Monogram Products, Inc. v. Berkowitz
| Decision Date | 24 December 1980 |
| Docket Number | No. 80-202,80-202 |
| Citation | 392 So.2d 1353 |
| Parties | MONOGRAM PRODUCTS, INC., a Florida Corporation, Appellant, v. Joseph L. BERKOWITZ, d/b/a J. L. Berkowitz Agency, Gulf Insurance Company,Aetna Insurance Company, Peninsular Fire Insurance Company and SecurityInsurance Company of Hartford, Appellees. |
| Court | Florida District Court of Appeals |
William M. Schneikart of Jacobs, Robbins & Gaynor, St. Petersburg, for appellant.
J. Emory Wood of Harris, Barrett & Dew, St. Petersburg, for appellee Joseph L. Berkowitz.
W. Donald Cox of Fowler, White, Gillen, Boggs, Villareal & Banker, Tampa, for appellees Aetna Ins. Co., Peninsular Fire Ins. Co., Sec. Ins. Co. of Hartford, and Gulf Ins. Co.
The trial court awarded summary final judgments holding that the Statute of Frauds barred enforcement of an oral contract concerning insurance and that an insurance agent owed no duty to the insured to provide coverage above the limits of the policies actually issued. We reverse.
Monogram Products, Inc., sued Joseph L. Berowitz, doing business as J. L. Berkowitz Agency, Gulf Insurance Company, Aetna Insurance Company, Peninsular Fire Insurance Company and Security Insurance Company of Hartford. Monogram alleged that the defendants' negligence and breach of an alleged oral contract resulted in inadequate insurance coverage for a fire loss at one of its warehouses.
Monogram alleged that it manufactured, imported and distributed novelty and souvenir merchandise. Since its plans called for importing and storing unusually large quantities of merchandise in early 1977, it leased a second warehouse. Realizing that the value of its inventory at the new warehouse could fluctuate as much as $200,000 in a month, Monogram asked Berkowitz, its regular insurance agent, to procure adequate insurance for the inventory prior to using the warehouse. Monogram alleged that it informed Berkowitz that $100,000 coverage on the inventory in the new warehouse would not be adequate and that due to the fluctuating inventory, coverage would have to be flexible.
In his deposition Charles Burkett, Monogram's president, testified that Berkowitz suggested that Monogram report the amounts of inventory in the two warehouses monthly so that proper premiums could be computed at year's end. Further, Burkett said that Berkowitz suggested that since the initial inventory in the new warehouse would be only $50,000 to $60,000, Monogram should set a limit to coverage of $100,000 for the inventory in that warehouse. According to Burkett, Berkowitz explained that when monthly reports indicated an inventory exceeding that amount, the policies would automatically cover it as long as inventory in both warehouses did not exceed $700,000 in value. Monogram alleged that it entered into an oral contract with Berkowitz to that effect. Berkowitz subsequently procured policies from the defendant insurance companies. The policies, however, limited coverage on the new warehouse to $100,000 without regard to the value of the inventory at both warehouses. Monogram was not aware of this since, claiming that it relied on the representations of Berkowitz, it had not read the policies. This, however, does not bar its claim. Blumberg v. American Fire & Casualty Co., 51 So.2d 182 (Fla.1951).
On November 26, 1977, fire destroyed Monogram's new warehouse and its inventory valued in excess of $180,000. At that time the inventory in both warehouses was worth less than $700,000. The four insurance companies subsequently honored Monogram's claim only to the extent of $100,000.
Monogram sued to recover the deficit on the theories that Berkowitz had been negligent in failing to maintain adequate insurance coverage for it and had breached the alleged oral contract and was therefore liable. It also alleged that the insurance companies were liable for the actions of Berkowitz as their agent. Each defendant moved for summary judgment on two grounds: (1) the Statute of Frauds barred enforcement of Monogram's claim because the alleged contract was not in writing and could not be performed in one year as required by section 725.01, Florida Statutes (1979), and (2) Berkowitz had no duty to maintain adequate insurance for Monogram. In their motions Aetna and Peninsular added that even if their agent Berkowitz made the alleged agreement, there was no evidence that he acted as their agent on this occasion; while Gulf and Security contended they were not liable because Berkowitz was not even their agent. The trial court awarded summary final judgments to all defendants on the grounds that Berkowitz had no duty to provide insurance to Monogram over the limits of the policies actually issued, and that the Statute of Frauds barred enforcement of the alleged oral contract. This appeal by Monogram followed.
Initially, we note that the liability of an insurance agent for failure to procure coverage as agreed is recognized in Florida. First National Insurance Agency v....
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