Insurance Co. of North America v. Whatley, 89-653

• Citation: 558 So.2d 120
• Decision Date: 08 March 1990
• Docket Number: No. 89-653,89-653
• Parties: 15 Fla. L. Weekly D654 INSURANCE COMPANY OF NORTH AMERICA, Appellant, v. Mace E. WHATLEY, Appellee.
• Court: Court of Appeal of Florida (US)

Page 120

558 So.2d 120

15 Fla. L. Weekly D654

INSURANCE COMPANY OF NORTH AMERICA, Appellant, v. Mace E. WHATLEY, Appellee.

No. 89-653.

District Court of Appeal of Florida Fifth District.

March 8, 1990.

Walter A. Ketcham, Jr. of Taraska, Grower, Unger & Ketcham, Orlando, for appellant.

Gary E. Doane of Hightower and Doane, Orlando, for appellee.

COBB, Judge.

The issue on this appeal is whether factual determinations made during a prior adjudication, establishing the tort liability of an insured, are binding on the insurer in a subsequent adjudication concerning coverage.

Stanley (insured), the operator of a tree removal company, allegedly hired Whatley. A few days later Whatley was injured by part of a falling tree. As a result, Insurance Company of North America (INA/insurer) wrote to Stanley and informed him that coverage would not apply to Whatley's injuries because Whatley was an "employee" and, as such, was excluded from coverage.

Whatley filed suit against Stanley alleging that Stanley had been negligent in regard to Whatley and explicitly referring to himself as "an employee" of Stanley. Count II maintained that Whatley was "an employee" but that Stanley had negligently failed to provide worker's compensation coverage. Stanley's answer denied that Whatley was an employee of Stanley.

Stanley brought a third-party complaint against INA for declaratory relief and breach of contract. INA responded to the third party complaint, specifically denying coverage due to the exclusionary language of the policy. Later, Whatley moved to abate the coverage issue (third-party action), stating that until a judgment was obtained there was no issue that was ripe for determination involving INA. The trial court granted Whatley's motion to abate and delayed the coverage issue until it was "ripe for adjudication."

A jury trial was held and the trial court directed a verdict in favor of Whatley in regard to Stanley's negligence. The only issues left for the jury (aside from determining damages) was whether or not Whatley was an employee, and if so, whether Stanley negligently failed to provide worker's compensation insurance. The jury found that Whatley was not an employee. After trial, Whatley filed a motion to amend the third-party complaint so that he could be added as a party plaintiff against INA. The trial court granted this motion. Subsequent to this, Whatley filed a motion for judgment on the pleadings or for summary judgment claiming that the issue of whether Whatley had been an employee had already been litigated. The trial court granted Whatley's motion and a final judgment was rendered in favor of Whatley and against INA.

INA maintains that the coverage action should not have been determined by facts established during the prior adjudication where INA was excluded from participating as an interested party. We agree.

Generally, an insured's duty to defend is determined by the allegations in a complaint. National Union Fire Insurance Company v. Lenox Liquors, Inc., 358 So.2d 533 (Fla.1977); Vanguard Insurance Company v. Townsend, 544 So.2d 1153, 1154 (Fla. 5th DCA 1989...