Pacific Indemnity Company v. Broward County, 71-2646.

• Decision Date: 25 September 1972
• Docket Number: No. 71-2646.,71-2646.
• Citation: 465 F.2d 99
• Parties: PACIFIC INDEMNITY COMPANY, Plaintiff, v. BROWARD COUNTY, Defendant-Appellee, and Florida Airmotive Sales, Inc., Defendant-Appellant.
• Court: U.S. Court of Appeals — Fifth Circuit

465 F.2d 99 (1972)

PACIFIC INDEMNITY COMPANY, Plaintiff, v. BROWARD COUNTY, Defendant-Appellee, and Florida Airmotive Sales, Inc., Defendant-Appellant.

No. 71-2646.

United States Court of Appeals, Fifth Circuit.

July 25, 1972.

Rehearing and Rehearing Denied September 25, 1972.

Paul R. Larkin, Jr., James E. Tribble, Blackwell, Walker & Gray, Miami, Fla., for Florida Airmotive Sales, Inc.

Richard J. Thornton, Walton, Lantaff, Schroeder, Carson & Wahl, Miami, Fla., for Broward County.

Samuel A. Brodnax, Jr., Kermit G. Kindred, Miami, Fla., for Pacific Indemnity Co.

Before GEWIN, COLEMAN and INGRAHAM, Circuit Judges.

Rehearing and Rehearing En Banc Denied September 25, 1972.

GEWIN, Circuit Judge:

This appeal presents the Case of the Forgotten Issue and raises the interesting problem of what happens in a diversity suit where the litigants raise an issue in their pleadings and then forget about the question until after the case has gone to the jury. The district court treated the absence of proof on the issue to be a failure of proof of a material element of the cross-claim of Florida Airmotive Sales, Inc. (Airmotive) against Broward County and granted judgment notwithstanding the verdict in favor of the County on the cross-claim. We affirm.

The suit was instituted by Pacific Indemnity Company as property damage insurer and subrogee of the Donzi Marine Corporation for damages in the sum of $389,000 for the destruction by fire of four aircraft owned by Donzi and insured by Pacific Indemnity. Pacific Indemnity sued both Broward County, which owned the hangar in which the aircraft were housed at the time of the fire, and Airmotive which rented the hangar from the County and had in turn leased space in the hangar to Donzi.

Airmotive filed a cross-claim against the County seeking indemnity from any loss from the suit by Pacific Indemnity and also seeking damages for the destruction of Airmotive's own aircraft and other property caused by the fire. The County replied to Airmotive's cross-claim, incorporating motions to dismiss, and asserting a counter-crossclaim against Airmotive for indemnity from loss arising from the suit by Pacific Indemnity and also seeking damages for the loss of the hangar.

Pre-trial motions disposed of both indemnity claims and that part of the County's claim for the loss of the hangar based on contractual indemnity. Pursuant to a stipulation between the parties a pre-trial order was entered. The cause was tried before a jury on the main claim of Pacific Indemnity and the remaining issues of negligence and damages raised by Airmotive's cross-claim and the County's counter-cross-claim. The jury returned verdicts in favor of Pacific Indemnity against the County for $389,000 and in favor of Airmotive as to Pacific Indemnity's claim against it. The jury also found in favor of Airmotive on its cross-claim against the County, awarding damages of $150,000, and against the County on its counter-cross-claim against Airmotive.

Following the entry of judgment on Airmotive's cross-claim, the County filed a motion for judgment N. O. V. and for a new trial. After a hearing on the motion the trial court granted the County's motion for judgment N.O.V., vacated the judgment in favor of Airmotive on its cross-claim, and entered judgment for the County. Airmotive appeals from that judgment.¹

Although the parties raise other questions on appeal, we reach only the problem of the interplay between the substantive law of Florida and Rule 16 F. R.Civ.P. concerning pre-trial orders.

Of central importance here is Florida Statute § 95.08, F.S.A.:

"Every claim against any county shall be presented to the board of county commissioners within one year from the time said claim shall become due, and shall be barred if not so presented."

In count one of their amended cross-claim Airmotive specifically pleaded that notice had been given to the County in accordance with the statute. In count two Airmotive realleged by reference a number of the specific allegations of count one, including the allegation of notice to the County. In reply the County specifically denied the allegation of notice contained in count one, denied all of the specific allegations of count two and included as to both counts a general denial of all allegations of the cross-claim not specifically admitted. In addition the County in its reply separately moved to dismiss both counts of Airmotive's cross-claim because, inter alia, Airmotive had failed to give the County notice of the claims within the time required by the statute.

