Essex Ins. Co. v. Mercedes Zota , 466 F.3d 981 ( 2006 )

[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FILED
FOR THE ELEVENTH CIRCUIT U.S. COURT OF APPEALS
________________________ ELEVENTH CIRCUIT
OCT 6, 2006
Nos. 05-13457 & 05-14671 THOMAS K. KAHN
________________________ CLERK
D. C. Docket No. 04-60619-CV-JIC
ESSEX INSURANCE COMPANY,
Plaintiff-Appellant,
versus
MERCEDES ZOTA,
MIGUEL ZOTA,
Defendants-Third-Party
Plaintiffs-Appellees,
LIGHTHOUSE INTRACOASTAL, INC.,
JACK FARJI, an individual,
BROWARD EXECUTIVE BUILDERS, INC.,
Defendants-Appellees,
R.A. BRANDON & CO., INC.,
Third-Party
Defendant.
________________________
Appeals from the United States District Court
for the Southern District of Florida
_________________________
(October 6, 2006)
Before TJOFLAT and CARNES, Circuit Judges, and HODGES,* District Judge.
CARNES, Circuit Judge:
This case involves an insurance coverage dispute arising in Florida, the
proper resolution of which depends on unsettled state law. The answers to the state
law questions at the core of the case are sufficiently unclear and difficult that we
think the proper course is to certify them to the Florida Supreme Court, which can
provide authoritative answers.
I.
Mercedes Zota was injured when she fell from scaffolding while painting a
mural on the second story ceiling of a home under construction in Lighthouse
Point, Florida. Zota was performing work as a salaried employee of Perla Lichi
Designs and the President of Trompe L’Oeils ‘R’ Us when she was injured.
Trompe L’Oeils and Perla Lichi Designs had contracted with Lighthouse
Intracoastal, Inc., the owner of the premises where Zota was injured, to paint the
*
Honorable William Terrell Hodges, United States District Judge for the Middle District
of Florida, sitting by designation.
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ceiling of that residence. After the incident, Zota and her husband, Miguel Zota,
brought a negligence action against: Lighthouse; Broward Executive Builders,
Inc., the general contractor for the project; and Jack Farji, a fifty percent
shareholder of Lighthouse and the owner of Broward. Lighthouse’s insurer, the
Essex Insurance Company, then filed this action seeking declaratory relief against
Lighthouse, Broward, Farji, and the Zotas. It sought a determination and
declaration of its rights and obligations with respect to the defendants in the
negligence action.
II.
The facts relevant to the insurance dispute are these. Lighthouse, which is in
the business of building “spec homes,” secured various types of insurance to cover
its activities as a home builder. Part of its insurance coverage is a surplus lines
insurance policy issued by MacDuff Underwriters, Inc. for Essex Insurance (Essex
policy). MacDuff is the surplus lines agent for Essex. The surplus lines policy in
question was delivered by MacDuff to R.A. Brandon & Company. Brandon is
Lighthouse’s producing agent, which means that it has undertaken to secure the
various types of insurance that Lighthouse wanted. When it secured insurance
policies for Lighthouse, Brandon received copies of the policies, reviewed them for
accuracy, and then provided them to Lighthouse. Brandon received a copy of the
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Essex policy, but Brandon, Essex and MacDuff all failed to provide a copy of it to
Lighthouse.
III.
In the district court, both Essex and the defendants filed motions for
summary judgment in this declaratory action. Essex contended that the terms of
Lighthouse’s policy preclude coverage. The defendants contended that Essex had
violated Florida Statutes §§ 626.922 and 627.421 by not delivering the policy to
Lighthouse and, therefore, Essex was precluded from denying coverage. As a
fallback position, the defendants contended that the Zota incident was covered
under the policy anyway. The district court agreed with the defendants’ first
contention and granted their motion for summary judgment, declaring that Essex
was precluded from denying coverage because it had failed to deliver the policy to
the insured, as required by Florida Statutes §§ 626.922 and 627.421.
