation process as a condition precedent to proceeding with litigation on any related matter until such time as the neutral evaluation process has been completed. The statute requires that any court proceeding related to the subject matter of the neutral evaluation shall be stayed pending completion of the neutral evaluation.
Plaintiffs urge that section 627.7074(10) is procedural in nature and, therefore, has no application in a case pending in federal court based upon diversity jurisdiction. Plaintiffs' argument is unfounded. It is established in this Circuit that where a condition precedent to proceed applies without discrimination to both state court and federal court actions, the Erie
Section 627.7074 provides a substantive right of parties to have a neutral evaluator review the claim and render a nonbinding report before the matter is adjudicated by a court. As Defendant asserts, the statute is substantive rather than procedural inasmuch as it will not
In addition, the Florida Supreme Court has recognized that the Legislature can statutorily mandate parties to participate in alternative dispute resolution and that findings from such a proceeding can be admissible at trial. See McCarthy v. Mensch, 412 So.2d 343, 345 (Fla.1982). In McCarthy, the court upheld the admission of the mediation panel's findings into evidence, overruling plaintiffs' argument that the statute was unconstitutional. The Court specifically approved of the decision in Woods, finding that there was no valid constitutional challenge to the admissibility of a mediation panel's findings (from a statutorily mandated proceeding) in a subsequent trial. 412 at 346. Thus, the Florida Supreme Court expressly approved the type of statutory scheme created by the Legislature through the neutral evaluation statute. Plaintiffs' challenges to the constitutionality of section 627.7074 are without merit.
Contrary to Plaintiffs' position, there is also no "clash" between Rule 62 of the Federal Rules of Civil Procedure and section 627.7074 of the Florida Statutes. There is no federal rule that specifically governs requests for a stay before discovery or trial. Rule 62, which is cited by Plaintiffs, governs "stays pending enforcement of a judgment" and, thus, has no application to the instant lawsuit. Consequently, courts in this District have routinely stayed or closed cases pending completion of the neutral evaluation process. See Ocasio v. American Sec. Ins. Co., No. 8:11-cv-02316-T-26MAP (Dkt. 11) (M.D.Fla. Oct. 26, 2011) (endorsed order "that the Clerk is directed to administratively close this case during the period of the stay, subject to the right of any party to file a motion to reopen"); Gonzalez v. American Sec. Ins. Co., No. 8:11-cv-02199-T-27AEP (Dkt. 6) (M.D.Fla. Oct. 7, 2011) (ordering clerk to administratively close case during stay); Agosto v. American Sec. Ins. Co., No. 8:11-cv-00790-T-17MAP (Dkt. 7) (M.D.Fla. May 2, 2011) ("ORDER granting Motion to stay pending the conclusion of the neutral evaluation process in accordance with § 627.707(11). Therefore, this case is administratively closed pending the outcome of the process."); Gongora v. American Sec. Ins. Co., No. 8:11-cv-00821-T-30MAP (Dkt. 6) (M.D.Fla. Apr. 27, 2011) (holding "[t]his action is stayed pending completion of the Neutral Evaluation Process of the Property."); Canales v. American Sec. Ins. Co., No. 8:09-cv-1335-T-33AEP, 2010 WL 2220066 (M.D.Fla. June 2, 2010).
Defendant's Motion to Stay Action Pending Completion of Neutral Evaluation Process (Dkt. 6) is granted. The parties are directed to engage in the Neutral Evaluation Process provided for in section 627.7074. The Clerk is directed to administratively close this case during the period