Aetna Casualty and Surety Company v. Hanna

• Decision Date: 30 June 1955
• Docket Number: No. 15249.,15249.
• Citation: 224 F.2d 499
• Parties: The AETNA CASUALTY and SURETY COMPANY, Appellant, v. F. H. HANNA and Margaret Hanna, his wife, Appellees.
• Court: U.S. Court of Appeals — Fifth Circuit

224 F.2d 499 (1955)

The AETNA CASUALTY and SURETY COMPANY, Appellant, v. F. H. HANNA and Margaret Hanna, his wife, Appellees.

No. 15249.

United States Court of Appeals Fifth Circuit.

June 30, 1955.

Willis H. Flick, T. J. Blackwell, Miami, Fla., Blackwell, Walker & Gray, Miami, Fla., for appellant.

Ross Williams, R. K. Bell, Miami, Fla., for appellee.

Before TUTTLE, Circuit Judge, and DAWKINS and SIMPSON, District Judges.

SIMPSON, District Judge.

The appellant (hereinafter called Aetna) was the defendant below in an action brought by Dr. and Mrs. Hanna to recover damages under the terms of a "Comprehensive Personal Liability Policy," in the face amount of $10,000.00, issued by Aetna to the Hannas June 25, 1946.

The principal residence premises were stated in the policy to be 1299 Brickell Avenue, Miami, Florida, which the policy shows was also the location of the Doctor's office. The policy stated that in addition to all premises where the Insured or his spouse maintain a residence, the word "Premises" means "* * * (4) vacant land, other than farm land, owned by or rented to an Insured, * * *".

The Hannas owned a vacant lot in Miami, which abutted Biscayne Bay. The lot, originally partly submerged, was filled in by Dr. Hanna with boulders, trash and dirt to an elevation several feet higher than adjoining property. During the life of the policy, in October, 1946, storms and high water undermined the retaining wall, and boulders, trash and other fill material was deposited on the adjoining property. This gave rise to extended litigation, which must be recounted here in some detail.

In March 1947, a suit for mandatory injunction was brought in the State Court, on the Chancery side of that Court, against the Hannas by the owners of this adjoining property. The object of the suit was to compel the Hannas to remove the boulders and fill material from the adjacent property, to restrain further trespass, and to require the Hannas to construct and maintain a bulkhead to prevent future encroachment. No damages of any sort were sought by this suit. Upon being called upon by the Hannas to provide them with a defense to the suit, Aetna declined, advising the Hannas that the suit was not one within the policy coverage requiring it "to pay * * * damages", and that hence no obligation existed under the policy to provide a defense. The Hannas thereupon employed counsel and undertook their own defense.

On May 14, 1948, the Chancery Court entered its decree granting all the relief prayed. Pertinent provisions of this decree were:

"(4) That the portion of the fill constructed by defendants on their submerged lands, which has fallen or moved onto the submerged lands of the plaintiffs\' submerged lands. That such encroachment and trespass results from the fact that the defendants\' fill was not bulkheaded as required in such case by Section 309.01, F.S.A. and the plaintiffs as adjoining riparian owners are entitled to protection against the same under remedies as provided in such case in Section 371.01, F.S.A. Apparently an erroneous citation to Section 271.01, F.S.A..

"(5) That the defendants Fuad H. Hanna and Margaret Alice Hanna, his wife, their agents, servants and employees, be and they are hereby enjoined and restrained from continuing or permitting the continuance of the said encroachment on the plaintiffs\' submerged lands in Biscayne Bay in front of and easterly from the plaintiffs\' said lands and south of dividing line of the lands of the parties as projected out into the bay; and the said defendants are further enjoined and restrained from causing or permitting further or additional encroachment of their rock, debris or other fill material onto the said submerged lands of the plaintiffs.

"(6) It is recognized by this Court that this injunction restraining further encroachment and restraining continuance of the present encroachment cannot be complied with by defendants without removing from plaintiffs\' submerged lands the rocks and other fill which constitute the present encroachment, and, as to future encroachment, without building a bulkhead or other effective restraining wall along the projected dividing line between the lands of the parties; and if the material causing the present encroachment on plaintiffs\' submerged lands is not removed and a bulkhead or other adequate restraining wall to protect against future encroachments is not constructed along said dividing line, all within 90 days from the date of this decree, the failure of the defendants to do so will constitute a violation of this injunction by which defendants may be made liable for damages to the plaintiffs; and this Court reserves jurisdiction, in that event to determine the liability and the amount of damages and to award such damages to the plaintiffs, or, if upon application by plaintiffs for a determination of damages, defendants shall indicate a desire for jury trial on the matter of damages and to award such damages to the plaintiffs, or if upon application by plaintiffs for a determination of damages, defendants shall indicate a desire for jury trial on the matter of damages, then to transfer it to the law side of the Court for a jury\'s determination of such question of such damages."

This decree was appealed, and was in all respects affirmed by the Supreme Court of Florida on November 30, 1948, in Hanna v. Martin, 160 Fla. 967, 37 So.2d 579.

Throughout this litigation to this point, relief by injunction, and not money damages, was sought by the Martins (plaintiffs in the State Court suit).

On April 1, 1949, since the Hannas had not complied with the injunction, upon motion of the Martins, the case was transferred to the law side of the Court for assessment of damages for non-compliance (as provided in Paragraph (6) of the decree, supra). A jury trial resulted in a $15,000.00 verdict and judgment for the Martins and against the Hannas. The day following the verdict, the Hannas' counsel notified Aetna that the action had been transferred to the law side of the Court and of the resulting verdict. This $15,000.00 judgment was appealed to the Supreme Court of Florida, which, in December, 1950, in Hanna v. Martin, 49 So.2d 585, reversed because the wrong measure of damages was applied in the lower court.

In February, 1951, the application for determination of damages was withdrawn by the Martins, and on their motion the case was returned to the Chancery side. There, in September, 1951, the Hannas were adjudged in contempt of Court for failure to comply with the injunctive decree, but no punishment was imposed, the Hannas representing that compliance was at last underway. In April, 1952, the Martins again applied for a determination of damages for non-compliance with the injunction. This application was refused by the State Court on the ground that the Hannas had by then complied with the decree, and that damages were recoverable only as a substitute for noncompliance.

Very fittingly, the Chancellor entitled this order "Final Order", and concluded it as follows: "It is intended that by this order this prolonged and troublesome litigation shall end. Jurisdiction is not reserved or retained for any purpose."

To recover the costs and expenses incident to all this State Court litigation, including attorneys' fees incurred therein, and the $2,000.00 expense of complying with the mandatory injunction, the Hannas instituted this suit in the District Court. It is appropriate here to quote the pertinent policy provisions:

"I. Coverage A —

...