Thereafter during the entire pre-trial proceedings, which included two motions by the County for summary judgment on Airmotive's cross-claim, through the pre-trial hearing and order, up until the close of all evidence at trial, no specific mention of the issue of notice was made by either the County or Airmotive. Under the district court's local rules the parties were required in their pre-trial stipulation to set forth the facts as to which there was no disagreement, the remaining issues for determination and all undisposed motions. Airmotive's allegation of notice to the County was not set forth as a stipulated fact,² and neither party included the question in their list of issues to be determined. The stipulation did indicate that the County's motions to dismiss the cross-claim which were based on the absence of notice remained to be acted on by the court. At the pre-trial hearing all pending motions to dismiss were denied.

At the trial of the cause, no mention was made of the issue of statutory notice until the conclusion of all of the evidence, when the County moved for a directed verdict on Airmotive's cross-claim because, inter alia, Airmotive had failed to introduce any proof of compliance with the statutory notice provisions. That motion was denied. However following trial the County sought and was granted judgment N.O.V. on Airmotive's cross-claim for the same reason.

Airmotive contends that the Florida notice statute does not affect the court's jurisdiction and that a county may waive or be estopped to assert the lack of statutory notice. Airmotive argues that in this case the County has waived or is estopped to assert the failure of Airmotive to prove compliance with the notice statute by (1) failing to preserve the issue by its pleadings, or (2) by failing to preserve the issue in the pretrial stipulation, or (3) by the collective impact of these and other procedural developments prior to the time of trial.

Broward County responds that any conduct on its part constituting an alleged waiver or estoppel to assert lack of notice must occur during the 1 year period in which notice must be given. The County contends it did preserve the issue and that in the absence of proof of notice the court lost jurisdiction of the suit.

A careful review of the Florida cases convinces us that the Florida courts view the statutory notice as a condition precedent to a claimant's suit. Whitehurst v. Hernando County, 91 Fla. 509, 107 So. 627 (1925) is perhaps the foundation case on the point. In Whitehurst the Florida Supreme Court affirmed a judgment on the pleadings for the County where the plaintiff had failed to allege that the claim had been presented to the County within the statutory period.

"The statutory requirement is a prerequisite to the right of action against the county."

107 So. at 628. See also, Fradley v. County of Dade, 187 So.2d 48 (Fla.App.1966); Kahl v. Board of County Commissioners of Dade County, 162 So.2d 522 (Fla.App.1964). Most recently in Ribler v. Florida Power and Light Co., 254 So.2d 238 (Fla.App.1971), involving a suit against Broward County arising from its operation of this same airport, the court affirmed a judgment in favor of the County because the complaint failed to allege compliance with the statute.

"It appears to be settled law . . . that the complaint must allege compliance with the statute as a pre-requisite to stating a valid cause of action against the county, . . ."

254 So.2d at 238-239.

In none of the cases cited have we found an instance where the Florida courts have indicated that the absence of notice affects the court's jurisdiction to hear the suit. Indeed in Webb v. Hillsborough County, 128 Fla. 471, 175 So. 874 (1935) the court permitted a claim in the absence of formal notice contemplated by the statute. In several suits involving analogous notice requirements³ of claims against municipalities the Florida Courts have indicated that suit may be maintained in some circumstances in the absence of any notice at all. Rabinowitz v. Town of Bay Harbor Islands, 178 So.2d 9 (Fla.1965); Tillman v. City of Pompano Beach, 100 So.2d 53 (Fla.1957).⁴ We therefore conclude that the absence of proof of notice does not deprive the court of jurisdiction, but that notice is an essential element of a claimant's suit which must be alleged and proved in the absence of an admission, waiver or estoppel by the County.

In the present case it is apparent that the County has neither waived nor admitted notice in fact. Unlike the pleadings in Rabinowitz and Tillman, supra, Airmotive did not allege in its cross-claim that the County by its actions had waived or was estopped to assert lack of notice. Airmotive alleged that it had given the County the required notice. The County by its answer denied that Airmotive had given the required notice and moved to dismiss. The issue was thus clearly joined in the pleadings.

Airmotive contends that even if the County's reply constituted a sufficient denial of the allegation of notice, it subsequently abandoned or waived the issue, or became estopped to assert it as a result of the...