A latest federal determination out of Puerto Rico ought to be a magnet for insurers and public adjusters. In Mapfre Praico Insurance coverage Firm v. Reynolds, 1 the courtroom dismissed an insurer’s negligence claims towards a public adjuster and his corporations, not as a result of the allegations lacked advantage, however as a result of the claims have been filed too late.
And never simply late—too late by the unforgiving normal of Puerto Rico’s one-year statute of limitations for tort claims.
After Hurricane Maria, the Puerto Rico Freeway and Transportation Authority offered a considerable declare to its insurer, MAPFRE. The general public adjuster concerned allegedly inflated damages, misrepresented licensing credentials, and pushed the declare towards coverage limits far exceeding what MAPFRE believed was owed. After years of litigation, the underlying declare settled for a fraction of the demanded quantity. MAPFRE then circled and sued the adjuster and his corporations for negligence, arguing that their conduct induced inflated litigation prices and pointless publicity.
The general public adjuster defendants argued that MAPFRE knew of the alleged misconduct effectively earlier than one 12 months previous to submitting swimsuit. They pointed to MAPFRE’s personal allegations about data of licensing points, consciousness of inflated estimates, and even prior litigation positions asserting misconduct. Briefly, they argued that MAPFRE had lengthy been on discover of a possible declare and that MAPFRE didn’t file swimsuit throughout the one-year limitations interval.
MAPFRE responded with a extra nuanced argument. It claimed that its explanation for motion didn’t accrue till the underlying litigation led to December 2023, when it may lastly quantify its damages and perceive the total affect of the alleged misconduct. It relied on doctrines sometimes utilized in authorized malpractice instances, the place claims typically don’t accrue till a ultimate judgment is entered.
The courtroom discovered that beneath Puerto Rico regulation, a tort declare accrues when the injured social gathering is aware of, or ought to know, of the damage and the id of the one who induced it. Not when damages are absolutely calculated. The courtroom emphasised a precept {that a} plaintiff can not await damages to succeed in their “ultimate diploma of growth” earlier than submitting swimsuit. As soon as you might be on discover of a possible declare, the clock begins ticking.
On this case, the courtroom discovered that MAPFRE had that discover effectively earlier than the one-year interval. Whether or not the set off date was Might 2022, July 2023, or November 2023, it didn’t matter. Every of these dates fell outdoors the permissible window. The grievance, filed in December 2024, was just too late.
What makes this determination notably instructive is what the courtroom rejected. It rejected the concept negligent misrepresentation claims ought to comply with the accrual guidelines of authorized malpractice. It rejected the notion that damages have to be absolutely quantified earlier than the statute begins to run.
There’s a broader lesson right here for each insurers and policyholders. Within the warmth of advanced claims litigation, events typically deal with profitable the underlying dispute and assume that associated claims may be sorted out later. This case is a reminder that the regulation doesn’t all the time enable that luxurious. Statutes of limitation function independently of litigation technique, and they don’t pause just because a case is ongoing.
For public adjusters, the choice underscores the scrutiny their work can face lengthy after a declare is submitted. Claims of misconduct may be with out advantage however could price dearly to defend. I counsel public adjusters carry vital malpractice protection. For insurers, it highlights the significance of appearing promptly when misconduct is suspected.
The courtroom didn’t say MAPFRE’s claims lacked substance or have been meritless. It mentioned MAPFRE waited too lengthy to carry them. In litigation, well timed submitting swimsuit is step one.
Thought For The Day
“The regulation helps the vigilant, earlier than those that sleep on their rights.”
— Latin maxim, Fairness helps those that don’t sleep
1 Mapfre Praico Ins. Co. v. ReynoldsNo. 3:24-cv-01557 (D.P.R. Mar. 26, 2026). See additionally, Defendant’s Movement to Dismissand Plaintiff’s Opposition to the Movement to Dismiss.
