Allstate Ins. Co. v. Theodotou
| Decision Date | 24 July 2015 |
| Docket Number | 5D14–1436.,5D14–1352,Nos. 5D14–1291,s. 5D14–1291 |
| Citation | 171 So.3d 163 |
| Parties | ALLSTATE INSURANCE COMPANY, et al., Appellants, v. Basil THEODOTOU, M.D., et al., Appellees. |
| Court | Florida District Court of Appeals |
Inguna Varslavane–Callahan, Daniel A. Martinez, Jennifer C. Worden and Weslee L. Ferron, of Martinez Denbo, LLC, St. Petersburg, for Appellant, Allstate Insurance Company and Allstate Indeminity Company.
Jane Anderson and Kansas R. Gooden, of Boyd & Jenerette, P.A., Jacksonville, for Appellant, Emily Boozer.
Sylvia H. Walbolt and Steven Blickensderfer, of Carlton Fields Jorden Burt, P.A., Tampa, and Henry W. Jewett, II and
Amy L. Baker, of Rissman Barrett, Hurt, Donahue & McLain, P.A., Orlando, for Appellee, Holmes Regional Medical Center.
Shea T. Moxon and Angela E. Rodante, of Swope, Rodante P.A., Tampa, for Appellee, Douglas Stalley.
Thomas E. Dukes, III, and G. Franklin Bishop, III, of McEwan, Martinez & Dukes, P.A., Orlando, for Appellees, David Packey, M.D., and Neurology Clinic, P.A.
Stephen B. Sambol of Mateer & Harbert, P.A., Orlando, and Tara N. Tamoney, of Alvarez, Sambol & Winthrop, P.A., Orlando, for Appellees, Basil Theodotou, M.D., and Basil Theodotou, M.D., P.A.
After being held liable for over $11 million in a personal injury action, Appellants, Allstate Insurance Company and Emily Boozer, sought equitable subrogation from Appellees Holmes Regional Medical Center (“HRMC”); Basil Theodotou, M.D.; Basil Theodotou, M.D., P.A.; David Packey, M.D.; and Neurology Clinic, P.A. (collectively “the Medical Providers”). Appellants claim that the Medical Providers are subsequent tortfeasors who are responsible for a substantial portion of the damages in the underlying personal injury action. The trial court dismissed Appellants' complaint for equitable subrogation with prejudice, leading to this appeal.
The issue we address is whether, under Underwriters at Lloyds v. City of Lauderdale Lakes, 382 So.2d 702 (Fla.1980), an initial tortfeasor or her insurer may assert an equitable subrogation claim against a subsequent tortfeasor when: (1) the initial tortfeasor was precluded from bringing the subsequent tortfeasor into the original personal injury action under Stuart v. Hertz, 351 So.2d 703 (Fla.1977) ; (2) judgment was entered against the initial tortfeasor for the full amount of the injured person's damages, regardless of the initial tortfeasor's portion of the fault; and (3) that judgment has not been completely paid by the initial tortfeasor or her insurer. We conclude that, under the circumstances presented in this case, equity dictates that Appellants be allowed to seek equitable subrogation from the Medical Providers. Accordingly, we reverse and certify the question to the Florida Supreme Court as one of great public importance.
Benjamin Edward Hintz was riding his scooter when he sustained head injuries as a result of an accident with Appellant Emily Boozer. Boozer was driving her father Otto's car at the time of the accident; Otto was insured by Appellant Allstate. Following the accident, Hintz was treated at HRMC, where, according to Appellants' allegations, his injuries were severely exacerbated by medical negligence.
Soon thereafter, Appellee Douglas Stalley, as guardian of Hintz's property, sued Emily and Otto Boozer for the damages resulting from the accident. In that action, Stalley successfully argued that the doctrine espoused in Stuart v. Hertz Corp., 351 So.2d 703 (Fla.1977), precluded the Boozers from presenting evidence that medical negligence was a contributing cause of Hintz's injuries. The Boozers were ultimately held liable for all of Hintz's damages—including those allegedly caused or aggravated by the Medical Providers' negligence. The lawsuit resulted in a $14,905,585.29 verdict for Stalley, which was reduced by twenty-five percent, to $11,179.188.98, due to Hintz's comparative negligence. Judgment was entered in favor of Stalley and against the Boozers in August 2012. Allstate then paid Stalley $1.1 million, its policy limit. The remainder of the judgment remains unpaid.
After the personal injury verdict was rendered, but before final judgment was entered, Stalley filed a separate medical malpractice lawsuit against the Medical Providers. He sought recovery for the same injuries involved in the initial lawsuit against the Boozers. Later, he also filed a bad-faith action against Allstate, which remains pending.
