Florida Ins. Guar. Ass'n v. Jacques

• Citation: 643 So.2d 101
• Decision Date: 05 October 1994
• Docket Number: Nos. 92-2667,93-0649 and 93-0659,s. 92-2667
• Parties: 19 Fla. L. Weekly D2137 FLORIDA INSURANCE GUARANTY ASSOCIATION, Appellant, v. Cheri JACQUES, Appellee.
• Court: Court of Appeal of Florida (US)

Page 101

643 So.2d 101

19 Fla. L. Weekly D2137

FLORIDA INSURANCE GUARANTY ASSOCIATION, Appellant, v. Cheri JACQUES, Appellee.

Nos. 92-2667, 93-0649 and 93-0659.

District Court of Appeal of Florida Fourth District.

Oct. 5, 1994.

John P. Joy of Walton Lantaff Schroeder & Carson, Miami, for appellant.

Nancy Little Hoffmann of Nancy Little Hoffmann, P.A., and Carl S. Karmin of Karmin & Adler, P.A., Fort Lauderdale, for appellee.

DELL, Chief Judge.

Florida Insurance Guaranty Association (FIGA) brings this appeal as receiver of Mission National Insurance Company (Mission National). Mission National insured Scrap Metal Processing, Inc. (Scrap Metal). Appellee Cheri Jacques obtained a $125,000 judgment for personal injuries against Scrap Metal. FIGA contends the trial court erred in holding it responsible for the unpaid portion of Jacques' judgment and in awarding her attorney's fees. Jacques cross-appeals the trial court's denial of her claim for interest on this judgment. We affirm the judgment and the trial court's denial of interest. We reverse the award of attorney's fees.

Scrap Metal maintained several insurance policies: a $1,000,000 comprehensive general liability policy with Mission National, a $10,000,000 umbrella policy also with Mission National and a $1,000,000 business automobile policy with Continental Casualty Company (Continental). The Mission National $1,000,000 liability policy is at issue in this appeal. This policy was subject to the following $250,000 deductible: "The deductible amount shall be applicable to each occurrence and shall include loss payments and claim expenses, whether or not loss payment is made."

A truck operated on Scrap Metal's behalf was involved in a motor-vehicle collision in which Jacques sustained personal injuries and her passenger, Michael Serano, died. Jacques and Serano's Estate sued Scrap Metal and others for damages. During the course of litigation, Continental settled with Jacques for $40,000 and with Serano's Estate for $250,000. At the time, Continental represented that it had liability limits of $250,000 per person and $500,000 per occurrence. As part of the settlement, Jacques agreed she would not execute on any later-obtained judgment against Scrap Metal or Continental. Continental agreed, however, that Jacques and Serano's Estate could proceed with the trial to obtain a damages award and then pursue a judgment against FIGA (receiver of Mission National) for damages awarded in excess of the Continental settlement.

The jury awarded Jacques $125,000 and Serano's Estate $392,000. The trial court entered judgment solely against Scrap Metal. Thereafter, Continental informed the parties that it had liability limits of $500,000 per person/$1,000,000 per occurrence rather than $250,000 per person/$500,000 per occurrence as previously represented. In light of this discovery, Continental agreed to satisfy the entire judgment in favor of Serano's Estate. Continental refused, however, to pay Jacques the entire amount of her judgment because she settled for less than the amount of coverage available to her under its policy.

Jacques then sued FIGA for $85,000, the unpaid balance of the $125,000 judgment. A nonjury trial of Jacques' claim against FIGA resulted in a verdict for Jacques of $84,900 (the $85,000 judgment less FIGA's $100 statutory deductible). After a hearing on Jacques' motion for attorney's fees and interest, the trial court assessed attorney's fees against FIGA pursuant to section 627.428, Florida Statutes, but denied her claim for interest on the judgment.

FIGA contends that it has no liability for the unpaid portion of Jacques' judgment because Scrap Metal failed to satisfy the deductible provision of Mission National's policy. ¹ We disagree.

Continental's payments to the Serano Estate of $392,000 and to appellee of $40,000 satisfied the $250,000 per occurrence deductible provision of the Mission National policy. Appellant has not cited nor have we found any policy provision or legal authority that would require Scrap Metal itself to have had to make the payments covering the deductible. In Fortune Ins. Co. v. McGhee, 571 So.2d 546 (Fla. 2d DCA 1990), the court held that a PIP deductible could properly be exhausted by other sources and need not be paid directly by the insured. We see no reason not to apply the reasoning of Fortune to the policy sub judice.

Moreover, the parties do not dispute that the unpaid balance of the final judgment constitutes a "covered claim" under section 631.57(1)(b), Florida Statutes, which provides that FIGA shall "[b]e deemed the insurer to the extent of its obligation on the covered claims, and, to such extent, shall have all rights, duties, and obligations of the insolvent insurer...." Since Scrap Metal satisfied the deductible through Continental's payments and the $85,000 is a covered claim, we hold the trial court did not err when it entered judgment against FIGA for $84,900.

Appellant also contends that the...