Liberty Mut. Ins. v. Aventura Engineering & Const.

Decision Date08 January 2008
Docket NumberNo. 06-22494-CIV.,06-22494-CIV.
Citation534 F.Supp.2d 1290
CourtU.S. District Court — Southern District of Florida
PartiesLIBERTY MUTUAL INSURANCE COMPANY, Plaintiff, v. AVENTURA ENGINEERING & CONSTRUCTION CORP., Cary O. Lopez, Camille A. Davis, and Rosaline Williams, Defendants.

Edward Etcheverry, Esq. & Guy Harrison, Esq., & Jeffrey Geller, Esq., Plantation, FL, for Plaintiff.

Vincent Vaccarella, Esq., & John Moore, Esq., Aventura, FL, for Defendants.


ALAN S. GOLD, District Judge.

THIS CAUSE is before the Court on: (1) Plaintiff's Motion for Summary Judgment [DE 101]; (2) Plaintiffs Motion for Preliminary Injunction [DE 113]; and (3) Plaintiffs Renewed and Supplemental Emergency Motion for Temporary Restraining Order with Notice and for Preliminary Injunction [DE 116]. The parties have filed responses and replies, and oral argument on these motions was held on November 20, 2007 and on December 20, 2007. This Court has jurisdiction pursuant to 28 U.S.C. § 1332 based on the parties diversity of citizenship.

Having reviewed the parties' arguments and the relevant case law, I conclude that Plaintiffs Motion for Summary Judgment seeking: (1) a judicial declaration that Plaintiff had the right to settle Aventura's claim against Goodwill, based on Aventura's breach of the Indemnity Agreement; (2) a monetary judgment in the amount of $2,755,936.51 to indemnify Plaintiff for losses and costs incurred in connection with the Goodwill Bond, with the Court reserving jurisdiction to determine Plaintiffs entitlement to recover interest, additional costs, and attorneys' fees; and, (3) a final decree of specific performance requiring that Defendants post collateral in the amount of $1,015,000.00 to secure Plaintiff against potential liability on the Village of Pinecrest Bond and the pending claim by Jag-Air Mechanical in connection with the Silver Lakes School Payment Bond, must be granted in its entirety. Based on the entry of summary judgment, I further conclude that Plaintiff is entitled to an All Writs Act Injunction to restrain Aventura and the American Arbitration Association ("AAA") from proceeding with the pending arbitration proceeding styled Aventura Engineering & Construction Corp, v. Goodwill Industries of Southern Florida, Inc., AAA Case No. 32410-Y-00500-06 (the "Arbitration Action"), Finally, because I granted summary judgment on Plaintiffs request for a final decree of specific performance, Plaintiffs Motion for Preliminary Injunction: (1) seeking to disgorge improperly received payments from the School Board of Broward County, Florida, in the amount of $163,628.00 in relation to the Silver Lakes Middle School Project; and, (2) requiring Defendants to post collateral in the additional amount of $411,372.00 to cover the potential losses and expenses associated with the pending claim on the Silver Lakes Bond by Jag-Air Mechanical, is denied as moot.

I. Factual Background

The following material facts are undisputed and supported by evidence in the record.1

Liberty Mutual Insurance Company ("Liberty") is a Massachusetts corporation which, among other things, issues surety bonds. Defendant Aventura Engineering & Construction Corp. ("Aventura"), a Florida Corporation, is a general contractor in the construction industry. Defendants Cary O. Lopez ("Lopez"), Camille A. Davis ("Davis"), and Rosaline Williams ("Williams") are citizens and residents of the state of Florida.

A. The General Indemnity Agreement

On or about December 4, 2003, Defendants Aventura, Lopez, Davis, and Williams (collectively "Defendants", "Indemnitors", or "Principals") executed an Indemnity Agreement in favor of Liberty. (Plaintiffs Revised Statement of Undisputed Facts, DE 143 at ¶ 1). The execution of the Indemnity Agreement was a condition precedent to Liberty issuing the bonds discussed in Section LB of this Order on behalf of Aventura, (Id., at ¶ 6).

