Bankers Ins. Co. v. American Team Managers, Inc.
| Decision Date | 13 June 2012 |
| Docket Number | Case No. 8:10-cv-2650-T-33EAJ |
| Parties | BANKERS INSURANCE COMPANY, Plaintiff, v. AMERICAN TEAM MANAGERS, INC., Defendant. |
| Court | U.S. District Court — Middle District of Florida |
This matter comes before the Court pursuant to Plaintiff Bankers Insurance Company's Dispositive Motion for Partial Summary Judgment (Doc. # 45), filed on February 10, 2012. Defendant American Team Managers, Inc. (ATM) filed a response in opposition to the motion on February 27, 2012 (Doc. # 48), to which Plaintiff filed a reply on March 22, 2012 (Doc. # 51). Also before the Court is Defendant's Dispositive Motion for Summary Judgment (Doc. # 46), filed on February 10, 2012. Plaintiff filed a response in opposition to the motion on February 27, 2012 (Doc. # 47), to which Defendant filed a reply on March 22, 2012 (Doc. # 52).
After due consideration and for the reasons stated in this Order, Plaintiff's motion for summary judgment is granted in part and denied in part and Defendant's motion for summary judgment is denied.
The following statement of facts is taken from the parties' Joint Pretrial Statement (Doc. # 56).
The relationship between Bankers, an insurance company, and ATM, its former general managing agent, began on or around September 20, 1998, when Bankers entered into a General Agency Agreement with ATM, pursuant to which ATM was required to act as Bankers' General Agent to produce and administer insurance policies underwritten by Bankers. The General Agency Agreement authorized ATM to write policies through duly licensed insurance brokers, agents, producers or other such entities. As General Agent, ATM had authority to bind coverage. Pursuant to the Agreement and on behalf of Bankers, ATM issued general commercial liability coverage, with a total policy limit of $1 million, to Ollin International for the policy period of June 19, 2002, to June 19, 2003. Ollin applied for this coverage through its broker, Warren Doctor and/or Doctor Insurance Agency. A July 15, 2002, brokerage agreement defined the terms and scope of ATM's relationship with Doctor. Pursuant to that agreement, Doctor submitted Ollin's insurance application to ATM and ATM then procured and issued the Bankers policy to Ollin.
On September 30, 2002, ATM terminated the brokerageagreement with Doctor. The termination letter left open the opportunity for Doctor to seek renewal policies for existing customers, but advised Doctor that he would not be entitled to commissions. ATM did not inform Ollin that Doctor had been terminated. On April 23, 2003, ATM wrote to Doctor offering to renew Ollin's Bankers policy upon receipt of a premium payment on or before June 16, 2003. Despite the provision in the termination letter, ATM's offer to Doctor to renew Ollin's policy included an offer to Doctor to receive a commission for the renewal.
On June 19, 2003, Ollin's policy expired. On July 7, 2003, ATM wrote to Doctor confirming the lack of response to ATM's April 23, 2003, letter. ATM's letter stated that no new policy had been bound and offered to rewrite the risk as new business upon the submission of a new application and a "no loss" letter from Ollin. No new application or no loss letter were ever submitted.
Also on July 7, 2003, by facsimile to ATM, Doctor requested renewal of Ollin's Bankers policy and advised that the premium payment would be placed in the mail. On July 8, 2003, Doctor mailed Ollin's premium payment to ATM. On July 28, 2003, ATM wrote to Doctor advising that it would not issue a renewal of the Bankers policy and that no coverage had beenbound and returning the policy premium. ATM did not directly inform Ollin that its Bankers policy would not be renewed or rewritten.
Notwithstanding this information and unbeknownst at the time to ATM or Bankers, Doctor issued a Certificate of Liability Insurance to Ollin stating that coverage from Bankers was in place for the period of June 20, 2003, to June 20, 2004. Also unknown at the time to ATM and Bankers, Doctor retained the premium payment made by Ollin.
On October 28, 2003, Kenneth Bloor, a granite worker, sustained serious injuries during the unloading of granite slabs sold by Ollin to Bloor's employer. Bloor subsequently filed suit against Ollin in Arizona state court, alleging negligence in the loading of the granite slabs (the "Arizona Case"). Ollin tendered defense of the Arizona Case to Bankers in 2004. Bankers declined coverage on multiple occasions and refused to defend Ollin, without making a reservation of its rights. In exchange for Bloor's agreement not to collect against Ollin for any damages, Ollin agreed to submit the matter to binding arbitration and to assign Ollin's coverage and bad faith rights against Bankers to Bloor. The Arizona Case ultimately resulted in a $9.5 million judgment against Ollin and in favor of Bloor.
