Citizens Prop. Ins. Corp. v. Perdido Sun Condo. Ass'n, Inc.

• Citation: 164 So.3d 663
• Decision Date: 14 May 2015
• Docket Number: No. SC14–185.,SC14–185.
• Parties: CITIZENS PROPERTY INSURANCE CORP., etc., Petitioner, v. PERDIDO SUN CONDOMINIUM ASSOCIATION, INC., etc., Respondent.
• Court: Florida Supreme Court

164 So.3d 663

CITIZENS PROPERTY INSURANCE CORP., etc., Petitioner

v.PERDIDO SUN CONDOMINIUM ASSOCIATION, INC., etc., Respondent.

No. SC14–185.

Supreme Court of Florida.

May 14, 2015.

Kara Berard Rockenbach of Methe & Rockenbach, P.A., West Palm Beach, FL; Raoul G. Cantero, III, David P. Draigh, and Ryan Andrew Ulloa of White & Case LLP, Miami, FL, for Petitioner.

Charles S. Liberis, Jr. and Thomas F. Condon of the Liberis Law Firm, P.A., Pensacola, FL, for Respondent.

Pamela Jo Bondi, Attorney General, Allen C. Winsor, Solicitor General, and Rachel Erin Nordby, Deputy Solicitor General, Tallahassee, FL, for Amicus Curiae State of Florida.

Mark Lawrence Zientz of the Law Offices of Mark L. Zientz, P.A., Miami, FL, for Amicus Curiae Florida Workers' Advocates.

Opinion

PARIENTE, J.

The issue in this case is whether the Florida Legislature intended Citizens Property Insurance Corporation, a state-created entity that provides property insurance, to be liable for statutory first-party bad faith claims as an exception to its statutory immunity from suit. The First District Court of Appeal in Perdido Sun Condominium Ass'n v. Citizens Property Insurance Corp., 129 So.3d 1210 (Fla. 1st DCA 2014), determined that the “willful tort” statutory exception to Citizens' immunity applied to statutory first-party bad faith claims and certified conflict with the Fifth District Court of Appeal's decision in Citizens Property Insurance Corp. v. Garfinkel, 25 So.3d 62 (Fla. 5th DCA 2009), disapproved on other grounds by Citizens Property Insurance Corp. v. San Perdido Ass'n, 104 So.3d 344 (Fla.2012), which held to the contrary that Citizens is statutorily immune. Additionally, the First District passed upon the following question, which it certified to be of great public importance:

WHETHER THE IMMUNITY OF CITIZENS PROPERTY INSURANCE CORPORATION, AS PROVIDED IN SECTION 627.351(6)(s), FLORIDA STATUTES, SHIELDS THE CORPORATION FROM SUIT UNDER THE CAUSE OF ACTION CREATED BY SECTION 624.155(1)(b), FLORIDA STATUTES [,] FOR NOT ATTEMPTING IN GOOD FAITH TO SETTLE CLAIMS?

Perdido Sun, 129 So.3d at 1213.¹

We conclude, as more fully explained below, that a statutory first-party bad faith cause of action under section 624.155(1)(b) is not an exception to the immunity granted to Citizens by the Legislature. Accordingly, we quash Perdido Sun, approve the reasoning of Garfinkel on this issue, and answer the certified question in the affirmative.

BACKGROUND

After prevailing in a breach of contract action against its insurance company, Citizens Property Insurance Corporation, Perdido Sun Condominium Association sued Citizens a second time. In the second lawsuit, Perdido Sun alleged a statutory first-party bad faith claim, pursuant to section 624.155(1), Florida Statutes (2009), which provides in relevant part:

(1) Any person may bring a civil action against an insurer when such person is damaged:

....

(b) By the commission of any of the following acts by the insurer:

1. Not attempting in good faith to settle claims when, under all the circumstances, it could and should have done so, had it acted fairly and honestly toward its insured and with due regard for her or his interests[.]

Specifically, Perdido Sun claimed that Citizens (1) refused to pay the full amount owed to Perdido Sun under the insurance policy; (2) refused to take part in the required appraisal process and instead used that process in an attempt to forestall litigation; (3) delayed payment of the appraisal award and improperly attempted to condition payment of the award upon the execution of a universal release; and (4) engaged in a pattern and practice of seeking to avoid or delay full settlement of claims.

Citizens moved to dismiss the complaint, citing its immunity from suit under section 627.351(6)(s) 1., Florida Statutes (2009), which provides:

There shall be no liability on the part of, and no cause of action of any nature shall arise against, any assessable insurer or its agents or employees, the corporation or its agents or employees, members of the board of governors or their respective designees at a board meeting, corporation committee members, or the office or its representatives, for any action taken by them in the performance of their duties or responsibilities under this subsection. Such immunity does not apply to:

a. Any of the foregoing persons or entities for any willful tort;

b. The corporation or its producing agents for breach of any contract or agreement pertaining to insurance coverage;

c. The corporation with respect to issuance or payment of debt;

d. Any assessable insurer with respect to any action to enforce an assessable insurer's obligations to the corporation under this subsection; or

e. The corporation in any pending or future action for breach of contract or for benefits under a policy issued by the corporation; in any such action, the corporation shall be liable to the policyholders and beneficiaries for attorney's fees under s. 627.428.