The defendants subsequently filed a motion for attorney’s fees under Florida
Statute § 627.428. The district court granted that motion and entered a judgment
for fees and costs against Essex and in favor of Lighthouse, Broward and Farji.
Essex has appealed both orders.
IV.
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Central to the legal dispute is Florida Statute § 626.922, which provides as
follows:
Upon placing a surplus lines coverage, the surplus lines agent shall
promptly issue and deliver to the insured evidence of the insurance
consisting either of the policy as issued by the insurer or, if such
policy is not then available, a certificate, cover note, or other
confirmation of insurance. Such document shall be executed or
countersigned by the surplus lines agent and shall show the
description and location of the subject of the insurance; coverage,
conditions, and term of the insurance; the premium and rate charged
and taxes collected from the insured; and the name and address of the
insured and insurer. If the direct risk is assumed by more than one
insurer, the document shall state the name and address and proportion
of the entire direct risk assumed by each insurer. A surplus lines
agent may not delegate the duty to issue any such document to
producing general lines agents without prior written authority from
the surplus lines insurer. A general lines agent may issue any such
document only if the agent has prior written authority from the surplus
lines agent. The surplus lines agent must maintain copies of the
authorization from the surplus lines insurer and the delegation to the
producing general lines agent. The producing agent must maintain
copies of the written delegation from the surplus lines agent and
copies of any evidence of coverage or certificate of insurance which
the producing agent issues or delivers. Any evidence of coverage
issued by a producing agent pursuant to this section must include the
name and address of the authorizing surplus lines agent.
Fla. Stat. § 626.922(1). Also relevant to the dispute is Florida Statute § 627.421,
which provides: “Subject to the insurer’s requirement as to payment of premium,
every policy shall be mailed or delivered to the insured or to the person entitled
thereto not later than 60 days after the effectuation of coverage.” Fla. Stat. §
627.421(1).
5
The district court interpreted these two statutory provisions to require
delivery of the policy directly to the insured. Because the policy was delivered
only to Lighthouse’s producing agent, Brandon, and never delivered directly to
Lighthouse, the court held that Essex had failed to comply with these statutes. The
court concluded that as a penalty or sanction for its failure to comply with the
delivery provisions Essex could not use the language of the policy against
Lighthouse to bar coverage.
Section 626.922(1) requires that the surplus lines agent, MacDuff in this
case, deliver evidence of the insurance to the insured. Florida law appears to
provide that, “delivery of an insurance policy to an agent constitutes delivery to the
insured.” Reliance Ins. Co. v. D’Amico, 528 So. 2d 533, 534 (Fla. 2d DCA 1988);
see also Prudential Ins. Co. v. Latham, 207 So. 2d 733, 735 (Fla. 3d DCA 1968);
United Nat’l Ins. Co. v. Jacobs, 754 F. Supp. 865, 869 (M.D. Fla. 1990). However,
the district court noted that § 626.922 was amended in 1998 and it pointed out that
none of the relevant decisions addressed the post-amendment version of § 626.922.
The court then concluded that the plain language of § 626.922 requires delivery
directly to the insured, and delivery to the insured’s agent will suffice only where
there is a written delegation of authority to do that.
By its terms, the first sentence of § 626.922(1) requires a surplus lines agent
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to issue and deliver evidence of insurance to the insured. Fla. Stat. § 626.922(1)
(“the surplus lines agent shall promptly issue and deliver to the insured evidence of
the insurance . . . .”). The fourth sentence (the written delegation rule) states that
the surplus lines agent may not delegate the duty to issue the evidence of insurance
without prior written authorization from the surplus lines insurer. Fla. Stat. §
626.922(1) (“A surplus lines agent may not delegate the duty to issue any such
document to producing general lines agents without prior written authority from
the surplus lines insurer.”). Finally, the next to last sentence of the subsection
provides that “[t]he producing agent must maintain copies of the written delegation
from the surplus lines agent and copies of any evidence of coverage or certificate
of insurance which the producing agent issues or delivers.” Fla. Stat. § 626.922(1)
(emphasis added).
