Douglas Stalley v. AllState Insurance Company , 682 F. App'x 846 ( 2017 )

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[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
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No. 16-14816
Non-Argument Calendar
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D.C. Docket No. 6:14-cv-01074-JA-DAB
DOUGLAS STALLEY,
as guardian of the Property of Benjamin Edward Hintz,
Plaintiff-Appellant,
versus
ALLSTATE INSURANCE COMPANY,
ALLSTATE INDEMNITY COMPANY,
Defendants-Appellees.
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Appeal from the United States District Court
for the Middle District of Florida
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(March 17, 2017)
Before HULL, WILSON and BLACK, Circuit Judges.
PER CURIAM:
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Douglas Stalley, as the guardian of the property of Benjamin Hintz, appeals
a final judgment entered in favor of Allstate Insurance Company in a diversity
action for third-party bad faith brought under Florida common law. Stalley
contends the district court abused its discretion by denying his proposed jury
instructions requesting the jury resolve any questions regarding the possible
outcome of a settlement effort in his favor and place a burden on Allstate to
“conclusively prove that there was no realistic possibility of settlement within
policy limits.” After review, 1 we affirm.
On June 2, 2009, Benjamin Hintz suffered a head injury when a Volkswagen
Beetle driven by eighteen-year-old Emily Boozer hit his scooter from behind.
Emily’s father, who lived in Melbourne Beach, Florida, listed and insured the
Beetle on his Allstate automobile liability insurance policy. The policy had bodily
injury limits of $100,000 per person and $300,000 per accident, and property
damage limits of $100,000 per accident.
A week following the accident, Allstate received a letter from the law firm
representing Hintz. Three days later, Allstate initiated settlement efforts by
tendering the $100,000 bodily injury limits to the law firm. The firm responded on
June 26, 2009 with a letter stating that Hintz preferred “a global settlement” of all
claims and asking Allstate to respond with their “very best offer for a global
1
We review a district court’s decision to exclude proposed jury instructions for an abuse
of discretion. Lamonica v. Safe Hurricane Shutters, Inc., 711 F.3d 1299, 1309 (11th Cir. 2013).
2
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acceptable mutual release of all” claims. After receiving the letter, Allstate
retained attorney John Krentzman to represent it in settling the claim, and also
hired separate counsel to represent Emily.
Over the next two months, Krentzman corresponded with the law firm
regarding settling the claim and requested confirmation of Hintz’s property
damage. Meanwhile, Allstate discovered in late July that Emily may have been
residing with her grandparents in Indialantic, Florida on the date of the accident;
thus, her grandparents’ $100,000/$300,000 Allstate automobile policy or $1
million Allstate umbrella policy may cover her. Allstate informed Hintz’s lawyers
of this development; however, the law firm never made a demand for the policy
limits.
In early October, the law firm representing Hintz accepted $1,675.35 as the
agreed amount of property damage, but rejected the $100,000 bodily injury limits
check Allstate sent in mid-June. Without notice to Allstate, the law firm
representing Hintz filed suit against Emily on September 22, 2009—three months
and twenty days after the accident. Although her grandparents’ umbrella policy
did not specifically list Emily as a named insured or resident, Allstate determined it
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covered Emily as a resident relative and tendered the $1.1 million policy limits on
January 12, 2010. 2
In February 2010, the law firm representing Hintz rejected that offer and
proceeded with a negligence lawsuit against Emily in state court. The court
entered judgment of more than $11 million against Emily. Allstate paid $1.1
million toward that judgment.
Douglas Stalley, as the guardian of Hintz’s property, then filed suit against
Allstate seeking to recover the unsatisfied portion of the final judgment, asserting
Allstate acted in bad faith in failing to settle Hintz’s claim against Emily.
The district court utilized Florida’s standard jury instructions for bad faith.3
Both parties agreed to this instruction and proposed additional language from bad
faith case law. The district court included much of the parties’ proposed additional
language, including an explanation of the duties of an insurer and the “totality of
the circumstances” standard for determining bad faith. However, the district court
did not include language Stalley requested that instructed the jury to resolve any
questions regarding the possible outcome of a settlement effort in his favor and to
2
Allstate determined that her grandparents’ automobile policy did not cover Emily. The
$1.1 million in coverage stemmed from the umbrella policy and Emily’s father’s automobile
policy.
3
“Bad faith on the part of an insurance company is failing to settle a claim when, under
all the circumstances, it could and should have done so, had it acted fairly and honestly toward
its insured and with due regard for her interests.” Fla. Standard Jury Instruction 404.4, Insurer’s
Bad Faith (Failure to Settle).
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place a burden on Allstate to “conclusively prove that there was no realistic
possibility of settlement within policy limits.”
The district court did not abuse its discretion by excluding Stalley’s
proposed language in the jury instructions. The proposed instructions were
unnecessary to correctly state the law. See Lamonica, 711 F.3d at 1309 (A district
court abuses its discretion in refusing to give a requested jury instruction when it
(1) “correctly stated the law,” (2) “dealt with an issue properly before the jury,”
and (3) “resulted in prejudicial harm to the requesting party.”). Stalley proffered
numerous cases in support of its instruction, none of which are directly on point or
binding.4 Nonetheless, the district court distinguished and rejected each case cited
by Stalley in a lengthy and well-reasoned opinion. Stalley v. Allstate Ins. Co., No.
6:14-cv-1074-Orl-28DAB, 2016 WL 3282371 (M.D. Fl. June 10, 2016).
Furthermore, an independent search indicated that this circuit’s case law lacks
relevant or binding precedent on this issue. Thus, the district court did not abuse
its discretion in excluding the requested instruction.
Even if the district court incorrectly applied the law in refusing to give the
jury instruction, the error did not prejudice Stalley. See Lamonica, 711 F.3d at
1309 (holding the district court’s refusal to give a requested jury instruction must
4
For example, Powell v. Prudential Prop. & Cas. Ins. Co., 584 So. 2d 12, 14 (Fla. 3d
DCA 1991) involved a directed verdict standard, not a request for a jury to resolve questions
about the possible outcomes of a settlement in favor of the insured or an insured’s burden of
proof. Additionally, State Farm Mut. Auto. Ins. Co. v. Laforet, 658 So. 2d 55, 63 (Fla. 1985)
applies to cases involving coverage disputes, which is not the case here.
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cause prejudicial harm to the requesting party). The court reached a considered
decision on the jury instructions after hearing arguments and requesting
supplemental briefing on the issue by both parties. The detailed jury instructions
properly informed the jury of each element of the claim, asking the jury to consider
all aspects of Allstate’s handling of the claim, from inception through judgment,
and to evaluate Allstate’s behavior for bad faith under the totality of the
circumstances. The jury instructions paralleled Florida’s pattern jury instructions
and included additional details and specifications requested by the parties.
Accordingly, the district court did not abuse its discretion by denying
Stalley’s proposed jury instructions.
AFFIRMED.
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