(Emphasis added.)

Perdido Sun relied on the statutory exception to immunity for “any willful tort” in asserting that immunity did not apply. The trial court disagreed and dismissed the complaint with prejudice, reasoning that a statutory bad faith action under section 624.155 was not among the specifically listed exceptions to the immunity provided in section 627.351(6)(s). On appeal, the First District reversed, concluding that “Citizens' immunity does not extend to the ‘willful tort’ of failing to attempt in good faith to settle claims as provided by section 624.155.” Perdido Sun, 129 So.3d at 1213. The First District certified conflict with Garfinkel, 25 So.3d 62, which had held to the contrary—that a cause of action for statutory first-party bad faith did not constitute a “willful tort” for purposes of the statutory exceptions from Citizens' immunity. Perdido Sun, 129 So.3d at 1213. The First District also certified the question to be one of great public importance. Id.

ANALYSIS

The issue in this case turns on a question of statutory construction—namely, whether the Legislature intended Citizens to be liable for statutory first-party bad faith claims. The answer to this question requires us to review the specific exceptions that the Legislature provided to Citizens' statutory immunity and to examine whether liability on this ground is included within the statutory phrase “willful tort.” Perdido Sun argues, and the First District agreed, that a statutory bad faith cause of action constitutes a “willful tort” for purposes of the statutory immunity. Citizens counters that a statutory bad faith cause of action is not a tort. Both Perdido Sun and Citizens rely on statutory construction principles to support their respective positions.

As the issue presented involves a question of statutory construction, this Court's review is de novo. See Diamond Aircraft Indus., Inc. v. Horowitch, 107 So.3d 362, 367 (Fla.2013). In applying principles of statutory construction, courts must “begin with the ‘actual language used in the statute.’ ” Raymond James Fin. Servs., Inc. v. Phillips, 126 So.3d 186, 190 (Fla.2013) (quoting Borden v. E.–European Ins. Co., 921 So.2d 587, 595 (Fla.2006) ). A court, in construing a statute, is required to “give effect to legislative intent, which is the polestar that guides the court in statutory construction.” Id. (quoting Gomez v. Vill. of Pinecrest, 41 So.3d 180, 185 (Fla.2010) ).

In examining the relevant statutory provisions at issue, we find no support that the Legislature intended for Citizens to be liable for a breach of the duty to act in good faith by allowing its policyholders to bring a statutory first-party bad faith cause of action. The clearest expression of legislative intent is found in the listed exceptions to Citizens' immunity. See § 627.351(6)(s) 1., Fla. Stat. Although the Legislature codified Citizens' duty to handle claims in good faith, see § 627.351(6)(s) 2., Fla. Stat., the Legislature never listed statutory first-party bad faith claims as one of the exceptions to Citizens' immunity. To the contrary, the Legislature chose to immunize Citizens for “any action taken by [it] in the performance of [its] duties or responsibilities under ... subsection [627.351(6)(s) ],” which necessarily includes a breach of the duty of good faith.

If the Legislature had intended to exempt first-party bad faith claims from Citizens' statutory immunity, listing this category within section 627.351(6)(s) 1. would have been a simple and explicit way to indicate this. Certainly, the Legislature knew how to accomplish an exception to the immunity because it created a specific exception to the immunity for attorney's fees, as authorized by section 627.428, Florida Statutes. See § 627.351(6)(s) 1.e., Fla. Stat.

As this Court has recognized, where the Legislature made one exception clearly, if it had “intended to establish other exceptions it would have done so clearly and unequivocally.” Dobbs v. Sea Isle Hotel, 56 So.2d 341, 342 (Fla.1952). Accordingly, where the Legislature articulates clear exceptions to a statute, “no other exceptions may be implied.”Garfinkel, 25 So.3d at 65. As Garfinkel observed, “because the Legislature identified five exceptions to its grant of immunity, there is no reason to think that another grant would show up in a nearby but separate paragraph, unless specifically identified as such.” Id. The Legislature has not included statutory first-party bad faith claims among the limited exceptions to Citizens' immunity when it could have easily chosen to do so.

Besides the failure to include a specific exception for statutory causes of action under section 624.155(1)(b) 1., we do not agree with the First District's conclusion that the statutory cause of action for first-party bad faith is a tort or specifically a “willful tort”—a principle that becomes clear after considering the history of first-party bad faith causes of action. Unlike common law causes of action for third-party bad faith, first-party bad...