Riverside Apartments of Cocoa, LLC v. Landmark Am. Ins. Co.
| Decision Date | 04 December 2020 |
| Docket Number | Case No. 6:18-cv-1639-Orl-40DCI |
| Citation | 505 F.Supp.3d 1293 |
| Parties | RIVERSIDE APARTMENTS OF COCOA, LLC, Equity of America, Inc. and Equity Planning Corporation, Plaintiffs, v. LANDMARK AMERICAN INSURANCE COMPANY, Defendant. |
| Court | U.S. District Court — Middle District of Florida |
Edward A. Proctor, Pro Hac Vice, Thomas J. Connick, Pro Hac Vice, Connick Law, LLC, Beachwood, OH, Joseph W. Janssen, III, Janssen, Siracusa & Keegan, P.A., West Palm Beach, FL, for Plaintiffs.
David Joshua Maldoff, Maxwell Harrison Stape, Scott J. Frank, Troy J. Seibert, William Roderick Lewis, Butler Weihmuller Katz Craig LLP, Tampa, FL, for Defendant.
This cause comes before the Court on Defendant's Omnibus Motion for Partial Summary Judgment (Doc. 63 (the "Motion ")). Plaintiffs responded in opposition (Doc. 85), and Defendant filed a reply (Doc. 90).
This dispute arises out of a commercial insurance policy (the "Policy ") issued by Defendant to Plaintiff Riverside Apartments of Cocoa, LLC ("Riverside "). The insured property (the "Property ") consists of four buildings containing 52 total rental apartment units. Building A contains 18 rental units, Building B contains nine rental units, Building C contains 25 rental units, and Building D is a storage/laundry room with no rental units.
Defendant is a Florida surplus lines insurance carrier. At the outset, the Court believes an overview of surplus lines insurance may be helpful:
Douglas R. Richmond, Surplus Lines Insurance and Wholesale Brokers , 25 No. 8 INS. LITIG. REP. 261 (May 16, 2003) (internal citations omitted); see also FLA. STAT. § 626.913.
Frequently, policyholders and insurance companies negotiate and execute contracts through intermediaries. See MacLaren Europe Ltd. v. ACE Am. Ins., 908 F. Supp. 2d 417, 419–20 (S.D.N.Y. 2012). Such intermediaries typically fall into two general categories: agents and brokers. See Essex Ins. v. Zota , 985 So. 2d 1036, 1040 (Fla. 2008). "An insurance agent is captive to one insurance company and is bound to place coverage with that company [whereas an] insurance broker is an ‘independent middleman’ who is not tied to a particular company." Douglas R. Richmond, Surplus Lines Insurance and Wholesale Brokers , 25 No. 8 INS. LITIG. REP. 261 (May 16, 2003). In general, "[a]n insurance broker acts as an agent of the insured, not the insurer. " Essex , 985 So. 2d at 1046 ; see also Lima Delta Co. v. Glob. Aerospace, Inc. , 325 Ga.App. 76, 752 S.E. 2d. 135, 140 (2013).
Additionally, Douglas R. Richmond, Surplus Lines Insurance and Wholesale Brokers , 25 No. 8 INS. LITIG. REP. 261 (May 16, 2003). In such cases, brokers are subcategorized as either "retail brokers" or "wholesale brokers." Id. The policyholder interfaces with the retail broker, the retail broker interfaces with the wholesale broker, and the wholesale broker interfaces with insurance companies. Id.
Discussions regarding the Policy began in the fall of 2015. Riverside employed Jeff Cohen ("Cohen "), a retail insurance broker, to seek insurance for the Property. In turn, Cohen asked T.C. Canterna ("Canterna "), a wholesale insurance broker, for assistance in procuring coverage.
On October 30, 2015, Canterna requested a policy quote for the Property from Defendant's underwriter, Zhanna Seglie ("Seglie "). Seglie and Jill Hartl ("Hartl "), another underwriter for Defendant, approved the final version of what would ultimately become Riverside's Policy. Seglie emailed Canterna the quote on November 2, 2015. On December 9, 2015, Canterna responded by requesting that Seglie "bind coverage per your most recent quote." Later that day, Seglie emailed Canterna the binder.2 On January 11, 2016, Hartl emailed Canterna a final copy of the Policy.
