Supreme Court of Florida

Transcription

1 Supreme Court of Florida CASE NO. BASIK EXPORTS & IMPORTS, INC., Petitioner, v. PREFERRED NATIONAL INSURANCE COMPANY, Respondent. ON PETITION FOR DISCRETIONARY REVIEW FROM THE DISTRICT COURT OF APPEAL, FOURTH DISTRICT OF FLORIDA PETITIONER S JURISDICTIONAL BRIEF ROY D. WASSON WASSON & ASSOCIATES, CHARTERED Suite 450 Gables One Tower 1320 South Dixie Highway Miami, Florida (305) MILLARD C. GLANCY 235 Seagrape Building 1500 University Drive Coral Springs, FL (954) Attorneys for Petitioner

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3 TABLE OF CONTENTS TABLE OF AUTHORITIES... : ii STATEMENT OF THE CASE AND OF THE FACTS... : 1 SUMMARY OF THE ARGUMENT... : 2 ARGUMENT: I. THE FOURTH DISTRICT S DECISION CONFLICTS WITH WOLLARD AND WITH DECISIONS OF THE THIRD DISTRICT THAT... APP II THE DECISION BELOW EXPRESSLY AND DIRECTLY CONFLICTS WITH DECISIONS OF OTHER DISTRICT COURTS OF APPEAL ON THE COLLATERAL LEGAL CONSEQUENCES... EXC III THE DECISION UNDER REVIEW APPLIES A DEFERENTIAL STANDARD OF REVIEW THAT EXPRESSLY AND DIRECTLY CONFLICTS WITH DECISIONS OF OTHER DISTRICTS WHICH... APP CONCLUSION... : 9 CERTIFICATE OF SERVICE... : 10 CERTIFICATE OF COMPLIANCE... : 10 i

4 TABLE OF AUTHORITIES CASES PAGE Avila v. Latin American Property & Cas. Ins. Co So. 2d 894 (Fla. 3d DCA 1989) :3, 4 Basik Exports & Imports, Inc. v. Preferred Nat l Ins. Co So. 2d 291 (Fla. 4 th DCA 2005) :1 Hardwick v. Moore, 795 So. 2d 970 (Fla.1st DCA 2001)... :8 Laganella v. Boca Grove Golf & Tennis Club, Inc So. 2d 705 (Fla. 4 th DCA 1987) :8 Lloyd's & Co. of Lloyd's v. Wollard, 420 So. 2d 940 (Fla. 3d DCA 1982)... :4 Mazer v. Orange County, 811 So. 2d 857 (Fla. 5th DCA 2002).... : 6 Mercury Ins. Co. v. Cooper, No. 3D , 30 Fla. L. Weekly... D 2648 (Fla. 3d DCA Nov. 23, 2005) : 3, Smith v. City of Fort Myers, 898 So. 2d 1177 (Fla. 2d DCA 2005)... :8 Soud v. Kendale, Inc. 788 So. 2d 1051 (Fla. 1 st DCA 2001)... :7 Wollard v. Lloyd's & Co. of Lloyd's, 439 So. 2d 217 (Fla. 1983)... :1 OTHER AUTHORITIES PAGE , Fla. Stat...: 2, , Fla. Stat... : 5 ii

5 STATEMENT OF THE CASE AND FACTS This is a proceeding for discretionary review of the decision of the Fourth District in Basik Exports & Imports, Inc. v. Preferred Nat l Ins. Co., 911 So. 2d 291 (Fla. 4 th DCA 2005). App. 1. The Appellant/Petitioner ( Basik ) was insured under a commercial general liability policy issued by the Appellee/Respondent ( Preferred ). Id. at 291. During the policy's term, a third party brought a negligence action against the insured arising from an automobile accident. Id. at [T]he insurer elected to provide a defense for the insured under a full reservation of rights. Id. at 292. While the third-party claim was pending, the insured filed a declaratory judgment action against the insurer, seeking a determination of its rights under the policy. Id. The insurer counter-claimed for declaratory relief.... Id. The insurer settled the third-party claim within its policy limits. Id. The insured then filed a motion for summary judgment on the declaratory judgment action and sought attorneys fees, arguing the settlement of the third-party claim amounted to a confession of judgment under Wollard v. Lloyd's & Co. of Lloyd's, 439 So. 2d 217 (Fla. 1983). Id. (foonote omitted). The trial court denied the insured's motion for summary judgment and entered a final judgment of 1