Although relevant parts of the Indemnity Agreement, a copy of which has been filed with the Court,2 are addressed in the substantive argument section of this order, certain key provisions are set forth below.

SECOND: INDEMNITY — The Indemnitors shall exonerate, hold harmless, indemnify, and keep indemnified the Surety from and against any and all losses, fees, costs and expenses whatsoever kind or nature ... from the date of a breach of this Agreement or a breach of any other written agreements between or for the benefit of the Surety and the Indemnitor(s) and/or Principal(s) (hereinafter referred to as "Other Agreements") ... which the Surety may sustain or incur: (1) by reason of being requested to execute or procure the execution of any Bond; or (2) by having executed or procured the execution of any Bond; (3) by reason of the failure of the Indemnitors or Principals to perform or comply with any of the covenants and conditions of this Agreement or Other Agreements; or (4) in enforcing any of the covenants and conditions of this Agreement or Other Agreements. Payment ... shall be made to the Surety by the Indemnitors ... promptly, upon demand by the Surety, whether or not the Surety shall have made any payment therefore and, at the Surety's sole option, irrespective of any deposit or collateral. If the Surety determines, in its sole judgment, that potential liability exists for losses and/or fees, costs and expenses for which the Indemnitors and Principals will be obliged to Indemnify the Surety under the terms of this Agreement or Other Agreements, the Indemnitors ... shall deposit with the Surety, promptly upon demand, a sum of money equal to an amount determined by the Surety or collateral security of a type and value satisfactory to the Surety, to cover that liability, whether or not the Surety has: ... (b) made any payments; or (c) received any notice of any claims thereof.... In the event of any payment by the Surety, the Indemnitors ... further agree that in any accounting between the Surety ... and the Indemnitors ... the Surety shall be entitled to charge for any and all disbursements made by it in good faith in and about the matters herein contemplated by this Agreement or Other Agreements under the belief that it is, or was, or might be labile for the sums and amounts so disbursed or that it was necessary or expedient to make to make such disbursements, whether or not such liability, necessity or expediency existed; and that the vouchers or other evidence of any such payments made by the Surety shall be prima facie evidence of the fact and amount of the liability to the Surety.

THIRD: ASSIGNMENT — The Indemnitors hereby consenting do assign, transfer, pledge and convey to the Surety ... as collateral security for the performance of the covenants and agreements herein contained, contained in Other Agreements and for the payment of any other indebtedness or liability of the Indemnitors and/or Principals to the Surety, whether therefore or hereafter incurred, the assignment in the case of each contract being effective as of the date of the Bond covering such contract the following: (a) all of the right, title and interest of the Indemintors and/or Principals in, and growing in any manner out of, all contracts referred to in the Bonds, or in, or growing in any matter out of the Bonds; ... (d) all actions, causes of action, claims and demands whatsoever which the Indemnitors and/or Principals may have or acquire against any subcontractor, laborer or materialrnan, or any person furnishing or agreeing to furnish or supply labor, material, supplies, machinery, tools or other equipment in connection with or on account of any and au con; tracts referred to in the Bonds; ...

FIFTH: TAKEOVER — In the event of any, of the following: breach, default, or termination asserted by the obligee in any Bond; any Principal's abandonment of the work or forfeiture of any contract covered by any Bond, any Principal's failure to pay obligations incurred in connection therewith; ... then the Surety shall have the right at its option and its sole discretion and is hereby authorized, with or without exercising any other right or option conferred upon it by law or under the terms of this Agreement, to take possession of any part or all of the work under any contract or contracts covered by the Bonds, and the Indemintors hereby agree to use their best efforts to cause the Principal to permit the Surety to take possession of any part or all of the work ..., at the expense of the Indemnitors and Principal, to complete or arrange for the completion of the same, and the Indemnitors and Principals shall promptly, upon demand, pay to the Surety all losses, fees, costs and expenses so incurred.

