Seitlin & Co. v. Phoenix Ins. Co.

• Decision Date: 14 September 1994
• Docket Number: 91-1099,Nos. 91-1121,s. 91-1121
• Citation: 650 So.2d 624
• Parties: 98 Ed. Law Rep. 574, 19 Fla. L. Weekly D1937 SEITLIN & COMPANY, Appellant, v. The PHOENIX INSURANCE COMPANY, Howard Silber, and Brad Schandler, Appellees. The PHOENIX INSURANCE COMPANY, Appellant/Cross-appellee, v. Howard SILBER, Appellee, and Brad Schandler, Appellee/Cross-appellant.
• Court: Florida District Court of Appeals

Page 624

650 So.2d 624

98 Ed. Law Rep. 574, 19 Fla. L. Weekly D1937

SEITLIN & COMPANY, Appellant, v.The PHOENIX INSURANCE COMPANY, Howard Silber, and Brad

Schandler, Appellees.

The PHOENIX INSURANCE COMPANY, Appellant/Cross-appellee, v.Howard SILBER, Appellee, andBrad Schandler, Appellee/Cross-appellant.

Nos. 91-1121, 91-1099.

District Court of Appeal of Florida Third District.

Sept. 14, 1994.

Rehearing Denied March 15, 1995.

Touby, Smith, DeMahy & Drake and Kenneth R. Drake, Miami, for appellantSeitlin & Co.Angones, Hunter, McClure, Lynch & Williams and Christopher Lynch, Miami, for appellant/appelleeThe Phoenix Ins. Co.

Magill & Lewis and R. Fred Lewis, Miami, for appellee/cross-appellantBrad Schandler.

Gordon & Michelson, P.A., Cooper & Wolfe and Sharon L. Wolfe and Linda G. Katsin, Miami, for appelleeHoward Silber.

Before COPE, LEVY¹ and GODERICH, JJ.

COPE, Judge.

These are consolidated appeals from a declaratory judgment determining the existence of insurance coverage under a homeowner's insurance policy, and a related judgment for indemnification.We affirm in part and reverse in part.

The first issue is whether the trial court properly concluded that appelleeBrad Schandler was an insured under his parents' homeowner's policy.Schandler's parents lived in northern Dade County and were covered by a homeowner's policy.Schandler enrolled in the University of Miami Law School.For convenience he took an apartment close to the law school.However, Schandler and his family treated the family home as his permanent residence.Schandler's parents were his sole support and claimed him as a dependent for federal income tax.Schandler had a key to the family home, received his mail there, and maintained a room and belongings there.

While at the apartment complex, Schandler engaged in horseplay with another student, appelleeHoward Silber.Silber sustained a broken collarbone and other injuries requiring surgery.Silber asked Schandler if the Schandler family's homeowner's insurance policy would provide coverage for the incident.Schandler's father in turn asked the insurance agent, appellantSeitlin & Company.²

The homeowner's policy was issued by the Phoenix Insurance Company.Under the homeowner's insurance policy, an "insured" included "a resident of the named insured's household...."The Seitlin insurance agent informed Schandler's father that there would be no coverage under the homeowner's policy.The agent reasoned that Schandler could not be a resident of the parents' household if he had his own apartment.

Silber brought suit against Schandler for the injuries he had sustained.At his own expense Schandler hired counsel to defend the lawsuit.Shortly before trial, defense counsel reexamined the homeowner's policy and concluded that the policy provided coverage.Schandler demanded that Phoenix provide coverage and defend the case.The insurer declined.At trial Silber recovered a judgment against Schandler for $80,000.After the trial, Silber and Schandler entered into a settlement agreement which limited Schandler's personal liability to $6,200.As part of the settlement, Schandler assigned his rights against Phoenix to Silber.

Silber then filed a declaratory judgment action against Phoenix, seeking a declaration that Schandler was covered under the homeowner's policy.Schandler intervened and took the same position.Phoenix contended that Schandler could not be deemed to be a resident of the parents' household, and that accordingly there was no coverage under the insurance policy.The trial court directed a verdict against Phoenix on this issue, ruling that Schandler was an insured under the policy and that Phoenix must provide coverage.Phoenix has appealed.