6 dismissal of the declaratory judgment action with prejudice... [finding that] the insured's claim for declaratory relief had become moot with the insurer's settlement of the third-party claim within its policy limits. Id. On appeal, the insured argue[d] that the insurer's settlement of the thirdparty claim amounted to a confession of judgment, entitling it to attorney's fees under section , Florida Statutes (2004). Id. The Fourth District applied the abuse-of-discretion standard to review the dismissal order and affirmed that order. Id. The Fourth District refused to apply Wollard to this case involving the insurance company s settlement of a third-party liability claim as opposed to a claim for first-party insurance benefits, and involving a declaratory judgment action filed by the insured, as opposed to one filed by the insurance company. Id. SUMMARY OF THE ARGUMENT This Court has jurisdiction to review the Fourth District s decision because it expressly and directly conflicts with decisions of this Court and other districts in three respects. The decision conflicts with this Court s Wollard holding that the insurer s voluntary payment of a disputed claim constitutes a confession of judgment in the litigation filed by the insured, entitling the insured to an award of attorneys fees under , Fla, Stat. The Fourth District s decision also conflicts with a similar decision from the Third District applying Wollard to the 2

7 insurance company s settlement of a third-party tort claim during the pendency of a declaratory judgment action on the coverage issue. The decision conflicts with decisions of other courts applying a de novo standard to review dismissals of declaratory judgment actions. Finally, the decision conflicts with decisions of other districts applying the collateral legal consequences doctrine to preclude dismissal of an action based on mootness. ARGUMENT I. THE FOURTH DISTRICT S DECISION CONFLICTS WITH WOLLARD AND WITH DECISIONS OF THE THIRD DISTRICT THAT APPLY WOLLARD TO THIRD-PARTY CLAIMS This Court has jurisdiction to review the Fourth District s decision because it is in express and direct conflict with this Court s decision in Wollard and with the decisions of the Third District applying Wollard, including Mercury Ins. Co. v. Cooper, No. 3D , 30 Fla. L. Weekly D 2648 (Fla. 3d DCA Nov. 23, 2005) and Avila v. Latin American Property & Cas. Ins. Co., 548 So. 2d 894 (Fla. 3d DCA 1989). Those cases hold that the insurer s voluntary payment of a 3

8 disputed claim constitutes a confession of judgment entitling the insured to an award of attorneys fees under , Fla. Stat. In Wollard, as in the present case, the insured was forced to file suit against its insurer when the insurer denied coverage on a claim. "On the eve of trial, the parties agreed to a settlement of the claim but stipulated that the matter of any award of attorney's fees would be submitted to the trial court." Id. at 218. The trial court awarded fees under section , which the Third District reversed. See Lloyd's & Co. of Lloyd's v. Wollard, 420 So. 2d 940 (Fla. 3d DCA 1982). This Court, however, disagreed with the Third District and reversed, holding that an insurer cannot escape liability for attorney's fees by settling a lawsuit filed by its insured prior to entry of judgment. See Wollard, 439 So. 2d at This Court held as follows in Wollard: When the insurance company has agreed to settle a disputed case, it has, in effect, declined to defend its position in the pending suit. Thus, the payment of the claim is, indeed, the functional equivalent of a confession of judgment or a verdict in favor of the insured. Requiring the plaintiff to continue litigation in spite of an acceptable offer of settlement merely to avoid having to offset attorney's fees against compensation for the loss puts an unnecessary 4

9 burden on the judicial system, fails to protect any interest the insured's, the insurer's or the public's and discourages any attempt at settlement. Id. at 218 (emphasis added). The Fourth District s efforts to distinguish this case from Wollard on the ground that the lawsuit here was filed by the insured instead of the insurer creates conflict with Avila v. Latin American Property & Cas. Ins. Co., 548 So. 2d 894 (Fla. 3d DCA 1989). In that case the Plaintiff suffered injuries in an automobile accident which he claimed was covered by a policy of insurance issued by Latin American. Latin American failed to pay Avila s claim and Avila brought an action seeking declaratory relief. Id. Avila s declaratory judgment action was ultimately dismissed for failing to state a cause of action, but Avila sought an award of his attorneys fees based upon Latin American s voluntary payment prior to that dismissal. The court held that if the payment had preceded the dismissal of Avila s declaratory judgment, then the payment constituted a settlement, and attorneys fees are mandatory pursuant to Wollard. The Fourth District s decision also conflicts with Mercury Ins. Co. v. Cooper, supra, which applied the Wollard decision to the insurer s settlement of a third-party claim brought against its insured during the pendency of a declaratory 5

10 judgment action on the coverage issue. The foregoing cases stand for the proposition that an insurer that voluntarily pays a disputed claim third party or first party during the pendency of litigation between itself and its insured on the coverage issue (whether instituted by either party) confesses judgment and is obligated for the insured s fees under This Court has jurisdiction over this important issue and should accept review in this case. II. THE DECISION BELOW EXPRESSLY AND DIRECTLY CONFLICTS WITH DECISIONS OF OTHER DISTRICT COURTS OF APPEAL ON THE COLLATERAL LEGAL CONSEQUENCES EXCEPTION TO THE MOOTNESS DOCTRINE Review should be granted because, by affirming dismissal of the declaratory judgment action on the ground of mootness, the Fourth District s decision expressly and directly conflicts with decisions of other districts employing the collateral legal consequence exception to the mootness doctrine. While the main subject of the declaratory judgment action was to obtain a determination whether Mr. Wood s claim against Basik Exports was covered, and while it might be said that that substantive legal issue was mooted by Preferred National s payment of 6