THIRTEENTH: SETTLEMENTS — Surety shall have the right, at its option and sole discretion, to adjust, settle or compromise any claim, demand, suit or judgment upon any Bond, unless any indemnitor or Principal providing a reasonable legal basis thereof, shall request the Surety to litigate such claim or demand, or to defend such suit, or to appeal from such judgment, and shall deposit with the Surety, at the time of such request, cash or collateral satisfactory to the Surety in kind and amount to be used in paying any judgment or judgements rendered or that may be rendered, with interest, costs, expenses and attorneys' fees, including those of the Surety.

EIGHTEENTH: ATTORNEY-INFACT — The Indemnitors and Principals hereby irrevocably nominate, constitute, appoint and designate the Surety as their attorney-in-fact with the full right and authority, but not the obligation, to exercise all the rights of the Indemnitors and" Principals assigned, transferred and set over to the Surety in this Agreement, with full power and authority to execute on behalf of and sign any Indemnitor or...

To continue reading

Request your trial
45 cases
  • Starbuck v. R.J. Reynolds Tobacco Co.
    • United States
    • U.S. District Court — Middle District of Florida
    • November 16, 2018
    ...relinquish the known right, and as such, a waiver must be knowing, intelligent and voluntary." Liberty Mut. Ins. Co. v. Aventura Eng'g & Constr. Corp., 534 F.Supp.2d 1290, 1315 (S.D. Fla. 2008) (applying Florida law)."Florida has a long standing public policy in favor of adjudication of dis......
  • Socas v. Northwestern Mut. Life Ins. Co.
    • United States
    • U.S. District Court — Southern District of Florida
    • November 2, 2011
    ...waived a contractual right. See Winans v. Weber, 979 So.2d 269, 274 (Fla.Dist.Ct.App.2007); Liberty Mutual Ins. Co. v. Aventura Eng'g & Const. Corp., 534 F.Supp.2d 1290, 1315 (S.D.Fla.2008). Therefore, Dr. Socas failed to comply with the Policies' Notice of Claim provision until August 2005......
  • Liberty Mut. Ins. Co. v. Milender White Constr. Co.
    • United States
    • U.S. District Court — District of Colorado
    • December 13, 2017
    ...with MWCC.11 The surety's right to indemnity is well established at common law. See, e.g., Liberty Mut. Ins. Co. v. Aventura Eng'g & Constr. Corp., 534 F. Supp. 2d 1290, 1303 (S.D. Fla. 2008), 4 Phillip L. Bruner & Patrick J. O'Connor, Jr., Bruner & O'Connor On Construction Law § 12:97 (Aug......
  • BRC Uluslararasi Taahut ve Ticaret A.S. v. Lexon Ins. Co.
    • United States
    • U.S. District Court — District of Maryland
    • November 19, 2020
    ...has the 'ability to perform its obligations.'" Travelers, 2017 WL 2256600, at *5 (quoting Liberty Mut. Ins. Co. v. Aventura Eng'g & Const., 534 F. Supp. 2d 1290, 1303 (S.D. Fla. 2008)); see also First Nat. Ins. Co. of Am. v. Sappah Bros. Inc., 771 F. Supp. 2d 569, 576 (E.D.N.C. 2011) ("[E]n......
  • Request a trial to view additional results
1 books & journal articles
  • Chapter 12 - § 12.6 • MISCELLANEOUS ISSUES
    • United States
    • Colorado Bar Association Practitioner's Guide to Colorado Construction Law (CBA) Chapter 12 Construction Sureties
    • Invalid date remain solvent through litigation or to satisfy a judgment).[247] See Liberty Mut. Ins. Co. v. Aventura Eng'g & Constr. Corp., 534 F. Supp. 2d 1290, 1308 (S.D. Fla. 2008) (recognizing indemnity agreement gives surety right to settle bond claim unless principal requests surety litigate cl......

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT