Car Accident

Florida Appeals Court Certifies Bad Faith Insurance Claim Question to Supreme Court: Boozer v. Stalley

Published on: September 12, 2014 | by Friedman Rodman Frank & Estrada, P.A.

Florida’s Fifth District Court of Appeals has certified a question of law to the Supreme Court of Florida in a bad faith insurance dispute. In Boozer v. Stalley, a boy was hurt in a motor vehicle collision that was apparently caused by a woman who was covered by two automobile insurance policies issued by related insurers. Following the collision, the guardian of the boy filed a negligence lawsuit against the woman, and her insurer secured an attorney to represent her. Following trial, jurors awarded the boy more than $11 million in damages. The insurance company paid the policy limits of $1.1 million, and the boy was unable to collect the remaining $10 million. Later, the boy’s guardian filed a third-party bad faith insurance claim against the woman’s liability insurance company. The same attorney continued to appear on behalf of the woman at the request of the insurer during post-judgment proceedings.

As part of the bad faith insurance lawsuit, the boy’s guardian sought to depose the at-fault motorist’s lawyer. The attorney refused to be questioned and asserted the attorney-client privilege. The attorney-client privilege requires a licensed attorney to protect most confidential statements made by a client in connection with his or her legal representation from disclosure. Despite this, a client may waive the privilege in a number of ways. After a trial court ordered the attorney to submit to deposition, he appeared as instructed. Although the legal advocate answered general questions posed by the boy’s guardian, the lawyer refused to disclose information he felt was privileged. The deposition was adjourned, and the woman and her attorney filed a petition for review with the Fifth District Appeals Court.

According to the boy’s guardian, his evidentiary requests were appropriate because Florida precedent states he may obtain discovery materials that would have been available to the at-fault driver. The Fifth District disagreed, however, and held that the lower court’s order compelling the woman’s attorney to disclose legally privileged materials was inappropriate and should be quashed. After analyzing the relevant case law, the Fifth District stated precedent shields attorney-client communications from discovery in a first-party bad faith claim. Since Florida case law is currently silent regarding whether attorney-client communications are shielded from discovery in a third-party bad faith insurance case, Florida’s Fifth District Court of Appeals certified the question to the Florida Supreme Court.

Florida Appeals Court Refuses to Limit Discovery Regarding Doctor’s Relationship With Law Firm in Car Accident Negligence Case: Brown v. Mittelman

Published on: September 5, 2014 | by Friedman Rodman Frank & Estrada, P.A.

In Brown v. Mittelman, a plaintiff who was injured in a car accident sought medical treatment from a physician following the collision. The plaintiff’s attorney apparently referred the plaintiff to the medical provider. In addition, the doctor reportedly treated the plaintiff under a letter of protection agreement. Such an agreement is generally used to help an injured person pay for medical care they would not be able to afford otherwise. In many cases, a letter of protection is sent to a medical provider by a plaintiff’s attorney who agrees to remit payment for services following an accident settlement.

After the plaintiff filed a lawsuit against the defendant, the defendant sought to discover certain billing documents from the non-party physician. The doctor objected to the defendant’s request, and a trial court overruled the medical provider’s objections. After that, the lower court compelled discovery of the evidence that was sought by the defendants. In response, the non-party physician filed a writ of certiorari seeking to quash discovery with Florida’s Fourth District Court of Appeals.

According to the physician, Florida Rule of Civil Procedure 1.280(b)(5) prohibited discovery of the information sought by the defendant because there was no evidence to support the notion that the plaintiff’s law firm directly referred the plaintiff to him for treatment. The appellate court disagreed and stated a lawyer’s financial relationship with a medical provider is discoverable because the relationship may result in bias. The Fourth District added that jurors should be allowed to review evidence related to such a relationship because the doctor may have a financial interest in the outcome of the plaintiff’s negligence lawsuit.

Tampa Federal Court Refuses to Sever Bad Faith Claim Against Insurer From Underlying Lawsuit: Jirau v. Wathen

Published on: September 2, 2014 | by Friedman Rodman Frank & Estrada, P.A.

The Middle District of Florida has refused to sever a bad faith insurance claim filed against an automobile insurance company from the underlying negligence action. In Jirau v. Wathen, a man was hurt in a Brandon traffic wreck. Following the crash, the man filed a negligence lawsuit against the allegedly at-fault driver in state court. He also sought underinsured or uninsured motorist coverage from his vehicle insurer. In addition, the man accused his insurance company of acting in bad faith when settling his claim. After the man filed his lawsuit, the insurer successfully removed the case to the Middle District of Florida in Tampa based upon diversity of citizenship. Diversity of citizenship is appropriate only when each of the parties to a lawsuit is a resident of a different state, and the amount in controversy exceeds $75,000.

