Marrero v. Rea

• Decision Date: 05 March 2021
• Docket Number: Case No. 5D20-1612
• Citation: 312 So.3d 1041
• Parties: Aleyssa Marie Arroyo MARRERO, Petitioner, v. Terence REA, Respondent.
• Court: Florida District Court of Appeals

312 So.3d 1041

Aleyssa Marie Arroyo MARRERO, Petitioner,

v.Terence REA, Respondent.

Case No. 5D20-1612

District Court of Appeal of Florida, Fifth District.

Opinion filed March 5, 2021

Sharon C. Degnan, of Kubicki Draper, Orlando, for Petitioner.

Brian J. Lee, of Morgan & Morgan, Jacksonville, for Respondent.

EDWARDS, J.

Aleyssa Marie Arroyo Marrero ("Petitioner") seeks certiorari review of the circuit court's orders, which completely prohibit the parties from engaging in any discovery related to Petitioner's affirmative defense that the underlying personal injury claims were settled prior to suit being filed. Because the trial court relied upon inapplicable law and the orders banning all discovery effectively eviscerate her settlement defense, Petitioner has demonstrated both a departure from the essential requirements of law and irreparable harm as to both issues raised in the petition. Accordingly, we grant the petition and quash the orders.

The Automobile Accident

The underlying personal injury action arose from a 2015 three-vehicle crash. Petitioner drove a vehicle that collided with one driven by Diann McMurtrie, which in turn collided with a car driven by Terence Rea ("Respondent") in which his son, Jack, was a passenger. Both Respondent and his son claimed to have been injured in the collision. Ms. McMurtrie, the driver of the third vehicle, is not directly involved in this matter, but she also claimed to have been injured.

Presuit Settlement Correspondence

Within a few months of the accident, the Reas and Ms. McMurtrie asserted claims against Petitioner and her insurer, Foremost Group Insurance ("Foremost"). Petitioner's liability limits through Foremost were $10,000 per person and $20,000 per occurrence. Attorney Nicholas Panagakis submitted a settlement demand by letter to Foremost on behalf of Respondent and his son Jack. The February 5, 2016, demand letter requested payment of full policy limits within a limited time period and provision of certain documentation that would confirm ownership of Petitioner's vehicle, the lack of other insurance, and other matters. Mr. Panagakis’ letter advised Foremost that a condition of settlement was approval of the settlement with Petitioner and waiver of subrogation rights by State Farm Mutual Automobile Insurance Company ("State Farm"), Respondent's insurer for uninsured/underinsured coverage.¹

Foremost, through its adjustor, Pablo Andrade, responded by letter on February 15, 2016, to Attorney Panagakis, stating that Foremost would tender full policy limits, and referencing his discussion with Attorney Panagakis’ case manager, Melissa Ulloa, in which Andrade had requested a global settlement conference which would attempt to resolve all claims asserted by the Reas and Ms. McMurtrie against Petitioner within her modest liability limits. On March 1, 2016, Mr. Andrade sent another letter to Attorney Panagakis referencing another conversation with Ms. Ulloa, confirming settlement of Respondent's claim for $5,700, which forwarded the settlement check and general release.²

Although a settlement conference, as such, apparently did not take place, a letter dated March 4, 2016, from Attorney Panagakis to State Farm announced that a global settlement had been reached with Foremost so that Respondent and Jack Rea each received $5,700, while Ms. McMurtrie received $8,500. State Farm responded with its letter dated March 11, 2016, waiving its subrogation rights and authorizing the Reas’ settlement with Petitioner.

Suit Filed in Circuit Court, Removed to Federal Court

Two years later, in March 2018, Respondent, represented by Attorney Panagakis, filed suit against Petitioner in circuit court, asserting that Petitioner negligently collided with Ms. McMurtrie's vehicle, causing it to collide with Respondent's vehicle, injuring both of the Reas. In the same suit, Respondent sued State Farm, alleging breach of the underinsured motorist insurance contract and claiming bad faith. State Farm then removed the action to federal district court on the basis of diversity jurisdiction.

