Case Law Update: Vainberg v. FIGA — Fourth DCA Revives Attorney's Fees After Avatar's Insolvency

On August 12, 2026, Florida's Fourth District Court of Appeal reversed an order denying attorney’s fees to two condominium owners in Samuel Vainberg and Lynn Vainberg v. Florida Insurance Guaranty Association, No. 4D2025-1219. The Vainbergs had sued their insurer, Avatar Property and Casualty Insurance Company, over defective repairs after a 2015 water-supply-line break; when Avatar was declared insolvent in March 2022, the Florida Insurance Guaranty Association (FIGA) was substituted in as the defendant. The appeal came from the Fifteenth Judicial Circuit in Palm Beach County, and the Fourth DCA reversed and remanded for the circuit court to determine the amount of fees. The opinion, written by Judge Gross with Judges Levine and Forst concurring, is marked “[n]ot final until disposition of timely-filed motion for rehearing.”

How the case got here

According to the opinion, Avatar exercised its policy option to repair rather than pay, which under Drew v. Mobile USA Insurance Co., 920 So. 2d 832 (Fla. 4th DCA 2006), created a new repair contract “separate and distinct” from the policy. The contractor’s flooring work was allegedly deficient, Avatar declined to fix it, and the Vainbergs sued. In an earlier appeal, 321 So. 3d 231 (Fla. 4th DCA 2021), the Fourth DCA ordered a new trial.

After Avatar’s insolvency, the trial court ruled that FIGA “is deemed the insurer and, as such, is now the defendant in this case.” In August 2022, the opinion states, the Vainbergs asked FIGA to pay their general contractor’s $49,674.94 estimate; FIGA paid $19,000, subtracting line items tied to Ordinance and Law coverage, including electrical upgrades and architectural and drafting fees. The case settled on the benefits ten days before a March 2024 trial, with a consent judgment for the $58,000 policy limits less the $19,000 already paid and jurisdiction reserved over fees. The trial court then denied fees entirely.

Holding one: a repair-contract claim is still a claim “under” the policy

The trial court had reasoned that section 627.428, Florida Statutes (2015), reaches only judgments rendered “under a policy or contract executed by the insurer,” and that a Drew repair contract sits outside that language. The Fourth DCA disagreed. Reading “policy or contract” in the disjunctive, the court held that a repair contract formed by the insurer’s written election to repair is itself “a ‘contract executed by the insurer’ within the ordinary meaning of those words,” and that treating “contract” as adding nothing beyond “policy” “would drain the word of meaning and render it superfluous.”

The court grounded the result in Florida Supreme Court precedent asking whether a dispute “arises under” the policy — Lexow, 602 So. 2d 528 (Fla. 1992), and Pepper’s Steel, 850 So. 2d 462 (Fla. 2003) — and closed with the practical point: “An insurer cannot escape statutory fee liability merely by substituting a repair obligation for a payment obligation, when both flow from the same covered loss and the same policy.”

Holding two: what counts as FIGA denying a claim “by affirmative action”

Section 631.70, Florida Statutes (2022), switched off section 627.428 fees for claims presented to FIGA “except when the association denies by affirmative action, other than delay, a covered claim or a portion thereof.” The Fourth DCA found two independent affirmative denials here.

First, the partial payment. Because some of the line items FIGA cut from the estimate were Ordinance and Law items, the court wrote that “[t]he only possible explanation for some of these line-item cuts was that FIGA had concluded the items were not covered.”

Second, the pleadings. Applying its own Ehrlich/Rahabi/Rubin line of cases, the court framed the “crucial fact determination” as whether FIGA was “compelled to file an answer without having sufficient time to investigate the claim.” Here it was not: FIGA had a six-month automatic stay plus two agreed extensions, did not seek a third, and then voluntarily pleaded affirmative defenses asserting that the policy “does not provide coverage for damage associated with Ordinance or Law” and that “a certain portion of the alleged loss, or claim, did not fall within coverage of the policy.” An order to answer following denial of a motion to dismiss, the court said, “merely required compliance with the Florida Rules of Civil Procedure.”

What this means if your carrier went insolvent

Both statutes at the center of this opinion have been repealed. The court’s own footnotes state that sections 627.428 and 631.70 were repealed effective March 24, 2023 (Ch. 2023-15, §§ 11, 24, Laws of Fla.), and that section 631.70 still applies to causes of action filed before that date. So the direct reach of Vainberg is the still-substantial tail of pre–March 24, 2023 suits against insurers that later failed — Avatar, and the other Florida carriers placed in receivership in that period — not claims filed today.

Within that group, a few things follow from what the court actually wrote. An insurer’s election to repair does not, by itself, take a dispute outside the older fee statute. A partial payment that quietly zeroes out specific coverage line items can read as a coverage denial rather than mere delay, which is why the correspondence explaining a payment can matter as much as the payment. And the Ehrlich/Rahabi/Rubin distinction turns on how much opportunity FIGA actually had to investigate before it pleaded — the procedural history is the evidence.

None of this predicts how any other case will come out; every fee dispute turns on its own record and dates. If you are a Florida policyholder whose insurer became insolvent and your claim or fee entitlement is still open, a lawyer can review the timeline against the current law. Louis Law Group offers a free case evaluation for Florida property insurance claims. See our guide on a denied homeowners insurance claim in Florida.

This article summarizes a published appellate opinion dated August 12, 2026, and is general information, not legal advice. The decision is not final until disposition of any timely-filed motion for rehearing.