Beta Eta House Corp. v. Gregory, M--241

• Decision Date: 20 January 1970
• Docket Number: No. M--241,M--241
• Citation: 230 So.2d 495
• Parties: BETA ETA HOUSE CORPORATION, Inc. of Tallahassee, Florida, a nonprofit Florida corporation, and General Accident Fire and Life Insurance Company, Limited, a foreign corporation, Petitioners, v. William E. GREGORY, a minor, by his mother and next friend, Lucy A. Gregory, and Lucy A. Gregory, individually, Respondents.
• Court: Florida District Court of Appeals

Page 495

230 So.2d 495

BETA ETA HOUSE CORPORATION, Inc. of Tallahassee, Florida, a nonprofit Florida corporation, and General Accident Fire and Life Insurance Company, Limited, a foreign corporation, Petitioners, v. William E. GREGORY, a minor, by his mother and next friend, Lucy A. Gregory, and Lucy A. Gregory, individually, Respondents.

No. M--241.

District Court of Appeal of Florida, First District.

Jan. 20, 1970.

H. O. Pemberton, E. Harper Field, and Helen C. Ellis, of Keen, O'Kelley & Spitz, Tallahassee, for petitioners.

Henderson, Buchanan & Sapp, Panama City, and Podhurst & Orseck, Miami, for respondents.

WIGGINTON, Judge.

Petitioners seek review by certiorari of an order rendered in a common law action by which the trial court denied petitioner General Accident Fire and Life Insurance Company's motion to dismiss the complaint as to it because of its failure to state a cause of action.

Interlocutory appeals from orders rendered in common law actions are not permitted except as to certain types of orders specified by the rule. ¹ The order which is the subject of attack in the case sub judice is not of the type of which an interlocutory appeal is permitted. Nevertheless, under the circumstances hereinafter shown it is our view that the order, if erroneous, constitutes a departure from the essential requirements of law and will cause material injury to the petitioners throughout the remainder of the proceedings for which there will be no adequate remedy by appeal after judgment. For this reason we will in the exercise of our discretion entertain jurisdiction and proceed to consider and pass upon the merits of the case. ²

Respondent has filed a complaint at law alleging that he suffered personal injuries when he tripped and fell on a concrete sidewalk while lawfully on the premises owned by petitioner, Beta Eta House Corporation, Inc.; that his damages resulted from the negligence of the House Corporation by its failure to maintain the premises in a reasonably safe condition as a proximate cause of which he was injured. Money judgment is sought against petitioner House Corporation for the damages suffered by respondent. Joined as an additional defendant is petitioner, General Accident Fire and Life Insurance Comapny, Limited. The complaint alleges that the company issued its policy of insurance to the House Corporation by which the latter was insured against loss. Although the allegations of the complaint do not specifically so state, parties by their briefs appear to concede without dispute that the insurance policy in question includes a premises liability insurance clause by which the company agrees to pay on behalf of the House Corporation all sums for which the latter may become legally obligated to pay as damages because of the negligent maintenance or operation of the premises. Our consideration will be premised upon this concession. General Accident filed its motion to dismiss the complaint on the ground that it failed to state a cause of action against it. From the order denying this motion both petitioners have filed their petition for certiorari contending the ruling to be an erroneous departure from the essential requirements of law.

The sole question presented for our decision is whether a premises liability insurer may be joined as an additional defendant in an action brought against its insured for damages proximately caused by the latter's negligence. A similar question was presented to and decided by this court in the case of Bussey v. Shingleton. ³ The only material distinction between the Bussey case and the one sub judice is that in the former the insurance contract there construed was an automobile liability insurance policy, whereas the contract in this case is a premises liability insurance policy providing insurance against loss suffered by the insured as a result of the negligent maintenance or operation of its premises.

In Bussey we held that because of several factors not theretofore considered by the courts of Florida in passing upon the question involved, an automobile liability insurance carrier was a real party in interest in every suit brought by an injured third party against an insured policyholder within the purview and meaning of Rule 1.210(a), Florida Rules of Civil Procedure, 30 F.S.A., and could therefore be properly joined as an additional party defendant in any such action. In our consideration of the case we took into account the provisions of the standard automobile liability insurance policy which grants to the insurer the right to control all claims arising under the policy, as well as all litigation, both trial and appellate, ensuing therefrom. We furthermore took into account the results of a former proceeding pursued in the Supreme Court of this state in which the automobile liability insurance carriers doing business in Florida took the firm and unequivocal position that they were real parties in interest in all litigation brought against their insureds under the terms and provisions of standard automobile liability insurance policies issued and sold by them. Secondarily, we held that automobile liability insurance policies, by their very nature, constituted quasi-third party beneficiary contracts intended for the protection of third persons who suffered damage as a result of the negligence of those insured by such policies. We buttressed this conclusion by reference to the Financial Responsibility Law of this state, ⁴ which requires the operators of motor vehicles, having had one prior accident resulting in damage to another, to procure and maintain liability insurance for the benefit of those members of the public who might subsequently suffer damages as a result of the negligent operation of the insured's vehicle.

Our decision was reviewed by the Supreme Court in Shingleton v. Bussey ⁵ and approved in every respect. By its decision, however, the Supreme Court appears to have placed the rule permitting joinder of liability insurance carriers in suits brought against their insureds on a much broader basis than this court did by its decision. In holding that a liability insurance policy is as a matter of law a contract for the benefit of third parties, the court conceded that its reasoning was supported by the public policy considerations flowing from the State's Financial Responsibility Law. The court's decision proceeded to hold, however, that its conclusion was not dependent upon the public policy considerations arising from the State's Financial Responsibility Law, but was based squarely upon the proposition that liability insurance was for the benefit of third parties to an equal extent as it was to the insured in whose favor the policy issued. In its decision the court said:

'It cannot be disputed that securance of liability insurance coverage protection for the operation of a motor vehicle, regardless of whether the policy is secured to meet the requirements of Ch. 324, F.S., is an act undertaken by the insured with the intent of providing a ready means of discharging his obligations that may accrue to a member or members of the public as a result of his negligent operation of a motor vehicle on the public streets and highways of this state.

'Viewed in this light, we think there exists sufficient reason to raise by operation of law the intent to benefit injured third parties and thus to render motor vehicle liability insurance amenable to the third party beneficiary doctrine.

'It seems reasonable to view the cause of action against an insurer in favor of an injured third party as vesting in or accruing to the injured party at the same time he becomes entitled to sue the insured, assuming, of course, due notice of the injured party's claim has been given insurer and it had had opportunity to duly investigate the same.'

In commenting upon the public policy considerations which militate against permitting a liability insurance carrier to avoid being joined as a defendant in a suit against its insured while at the same time controlling the litigation in its own self-interest, the court said:

'In any case, it seems anomalous to public policy to procedurally sanction and condone a situation where the ultimate beneficiary of policy proceeds is deprived by a provision in the policy of an open, speedy and realistic opportunity to pursue by due process his right of an adequate remedy at law jointly against the insured and insurer. Especially is the result obtained by such policy restriction incongruous where the insurer participates in the controversy, not as a joint defendant in the proceedings brought by the injured plaintiff against the insured, but, rather, as the undisclosed guardian of the interests and rights of...