The situation presented here is the rather common one in which a student takes an apartment in the vicinity of a university or other school for the duration of studies, while continuing to maintain the parents' home as the permanent place of residence.The facts of the present case are comparable to those found in General Guaranty Insurance Co. v. Broxsie, 239 So.2d 595(Fla. 1st DCA1970), which we follow.See alsoTrezza v. State Farm Mutual Auto. Ins. Co., 519 So.2d 649(Fla. 2d DCA1988)(military service); 7A John A. Appleman, Insurance Law and Practice Sec. 4501.08, at 262-63(Berdaled. 1979)("Students who are temporarily away at school, whose tuition and expenses are provided by parents and who maintain some possessions at the home of their parents remain residents within the definition of the policy.").Comparable policy language has been liberally construed in favor of coverage in analogous circumstances.SeeState Farm Mutual Auto. Ins. Co. v. Johnson, 536 So.2d 1089(Fla. 4th DCA1988);Sutherland v. Glens Falls Ins. Co., 493 So.2d 87(Fla. 4th DCA1986);Row v. United Servs. Auto. Ass'n, 474 So.2d 348(Fla. 1st DCA1985).

Phoenix argues, however, that in order for Schandler to be considered a resident of the parents' household, he must have a fixed intention to return to the parents' home and reside there upon the conclusion of his studies.This argument was rejected in Broxsie.There, the court said:

[P]laintiff was a resident of her aunt's household [in Monticello, Florida] at the time of the collision.This conclusion is sustainable even though during the school year immediately preceding the collision plaintiff was living in a rented room in Thomasville [Georgia] while attending school there and intended, after graduation, to accept employment at a hospital in Thomasville.It would not be until after plaintiff entered upon the full-time duties of her new employment at the hospital in Thomasville with the intention of establishing a new permanent residence there that she will be considered to have abandoned her prior residence in the home of her aunt in Monticello.

239 So.2d at 598(footnote omitted).As in Broxsie, Schandler anticipated that upon the conclusion of his studies, he would obtain employment and set up a household entirely independent of his parents.That future intention did not detract from the fact that, at the time of the tort incident, Schandler was properly viewed as being resident in the parents' household.The directed verdict was entirely correct.SeeSears, Roebuck & Co. v. McKenzie, 502 So.2d 940, 941(Fla. 3d DCA), review denied, 511 So.2d 299(Fla.1987).

We next consider Schandler's cross-appeal.In the declaratory judgment action Schandler made a claim against Phoenix for his attorney's fees and costs expended in defending against the Silber lawsuit.Because Schandler was an insured under the homeowner's policy, Phoenix had a duty to defend him in the Silber tort suit.By failing to do so, Phoenix breached the contract of insurance.As a result, Schandler was entitled to recover attorney's fees and costs reasonably paid or incurred.SeeTown & Beach Plumbing Co. v. American Fire & Casualty Co., 157 So.2d 700, 701(Fla. 3d DCA1963);see alsoPreuss v. United States Fire Ins. Co., 414 So.2d 249, 250(Fla. 4th DCA), review denied, 424 So.2d 763(Fla.1982);Tropical Park, Inc. v. United States Fidelity & Guaranty Co., 357 So.2d 253, 257(Fla. 3d DCA1978).

Schandler testified that he had actually paid approximately $2,000 in out-of-pocket costs and $5,000 in attorney's fees defending against the Silber claim.Schandler testified that he owed approximately $24,000 more in attorney's fees which he had not yet paid.Schandler introduced into evidence the invoices reflecting these amounts.The jury returned a verdict of zero.Schandler moved for a new trial, contending that the verdict was contrary to the manifest weight of the evidence.The trial court denied the motion, and Schandler has appealed.

Phoenix argues that Schandler's attorney's fee case was fatally deficient because Schandler failed to call an attorney's fee expert to testify at trial.Phoenix specifically objected that an attorney's fee expert was necessary.Schandler declined to call an attorney's fee...