Nationwide Mut. Fire Ins. Co. v. Kaloust Fin., LLC, Case No. 8:12-cv-235-T-33MAP

• Decision Date: 26 June 2013
• Docket Number: Case No. 8:12-cv-235-T-33MAP
• Parties: NATIONWIDE MUTUAL FIRE INSURANCE COMPANY, Plaintiff, v. KALOUST FINANCIAL, LLC, ET AL., Defendants.
• Court: U.S. District Court — Middle District of Florida

NATIONWIDE MUTUAL FIRE INSURANCE COMPANY, Plaintiff,

v.KALOUST FINANCIAL, LLC, ET AL., Defendants.

Case No. 8:12-cv-235-T-33MAP

UNITED STATES DISTRICT COURT MIDDLE DISTRICT OF FLORIDA TAMPA DIVISION

Dated: June 26, 2013

ORDER

This cause is before the Court pursuant to Plaintiff Nationwide Mutual Fire Insurance Co.'s Motion for Clarification (Doc. # 49), filed on April 12, 2013, requesting clarification of the Court's Order entered on April 9, 2013 (Doc. # 47). In that Order, the Court granted in part and denied in part Nationwide's Motion to Strike (Doc. # 39), denied Nationwide's Motion for Final Summary Judgment (Doc. # 36), and granted Defendants Stephen and Jackie Bleile's Dispositive Motion for Summary Judgment (Doc. # 38). The Defendants have not filed a response to Nationwide's Motion for Clarification, and the time for doing so has now elapsed.

After due consideration, Nationwide's Motion for Clarification is granted, and the Court's April 9, 2013, Order as to the parties' Motions for Summary Judgment is supersededand amended as detailed herein.¹ For the reasons that follow, Nationwide's Motion for Summary Judgment is granted in part and denied in part, and the Bleiles' Motion for Summary Judgment is granted.

I. Factual Background and Procedural History

Nationwide issued a Business Owners Liability Insurance Policy to Defendant Kaloust Financial, LLC, Policy No. 77BO7268003001, with effective dates of July 11, 2008, to July 11, 2009 (the "Policy"). (Doc. # 12 at ¶ 11; Doc. # 12-2). On or about May 20, 2009, Defendants Stephen and Jackie Bleile filed a wrongful death lawsuit in Missouri state court against Defendants Kaloust Financial, Richard Kaloust,² and Daniel Barbosa, among others, Case No. 09WA-CC0066-01 (the "Underlying Action"). (Doc. # 12 at ¶ 9; Doc. # 12-1). A copyof the fourth amended complaint filed by the Bleiles is attached to Nationwide's Motion for Summary Judgment as Exhibit A (the "Underlying Complaint"). (Doc. # 36-1).

The Underlying Complaint alleges that on or about January 7, 2009, the Bleiles' son, Mitchell Bleile, was a passenger in a vehicle operated by Barbosa. (Id. at ¶¶ 16-17). According to the Underlying Complaint, while approaching an intersection, Barbosa intentionally disregarded a stop sign and proceeded into the intersection without stopping, causing another vehicle to strike the passenger's side of Barbosa's vehicle. (Id. at ¶¶ 19, 20). As a result of the impact, Mitchell Bleile sustained serious injuries and subsequently died from those injuries. (Id. at ¶ 21).

The Underlying Complaint alleges that at the time of the accident, Barbosa was acting as an "agent" of Kaloust. (Id. at ¶ 17). The Underlying Complaint alleges counts for negligence and negligence per se against Kaloust and Barbosa and counts for negligent hiring, negligent retention, and negligent supervision against Kaloust. (Id. at 4-15). Kaloust and Barbosa have sought liability coverage from Nationwide for the Underlying Action pursuant to the Policy.

On February 3, 2012, Nationwide filed a three-count Complaint in this Court seeking declaratory judgment againstDefendants Kaloust Financial LLC and the Bleiles.³ (Doc. # 1). Each "count" consists of a Policy exclusion which Nationwide contends precludes coverage. (Id.). Nationwide filed an Amended Complaint on March 12, 2012, which added Richard Kaloust, the Estate of Richard Kaloust, and Barbosa as Defendants and added identical Policy exclusion "counts" against Barbosa. (Doc. # 12).

Specifically, the Amended Complaint alleges that coverage is barred by the Policy's Workers' Compensation and Similar Laws Exclusion (Counts I and IV), by the Policy's Employers' Liability Exclusion (Counts II and V), and/or by the Policy's Aircraft, Auto or Watercraft Exclusion (Counts III and VI). (Id.). Thus, Nationwide seeks a declaration that it has no duty to defend Kaloust and/or Barbosa in the Underlying Action and has no duty to indemnify Kaloust and/or Barbosa for any damages awarded to the Bleiles in the Underlying Action, whether by judgment, verdict, settlement, or compromise. (Id. at 15, 19, 23, 26, 29-30, 33).

Barbosa failed to appear in this action and a Clerk's default was entered against him on July 31, 2012. (Doc. # 27).

Nationwide filed a Motion for Judgment on the Pleadings on July 30, 2012. (Doc. # 24). On December 18, 2012, the Court entered an Order denying Nationwide's Motion. (Doc. # 35). Nationwide and the Bleiles filed Motions for Summary Judgment on January 11, 2013. (Doc. ## 36, 38). These motions are now before the Court.