Federal District Court Litigation and Rulings

In June 2018, Petitioner filed a motion for summary judgment, asserting that Respondent's claims against her had been settled in 2016. As evidence in support of her motion for summary judgment, Petitioner filed copies of the various letters referred to above. Respondent opposed the summary judgment, claiming no settlement had been reached. Respondent filed copies of additional settlement-related correspondence, together with affidavits from both Attorney Panagakis and Respondent that essentially said that Panagakis did not have authority to settle the Reas’ claims for $5,700 each nor was he authorized to settle unless State Farm actually reached a settlement agreement on the Reas’ underinsured claims, as well. Respondent argued to the federal district court that there were disputed issues of material fact that made the settlement defense inappropriate for summary judgment. While the action was pending in federal court, Respondent deposed Foremost's adjustor, Mr. Andrade, and inquired about Andrade's correspondence or conversations with Attorney Panagakis and Melissa Ulloa, Panagakis’ assistant/case manager, regarding settlement.

On January 9, 2019, the federal district court entered an order denying Petitioner's motion for summary judgment because there appeared to be disputed factual issues. The federal court order noted that ordinarily, resolution of those factual issues would occur at trial. However, the federal court stated that it would lack diversity jurisdiction to entertain the suit further, unless it could determine that a settlement had been reached, because both Petitioner and Respondent were residents/citizens of Florida. The federal court noted that it was obliged to resolve that jurisdictional question by making a determination regarding the settlement issue, and advised that it would hold an evidentiary hearing for that purpose.

In response to a scheduling order from federal court, Petitioner and Respondent filed a written joint stipulation on April 12, 2019, in which they both stated that no further discovery would be required in order to permit resolution of the settlement/jurisdictional issues. The federal court accepted the stipulation and on May 23, 2019, entered its order, in which it noted that Foremost's letter responding to the initial demand letter was not a mirror-image, point-by-point acceptance of the original demand letter, nor were the checks cashed or release signed. The federal district judge denied Petitioner's motion stating that "the Court cannot conclude that it is more likely than not that [Respondent] settled his claim against [Petitioner]." Based on that finding, the federal court determined that diversity was lacking, which in turn meant that the district court lacked subject matter jurisdiction. On May 23, 2019, the federal court entered its order remanding the case back to circuit court and vacating its prior substantive orders, including its order denying Petitioner's motion for summary judgment on the settlement issue.

Post-remand Circuit Court Litigation

Once the case had been remanded, Petitioner filed a motion for summary judgment in circuit court, which was essentially identical to the motion she had filed in federal court, asserting that Respondent's claims against her had been settled presuit in 2016. Respondent served a set of interrogatories on Petitioner that included at least one question asking Petitioner to explain the factual basis for her settlement defense with the further request that she identify all documents and witnesses supporting that defense.

Later, Respondent filed a response to Petitioner's motion for summary judgment in which he argued no settlement had been reached because the supposed acceptance letter from Foremost did not mirror the initial demand letter. Respondent filed his own summary judgment motion seeking to defeat the settlement defense based on the non-mirror image argument.

Petitioner's Intent to Depose Respondent and Counsel

Petitioner notified Respondent of her intention to depose Respondent, Attorney Panagakis, and the assistant/case manager, Ms. Ulloa. Petitioner ultimately filed a motion to compel these depositions. Respondent filed a motion to determine the scope of discovery necessary for his summary judgment and an alternative motion for protective order to prohibit those depositions from going forward. Respondent argued in his motion and during the hearings held on the motion that Petitioner was judicially estopped from pursuing discovery in circuit court because of the parties’ joint stipulation in federal court that no additional discovery was needed to resolve the settlement defense summary judgment motion. Respondent also argued that the attorney-client privilege barred depositions of Respondent and his attorney regarding settlement.

Orders Precluding Discovery

Following two hearings, the circuit court issued two orders on June 26, 2020. The first order granted Respondent's motions and prohibited Petitioner from deposing Respondent, his lawyer, and the case manager based upon the application of the doctrine of judicial estoppel flowing from the parties’ federal court stipulation. The circuit court also ruled that those depositions would violate the attorney-client privilege regarding their discussions regarding settlement.

The second order denied Petitioner's motion to compel these depositions and denied her motion for protective order in which she had requested that Respondent should not be allowed to question her about settlement issues when deposing her. In response to Petitioner's motion for rehearing, the trial court entered amended orders, "to clarify that neither party shall conduct additional discovery on the issue of [Petitioner's] settlement defense." The orders would allow Petitioner to depose Respondent on relevant topics other than settlement. The trial court gra...