Normandy Ins. Co. v. Jose Sorto, Jimerico Constr., Inc., No. 1D17-5259

• Court: Court of Appeal of Florida (US)
• Writing for the Court: OSTERHAUS, J.
• Parties: NORMANDY INSURANCE COMPANY, Appellant, v. JOSE SORTO, JIMERICO CONSTRUCTION, INC., and AMERISURE INSURANCE COMPANY, Appellees.
• Docket Number: No. 1D17-5259
• Decision Date: 31 October 2018

NORMANDY INSURANCE COMPANY, Appellant,
v.
JOSE SORTO, JIMERICO CONSTRUCTION, INC.,
and AMERISURE INSURANCE COMPANY, Appellees.

No. 1D17-5259

FIRST DISTRICT COURT OF APPEAL STATE OF FLORIDA

Date of Accident: May 2, 2016
October 31, 2018

On appeal from an Order of the Judge of Compensation Claims.
Iliana Forte, Judge.

OSTERHAUS, J.

After a heavy Bobcat machine ran over Jose Sorto's foot at his job site one morning, his employer J.A.M. Construction called its insurance broker about the expected workers' compensation claim. Upon hearing of the injury, the broker promptly submitted the paperwork to obtain workers' compensation coverage with Normandy Insurance Company. J.A.M.'s broker did not disclose that morning's accident. Normandy proceeded to write the policy

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effective as of that same day forward, but when it discovered Mr. Sorto's undisclosed injury, it refused to cover the claim. And it filed a case seeking repayment from the general contractor's workers' compensation insurer.

Ultimately, a Judge of Compensation Claims granted the motion for summary order against Normandy on the basis of a default rule that the insurance agreement between J.A.M. and Normandy was effective as of 12:01 a.m. of its effective date (there was no time-of-day term specified in the agreement). Normandy's policy was thus determined to cover Mr. Sorto's morning injury. We reverse, however, because Mr. Sorto's claim involves an undisclosed, known loss that Normandy's policy could not cover. Florida's insurance laws apply known loss principles and preclude coverage for losses that have already taken place. Uninsured persons cannot experience a loss, then scramble to get insurance and fail to disclose their loss, and then have the cost of their loss borne by the new insurer.

I.

An ambulance carted Jose Sorto to the hospital one morning in May 2016, after a Bobcat S300 ran over his foot at the jobsite. His injury was bad. So his employer, subcontractor J.A.M. Construction, promptly called its insurance agent about the expected workers' compensation claim. J.A.M. didn't know it, but it didn't have workers' compensation coverage. J.A.M.'s insurance agent had inquired about getting workers' compensation coverage a month before, but hadn't finalized anything. Once the agent heard about the new accident, he promptly submitted all the paperwork and got coverage for J.A.M. with Normandy Insurance Company made effective that same day. The agent did not tell Normandy about Mr. Sorto's injury that morning, but made it clear that J.A.M.'s coverage should be made effective for that day.

Mr. Sorto's injury was later reported to Normandy in the form of a claim. And for a while, Normandy duly accepted the claim and provided medical care and indemnity benefits. But once it discovered that Mr. Sorto's injury pre-existed J.A.M.'s application for coverage and wasn't disclosed, Normandy objected to covering it. Normandy instead sought contribution from the general contractor at the work site, Jimerico, Inc., who otherwise would be

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considered Mr. Sorto's statutory employer and responsible for providing workers' compensation coverage for the injury. See § 440.10(1)(b), Fla. Stat. (2016). Jimerico's insurer, Amerisure Insurance Company, filed a Response and Counter Motion for Final Summary Order. Amerisure argued that according to Normandy's policy with J.A.M., Normandy's coverage began at 12:01 a.m. on the day of the accident, prior to Mr. Sorto's accident, and thus Normandy was responsible for covering the injury. The JCC agreed with Amerisure that Normandy was responsible for covering the loss and granted Amerisure's motion. See Fla. Admin. Code R. 60Q-6.120(1) (authorizing JCCs to grant summary final order on the issue of whether there is coverage). Normandy then appealed.

II.

An appellate court considers de novo whether disposition by summary final order was appropriate. See Moya v. Trucks & Parts of Tampa, Inc., 130 So. 3d 719, 721 (Fla. 1st DCA 2013). This court reviews de novo a JCC's interpretation of the insurance policy contract and the determination of whether the law requires the insurer to provide coverage. See Bend v. Shamrock Servs., 59 So. 3d 153, 156 (Fla. 1st DCA 2011); State Farm Mut. Auto. Ins. Co. v. Mashburn, 15 So. 3d 701, 704 (Fla. 1st DCA 2009).

The key question in this appeal is whether a workers' compensation insurer must cover claims that were known to the insured before procuring coverage, but that weren't disclosed to the insurer. Nothing in the Workers' Compensation Law, chapter 440 of the Florida Statutes, requires new insurers to cover an insured's prior known...