The parties in this case dispute the relevance of the amendment to § 626.922
and the legislative history behind that amendment. Before the 1998 amendment, §
626.922 provided:
Upon placing a surplus lines coverage, the surplus lines agent shall
promptly issue and deliver to the insured evidence of insurance
consisting of either the policy as issued by the insurer or, if such
policy is not then available, a certificate, cover note, or other
confirmation of insurance.
As a result of the 1998 amendment, the section now reads:
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A surplus lines agent may not delegate the duty to issue any such
document to producing general lines agents without prior written
authority from the surplus lines insurer. A general lines agent may
issue any such document only if the agent has prior written authority
from the surplus lines agent. The surplus lines agent must maintain
copies of the authorization from the surplus lines insurer and the
delegation to the producing general lines agent. The producing agent
must maintain copies of the written delegation from the surplus lines
agent and copies of any evidence of coverage or certificate of
insurance which the producing agent issues or delivers.
Fla. Stat. § 626.922(1). The district court found that the 1998 amendment, which
added the written delegation rule to § 626.922, superceded the rule from Florida
case law that delivery to the insured’s agent constitutes delivery to the insured.
The district court also found that § 627.421(1) applies to this case and
requires delivery to the insured. The parties dispute whether that provision, which
we have already quoted, applies to surplus lines insurers at all. Essex contends that
it is inapplicable but, argues that even if it does apply, the delivery requirement is
satisfied by the delivery of the policy to Lighthouse’s agent. The defendants argue
that § 627.421 does apply to surplus lines insurers and that, like § 626.922, it can
only be satisfied by delivery directly to the insured.
If there was a violation of § 626.922 or § 627.421, the next question is
whether the appropriate remedy is to preclude the insurer from asserting lack of
coverage under the terms of the policy. One way to view such a remedy is as a
form of equitable estoppel. The general rule in Florida is that equitable estoppel
8
may not be used affirmatively to create or extend coverage under an insurance
contract. Crown Life Ins. Co. v. McBride, 517 So. 2d 660, 661 (Fla. 1987).
Florida courts have recognized an exception and will apply estoppel “to create
insurance coverage where to refuse to do so would sanction fraud or other
injustice.” Id. at 662. However, in this case, the defendants do not allege that
Essex or MacDuff engaged in conduct that would amount to fraud.
Essex relies on AIU Ins. Co. v. Block Marina Inv., Inc., 544 So. 2d 998 (Fla.
1989). In that case, the trial court held that the insurer was prohibited from
denying coverage under a Florida statute which stated that “liability insurer[s] shall
not be permitted to deny coverage based on a particular coverage defense” unless
the insurer complies with certain notice requirements. Id. at 998. The Florida
Supreme Court quashed the decision of the district court and held that non-
compliance with the statute only prohibited insurers from asserting defenses to
coverage that would otherwise exist; it did not preclude the insurer from denying
coverage “where the coverage sought is expressly excluded or otherwise
unavailable under the policy.” Id. at 1000. The opinion notes that the general rule
that estoppel may not be used to create coverage is a “long-standing rule” not
altered by the statute. Id. It also states that interpreting the statute to preclude
insurers from denying coverage based on an express coverage exclusion in the
9
policy would have the effect of re-writing the policy and this would raise “grave
constitutional questions [regarding] the impairment of contracts and the taking of
property without due process of law.” Id.The defendants attempt to confine the scope of the AIU decision to
interpretation of the particular Florida statute at issue in that case. A strong
argument can be made, however, that the AIU decision evidences the Florida
Supreme Court’s reluctance to do what the defendants seek here, which would
have the effect of altering the terms of the insurance contract to create coverage
that is not provided for under the policy. See id.Two Florida decisions have addressed whether the appropriate remedy for a
violation of § 627.421 is to prevent the insurer from denying coverage. In ZC Ins.
Co. v. Brooks, the Fourth District Court of Appeal of Florida found that the insurer
had failed to comply with § 627.421 because it had not provided the insured with
any information on the exclusion at issue. 847 So. 2d 547, 550 (Fla. 4th DCA
2003). Because of that failure, the court held that the insurer could not rely on that
exclusion to deny coverage even though the claim at issue otherwise would have
been defeated by the exclusion if applied. Id. at 551. However, an important
consideration in the court’s analysis was the fact that the insurer had given
documents to the insured and those documents seemed to indicate that there was
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coverage. See id. The court held that providing the insured with documents that
defined the coverage without also defining the applicable exclusions was
tantamount to fraud by omission. Id. Because of that fraud, the court found that
the situation fell under the exception and applied promissory estoppel to create
coverage. Id. In the case before us no one contends that there was any fraud,
intentional or otherwise.
In another case, the Fifth District Court of Appeal refused to extend
coverage despite the insurer’s violation of § 627.421. In T.H.E. Ins. Co. v. Dollar
Rent-A-Car Sys., Inc., 900 So. 2d 694 (Fla. 5th DCA 2005), the policy was not
delivered to the insured, but the exclusion at issue was for driving while
intoxicated and the rental agreement that the insured received clearly indicated that
driving the vehicle under the influence of alcohol would deprive the renter of
insurance coverage. Id. at 695. The court rejected the argument that the insurer’s
failure to deliver a copy of the policy prevented application of the exclusion. Id. It
reasoned that the purpose of the statute is to provide notice of exclusions to the
insured “and this was accomplished by placing the notice in large print, in plain
language, in the rental agreement.” Id. The court explained that “[p]rejudice to
the insured should be considered when imposing any sanction for failure to deliver
a policy of insurance as required by section 627.421.” Id. at 696. The insured was
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not prejudiced by the failure to deliver a copy of the policy in that case because the
rental agreement itself gave him notice of the exclusion. Id.If the district court erred in holding that Essex was precluded from asserting
lack of coverage because of its violation of Florida Statutes §§ 626.922 and
627.421, then the Court must determine whether Essex was entitled to judgment
based on two relevant coverage exclusions in the policy. The first is the contractor,
builder, or developer exclusion which provides:
If you are a contractor, builder or developer, there is no coverage
under this policy for . . .
“Bodily injury,” “personal injury,” or “property damage” caused by
acts of independent contractors/sub-contractors contracted by you or
on your behalf unless you obtain Certificates of Insurance from them
providing evidence of at least like coverage and limits of liability as
provided by this policy and naming you as an additional insured.
“Bodily injury,” “personal injury,” or “property damage” sustained by
any independent contractor/sub-contractor, or any employee, leased
worker, temporary or volunteer help of same, unless a Named Insured
or employee of a Named Insured is on site, at the time of the injury or
damage, and the Named Insured’s actions or inactions are the direct
cause of the injury or damage, or the injury or damage is directly
caused by an employee of the Named Insured.
Lighthouse did not obtain the required certificates of insurance covering Zota, so
there is no coverage under the first paragraph if Lighthouse is a “contractor, builder
or developer,” and there is none under the second paragraph unless an employee of
Lighthouse was on site at the time of Zota’s accident and directly caused her
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injuries. Although Lighthouse asserts that Jack Farji was on site at the time of the
Zota incident, it concedes that there is no evidence that Farji’s actions were the
direct cause of Zota’s injury. Therefore, there would be no coverage if Lighthouse
is a “contractor, builder or developer.”
It is well-established in Florida that “an insurer, as the writer of an insurance
policy, is bound by the language of the policy, which is to be construed liberally in
favor of the insured and strictly against the insurer.” Berkshire Life Ins. Co. v.
Adelberg, 698 So. 2d 828, 830 (Fla.1997). Therefore, if there is an ambiguity in an
insurance policy, that ambiguity should be construed against the insurer. Purrelli
v. State Farm Fire & Cas. Co., 698 So. 2d 618, 620 (Fla. 2d DCA 1997). An
insurance policy is ambiguous “if it is susceptible to two or more reasonable
interpretations that can fairly be made.” Cont’l Cas. Co. v. Wendt, 205 F.3d 1258,
1261 (11th Cir. 2000). The court may look to parol evidence in interpreting an
insurance contract only if there is an ambiguity. Fireman’s Fund Ins. Co. v.
Tropical Shipping and Const. Co., 254 F.3d 987, 1003 (11th Cir. 2001).
The parties dispute the role Lighthouse played with respect to the property
where the Zota incident occurred. The district court did not make any findings for
summary judgment or other purposes regarding the activity Lighthouse actually
conducted at this residence. Lighthouse contends that it was merely the owner of
13
the land where the home was being constructed and that Broward was the
contractor. Lighthouse cites the Commercial Liability Declarations page of the
policy issued by Essex. On that page Essex describes Lighthouse’s business
activity as: “Owner of land where dwellings are being built.” Lighthouse also
argues that the terms are ambiguous because they are susceptible to more than one
reasonable interpretation and, therefore, the terms should be construed against
Essex as the drafter.
Essex, of course, contends that the terms “builder, contractor and developer”
are plain and that Lighthouse fits within the plain and ordinary meaning of those
terms. Essex also submitted evidence of another policy that Lighthouse obtained
to cover the same property where Mercedes Zota was injured. On that policy
Lighthouse admitted that it was the “builder” and “contractor” for that property.
Essex also submitted evidence from other policies that Lighthouse had obtained in
the past where it had described itself as a “General Contractor–Home Builders”
and “General Contractor–Builder–Single family dwelling.” Essex contends that it
would be inappropriate for Lighthouse to now argue that it does not fit within the
definition of those terms or that they are ambiguous when it used the same terms to
describe its activities in other insurance policies.
There is a second provision of the insurance contract which is relevant to
14
this dispute. An exclusion in Lighthouse’s policy provides:
This insurance does not apply to any claim, suit, cost or expense
arising out of “bodily injury” to . . . any employee of a Named Insured
arising out of and in the course of employment or while performing
duties related to the conduct of the Insured’s business . . .
The parties dispute whether Zota was an employee of Lighthouse under the policy.
Contending that Zota was an employee of Lighthouse, Essex points out that
in Lighthouse’s answer in the underlying negligence action it stated that it was the
statutory employer of Zota for purposes of the worker’s compensation laws of
Florida. Essex argues that even if this admission does not bind Lighthouse it raises
an issue of fact as to whether Zota was an employee of Lighthouse. The
defendants respond by citing the deposition testimony of the Associate Vice
President of Essex. They contend that in his testimony he admitted that Zota was
not an employee of Lighthouse as the term is defined in the policy. As Essex
apparently concedes, the Vice President stated in his deposition that Essex should
have admitted that Zota was not an employee as defined in the policy.
If the party’s contrary admissions do not determine the factual issue then it
appears that neither party is entitled to summary judgment on this issue. The
parties rely solely on the other side’s admissions and do not offer any other
evidence regarding the particulars of the relationship between Zota and
Lighthouse. In fact, Essex concedes that if Lighthouse is not bound by its
15
admission that it was the “statutory employer,” then the issue is a question of fact
for trial.
III.
If summary judgment for the defendants is due to be affirmed, or if they
otherwise obtain a judgment in their favor, there is an attorney’s fees issue that
must be decided. The district court awarded the defendants attorney’s fees under
Florida Statute § 627.428, which provides:
Upon the rendition of a judgment or decree by any of the courts of this
state against an insurer and in favor of any named or omnibus insured
or the named beneficiary under a policy or contract executed by the
insurer, the trial court or, in the event of an appeal in which the
insured or beneficiary prevails, the appellate court shall adjudge or
decree against the insurer and in favor of the insured or beneficiary a
reasonable sum as fees or compensation for the insured’s or
beneficiary’s attorney prosecuting the suit in which the recovery is
had.
Fla. Stat. § 627.428(1). Section 627.428 is found in Part II of Chapter 627.
