Moncello v. Federal Ins. Co.

• Decision Date: 22 March 1990
• Docket Number: No. 89-668,89-668
• Citation: 558 So.2d 1081
• Parties: 15 Fla. L. Weekly D775 Richard J. MONCELLO, Appellant, v. FEDERAL INSURANCE COMPANY, etc., Appellee.
• Court: Florida District Court of Appeals

Page 1081

558 So.2d 1081

15 Fla. L. Weekly D775

Richard J. MONCELLO, Appellant, v. FEDERAL INSURANCE COMPANY, etc., Appellee.

No. 89-668.

District Court of Appeal of Florida Fifth District.

March 22, 1990.

Patrick M. Magill, Orlando, for appellant.

Craig L. Brams of Eubanks, Hilyard, Rumbley, Meier and Lengauer, P.A., Orlando, for appellee.

GOSHORN, Judge.

Richard Moncello appeals the summary final judgment entered in favor of Federal Insurance Company. Because the plain language of the policy provides coverage to Moncello, we reverse.

The facts are not disputed. Moncello is a real estate broker who was employed by Active One Realty, Inc. (Active) as an "independent contract broker." A professional malpractice policy issued by Federal Insurance Company (Federal) to Active was in effect during Moncello's employment. As an "independent contract broker," Moncello was an insured as that term is defined by the policy. The policy in question was issued on a "claims made" basis covering only wrongful acts reported to Federal during the policy period. ¹

Marilyn Walden filed suit against Moncello alleging acts which admittedly took place prior to the inception date of the policy. Moncello duly notified Federal of the claim, but the company refused to provide coverage or defend the suit on the ground that Moncello was not "acting on behalf of Active One Realty, Inc. during the realty transaction sited (sic) in the law suit." After employing his own attorney, Moncello successfully defended the action, and later filed suit seeking a declaratory judgment that Federal had wrongfully refused to defend the Walden suit and was required to reimburse Moncello for his incurred defense costs. ²

Federal moved for summary judgment, contending the policy did not provide coverage. The trial judge, granting Federal's motion, found:

[A]lthough the claims against Moncello were lodged during his association with Active One Realty, Inc., at the time of the tortious acts, Mr. Moncello was not in any way associated with Active One Realty, Inc., and, therefore, is not entitled to any benefits or defenses that might be provided under the Federal Insurance Company policy issued to Active One Realty, Inc.

In support of the trial court's decision, Federal primarily relies on two cases: Padberg v. The Travelers, 197 Cal.App.3d 1161, 243 Cal.Rptr. 266 (1987) and Swift v. American Home Assurance Co., 22 Wash.App. 777, 591 P.2d 1216 (1979). Padberg concerned a broker associated with a real estate agency who sought coverage under the agency's malpractice policy for claims against him rising out of activities occurring prior to his association with the agency. The insurer refused to defend the broker. Reviewing the policy, the California court found that the policy language did cover the broker, "but only while acting within the scope of his duties as such." Actions occurring prior to the broker's association with the policy holder were not within the scope of his duties, and thus were not covered. Similarly, in Swift, an insurance agent failed to include a church parsonage in a fire policy. After the agent became employed by another concern, the church was destroyed in fire. The church filed suit against the agent who requested that his current employer's carrier defend him under the employer's malpractice policy. The carrier refused. After the church recovered against the agent, the agent brought suit against the carrier. The policy contained language requiring an employee to be acting within the scope of his duties when the omission occurred in order to be covered under the policy. The court found that the agent was not acting within the scope of his duties when he failed to insure the parsonage and therefore no coverage attached.

In this case, the policy contains no such restrictive language. Moreover, the policy is not ambiguous. Therefore this court cannot interpret the policy to assign a different meaning to language that is clear. ³ Rigel v. National Casualty Company, 76 So.2d 285 (Fla.1954). The policy simply defines "insured" to mean:

(A) The brokerage firm named in Item 1 of the Declarations.

(B) Any person who is a proprietor, partner, officer, director, or stockholder of such brokerage firm, including spouses of such persons who are actively engaged in the operations of such brokerage firm.

(C) Any person who is an employee, sales person, sales associate or unlicensed trainee or independent contractor broker of such brokerage firm.

(D) The estates, heirs, legal employee, sales person, sales associate or unlicensed trainee or independent contractor broker of such brokerage firm.

The policy then expressly and without limitation provides coverage for wrongful acts reported to the company during the policy period. If Federal wished to further restrict its coverage it could have so stated in the policy. We can only assume that the insurance company, aware of its actuarial risk, charged what it believed to be an adequate premium.

The summary judgment entered against Federal is reversed and the cause remanded to the trial court to enter judgment according Moncello coverage.

REVERSED and REMANDED with instructions.

DAUKSCH, J., concurs.

HARRIS, J., dissents with opinion.

HARRIS, Judge, dissenting.

I respectfully dissent. While I agree with the majority that the insurance policy here involved is not ambiguous, still its coverage must be determined from the entire policy and not merely portions thereof. Unambiguous insurance contracts are enforced in accordance with the reasonable expectations of the insured. Sparks v. St. Paul Ins. Co., 100 N.J. 325, 495 A.2d 406 (1985).

It is true that the policies involved in Padberg v. The Travelers, 197 Cal.App.3d 1161, 243 Cal.Rptr. 266 (1987) and Swift v. American Home Assurance Co., 22 Wash.App. 777, 591 P.2d 1216 (1979) both contained "within the scope of...