Scottsdale Ins. Co. v. Kuntz
| Decision Date | 03 December 2020 |
| Docket Number | Case No.: 2:19-cv-00113-JES-MRM |
| Parties | SCOTTSDALE INSURANCE COMPANY, as successor in interest to WESTERN HERITAGE INSURANCE COMPANY, Plaintiff, v. CHARLES DYLAN KUNTZ, Defendant. |
| Court | U.S. District Court — Middle District of Florida |
This matter comes before the Court on the parties' cross Motions for Summary Judgment (Docs. ##22, 25) and supporting materials (Docs. ##23, 24) filed on January 3, 2020. The parties filed responses in opposition to each other's motions (Docs. ##27, 28) on January 17, 2020. For the reasons set forth below, the Plaintiff's Motion for Summary Judgment is granted, and Defendant's Motion for Summary judgment is denied.
On or about February 28, 2017, Charles Dylan Kuntz (defendant or Kuntz) filed a negligence action against Whalen Auto Group, LLC (the insured or Whalen Auto)(Doc. #1-2.), styled Charles Dylan Kuntz v. Whalen Auto Group, LLC dba Whalen Power Sports, Case No. 08-2017-CA-000186, in the Circuit Court of the Twentieth Judicial Circuit in and for Charlotte County, Florida (the Negligence Action). Kuntz sought to recover damages for bodily injuries he sustained in an accident on December 10, 2016, involving an All-Terrain Vehicle (ATV) owned by Whalen Auto and driven by its employee. (Id., pp. 1-2.)
On August 17, 2018, Whalen Auto tendered the Negligence Action to Scottdale Insurance Company's (Plaintiff or Scottsdale) predecessor-in-interest for defense and indemnity.1 (Doc. #1, ¶¶ 11, 12.) Kuntz, Whalen Auto, and Scottsdale resolved the Negligence Action pursuant to a written settlement agreement. The settlement agreement required Scottsdale to institute a declaratory judgment action to determine the rights and obligations, if any, of the parties arising from the insurance Policy, and to pay Kuntz $150,000.00 should Kuntz prevail in the declaratory action. (Id., ¶¶ 3, 13-14.) On February 25, 2019, as required by the settlement agreement, Scottsdale filed its Complaint with this Court seeking a declaration as to whether there is coverage under the provisions of the Commercial Garage Coverage insurance policy (the Policy). (Doc. #1, ¶¶ 6-7, 15; Doc. #1-1, pp. 43, 49.)
Summary judgment is appropriate only when the Court is satisfied that "there is no genuine dispute as to any material fact and that the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). "An issue of fact is 'genuine' if the record taken as a whole could lead a rational trier of fact to find for the nonmoving party." Baby Buddies, Inc. v. Toys "R" Us, Inc., 611 F.3d 1308, 1314 (11th Cir. 2010). A fact is "material" if it may affect the outcome of the suit under governing law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). "A court must decide 'whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law.'" Hickson Corp. v. N. Crossarm Co., Inc., 357 F.3d 1256, 1260 (11th Cir. 2004)(quoting Anderson, 477 U.S. at 251).
In ruling on a motion for summary judgment, the Court views all evidence and draws all reasonable inferences in favor of the non-moving party. Scott v. Harris, 550 U.S. 372, 380 (2007); Tana v. Dantanna's, 611 F.3d 767, 772 (11th Cir. 2010). However, "if reasonable minds might differ on the inferences arising from undisputed facts, then the court should deny summary judgment." St. Charles Foods, Inc. v. America's Favorite Chicken Co., 198 F.3d 815, 819 (11th Cir. 1999)(quoting Warrior Tombigbee Transp. Co. v. M/V Nan Fung, 695 F.2d 1294, 1296-97 (11th Cir.1983)( summary judgment "may be inappropriate even where the parties agree on the basic facts, but disagree about the factual inferences that should be drawn from these facts")). "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, then the court should not grant summary judgment." Allen v. Bd. of Pub. Educ., 495 F.3d 1306, 1315 (11th Cir. 2007).
Under Florida law, the interpretation of an insurance policy is a pure question of law to be decided at the summary judgment stage.2 Tech. Coating Applicators, Inc. v. U.S. Fid. & Guar., Co., 157 F.3d 843, 844 (11th Cir. 1998); Coleman v. Fla. Ins. Guar. Ass'n, Inc., 517 So. 2d 686, 690 (Fla. 1988). Terms utilized in an insurance policy should be given their plain and unambiguous meaning as understood by the "[person] on the street." State Farm Fire & Cas. Co. v. Castillo, 829 So. 2d 242, 244 (Fla. 3rd DCA2002). See also Swire Pac. Holdings, Inc. v. Zurich Ins. Co., 845 So. 2d 161, 165 (Fla. 2003). The Florida Supreme Court has consistently held that "in construing insurance policies, courts should read each policy as a whole, endeavoring to give every provision its full meaning and operative effect." Auto-Owners Ins. Co. v. Anderson, 756 So. 2d 29, 34 (Fla. 2000). See also Wash. Nat'l Ins. Corp. v. Ruderman, 117 So. 3d 943, 948 (Fla. 2013). Courts may not "rewrite, add meaning that is not present, or otherwise reach results contrary to the intentions of the parties" when interpreting an insurance policy. Deni Assocs. of Fla., Inc. v. State Farm Fire & Cas. Ins. Co., 711 So. 2d 1135, 1138 (Fla. 1998)(citations omitted). Where "a policy provision is clear and unambiguous, it should be enforced according to its terms." Taurus Holdings, Inc. v. U.S. Fid. & Guar. Co., 913 So. 2d 528, 532 (Fla. 2005).