Essex challenges the application of § 627.428 to surplus lines insurers,
arguing that under the plain language of Fla. Stat. § 627.021, none of Chapter 627
applies to them. Section 627.021 is found in Part I of Chapter 627 and is entitled
“Scope of this part.” Fla. Stat. § 627.021 (emphasis added). It states that:
(2) This chapter does not apply to: . . .
(a) Reinsurance, except joint reinsurance as provided in s. 627.311. . . .
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(e) Surplus lines insurance placed under the provisions of ss.
626.913–626.937.
Fla. Stat. § 627.021(2) (emphasis added). Essex argues that no statutory
construction is necessary because the language of § 627.021(2)(e) is clear on its
face.
The defendants respond with a number of arguments. First, they contend
that the title of § 627.021 indicates that the legislature intended that only Part I of
Chapter 627 not apply to surplus lines insurers. They cite Florida Statute §
627.401 in support of their position. That section is found in Part II of Chapter 627
and entitled “Scope of this part.” It provides:
No provision of this part of this chapter applies to:
(1) Reinsurance. . . .
Fla. Stat. § 627.401. The defendants argue that if § 627.021 did apply to the whole
chapter there would be no need for the legislature to include reinsurance in §
627.401 because it would already be excluded from all of chapter 627.
Second, the defendants point to two Florida decisions that hold § 627.428
applies to surplus lines insurers. In English & Am. Ins. Co. v. Swain Groves, Inc.,
218 So. 2d 453 (Fla. 4th DCA 1969), the court held that § 627.0127 (which is now
§ 627.428) applied to a surplus lines insurer. Id. at 458. Thereafter, in 1988, the
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Florida legislature amended § 627.021 to add the provision: “This chapter does not
apply to . . . surplus lines insurance placed under the provisions of §§
626.913–626.937.”
In 1995 the same intermediate appellate court was presented with the same
question. See Chacin v. Generali Assicurazioni Generali Spa, 655 So. 2d 1162(Fla. 3d DCA 1995). In answering the question the same way it had in English
before the amendment, the court’s only discussion was to block quote the relevant
portion of the English decision. See id. at 1162. It did not mention the amendment
to § 627.021.
Essex argues that Chacin is flawed because it relied on English without
taking note of the language of § 627.021 which excludes surplus lines insurance
from chapter 627. The defendants argue that Chacin is the law of Florida and must
be applied. They note that Chacin was decided more than ten years ago and there
has been no legislative action on the subject since then.
The district court agreed with the defendants regarding the meaning of §
627.021. It reasoned:
The titles of both sections, “Scope of this Part,” indicate that the
exclusions only apply to each part, and not the entire chapter.
Furthermore, had the legislature intended for § 627.021 to apply to the
entire chapter, it would not have included “Reinsurance” under both
sections §§ 627.[021] and 627.401. In other words, if the legislature
had intended for § 627.[021] to apply to the entire chapter, the
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legislature would only have excluded joint reinsurance under §
627.401, rather than all reinsurance, since that was the only form of
reinsurance permitted under § 627.[021]. The fact that the statute
excludes “reinsurance” in two separate parts indicates that the first
exclusion was not intended to apply to the entire chapter, but only to
apply to the first part.
This interpretation is also in accordance with the court’s decision in
Chacin . . . . Plaintiff contends that the holding in Chacin is no longer
applicable because it relied on the decision in English . . . which was
based on § 627.021 prior to its amendment. . . .
Plaintiff’s argument lacks merit, however, given that Chacin was
decided after the amendment to Fla. Stat. § 627.021. . . . In Chacin,
the court did not exclusively cite the decision in English, but made
specific mention of the relevant statutes in their amended form.
Therefore, the Court finds that the holding in Chacin is still good law.
Essex contends that, although the title of § 627.021 might create some
ambiguity, the language of § 627.021(2)(e) is clear on its face. It cites Askew v.