Following removal to federal court, the injured man sought to have the case remanded back to state court because the at-fault driver was also a Florida citizen. Despite evidence to the contrary, the auto insurer claimed diversity of citizenship existed and asked the court to sever the at-fault driver from the case rather than remand the entire lawsuit. Following a hearing, the federal court granted the injured man’s motion and sent the case back to state court. According to the Middle District of Florida, “the power to sever non-diverse defendants to maintain jurisdiction should be used sparingly” in order to prevent potential prejudice. In response, the insurance company filed a motion for reconsideration as to the bad faith claim pending against it with the federal court.

After reviewing the claims the injured man made against the at-fault driver and his insurer, the court stated that severing the bad faith cause of action would waste judicial resources. Additionally, the court held it would be unfair to require the accident victim to pursue two different cases against the same defendant in both state and federal court. The federal court added that doing so could require the plaintiff to prove damages related to the same accident twice. Since severing the claims would be unnecessarily unfair to the plaintiff, the Middle District of Florida in Tampa denied the auto insurer’s motion for reconsideration.

Orlando Federal Court Refuses to Remand Underinsured Motorist Claim Back to State Court: Stephenson v. Amica Mutual Insurance Co.

Published on: August 28, 2014 | by Friedman Rodman Frank & Estrada, P.A.

In Stephenson v. Amica Mutual Insurance Co., a man suffered permanent physical injuries when he was struck by an automobile while riding his bicycle. Following the collision, the man filed a demand letter seeking $100,000 in damages with the provider of his underinsured-motorist coverage. After the injured man’s automobile insurance company denied his claim, he filed a lawsuit in a Florida court against the insurer and the driver who struck him, seeking more than $15,000. In response, the automobile insurance company filed a number of discovery requests that the injured man apparently ignored.

After the bicyclist settled his case against the Florida motorist, the insurance company filed a motion to remove the lawsuit to federal court based upon diversity of citizenship. In order to remove a case to federal court on this basis, the parties to a lawsuit must be citizens of different states, and the amount in controversy must exceed $75,000. In addition to filing its motion, the insurance company also submitted a request to the injured man asking him to admit that the amount in controversy did not exceed $75,000. After the bicyclist refused to answer because the question “invaded the province of the jury,” the case was removed to the Middle District of Florida in Orlando.

Not long after the personal injury case was removed to federal court, the injured man filed a motion to remand the case back to state court based on a lack of timeliness and a failure to meet the amount in controversy threshold. The Orlando court stated removal is proper when a case that was filed in state court could have initially been brought in federal court. According to the court, the injured man’s demand letter demonstrated the amount in controversy exceeded $75,000. The Orlando court also said the allegations in the man’s complaint did not provide enough information to determine the actual amount in controversy. After that, the Middle District of Florida held that the amount in controversy exceeded the jurisdictional threshold based on “judicial experience and common sense.”

Middle District of Florida Rules in Favor of Insurer Where No Meeting of the Minds Occurred in Rescinded Settlement Offer: Goodman v. SAFECO Insurance Co. of Illinois

Published on: August 21, 2014 | by Friedman Rodman Frank & Estrada, P.A.

In Goodman v. SAFECO Insurance Co. of Illinois, an insurance company provided bodily injury and other automobile coverage to a woman whose vehicle was involved in a 2012 traffic wreck. Immediately prior to the collision, the owner of the insured vehicle apparently allowed another individual to drive her car. Unfortunately, the man who borrowed the vehicle was involved in an accident while he was operating the insured auto. Following the collision, a plaintiff who was allegedly hurt in the traffic wreck filed a personal injury claim seeking $200,000 from the owner of the vehicle’s insurance company. In response, the insurer offered to settle the plaintiff’s claim for the insured’s bodily injury liability limit of $100,000 per person. Following the offer, the insurance company and the plaintiff reportedly entered into negotiations regarding the plaintiff’s property damage.

A few months later, the plaintiff filed a Civil Remedy Notice of Insurer Violations under Florida Statute Section 624.155. According to the plaintiff, the automobile insurance company failed to act in good faith when it attempted to settle the plaintiff’s car accident claim. In addition, the plaintiff stated her claim could be settled for about $107,000. Later, the insurer withdrew its settlement offer and stated the company was not required to cover the automobile accident. In response, the plaintiff filed a breach of contract lawsuit against the insurer and the owner of the vehicle that allegedly harmed her in a Florida court. The insurance company then removed the case to the Middle District of Florida.