In 2006, in his capacity as assignee of Ollin's rights, Bloor sued Bankers in California state court alleging, among other things, breach of contract and bad faith (the "Bad Faith Case"). Bloor also named ATM and Doctor as defendants in the Bad Faith Case, alleging various claims against all parties, including negligence and fraud. ATM was subsequently dismissed from the case after filing a motion to dismiss. Doctor was voluntarily dismissed by Bloor.
In the Bad Faith Case, Bloor claimed that a renewal policy had been created because Ollin paid Doctor a premium for the renewal of the Bankers policy and at all material times believed the policy had indeed been renewed. Bloor claimed that Doctor's action in issuing the Certificate of Liability Insurance and retaining the premium payment bound Bankers because Doctor was acting as Bankers' agent. In the alternative, Bloor alleged that Ollin never directly received statutorily-required notification of non-renewal of the Bankers policy, thereby continuing the Bankers policy beyond its original expiration by operation of California law and affording coverage on the date of Bloor's accident.
On July 14, 2010, citing, among other things, its probable liability to Bloor due to certain adverse rulings from the court and evidence developed in the Bad Faith Case,Bankers entered into a settlement agreement with Bloor, pursuant to which Bankers agreed to pay Bloor $1.8 million. On October 15, 2010, Bankers filed suit against ATM in Florida state court. (Doc. # 1). ATM removed the case to this Court on November 23, 2010, and thereafter sought dismissal of Bankers' breach of contract and negligence counts. (Id.; Doc. # 6). Bankers filed an amended complaint on January 4, 2011, eliminating the breach of contract and negligence counts and alleging one count for contractual indemnification in the amount of $1.8 million plus attorneys' fees and costs for its defense and settlement of the Bad Faith Case.
The parties' cross motions for summary judgment are now before the Court.
Summary judgment is appropriate "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). A factual dispute alone is not enough to defeat a properly pled motion for summary judgment; only the existence of a genuine issue of material fact will preclude a grant of summary judgment. Anderson v. Liberty Lobby, Inc.,477 U.S. 242, 247-48 (1986).
An issue is genuine if the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Mize v. Jefferson City Bd. of Educ., 93 F.3d 739, 742 (11th Cir. 1996)(citing Hairston v. Gainesville Sun Publ'g Co., 9 F.3d 913, 918 (11th Cir. 1993)). A fact is material if it may affect the outcome of the suit under the governing law. Allen v. Tyson Foods, Inc., 121 F.3d 642, 646 (11th Cir. 1997). The moving party bears the initial burden of showing the court, by reference to materials on file, that there are no genuine issues of material fact that should be decided at trial. Hickson Corp. v. N. Crossarm Co., Inc., 357 F.3d 1256, 1260 (11th Cir. 2004)(citing Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986)). "When a moving party has discharged its burden, the non-moving party must then 'go beyond the pleadings,' and by its own affidavits, or by 'depositions, answers to interrogatories, and admissions on file,' designate specific facts showing that there is a genuine issue for trial." Jeffery v. Sarasota White Sox, Inc., 64 F.3d 590, 593-94 (11th Cir. 1995)(citing Celotex, 477 U.S. at 324).
If there is a conflict between the parties' allegations or evidence, the non-moving party's evidence is presumed to be true and all reasonable inferences must be drawn in the non-moving party's favor. Shotz v. City of Plantation, Fla., 344 F.3d 1161, 1164 (11th Cir. 2003). If a reasonable fact finder evaluating the evidence could draw more than one inference from the facts, and if that inference introduces a genuine issue of material fact, the court should not grant summary judgment. Samples ex rel. Samples v. City of Atlanta, 846 F.2d 1328, 1330 (11th Cir. 1988)(citing Augusta Iron & Steel Works, Inc. v. Employers Ins. of Wausau, 835 F.2d 855, 856 (11th Cir. 1988)). However, if the non-movant's response consists of nothing "more than a repetition of his conclusional allegations," summary judgment is not only proper, but required. Morris v. Ross, 663 F.2d 1032, 1034 (11th Cir. 1981), cert. denied, 456 U.S. 1010 (1982).
In this case, Bankers is seeking contractual indemnification from ATM for the $1.8 million settlement it paid Bloor in the Bad Faith Case, pursuant to the following provision of the parties' General Agency Agreement:
The General Agent [ATM] agrees to indemnify and hold the Company [Bankers], its subsidiaries, successors and assigns, and shareholders, directors, officers, agents and employees of any of them...
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