FAMILY CARE CENTER v. Truck Ins. Exchange, 4D03-295.

• Decision Date: 16 June 2004
• Docket Number: No. 4D03-295.,4D03-295.
• Citation: 875 So.2d 750
• Parties: FAMILY CARE CENTER, P.A., Appellant, v. TRUCK INSURANCE EXCHANGE, Appellee.
• Court: Florida District Court of Appeals

875 So.2d 750

FAMILY CARE CENTER, P.A., Appellant, v. TRUCK INSURANCE EXCHANGE, Appellee.

No. 4D03-295.

District Court of Appeal of Florida, Fourth District.

June 16, 2004.

Rehearing Denied June 16, 2004.

Richard M. Benrubi and Jeffrey M. Liggio of Liggio, Benrubi & Williams, P.A., West Palm Beach, and Philip M. Burlington of Philip M. Burlington, P.A., West Palm Beach, for appellant.

Mark Hicks, Jean Kneale and Dinah Stein of Hicks & Kneale, P.A., Miami, for appellee.

KLEIN, J.

We withdraw the opinion issued on March 31, 2004 and replace it with this opinion.

The medical malpractice insurance policy issued by the appellee insurer provided coverage only for Dr. Dean and her employer, the Family Care Center, which was an additional insured. Another physician employed by Family Care, Dr. Stine, was sued for malpractice, and the issue is whether Family Care is an insured under this policy for the claim against Dr. Stine. We affirm a summary judgment determining that there was no coverage, but reverse for Family Care to proceed on an amendment alleging estoppel.

Family Care required each of its physicians to carry malpractice insurance and Dr. Stine, who was allegedly negligent, was covered by a different insurer which settled with the claimant. Additional coverage was claimed under this policy, and during the statutory presuit medical malpractice proceedings, this insurer provided a defense to represent Family Care. Soon after the termination of the presuit proceedings, however, the insurer denied coverage and withdrew its defense. Family Care then entered into a consent judgment for $1 million with the claimant which provided that the claimant would not seek to collect against Family Care Center. Claimant agreed to seek satisfaction only from this insurer.

Family Care's coverage argument relies on the first page of the policy which limited the coverage to "claims that are first made against you or any other protected person." The introduction to the policy provides that "other insured parties may be identified in amendments attached to this policy and will be referred to in the policy as `Protected Persons.'"

An endorsement provided the following:

PROFESSIONAL CORPORATION/ASSOCIATION AS AN ADDITIONAL INSURED

It is understood and agreed that such insurance as is afforded by this Policy shall apply to:

FAMILY CARE CENTER, P.A.

as an additional insured (including any Executive officer, Director, Stockholder, or Shareholder thereof while acting within the scope of his duties as such) but only as respects professional services rendered or which should have been rendered by any Protected Persons named in this policy.

Section III of the policy, entitled "What this policy covers" provides coverage for Dr. Dean, but states:

Also, your coverage will not apply for acts of a member of your partnership, corporation, or professional association, simply because he or she is a member of your organization. It is necessary that each member, partner, or shareholder be individually insured.

Family Care's argument is that by virtue of the endorsement, Family Care became an additional insured and was therefore a "protected person" under the introductory language quoted above. This, Family Care argues, creates an ambiguity.

We do not agree with the ambiguity argument, as it is clear that, when all of the provisions are read together, Family Care is an additional insured only for medical treatment rendered by Dr. Dean. Fla. Physicians Ins. Co. v. Lazenby, P.A., 576 So.2d 794 (Fla. 2d DCA 1991); Caduceus Self Ins. Fund v. S. Fla. Emergency Physicians, 436 So.2d 1034 (Fla. 3d DCA 1983).

Even if there were an ambiguity between the endorsement and the body of the policy, the endorsement, which is clear, controls. Fireman's Fund Ins. Co. v. Levine & Partners, P.A., 848 So.2d 1186 (Fla. 3d DCA 2003); Steuart Petroleum Co. v. Certain Underwriters at Lloyd's London, 696 So.2d 376 (Fla. 1st DCA 1997). Accordingly, Family Care is not an insured for this claim under the policy.

The estoppel argument, which we now address, was not initially included in the pleadings. On the eve of the summary judgment hearing on coverage, Family Care filed a motion to amend its pleadings to include a claim that the insurer was estopped from denying coverage, based on conduct during the time it initially provided a defense. The trial court denied the motion to amend, because the proposed amendment did not allege any facts which could constitute estoppel, and granted the motion for summary judgment. Family Care moved for rehearing on estoppel and filed an affidavit by counsel asserting specific factual allegations involving decisions made by the insurer while furnishing a defense which were prejudicial to Family Care's ability to defend after the insurer denied coverage.

The estoppel theory was explained in Doe v. Allstate Insurance Co., 653 So.2d 371, 374 (Fla.1995), as follows:

Thus, when the insurer undertakes the defense of a claim on behalf of one claiming to be an insured, we have recognized substantial duties on the part of both the insurer and the insured. If an insurer erroneously begins to carry out these duties, and the insured, as required, relies upon the insurer to the insured's detriment, then the insurer should not be able to deny the coverage which it earlier acknowledged. However, we clearly state that the insured must demonstrate that the insurer's assumption of the insured's defense has prejudiced the insured. It is the fact that the insured has been prejudiced which estops the insurer from denying the indemnity obligation of the insurance policy.

The insurer argues that the trial court properly denied the amendment as futile, because the facts alleged in the affidavit supporting the motion for rehearing were insufficient as a matter of law to amount to estoppel. The insurer argues that estoppel to deny coverage is limited only to situations surrounding the procurement of insurance, citing State Farm Mutual Automobile Insurance Co. v. Hinestrosa, 614 So.2d 633 (Fla. 4th DCA 1993), and Aetna Casualty & Surety Co. v. Deluxe Systems, Inc. of Florida, 711 So.2d 1293 (Fla. 4th DCA 1998). The issue in Hinestrosa was whether the insurer was precluded from denying coverage because of the failure of the insurer to comply with a claims administration statute. Hinestrosa is accordingly distinguishable, and any language in Hinestrosa which would limit estoppel to...