MGIC Dev. Corp. of Fla., 262 So. 2d 227 (Fla. 4th DCA 1972), which interpreted
a Florida statute with conflicting language and section headings. The statutory
provision created a sixty day limitation on filing taxpayer suits for assessment,
while the title of the section indicated that the limitation applied only to appeals
from the decisions of the Board of Equalization. The court rejected the argument
that the limitation applied only to the Board’s decisions as “sophistry and
caution[ed] that the statutory section headings, inserted by the statutory revisors
and/or legislative service bureau as a convenient visual reference to the content, are
19
not themselves a part of the statute.” Id. at 228.
At least when we are dealing with federal law, the heading or title of a
statute cannot trump the plain meaning of the text. The Supreme Court has
instructed us that “the title of a statute and the heading of a section cannot limit the
plain meaning of the text. For interpretive purposes, they are of use only when
they shed light on some ambiguous word or phrase. They are but tools available
for the resolution of a doubt. But they cannot undo or limit that which the text
makes plain.” Brotherhood of R.R. Trainmen v. Baltimore & Ohio R.R. Co., 331
U.S. 519, 528–29, 67 S. Ct. 1387, 1392 (1947) (citations omitted). In accordance
with that mandate this Court has held repeatedly that section headings may only be
used to interpret a statute when the statute is ambiguous. See, e.g., United States v.
Ferreira, 275 F.3d 1020, 1029 (11th Cir. 2001); Scarborough v. Office of Personnel
Mgmt., 723 F.2d 801, 811 (11th Cir. 1984). If this were a question of federal law
and the interpretation of a federal statute, we would not hesitate to hold that the
district court had erred in using the heading of a statutory section to “undo . . . that
which the text makes plain.” See Brotherhood, 331 U.S. at 529, 67 S. Ct. at 1392.
But this case arises under Florida law and involves the interpretation of a Florida
statute, and there are no decisions of that state’s highest court precisely on point as
to the meaning and effect of Florida Statute § 627.428. Since we are certifying
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other issues of state law to the Florida Supreme Court, we think it prudent to send
this one along with them.1
IV.
As we have explained, there are a number of unresolved issues of Florida
law in this case. The Florida Supreme Court is the only body that can definitively
decide them. Therefore, we certify the following questions to that Court:
1. Whether Fla. Stat. § 626.922 or § 627.421, or both, require delivery of
evidence of insurance directly to the insured, so that delivery to the insured’s
agent is insufficient.
2. Whether, if the delivery requirement of Fla. Stat. § 626.922 or § 627.421, or
both, was not met in this case the appropriate remedy is to preclude the
insurer from asserting lack of coverage under the terms of the policy.
3. If either the first or second question is answered in the negative, whether
Lighthouse is a “builder, contractor or developer” under the terms of the
insurance contract, so that there is no coverage.
1
The final judgment issued by the district court included attorney’s fees and costs in
favor of Lighthouse, Farji and Broward. Broward was not insured under the Essex policy and,
therefore, is not eligible for attorney’s fees under § 627.428. Even if the district court did not err
in awarding attorney’s fees, both parties agree that it did err in awarding them in favor of
Broward. As a result, if the part of the final judgment awarding attorney’s fees is not to be set
aside in its entirety, it must be altered so that it is in favor of Lighthouse and Farji only. Essex
does not contend that this would affect the amount of the award.
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4. If either the first or second question is answered in the negative, whether
Zota is an employee of Lighthouse under the policy.
5. If Lighthouse is entitled to coverage, whether Fla. Stat. § 627.428 applies to
surplus lines insurers.
Of course, our phrasing of the certified questions, as well as the order in which we
list them, is merely suggestive and not intended to restrict the Florida Supreme
Court in any way in its consideration of the relevant state law issues. Swire Pacific
Holdings Inc. v. Zurich Ins. Co., 284 F.3d 1228, 1234 (11th Cir. 2002). It may
restate the issues as it sees fit and is free to determine that a resolution of all the
issues we have posed is not necessary to dispose of the case. In short, we leave all
aspects of the state law issues in the Florida Supreme Court’s hands. That Court’s
assistance will be, as always, greatly appreciated.
The entire record on appeal in this case, together with copies of the briefs of
the parties, is transmitted herewith.
QUESTIONS CERTIFIED.
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