II. Legal Standard

Summary judgment is appropriate "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). A factual dispute alone is not enough to defeat a properly pled motion for summary judgment; only the existence of a genuine issue of material fact will preclude a grant of summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986).

An issue is genuine if the evidence is such that a reasonable jury could return a verdict for the non-moving party. Mize v. Jefferson City Bd. of Educ., 93 F.3d 739, 742 (11th Cir. 1996)(citing Hairston v. Gainesville Sun Publ'g Co., 9 F.3d 913, 918 (11th Cir. 1993)). A fact is material if it may affect the outcome of the suit under the governing law.Allen v. Tyson Foods, Inc., 121 F.3d 642, 646 (11th Cir. 1997). The moving party bears the initial burden of showing the court, by reference to materials on file, that there are no genuine issues of material fact that should be decided at trial. Hickson Corp. v. N. Crossarm Co., Inc., 357 F.3d 1256, 1260 (11th Cir. 2004)(citing Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986)). "When a moving party has discharged its burden, the non-moving party must then 'go beyond the pleadings,' and by its own affidavits, or by 'depositions, answers to interrogatories, and admissions on file,' designate specific facts showing that there is a genuine issue for trial." Jeffery v. Sarasota White Sox, Inc., 64 F.3d 590, 593-94 (11th Cir. 1995)(citing Celotex, 477 U.S. at 324).

If there is a conflict between the parties' allegations or evidence, the non-moving party's evidence is presumed to be true and all reasonable inferences must be drawn in the non-moving party's favor. Shotz v. City of Plantation, Fla., 344 F.3d 1161, 1164 (11th Cir. 2003). If a reasonable fact finder evaluating the evidence could draw more than one inference from the facts, and if that inference introduces a genuine issue of material fact, the court should not grant summary judgment. Samples ex rel. Samples v. City of Atlanta, 846 F.2d 1328, 1330 (11th Cir. 1988)(citing Augusta Iron & SteelWorks, Inc. v. Emp'rs Ins. of Wausau, 835 F.2d 855, 856 (11th Cir. 1988)).

III. Analysis

A. The Duty to Defend and the Duty to Indemnify

Under Florida law, which the Court applies in this diversity case, the duty to defend is broader than the duty to indemnify. Sinni v. Scottsdale Ins. Co., 676 F. Supp. 2d 1319, 1323 (M.D. Fla. 2009). The decision of whether an insurer has a duty to defend "is determined solely by the claimant's complaint if suit has been filed." Higgins v. State Farm Fire & Cas. Co., 894 So. 2d 5, 9-10 (Fla. 2004). An insurer's duty to defend against a legal action is triggered "when the complaint alleges facts that fairly and potentially bring the suit within policy coverage." Jones v. Fla. Ins. Guar. Ass'n, Ins., 908 So. 2d 435, 442-43 (Fla. 2005).

In contrast to the duty to defend, the duty to indemnify is not determined by reference to the claimant's complaint, but rather by reference to the actual facts and circumstances of the injury. Underwriters at Lloyds London v. STD Enters., 395 F. Supp. 2d 1142, 1147 (M.D. Fla. 2005). In this context,

insurance contracts are to be construed in a manner that is reasonable, practical, sensible, and just. . . . Terms used in a policy are given their plain and ordinary meaning and read in the light of the skill and experience of ordinary people.

Provisions that exclude or limit liability of an insurer are construed more strictly than provisions that provide coverage.

U.S. Fire Ins. Co. v. Freedom Vill. of Sun City Ctr., 279 F. App'x 879, 880-81 (11th Cir. 2008)(internal citations omitted). Furthermore, if provisions in an insurance contract are "reasonably susceptible of more than one meaning, they are ambiguous and construed in favor of the insured. That rule applies if a genuine inconsistency, uncertainty, or ambiguity in meaning remains after a review of the plain language." Id. at 881.

B. The Policy's Relevant Provisions

The Policy provides, in pertinent part, as follows:

B. Exclusions

1. Applicable to Business Liability Coverage

This insurance does not apply to:

* * *

d. Workers' Compensation and Similar Laws

Any obligation of the insured under a workers' compensation, disability benefits or unemployment compensation law or any similar law.

e. Employer's Liability

"Bodily Injury" to:

(1) An "employee" of the insured arising out of and in the course of:

(a) Employment by the insured; or

(b) Performing duties related to the conduct of the insured's business;

* * *

This exclusion applies:

(a) Whether the insured may be liable as an employer or in any other capacity; and

(b) To any obligation to share damages with or repay someone else who must pay damages because of the injury.

* * *

g. Aircraft, Auto Or Watercraft

"Bodily injury" or "property damage" arising out of the ownership, maintenance, use or entrustment to others of any aircraft, "auto" or watercraft owned or operated by or rented or loaned to any insured. Use includes operations and "loading and unloading."

(Doc. # 12-2 at 20, 22)(emphasis in original). The Policy additionally provides:

C. Who Is An Insured

1. If you are designated in the Declarations as:

* * *

c. A limited liability company, you are an insured. Your members are also insureds, but only with respect to the conduct of your

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