On the other hand, if relevant policy language is "susceptible to more than one reasonable interpretation, one providing coverage and the [other] limiting coverage, the insurance policy is considered ambiguous." Swire, 845 So. 2d at 165 (quoting Anderson, 756 So. 2d at 34). An ambiguous provision is construed in favor of the insured and strictly against the drafter. Anderson, 756 So. 2d at 34. This rule is tempered, however, by the principle that even insurance policies must be given "practical, sensible interpretations in accordance with the natural meaning of the wordsemployed." Simmons v. Provident Mut. Life Ins. Co., 496 So. 2d 243 (Fla. 3rd DCA 1986). See also State Farm Mut. Auto. Ins. Co. v. Pridgen, 498 So. 2d 1245, 1248 (Fla. 1986).
Failure to provide a definition for a term involving coverage does not necessarily render the term ambiguous. Deni, 711 So. 2d at 1138. See also State Farm Mut. Auto. Ins. Co. v. Smith, 198 So. 3d 852, 857 (Fla. 2d DCA 2016); Swire, 845 So. 2d at 166. "When a term in an insurance policy is undefined, it should be given its plain and ordinary meaning, and courts may look to legal and non-legal dictionary definitions to determine such a meaning." Deutsch v. Geico Gen. Ins. Co., 284 So. 3d 1074, 1076 (Fla. 4th DCA 2019)(quoting Botee v. S. Fid. Ins. Co., 162 So. 3d 183, 186 (Fla. 5th DCA 2015)). Nevertheless, if an insurer fails to define a policy term, the insurer cannot assert that there should be a "narrow, restrictive interpretation of the coverage provided." CTC Dev. Corp., 720 So. 2d at 1076 (quoting State Comprehensive Health Ass'n v. Carmichael, 706 So. 2d 319, 320 (Fla. 4th DCA 1997)).
The undisputed material facts are as follows: On a signed application (the Application) for an insurance policy, Whalen Auto's representative Esther Whalen described its business operations as buying, selling and servicing motorcycles, and selling protective gear, cleaning supplies, tires and motor oil. (Doc. #25-4, p. 1.) The Application also stated that 98% of WhalenAuto's business consisted of sales and repairs of motorcycles, while 2% of its operations were sales and repairs of "Dirt Bikes or ATVs/UTVs and all other recreational autos." (Id., p. 4.)
Western Heritage, acting through its managing general agent Hull & Company (Hull), issued a commercial garage coverage policy, Policy Number AGP0860853, to Whalen Auto (the Policy). (Docs. #1-1; #22-18, p. 7; #22-6, p. 21.) The Policy consisted of forms and endorsements set forth in a Schedule of Forms and Endorsements, mainly organized into three categories: (1) Common Forms; (2) Garage Forms; and (3) State Forms. (Doc. #22-1, p. 6.)
On December 10, 2016, Charles Dylan Kuntz (defendant or Kuntz) sustained bodily injuries while riding as a passenger on a "Stampede Bad Boy," a four-wheel ATV owned by Whalen Auto and driven by its employee Brett DeGrasse (DeGrasse). (Doc. #27-1, pp. 13-17.) The ATV was not licensed nor equipped for use on Florida roads or highways. (Doc. #22-16, p. 15.) DeGrasse was driving from Whalen Auto's service facility to its showroom area when the ATV flipped over, injuring Defendant. (Id., pp. 11, 14-17.) At the time of the accident, DeGrasse was twenty years old. (Doc. #23; Doc. #25-4, p. 3; Doc. #25-3). DeGrasse is not identified in the Policy as a driver of a covered "auto" nor named as an authorized driver in the Schedule of Youthful Drivers. (Doc. #1-1, pp. 43-44, 49.) Defendant Kuntz was not employed by Whalen Auto, nor was he test driving the ATV as a prospective purchaser. (Doc. #27-1,p. 25.) Additional facts will be set forth as necessary to discuss certain issues.
Plaintiff Scottsdale asserts that the damages sought by Kuntz are not covered by the Policy because the claim falls within the Youthful Driver Exclusion (the Exclusion) of the Policy, or the Policy's Covered Driver(s) or Operator(s) Limitation (the Limitation), or both. Defendant responds that the Policy neither excludes coverage nor precludes the damages he may recover, and seeks a declaratory judgment to that effect. As defendant succinctly states, "the only issue for this Court to decide is whether the Youthful Driver Exclusion, or the Covered Driver Limitation, operates to preclude coverage." (Doc. #22, p. 2.)
Liability coverage under the Policy turns on the question of whether the Youthful Driver Exclusion applies, which in turn depends on whether the ATV is a covered "auto"...
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