At all relevant times during this process, Cohen and Canterna were located in Ohio, and Defendant's underwriters were located in Georgia.
The loss at issue in this case involves wind and rain damage caused by Hurricane Matthew in October 2016. Plaintiffs estimate approximately $4,123,429.42 in damages. (Doc. 66-28). Defendant approved coverage and remitted payment for some—but not all—of Plaintiffs’ claims.
Of particular relevance to the instant Motion is damage caused to the roof of Building C. Prior to the loss, Plaintiff contracted with G&G Roofing Construction, Inc. ("G&G Roofing "), to replace Building C's roof. According to Plaintiffs’ corporate representative and G&G Roofing's Chief Estimator, a portion of Building C's replacement roof had been completed when Hurricane Matthew reached the Property. The completed portion was unharmed, but Plaintiffs allege that the incomplete portion "was damaged and subject to wind uplift and, as a result, allowed water intrusion into [B]uilding C." (Doc. 85, p. 17). After Hurricane Matthew passed, G&G Roofing finished replacing Building C's roof. As part of its claim adjustment, Defendant approved coverage for a portion of the costs associated with Building C's roof replacement.
The Policy provides that, "If [Defendant] decide[s] not to renew this policy, [it] will mail or deliver to the first Named Insured written notice of nonrenewal, accompanied by the specific reason for nonrenewal, at least 45 days prior to the expiration of the policy." (Doc. 66-1, p. 23). On October 31, 2016, Hartl emailed Canterna to inform him that Defendant would not be renewing the Policy. Attached to the email was: (1) the Notice of Nonrenewal explaining that the reasons for nonrenewal were underwriting reasons; and (2) an endorsement extending the Policy to December 19, 2016, to ensure the correct number of days under the Policy for advance notice for the nonrenewal.
To prevail on a summary judgment motion, the movant must show "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) ; see also Celotex Corp. v. Catrett , 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). The Court must "view the evidence and all factual inferences therefrom in the light most favorable to the non-moving party, and resolve all reasonable doubts about the facts in favor of the non-movant." Davila v. Gladden , 777 F.3d 1198, 1203 (11th Cir. 2015) (quoting Carter v. City of Melbourne , 731 F.3d 1161, 1166 (11th Cir. 2013) (per curiam)). Harrison v. Culliver , 746 F.3d 1288, 1298 (11th Cir. 2014). "A mere ‘scintilla’ of evidence supporting the opposing party's position will not suffice; there must be enough of a showing that the jury could reasonably find for that party." Brooks v. Cnty. Comm'n of Jefferson Cnty. , 446 F.3d 1160, 1162 (11th Cir. 2006) (quoting Walker v. Darby , 911 F.2d 1573, 1577 (11th Cir. 1990) ).
Before reaching Defendant's substantive arguments, the Court must first determine the source of applicable law. Defendant argues that Georgia law applies, whereas Plaintiffs argue for the application of Florida or, in the alternative, Ohio law. In a diversity action, a federal court must apply the choice-of-law rules of the forum state. Klaxon Co. v. Stentor Elec. Mfg. Co. , 313 U.S. 487, 497, 61 S.Ct. 1020, 85 L.Ed. 1477 (1941). Under Florida's choice-of-law rule, Georgia law applies.
In Florida, insurance disputes are governed by contract law, because they arise out of insurance contracts.
Lumbermens Mut. Cas. Co. v. August , 530 So. 2d 293, 295 (Fla. 1988). "With regard to insurance contracts, Florida follows the ‘lex loci contractus ’ choice-of-law rule, which ‘provides that the law of the jurisdiction where the contract was executed governs the rights and liabilities of the parties in determining an issue of insurance coverage.’ " Rando v. Gov't Emps. Ins. , 556 F.3d 1173, 1176 (11th Cir. 2009) (quoting State Farm Mut. Auto. Ins. v. Roach , 945 So. 2d 1160, 1163 (Fla. 2006) ). "Lex loci contractus is, in...
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