Travelers Commercial Ins. Co. v. Harrington
| Decision Date | 23 October 2014 |
| Docket Number | No. SC12–1257.,SC12–1257. |
| Parties | TRAVELERS COMMERCIAL INSURANCE COMPANY, etc., Petitioner, v. Crystal Marie HARRINGTON, Respondent. |
| Court | Florida Supreme Court |
James Paul Waczewski of Luks, Santaniello, Petrillo, & Jones, Tallahassee, FL, and Raoul G. Cantero, III, and Maria Josefa Beguiristain of White & Case LLP, Miami, FL, for Petitioner.
Stephen Charles Bullock and Christopher M. Costello of Brannon, Brown, Haley & Bullock, P.A., Lake City, FL, for Respondent.
Cynthia Skelton Tunnicliff and Gerald Don Nelson Bryant, IV, of Pennington, Moore, Wilkinson, Bell & Dunbar, P.A., Tallahassee, FL, for Amicus Curiae Personal Insurance Federation of Florida.
Henry Gerome Gyden and Dorothy Venable DiFiore of Haas, Lewis, & DiFiore, P.A., Tampa, FL, for Amicus Curiae GEICO Insurance Company.
Louis Kahn Rosenbloum of Louis K. Rosenbloum, P.A., Pensacola, FL, for Amicus Curiae The Florida Justice Association.
This case is before the Court for review of the First District Court of Appeal's decision in Travelers Commercial Insurance Co. v. Harrington, 86 So.3d 1274 (Fla. 1st DCA 2012). In its decision the First District ruled upon the following questions, which the court certified to be of great public importance:
For the reasons explained below, we answer both certified questions in the negative and quash the First District's decision.2 We conclude that a family vehicle exclusion in an automobile insurance policy, which excludes a family vehicle from the definition of an uninsured motor vehicle, does not conflict with section 627.727(3), Florida Statutes (2009). We also conclude that uninsured motorist (UM) benefits are not stackable under section 627.727(9) if the named insured or purchaser of the policy made a non-stacking election, as this waiver applies on behalf of all insureds under the policy.
On October 29, 2009, Crystal Harrington was injured in a single-car accident, while riding as a passenger in a car owned by her father, but driven with permission by a non-family member, Joey Williams. The vehicle was insured by Travelers Commercial Insurance Company (“Travelers”). Harrington's mother was the named insured and the purchaser of the policy on the vehicle. The policy insured three vehicles and provided liability and non-stacked uninsured motorist coverage for Harrington, her mother, and her father. Specifically, the Harrington's policy provided for bodily injury liability coverage of $100,000 per person and $300,000 per accident, and non-stacked UM coverage of $100,000 per person and $300,000 per accident. The policy defined the term “your covered auto” as any one of the three insured vehicles, which included the vehicle involved in the accident.
The driver, Joey Williams, had his own liability policy with Nationwide. Williams was also covered under the liability provisions of the Harrington's policy because the policy defined an “insured” as the named insured, the named insured's family, or any other person lawfully occupying the vehicle. Thus, Harrington was a class I insured and Williams was a class II insured.3
After she was injured, Nationwide paid Harrington the $50,000 limit of Williams' liability policy. This payment did not fully cover Harrington's medical expenses, and Travelers also tendered its liability limit of $100,000. However, Harrington's damages still exceeded the combined liability payments, and she subsequently sought UM benefits from Travelers. Travelers denied the claim on the ground that the vehicle was not an “uninsured motor vehicle” as defined in the policy.
Specifically, the policy's definition of an “uninsured motor vehicle” included an “underinsured” vehicle, that is a vehicle to which a liability policy applies at the time of the accident but the amount paid under the policy is not enough to pay the full amount of the insured's damages. However, the policy also contained a “family vehicle exclusion” which expressly provided that an uninsured vehicle does not include any vehicle:
Owned by or furnished or available for the regular use of you or a “family member” unless it is a “your covered auto” to which Coverage A of the policy applies and bodily injury liability coverage is excluded for any person other than you or any “family member” for damages sustained in the accident by you or any “family member[.]”
Therefore, the vehicle in question was excluded from UM coverage pursuant to this provision.
After Travelers denied her claim for UM benefits, Harrington sued Travelers, seeking payment of stacked UM benefits in the amount of $300,000, despite the fact that her mother, the named insured and purchaser of the policy, had expressly selected and paid for non-stacking UM coverage.
Before trial, both parties moved for summary judgment, and the trial court granted summary judgment in favor of Harrington, concluding that the policy provision excluding family vehicles from UM coverage was invalid because it conflicted with section 627.727(3)(b) and (c), Florida Statutes (2009). The trial court also concluded that the waiver executed by Harrington's mother electing non-stacking UM coverage did not apply to Harrington because Travelers did not obtain a knowing acceptance of the limitation of non-stacking UM coverage from Harrington personally.
On appeal, the First District affirmed the trial court's ruling on both the coverage and stacking issues, but reversed the amount of the UM benefits awarded and the attorney's fees awarded because “Travelers' asserted other defenses which might impact the amount of the benefits due under the policy.” Harrington, 86 So.3d at 1278. The First District then certified two questions of great public importance to this Court. Id. at 1278–79.
The first question before us is whether the family vehicle exclusion for UM coverage conflicts with section 627.727(3), Florida Statutes (2009). More specifically, whether the exclusion conflicts with subsection (b) or (c) of section 627.727(3), when applied to a class I insured, injured in a car accident, who seeks UM benefits when the combined liability payments from the class II insured's policy and the class I insured's own policy do not fully cover the insured's medical expenses.4 As explained below, we find that the exclusion does not conflict with either subsection.
Under Florida law, insurers are required to provide UM coverage for all vehicles insured for liability purposes, unless the insured expressly rejects UM coverage. See generally § 627.727(1), Fla. Stat. (2009). In enacting the UM statute, section 627.727, the Legislature intended “to provide for the broad protection of the citizens of this State against uninsured motorists.” Salas v. Liberty Mut. Fire Ins. Co., 272 So.2d 1, 5 (Fla.1972). But, as originally enacted, “UM coverage came into play only when the offending owner or operator carried no liability insurance whatsoever.” Shelby Mut. Ins. Co. v. Smith, 556 So.2d 393, 393 (Fla.1990). This meant that Williams v. Hartford Accident & Indem. Co., 382 So.2d 1216, 1218 (Fla.1980). However, in 1973, the Legislature created subsection 627.727(3)(b) (originally subsection 627.727(2)(b)) to provide UM coverage for underinsured tortfeasors as well. See Smith, 556 So.2d at 393–94 ; see also ch. 73–180, § 4, Laws of Fla. This subsection provides as follows:
§ 627.727(3)(b), Fla. Stat. (2009).
Harrington argues, and the First District concluded, that the family vehicle exclusion in the Travelers policy is void because it conflicts with section 627.727(3)(b), which provides that underinsured vehicles shall be considered uninsured for purposes of UM coverage, and that Harrington is entitled to both liability and UM benefits under the Travelers policy. See Harrington, 86 So.3d at 1276–77. We disagree.
While section 627.727(3)(b) provides that underinsured vehicles shall be considered uninsured for purposes of UM coverage, it also provides that the term uninsured motor vehicle is “subject to the terms and conditions of such coverage.” § 627.727(3)(b), Fla. Stat. And, an insurance “ ‘policy may contain other general conditions affecting coverage or exclusions on coverage’ as long as the limitations are unambiguous and ‘consistent with the purposes of the UM statute.’ ” Sommerville v. Allstate Ins. Co., 65 So.3d...
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