After Appellants were granted leave to intervene in Stalley's medical-malpractice lawsuit, they each filed complaints in that case, claiming that they were entitled to equitable subrogation from the Medical Providers. The Medical Providers moved to dismiss the complaints, arguing that Appellants were barred from seeking equitable subrogation because they had not paid the entirety of Hintz's damages.1 The trial court granted the Medical Providers' motion to dismiss and dismissed Appellants' complaints with prejudice. This appeal followed.
In Stuart v. Hertz Corp., 351 So.2d 703 (Fla.1977), the Florida Supreme Court held that an initial, active tortfeasor may not file a third-party complaint for indemnity against a treating physician whose subsequent medical negligence aggravated the plaintiff's injuries. See id. at 706. The Court reasoned that an active tortfeasor should not be permitted to turn a simple personal injury action into a complex medical malpractice lawsuit. Id. Instead, the plaintiff should be allowed to “choose the time, forum and manner in which to press his claim”:
The choice of when and whether to sue his treating physician for medical malpractice is a personal one which rightfully belongs to the patient. A complete outsider, and a tortfeasor at that, must not be allowed to undermine the patient-physician relationship, nor make the plaintiff's case against the original tortfeasor longer and more complex through the use of a third-party practice rule which was adopted for the purpose of expediting and simplifying litigation.
Id. Stuart makes clear that an injured party can choose to sue only the initial tortfeasor and seek recovery for all injuries resulting from both torts. See Rucks v. Pushman, 541 So.2d 673, 675 (Fla. 5th DCA 1989). Or the injured party can first recover from the initial tortfeasor for the injuries caused solely by the original tort and then seek recovery from the subsequent tortfeasors for the injuries caused, or aggravated, by their negligence. Id. But in no case can the victim “recover from the initial tortfeasor for injury caused by the negligent health care providers and also recover for the same injuries from the health care providers.”Id. In other words, victims are not permitted to obtain double recovery.
As a corollary, depending on how the injured party chooses to proceed, an initial tortfeasor may be held liable for the entirety of the plaintiff's damages, even if a subsequent independent tortfeasor is partially—or even mostly—responsible. See Underwriters at Lloyds v. City of Lauderdale Lakes, 382 So.2d 702, 704 (Fla.1980) (). As recognized in Underwriters, this creates an injustice: The initial tortfeasor is held liable for the totality of the plaintiff's damages, while the doctors are not held accountable at all for their actions. Id. To rectify this injustice, the Court held that the proper remedy for initial tortfeasors affected by Stuart is equitable subrogation. See id.
Subrogation is a legal device “founded on the proposition of doing justice without regard to form, and was designed to afford relief where one is required to pay a legal obligation which ought to have been met, either wholly or partially, by another.” Id. (citations omitted). Subrogation suits eliminate the concerns noted in Stuart because they are separate, independent actions where the injured party, having already received compensation for all of his or her injuries, is not a party and “is spared the trauma of an extensive malpractice trial.” Id. The initial tortfeasor, however, is “placed ‘in the shoes' of the plaintiff” and is able to “recoup his losses that in fairness should be shared with a negligent doctor.” Id.
This case presents the precise situation contemplated by Underwriters. Under Stuart, Stalley made a decision to recover from only the initial tortfeasor. Boozer was not permitted to file a third-party complaint against the Medical Providers, nor was she able to introduce evidence of the Medical Providers' negligence so that the relative portions of fault could be determined. As such, she was unable to shift any portion of liability to the Medical Providers and was held liable for the entirety of Hintz's damages.
Despite this, Appellees argue that Appellants are not entitled to equitable subrogation because they have not paid the entirety of the judgment. In response, Appellants contend that an initial tortfeasor's right to equitable subrogation is triggered when the victim has been fully compensated or judgment is entered against the initial tortfeasor for the entirety of the victim's injuries. Neither party has provided us with case law that is directly on point. Much of the language relied upon by Appellants is dicta. See, e.g., Caccavella v. Silverman, 814 So.2d 1145, 1147 (Fla. 4th DCA 2002) (); Nat'l Union Fire Ins. Co. v. Se. Bank, 476 So.2d 766, 767 (Fla. 3d DCA 1985) ().
The cases cited by Appellees, on the other hand, are all distinguishable. Most involve situations where the party seeking equitable subrogation settled with the victim for only the portion of the injury directly attributable to it. See,...
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Holmes Reg'l Med. Ctr., Inc. v. Allstate Ins. Co.
...QUINCE, J.This case is before the Court for review of the decision of the Fifth District Court of Appeal in Allstate Insurance Co. v. Theodotou, 171 So.3d 163 (Fla. 5th DCA 2015). In its decision, the district court ruled upon the following question which the court certified to be of great ......