Eventually, the insurer filed a motion for summary judgment against the plaintiff asserting that it could not have breached a settlement agreement with her absent the existence of an enforceable contract. When a party to a lawsuit files a motion for summary judgment, the party is asking the court to rule in its favor without proceeding to trial. In general, such a motion will not be granted unless there is no material issue of fact in dispute and the moving party is entitled to judgment as a matter of law. A court must view a motion for summary judgment in the light that is most favorable to the non-moving party.

Florida’s Fifth District Court of Appeals Holds Man Must Litigate Injury Case Separately From Bad-Faith Insurance Claim: GEICO Casualty Co. v. Barber

Published on: August 18, 2014 | by Friedman Rodman Frank & Estrada, P.A.

The District Court of Appeal of Florida, Fifth District has ruled that a man must litigate his bad-faith claim against an automobile insurance company separately from his personal injury case. In GEICO Casualty Co. v. Barber, a man filed a complaint for uninsured or underinsured motorist benefits from his automobile insurer following an injury traffic crash. The man also filed a Civil Remedy Notice claiming his harm exceeded his policy limits. The insurer responded to the man’s claim by stating it would not offer to pay him the entire policy limits of $10,000.

Several years later, the insurer sent the man a proposed settlement offer of $10,000 after learning he underwent surgery that was apparently related to his accident injuries. Despite the insurer’s proposal, the man refused to accept the company’s offer of settlement.

Eventually, the insurer filed a motion for summary judgment asking the court to rule in the company’s favor. Before the court issued a ruling, however, the injured man amended his complaint and asserted additional claims against the insurance company. After the court held several hearings, it granted the insurer’s motion with regard to the underinsured motorist benefits because the company made a confession of judgment. A confession of judgment normally occurs when one party to a lawsuit agrees to allow the opposing party to enter judgment against it. In addition, the court allowed the injured man to file a second amended complaint including a bad-faith cause of action against the insurer. The insurance company responded by filing an appeal with Florida’s Fifth District Court of Appeals.

Florida Court Grants Summary Judgment in Favor of Insurer in Motorcycle Crash Case: American Economy Ins. Co. v. Traylor/Wolfe Architects, Inc.

Published on: August 11, 2014 | by Friedman Rodman Frank & Estrada, P.A.

In American Economy Ins. Co. v. Traylor/Wolfe Architects, Inc., a man filed a personal injury lawsuit against an architect and his company following a motor vehicle accident. According to the man’s complaint, he was injured when the architect caused a collision by negligently driving his personal sport utility vehicle into the path of his motorcycle. In his complaint, the man alleged the architecture company was vicariously liable for the architect’s negligent behavior. The doctrine of vicarious liability allows an injured person to hold an employer financially responsible for the negligent acts of a worker if the worker was under the employer’s control at the time and the employee was acting within the scope of his or her work duties.

At the time of the accident, the architect’s company was insured by a business policy. After the lawsuit was filed, the architectural firm’s insurance company filed a motion for summary judgment, alleging the insurer had no duty to defend or indemnify the architect or his firm under the terms of the insurance policy. In a motion for summary judgment, a party to a lawsuit asks the court to rule in its favor because no genuine issue of material fact is in dispute and the party is entitled to judgment as a matter of law. When a court considers such a motion, the facts of the case are normally viewed in the light that is most favorable to the non-moving party. The injured man opposed the insurance company’s motion, and the Middle District of Florida held a hearing on the matter.

According to the insurer, the architect was not operating the vehicle for a business purpose at the time of the motor vehicle wreck. While reviewing the insurer’s motion, the federal court examined the undisputed facts of the case in order to determine whether the architect was in fact operating his vehicle within the scope of his employment. Although the architect made a business trip to a mobile telephone store prior to the accident, the court found there was no evidence beyond the injured man’s speculation that the architect was using his vehicle for business purposes at the time the collision occurred. The court stated the two trips that the architect took on the day of the accident were separate. In addition, evidence offered to the court indicated the nature of the trip he was taking at the time of the crash was personal. Since the undisputed evidence demonstrated the architect was not operating his SUV within the scope of his employment with his company when he collided with the motorcycle rider, the Middle District of Florida granted the business insurer’s motion for summary judgment and held the insurance company had no duty to defend the architect or his firm.

11th Circuit Says Florida Workers’ Compensation Laws Apply to Temporary Driver Injured in Dump Truck Crash: Wesco Insurance Co. v. Casto

Published on: August 4, 2014 | by Friedman Rodman Frank & Estrada, P.A.

