Hechtman v. Nations Title Ins. of New York
Decision Date | 06 February 2003 |
Docket Number | No. SC00-2242.,SC00-2242. |
Citation | 840 So.2d 993 |
Parties | Barry I. HECHTMAN, et al., Petitioners, v. NATIONS TITLE INSURANCE OF NEW YORK, et al., Respondents. |
Court | Florida Supreme Court |
840 So.2d 993
Barry I. HECHTMAN, et al., Petitioners,v.
NATIONS TITLE INSURANCE OF NEW YORK, et al., Respondents
No. SC00-2242.
Supreme Court of Florida.
February 6, 2003.
James S. Telepman of Cohen, Norris, Scherer, Weinberger & Wolmer, North Palm Beach, FL; and Robert A. Cohen of Cohen/Fox, P.A., Miami, FL, for Respondents.
QUINCE, J.
We have for review a decision on the following question certified by the Third District Court of Appeal to be of great public importance:
840 So.2d 995WHETHER § 627.792, FLA. STAT. (1997), WHICH PROVIDES THAT AN INSURER IS LIABLE FOR THE MISFEASANCE OF A "LICENSED TITLE INSURANCE AGENT" APPLIES TO A TITLE INSURANCE AGENT WHO IS AN ATTORNEY AND IS THEREFORE EXEMPT FROM LICENSING AS A TITLE INSURANCE AGENT BY THE DEPARTMENT OF INSURANCE UNDER § 626.8417, FLA. STAT. (1997).
Hechtman v. Nations Title Ins. New York, Inc., 767 So.2d 505, 509 (Fla. 3d DCA 2000). We have jurisdiction. See art. V, § 3(b)(4), Fla. Const. For the reasons set forth below, we answer the certified question in the negative and find that section 627.792, Florida Statutes (1997), does not apply to attorneys who are acting as title insurance agents if those attorneys are exempt from the licensing requirements of section 626.8417, Florida Statutes (1997).
Barry and Brenda Hechtman brought suit against Nations Title Insurance of New York (Nations Title) and Commonwealth Land Title Insurance Company (Commonwealth), pursuant to section 627.792, Florida Statutes (1997), alleging that Nations Title and Commonwealth were liable to them for the defalcation of funds committed by a licensed Florida attorney who was serving as a title insurance agent on behalf of the insurance companies. The attorney held the Hechtmans' funds in his attorney escrow account and subsequently misappropriated the funds for his own use. Section 627.792 makes title insurers liable for the defalcation of funds by their licensed title agents if the funds are held in trust pursuant to section 626.8473, Florida Statutes (1997). Specifically, section 627.792 provides as follows:
A title insurer is liable for the defalcation, conversion, or misappropriation by a licensed title insurance agent of funds held in trust by the agent pursuant to s. 626.8473. If the agent is licensed by two or more title insurers, any liability shall be borne by the title insurer upon which a title insurance binder, commitment, policy, or title guarantee was issued prior to the illegal act. If no binder, commitment, policy, or guarantee was issued, each title insurer represented by the agent at the time of the illegal act shares in the liability in the same proportion that the premium remitted to it by the agent during the 1 year period before the illegal act bears to the total premium remitted to all title insurers by the agent during the same time period.
Generally, however, attorneys licensed to practice law in Florida who serve as title insurance agents are statutorily exempt from the title insurance licensing requirements. See § 626.8417(4)(a), Fla. Stat. (1997). Attorneys who are exempt from the title insurance licensing requirements may act as escrow agents and hold funds in their attorney trust accounts pursuant to Rules Regulating the Florida Bar 4-1.15, 5-1.1, and 5-1.2. Ordinarily, a nonattorney may not act as an escrow agent; however, the nonattorney may do so pursuant to section 626.8473 if he or she is licensed as a title insurance agent under section 626.8417. In most cases, attorneys act as title insurance agents pursuant to their license to practice law, not by virtue of a license issued by the Department of Insurance; therefore, they hold the insured's funds in escrow pursuant to the Rules Regulating the Florida Bar.
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