Steiner v. Physicians Protective Trust Fund, 80-114
| Decision Date | 16 September 1980 |
| Docket Number | No. 80-114,80-114 |
| Citation | 388 So.2d 1064 |
| Parties | Leonard STEINER, Sheldon Munach, Oswaldo Valdes, Myriam Capati, Harry Schrier and Eduardo Darcy, Appellants, v. PHYSICIANS PROTECTIVE TRUST FUND, an unincorporated body, Appellee. |
| Court | Florida District Court of Appeals |
Burt E. Redlus, Miami, for appellants.
Blackwell, Walker, Gray, Powers, Flick & Hoehl and James C. Blecke, Miami, for appellee.
Before HUBBART, NESBITT and BASKIN, JJ.
Appellants, plaintiffs below, seek reversal of summary final judgment entered against them which denied their entitlement to dividends from the appellee, Physicians Protective Trust Fund (Trust Fund). We affirm the judgment.
The Trust Fund was established to defend and "pay all claims arising against the Members as a result of malpractice or negligence in the care and treatment of patients . . . ."
The appellants were members during the years, 1976 and 1977, following which they withdrew from the Trust Fund. The low loss rate incurred by trust members enabled the Trust Fund to declare a credit "dividend" against the funds collected from the members during 1976 and 1977. The credit "dividend" was distributed only to members who renewed their coverage through December 31, 1978. The credit "dividend" was in the form of a reduction in the premium for the remaining quarter of 1978. Such a reduction in premium was expressly authorized by the trust agreement in paragraph 15(m) which reads as follows:
(15) (m) All portions of the Loss Account and the Loss Leveling Reserve Account not used for the payment of losses, the purchase of excess insurance, or the allowable expenses or reserves in any one year, shall be credited to the Loss Account of the Loss Leveling Reserve Account for succeeding years. Such credits shall be used to reduce the premium for succeeding years as allowed by excess carriers and the Department of Insurance. (emphasis added)
Appellants contend, and we agree, that a literal reading of paragraph 14 of the trust agreement provides for a distribution of dividends only in the event the Trust Fund is dissolved. 1 Admittedly, the Trust Fund was not dissolved. Appellants also contend that the trustees are under a fundamental duty of loyalty to the beneficiaries of a trust to administer it only in the interest of the beneficiaries. Investors Syndicate of America, Inc. v. City of Indian Rocks Beach, Florida, 434 F.2d 871 (5th Cir. 1970). They argue that this is especially true because of the provisions of paragraph 15(n) which provides:
(15) (n) In the event of exhaustion of the Loss Account and the Loss Leveling Reserve Account in any one year, the Trustees' Account will be used to provide funds as necessary. If the Trustees' Account is also exhausted, the Members of the Trust Fund may be subject to assessment for losses reported in the policy year.
Appellants argue that they are potentially subject to additional liability resulting from the depletion of the loss account resulting from the distribution of funds to reduce future premiums.
In affirming the trial judge's ruling that the...
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