10 Fla. L. Weekly Supp. 187a
Insurance — Workers’ compensation — Employer’s liability — Plaintiff seeking to recover from insurer the amount of a judgment entered against insureds pursuant to a settlement agreement whereby the insureds admitted liability and conceded damages in specified amount, insureds assigned their rights under policy to plaintiff, and plaintiff agreed to seek to recover under the judgment only against insurer under the policy — Remand following appeals court ruling that where insurer refused both coverage and a defense to its insured for claims brought by injured employee against insured in a civil action, insurer thereby ceded to its insured control of the litigation and the right to settle the claims, insurer is bound by settlement waiving defense of workers’ compensation immunity and may not assert that defense against plaintiff’s claim for policy benefits to satisfy the judgment entered against the insured pursuant to settlement agreement, and insurer may not relitigate issue of liability by raising any affirmative defenses that could have been raised in the civil action — Insurer is not entitled to set-off of workers’ compensation payments or workers’ compensation lien on plaintiff’s recovery as these defenses could have been raised in civil action — Settlement is reasonable
STANLEY WRIGHT, Individually and as assignee of UZIEL JAACOBI a/k/a UZI JACOBI, PETTIT TOOLS & SUPPLIES, INC., a Florida Corporation, Plaintiff, vs. HARTFORD UNDERWRITERS INSURANCE COMPANY, a foreign corporation, Defendant. Circuit Court, 17th Judicial Circuit in and for Broward County. Case No. 00-8286 (09). January 16, 2003. Robert Lance Andrews, Judge.
ORDER
THIS CAUSE having come before the Court upon Plaintiff’s Motion for Entry of Final Judgment, and the Court having considered same, having heard argument of counsel and being otherwise duly advised in premises, finds and decides as follows:
Plaintiff, Stanley Wright was injured while in the employ of Defendant Hartford’s insured, Pettit Tools & Supplies, Inc. (Pettit). Plaintiff sought and received workers compensation benefits, pursuant to a policy of workers’ compensation insurance issued by Hartford to Pettit. Plaintiff then filed a civil complaint for recovery of damages and named Uziel Jaacobi a/k/a Uzi Jacobi, Pettit, and CNB International as defendants. The Hartford declined to provide a defense to Pettit, claiming that the extent of its liability under the insurance policy was payment of workers’ compensation benefits. Plaintiff entered into a settlement agreement with Pettit and Uziel Jaacobi, establishing damages for $25,000.00 recoverable only from Hartford. On December 9, 2001, Final Judgment in the amount of $25,000.00 was entered against Uziel Jaacobi a/k/a Uzi Jacobi and Pettit Tools & Supplies, Inc.
On October 18, 2002, the Plaintiff moved for an Order Determining that the Judgment entered on December 7, 1999 in the amount of $25,000.00 is reasonable. At the hearing in this regard on November 18, 2002, Hartford did not contest the reasonableness of the civil settlement. However, Hartford did argue for set-off and a workers’ compensation lien on Plaintiff’s recovery. This Court requested memoranda of law on this issue. The parties submitted their respective memoranda for this Court’s review, and in addition the Plaintiff has filed the instant Motion for Entry of Final Judgment.
On August 2, 2001, this Court entered an Order Granting Defendant’s Motion for Judgment on the Pleadings, finding that Stanley Wright was barred from recovery of civil damages because of workers’ compensation immunity [8 Fla. L. Weekly Supp. 634a]. In the Order, this Court stated that it was this Court’s opinion that this case constituted an attempt on the part of Stanley Wright to seek double recover for his injured. The Fourth District Court of Appeal disagreed and reversed this Court’s decision. Stanley Wright, Uzi Jacobi and Pettit Tools & Supplies, Inc. v. Hartford Underwriters Insurance Company, 823 So.2d 241 (Fla. 4th DCA 2002). In reversing, the Fourth District Court of Appeal specifically rejected this Court’s finding that the case constituted an attempt to seek double recovery. The Court found that when Hartford refused both coverage and a defense to its insured for Wright’s claims in the civil action, it thereby ceded to its insured control of the litigation and a right to settle the claims. Id. at 242. As the court stated, “Hartford is now bound by the settlement and may not re-litigate the issue of liability by raising any affirmative defenses that could have been raised in the civil action.” Id. Under the Fourth District Court of Appeal’s reasoning, once Hartford refused to defend its insured, the instant cause of action became one of bad faith, and Hartford could not relitigate the claim for damages.
Based on the clear holding of the Fourth District Court of Appeal in Wright, supra, Hartford is not entitled to set-off of workers’ compensation payments, nor a workers’ compensation lien on Plaintiff’s recovery.
This Court finds that the settlement is reasonable and that the Plaintiff is entitled to entry of Final Judgment.
Accordingly, it is hereby
ORDERED AND ADJUDGED that the amount of the Judgment for $25,000.00 rendered in Stanley Wright vs. Uziel Jaacobi a/k/a Uzi Jacobi, Pettit Tools & Supplies, Inc., a Florida Corporation and CNB International, Inc., d/b/a Clearing-Niagara, a Delaware Corporation, Broward County Case Number, 98-15765 (25) is REASONABLE.
It is further ORDERED AND ADJUDGED that Defendant, Hartford Underwriters’ Insurance Company’s Request for Set-Off and Workers’ Compensation Lien is DENIED.
It is further ORDERED AND ADJUDGED that Final Judgment is hereby entered in favor of Stanley Wright, and against Hartford Underwriters Insurance Company, in the amount of $25,000.00 together with interest at the statutory rate.
Hartford Underwriters Insurance Company shall take nothing and go hence without day.
This Court reserves jurisdiction to award reasonable costs and attorney’s fees.
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