Rollins Burdick Hunter of New York, Inc. v. Euroclassics Ltd., Inc.

• Decision Date: 03 February 1987
• Docket Number: Nos. 85-1326,85-2698,s. 85-1326
• Citation: 502 So.2d 959,12 Fla. L. Weekly 439
• Parties: 12 Fla. L. Weekly 439 ROLLINS BURDICK HUNTER OF NEW YORK, INC., Appellant, v. EUROCLASSICS LIMITED, INC., Appellee.
• Court: Florida District Court of Appeals

Page 959

502 So.2d 959

12 Fla. L. Weekly 439

ROLLINS BURDICK HUNTER OF NEW YORK, INC., Appellant, v. EUROCLASSICS LIMITED, INC., Appellee.

Nos. 85-1326, 85-2698.

District Court of Appeal of Florida,

Third District.

Feb. 3, 1987.

Rehearing Denied March 12, 1987.

McDermott, Will & Emery and Robert T. Palmer and Steven E. Siff, Miami, for appellant.

Palmer & Lazar and Bruce Lazar, Miami, for appellee.

Before HENDRY, NESBITT and FERGUSON, JJ.

NESBITT, Judge.

Rollins Burdick Hunter of New York, Inc. (RBH) appeals an amended final judgment for Euroclassics Limited, Inc. (Euroclassics) in Euroclassics' action to collect benefits under an insurance policy. RBH further appeals the denial of its motion for relief from judgment and new trial on the ground of newly discovered evidence. The two appeals are consolidated. We reverse the trial court's judgment.

Jack Kartee, Euroclassics' president and sole officer, retained RBH, an insurance broker, to procure coverage for Euroclassics' twin-engine airplane. The airplane later disappeared under mysterious circumstances in the Caribbean while the policy was in effect. The policy's underwriter, Federal Insurance Company (Federal), denied Euroclassics' subsequent claim for insurance benefits on the ground that the policy did not cover losses occurring in the Caribbean. Euroclassics sued both Federal and RBH, alleging that Federal breached its agreement to provide the coverage (count I), or that RBH breached its agreement to obtain a policy with the proper geographic scope (count II), or that RBH negligently failed to obtain a proper policy (count III).

Federal's sole defense, consistent with its basis for denying the claim for benefits, was that the policy simply did not cover losses occurring in the Caribbean. RBH, however, interjected affirmative defenses which asserted that Euroclassics was not entitled to coverage because the plane was being used for illegal activities at the time of its disappearance and because Euroclassics had materially misrepresented its intended usage of the plane at the time it applied for the insurance coverage.

During discovery RBH deposed Kartee. RBH asked Kartee whether he had ever been convicted of a crime. Kartee answered in the affirmative and revealed that he had been convicted of conspiracy. Kartee refused, however, to answer any further questions concerning his criminal activities and instead invoked his fifth amendment privilege against self-incrimination. RBH moved for an order to compel Kartee to answer the questions or to strike Euroclassics' pleadings on the ground that RBH's ability to prove its affirmative defenses based on the illegal use of the aircraft was thwarted by Kartee's refusal to answer. The trial court denied the motion.

At the bench trial, RBH presented no evidence of the aircraft's alleged involvement in illegal activities, although reference to rumors of such involvement was made throughout the trial. On the evidence presented the court entered judgment against RBH for the insured value of the airplane, plus interest. The court found Federal not liable.

Shortly after the trial, Kartee testified in a federal criminal case under a grant of immunity. His testimony revealed that the aircraft had been used continuously, from the approximate time of its purchase until it disappeared, to smuggle drugs. Based on this newly discovered evidence, RBH moved for relief from judgment. The motion was denied.

On appeal RBH argues that any negligence on its part in failing to procure the proper insurance coverage was not the proximate cause of Euroclassics' loss. Instead, RBH contends, Kartee's use of the insured aircraft for drug smuggling would have precluded Euroclassics from obtaining insurance in the first place. RBH further contends that since its affirmative defenses relied upon proof of Kartee's illegal activity, the trial court's order denying RBH's motion to compel discovery was erroneous and effectively prevented RBH from proving at trial what would have amounted to a valid defense. We agree.

Generally, the scope of discovery is broad with parties being entitled to discover "any matter, not privileged, that is relevant to the subject matter of the pending action ... [and] appears reasonably calculated to lead to the discovery of admissible evidence." Fla.R.Civ.P. 1.280(b)(1); see Simons v. Jorg, 384 So.2d 1362 (Fla.2d DCA 1980); Murray Van & Storage, Inc. v. Murray, 343 So.2d 61 (Fla. 4th DCA 1977); Spencer v. Spencer, 242 So.2d 786 (Fla. 4th DCA 1970), cert. denied, 248 So.2d 169 (Fla.1971).

The trial judge gave no reason for denying RBH's motion to compel. Even taking into account the broad discretion afforded the trial court in discovery matters, see, e.g., Dickinson v. Wells, 454 So.2d 758 (Fla. 1st DCA 1984), when viewed in light of the above enunciated rule, the trial court abused its discretion in denying RBH's motion to compel. Not only did RBH's questions to Kartee appear to be reasonably calculated to lead to admissible evidence, but the answers they would have evoked were necessary for RBH to prove its defenses which had been validly raised in its answer to the complaint.

It would appear that the trial judge relied on Kartee's fifth amendment argument in denying RBH's motion to compel. This was also error. A civil litigant's fifth amendment right to avoid self-incrimination may be used as a shield but not a sword. This means that a plaintiff seeking affirmative relief in a civil action may not invoke the fifth amendment and refuse to comply with the defendant's discovery requests, thereby thwarting the defendant's defenses. City of St. Petersburg v. Houghton, 362 So.2d 681, 683 (Fla.2d DCA 1978); see also Minor v. Minor, 240 So.2d 301 (Fla.1970); Zabrani v. Riveron, 495 So.2d 1195 (Fla.3d DCA 1986); Fischer v. E.F. Hutton...