Travelers Indem. Co. v. Thomas

• Decision Date: 09 April 1975
• Docket Number: No. U--327,U--327
• Citation: 315 So.2d 111
• Parties: The TRAVELERS INDEMNITY COMPANY, a Foreign Corporation, Appellant, v. Matthew F. THOMAS, Appellee.
• Court: Florida District Court of Appeals

Page 111

315 So.2d 111

The TRAVELERS INDEMNITY COMPANY, a Foreign Corporation, Appellant, v. Matthew F. THOMAS, Appellee.

No. U--327.

District Court of Appeal of Florida, First District.

April 9, 1975.

Rehearing Granted June 3, 1975.

Rehearing Denied July 7, 1975.

George Stelljes, Jr., of Marks, Gray, Conroy & Gibbs, Jacksonville, for appellant.

David R. Lewis and Fred C. Isaac, of Blalock, Holbrook, Lewis, Paul & Isaac, Jacksonville, for appellee.

BOYER, Acting Chief Judge.

Appellant issued a policy of insurance insuring Charles A. Thomas, d/b/a Edgewood Hardware. That policy was subsequently endorsed to cover Curry-Thomas Hardware, Inc. Appellee, Matthew F. Thomas, at all times material hereto was a stockholder, director and executive officer of Curry-Thomas Hardware, Inc.

The policy provided insurance for fire and other related physical damage perils (Section I) and general liability (Section II).

The material portions of the policy relating to Section II are as follows:

'PROVISIONS APPLICABLE TO SECTION II

(Broad Liability Form)

INSURING AGREEMENTS

1. Coverage D-Liability-The Travelers agrees to pay on behalf of the Insured all sums which the Insured shall become legally obligated to pay as damages because of bodily injury or property damage to which this Section applies, caused by an occurrence, or personal injury caused by an offense committed during the period insurance under this Section is in effect within the United States of America, its territories or possessions or Canada; and The Travelers shall have the right and duty to defend any suit against the Insured seeking damages on account of such bodily injury or property damage, even if any of the allegations of the suit are groundless, false or fraudulent, and may make such investigation and settlement of any claim or suit as it seems expedient, but The Travelers shall not be obligated to pay any claim or judgment or to defend any suit after the applicable limit of The Travelers' liability has been exhausted by payment of judgments or settlements.

* * *

* * *

4. Definition of Insured-With respect to Coverage D, each of the following is an Insured, to the extent set forth below:

* * *

* * *

(c) if the Named Insured designated in this declaration is other than an individual, partnership or joint venture, the organization so designated and any executive officer, director or stockholder thereof while acting within the scope of his duties as such;

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* * *

CONDITIONS

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2. Definitions

Under Section II:

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* * *

(b) Bodily Injury; Personal Injury--

(1) Bodily Injury--The term 'bodily injury' means bodily injury, sickness or disease sustained by any person;

(2) Personal Injury--The term 'personal injury' means injury sustained by any person or organization and arising out of one or more of the following offenses:

A--false arrest, detention or imprisonment, or malicious prosecution;

* * *

* * *

(d) Occurrence--The word 'occurrence' means an accident, including injurious exposure to conditions, which results, during the period of this policy is in effect, in bodily injury or property damage neither expected nor intended from the standpoint of the Insured.'

On July 29, 1971 one Foucart filed suit in the Circuit Court of Duval County alleging that appellee, while acting in the scope of his employment, assaulted, battered, slandered, falsely imprisoned and maliciously prosecuted him. The complaint was ultimately amended to name Curry-Thomas Hardware, Inc. and appellee as parties defendant. Appellant denied coverage and refused to defend, resulting in the defendants retaining counsel to represent them.

Appellee claimed that his actions in the Foucart incident were within the scope of Appellee thereupon commenced the suit giving rise to this appeal, alleging that the insurer (appellant here) wrongfully refused to defend. Appellant moved for summary judgment and appellee moved for partial summary judgment, the latter being granted by the trial judge, leaving open only the question of damages. The jury returned a verdict for appellee upon which the final judgment here appealed was entered.

his employment. However, the jury apparently determined to the contrary, finding Curry-Thomas Hardware, Inc. not guilty while awarding a verdict against appellee here.

The appellee cross appeals, claiming that the trial judge erred when he refused to permit appellee to adduce before the jury evidence as to reasonable compensation for his representation in the defense of the Foucart suit.

We have carefully read appellant's brief and reply brief in conjunction with the policy of insurance which was made a part of the record on appeal. Appellant urges that it owed no defense to appellee because appellee was not covered by the policy, claiming that the coverage issue was resolved favorably to appellant by the verdict of the jury in the Foucart case which absolved Curry-Thomas Hardware, Inc. of liability obviously finding that the acts of appellee giving rise to that action were not done within the scope of his employment. We simply do not so read the policy.

It is not necessary for us here to determine whether appellee was technically in the employment of Curry-Thomas Hardware, Inc. Both parties recite in their briefs that he was a stockholder, director and executive officer: As such he was, by the very terms of the policy, an insured. Coverage D (above quoted) provides that the insurer shall pay on behalf of the insured 'all sums which the Insured shall become legally obligated to pay as damages because of * * * personal injury caused by an offense committed during the period insurance * * * is in effect * * *'. Personal injury is defined by the policy to mean injuries sustained and arising out of false arrest, detention, imprisonment or malicious prosecution. An examination of the complaint filed by Foucart reveals a count for malicious prosecution, slander, battery, assault and false imprisonment.

Appellant places great emphasis upon the policy definition of the word 'occurrence', claiming that by virtue of that definition coupled with the verbiage of the policy in describing the coverage afforded under Coverage D the insurer could not be held liable for damages recovered by Foucart against Matthew Thomas, appellee here. That contention misses the point. Appellee here is not claiming damages from appellant for the sums required to be paid to satisfy the judgment entered on the jury verdict in the Foucart case. The basis of this suit is the expenses incurred by appellee, including attorney's fees, incident to defense of that suit.

The general rule is that a liability insurance carrier must defend its insured if the initial pleadings fairly bring the case within the scope of coverage even though ultimately it is determined that there is no liability. (Tennessee Corporation v. Lumb Brothers Const. Co., Fla.App.2nd 1972, 265 So.2d 533) The insurers' duty to defend its insured is governed solely by the allegations of the complaint against the insured and not by ultimate determination of liability. (See Bennett v. Fidelity & Casualty Company of New York, Fla.App.1st 1961, 132 So.2d 788; St. Paul Fire & Marine Insurance Co. v. Thomas, Fla.App.4th 1973, 273 So.2d 117 and Garden Sanctuary, Inc. v. Insurance Co. of No. Amer., Fla.App.2nd 1974, 292 So.2d 75) Where the complaint against the insured contains allegations which are partially within and partially without the scope of the insured's coverage then the Our reading of the subject policy reveals that the appellee was clearly entitled to a defense by appellant in the Foucart proceeding. We find no ambiguities in that regard. However, since appellant...