11 Mr. Woods claim, the resolution of the substantive legal issue did not immediately render moot the entire declaratory action. The collateral legal consequences doctrine was applied by the Fifth District in Mazer v. Orange County, 811 So. 2d 857 (Fla. 5th DCA 2002) as follows: Generally, a case that has been rendered moot will be dismissed.... A case is rendered moot when it no longer presents an actual controversy or when the issues cease to exist because they have been so fully resolved that a judicial determination can have no actual effect.... At least three instances have been recognized by Florida courts in which a moot case will not be dismissed: 1) when the issues are of great public importance; 2) when the issues are likely to recur; and 3) when collateral legal consequences flow from the issues to be resolved that may affect the rights of a party. Id. at 859 (emphasis added). In the Mazer case, although the merits of the underlying litigation had been disposed of and apparently were moot, the appellant still had a potentially viable claim for attorney s fees. Therefore, just as in the present case, the attorney s fee issue remained an active matter within the jurisdiction of the court and the disposition of the main issue between the parties could not support dismissal under the mootness doctrine. In reversing the dismissal based on mootness, the court 7

12 held: the instant case comes within the third exception. The collateral legal consequence here is Mazer s right, vel non, to attorney s fees. Id. The Fourth District s decision also conflicts with Soud v. Kendale, Inc. 788 So. 2d 1051 (Fla. 1 st DCA 2001). That was another case holding that a statutory request for attorneys fees under the Sunshine Act was a collateral legal consequence precluding dismissal based on mootness, even though the balance of the case had been disposed of. This Court has jurisdiction to review the decision below based on that express and direct conflict. III. THE DECISION UNDER REVIEW APPLIES A DEFERENTIAL STANDARD OF REVIEW THAT EXPRESSLY AND DIRECTLY CONFLICTS WITH DECISIONS OF OTHER DISTRICTS WHICH APPLY THE DE NOVO REVIEW STANDARD In affirming the trial court s dismissal of the declaratory judgment action as moot, the panel stated the standard of review it applied as follows: We review the dismissal of a complaint seeking declaratory judgment for an abuse of discretion. App. 1 (citing Laganella v. Boca Grove Golf & Tennis Club, Inc., 690 So. 2d 705, 706 (Fla. 4 th DCA 1987)). The Second District has stated that the standard of review of an order dismissing a complaint is de novo. See Smith v. City of Fort Myers, 898 So. 2d 8

13 1177 (Fla. 2d DCA 2005) (de novo review of complaint seeking declaratory decree that City s approval of transfer of property to county was a violation of statute, and city code). In Hardwick v. Moore, 795 So. 2d 970 (Fla.1st DCA 2001), the First District applied a de novo standard when reviewing the dismissal of a two-count declaratory judgment complaint. Thus, the Fourth District was in direct conflict with two of its sister courts when it applied an abuse of discretion standard to its review of this case. This Court therefore has discretionary jurisdiction. CONCLUSION Due to express and direct conflict with this Court and district court decisions regarding voluntary payments as confessions of judgment, conflicts in applying the collateral legal consequences exception to the mootness doctrine, as well as express and direct conflict in not applying a de novo standard of review, this Court has discretionary jurisdiction to review the decision rendered by the Fourth District in this case. ROY D. WASSON WASSON & ASSOCIATES, CHARTERED Suite 450 Gables One Tower 1320 South Dixie Highway Miami, Florida (305) MILLARD C. GLANCY 9

14 235 Seagrape Building 1500 University Drive Coral Springs, FL (954) Attorneys for Petitioners By: ROY D. WASSON Florida Bar No CERTIFICATE OF SERVICE I HEREBY CERTIFY that true and correct copies of the foregoing were served by U.S. Mail to Robert H. Schwartz and Alain Boileau, Adorno & Yoss, LLP, Counsel for Appellee, 888 SE 3d Avenue, Suite 500, Fort Lauderdale, FL ; Millard C. Glancy, Co-Counsel for Appellant, 235 Seagrape Building, 1500 University Drive, Coral Springs, FL 33071; on this the 27 th day of February, By: ROY D. WASSON Florida Bar No CERTIFICATE OF COMPLIANCE 10

15 I HEREBY CERTIFY that this brief has been computer generated in 14 point Times New Roman font and complies with the requirements of Rule 9.210(a)(2). By: ROY D. WASSON Fla. Bar No