In Wesco Insurance Co. v. Casto, a man sued a Florida company in federal court for personal injuries he allegedly suffered in a collision while driving a dump truck that was owned by the company. In response to the lawsuit, the company sought defense and indemnity from its motor vehicle insurer. The insurance company then filed a motion for summary judgment, arguing the injured man was an employee at the time of his injury. According to the insurer, the man’s injury was subject to the Floridaworkers’ compensation statute and excluded from coverage pursuant to the terms of the company’s automobile policy. When a party to a lawsuit files a motion for summary judgment, that party is asking the court to rule in his or her favor because no material facts are in dispute and the party is entitled to judgment as a matter of law. The district court granted the insurer’s motion, and the injured man filed an appeal with the 11th Circuit Court of Appeals.

On appeal, the injured man argued that his harm was not properly subject to the workers’ compensation statute because he was not being compensated for driving the dump truck. Instead, he claimed that he was a volunteer. The man also claimed that the district court committed error when it granted the insurer’s motion for summary judgment because there was a genuine issue of material fact regarding whether he was a volunteer or temporary worker who was not included under the company’s motor vehicle insurance coverage.

First, the 11th Circuit examined whether the injured man was in fact a volunteer at the time of the dump truck crash. The court stated the relevant inquiry regarding whether a person is a volunteer relates to the expectation of payment for services. Since the injured man testified that he expected to be compensated for driving the dump truck on the date of the accident, and no contrary evidence was offered to the district court, the appellate court held that the man was not a volunteer under Florida law.

Orlando Court Rules on Evidentiary Issues in Bad Faith Insurance Case: Soto v. GEICO Indemnity Co.

Published on: July 29, 2014 | by Friedman Rodman Frank & Estrada, P.A.

The Middle District of Florida in Orlando has refused to allow an automobile insurance company to introduce certain evidence in a bad faith insurance lawsuit. In Soto v. GEICO Indemnity Co., two drivers were involved in a motor vehicle accident in Volusia County, Florida. At the time of the crash, the at-fault driver was insured by GEICO Indemnity Co. Following the traffic wreck, the other motorist sued the at-fault driver and her insurer for damages related to the injuries the plaintiff allegedly sustained in the auto collision. Following a trial before the Circuit Court of the Seventh Judicial Circuit in and for Volusia County, the plaintiff obtained a judgment of more than $100,000 against the driver who caused the accident.

The plaintiff later filed a third-party bad faith insurance lawsuit against the at-fault driver’s auto insurance company, alleging the insurer committed bad faith in handling her claim against the other motorist. In Florida, an insurer has a duty to pay a valid insurance claim in good faith and without unreasonable delay. If an insurance company fails to do so, it may be held accountable.

Both parties to the lawsuit reportedly agreed that the only issue at trial was whether the insurer acted in good faith when it handled the plaintiff’s claim against the at-fault driver. Prior to trial, the plaintiff and the insurer filed a number of motions in limine. In general, a motion in limine asks a judge to determine whether certain evidence may be included or excluded before the finder of fact.

Tampa Court Dismisses Case Against Insurer’s Parent Company: Patoo Enterprises, Inc. v. Landmark American Ins. Co.

Published on: July 22, 2014 | by Friedman Rodman Frank & Estrada, P.A.

The United States District Court for the Middle District of Florida in Tampa has dismissed a lawsuit that was filed against the parent company of an insurer. In Patoo Enterprises, Inc. v. Landmark American Ins. Co., a licensed transportation broker purchased a commercial liability insurance policy from Landmark American Insurance. In addition to this general liability policy, the company also purchased an umbrella policy from Commerce and Industry Insurance Company. Commerce’s parent company is American International Group, Inc. (AIG). While both insurance policies were in effect, the transportation broker and its parent company were sued following a motor vehicle collision. In response to the lawsuit, the transportation companies filed a claim under both insurance policies. After the insurers denied both claims, the transportation companies filed a lawsuit against Landmark, Commerce, and AIG seeking a declaratory judgment in their favor. AIG then filed a motion to dismiss the lawsuit alleging the court lacked jurisdiction against the company and that the transportation companies failed to state a claim on which relief may be granted.

Initially, the federal court stated a motion to dismiss a lawsuit must be viewed in the most favorable light possible to the party who is opposing the motion. Because of this, the court said it is required to assume anything alleged in a complaint is true for purposes of a motion to dismiss for failure to state a claim on which relief may be granted. According to the court, dismissal is only appropriate where a plaintiff failed to allege sufficient facts to demonstrate the party is entitled to relief. Although an AIG employee denied the transportation companies’ claims under the umbrella policy on an AIG letterhead, AIG is a separate company from Commerce. Since AIG did not issue the umbrella policy, the company asserted it should not be required to defend itself despite that the transportation companies argued AIG was a proper party to the lawsuit.

Ultimately, the Middle District of Florida agreed with AIG. According to the court, only Commerce would be required to provide coverage if the transportation companies were entitled to relief under the umbrella policy. Because of this, AIG’s motion was granted and the case against the insurer was dismissed.