## Facts

- The Meyers held a homeowners/fire insurance policy issued by State Farm covering their residence.
- A fire damaged the Meyers’ home, and the parties disagreed on the amount of the covered loss.
- The policy required disputes over the amount of loss to be resolved through appraisal upon demand: each side selects an appraiser, the appraisers select an impartial umpire, and an agreement by any two fixes the amount of loss.
- The policy also barred suit unless the insured complied with policy provisions.
- State Farm sought to proceed under the appraisal clause, but the Meyers filed a damages action seeking a judicial determination of the loss amount and challenging the clause’s validity.
- The circuit court dismissed the action for failure to comply with the appraisal clause, and the Meyers appealed.

## Issues

1. Whether enforcing the policy’s appraisal clause as a condition precedent to suit violates Article 23 of the Maryland Declaration of Rights by depriving insureds of a jury determination of the amount of loss.
2. Whether the appraisal clause is unenforceable because it allegedly effects an invalid waiver of the jury-trial right, given the policy’s adhesive nature and the insureds’ claimed lack of actual knowledge of the clause.

## Decision

- The appellate court affirmed dismissal of the Meyers’ action.
- The court held the appraisal clause was valid and enforceable as a condition precedent to litigation over the amount of loss.
- The court held compelling appraisal of the amount of loss did not violate Article 23’s jury-trial guarantee.
- The court rejected the insureds’ arguments that the clause was unenforceable due to the policy being a form contract and their asserted unawareness, absent fraud or unconscionability.

## Legal Principles

- An insurance appraisal clause limited to determining the amount of loss may be enforced as a contractual condition precedent to a damages action concerning valuation.
- Enforcing appraisal for valuation disputes does not, by itself, unconstitutionally deny the right to a jury trial under Article 23, because it channels a technical fact determination through a contractually selected process and does not necessarily foreclose later judicial review if the process fails without the insured’s fault.
- Standardized insurance contract terms, including appraisal provisions, are generally binding under objective contract principles, absent proof of fraud, misrepresentation, unconscionability, or ambiguity.
- Appraisal is treated as an arbitration-like mechanism favored for efficient resolution of specialized valuation disputes, distinct from determinations of coverage or liability.

## Conclusion

The court upheld the homeowners policy appraisal clause, ruling that insureds disputing only the amount of fire loss must pursue appraisal in good faith before suing, and that this requirement neither invalidly waives nor unconstitutionally infringes the Maryland constitutional right to a civil jury trial.


Meyer v. State Farm Fire & Cas. Co., 85 Md. App. 83, 582 A.2d 275 (Md. Ct. Spec. App. 1990)