14 Fla. L. Weekly Supp. 583a
Insurance — Indemnity — Declaratory judgments — Factual issues — Declaratory relief is available to determine whether notice was proper under insurance policy, a fact upon which insurer’s obligation to provide coverage exists
ARTIBONITE INJURY CARE CENTER, INC., Plaintiff, vs. NEW HAMPSHIRE INDEMNITY CO., INC., Defendant. County Court, 17th Judicial Circuit in and for Broward County. Case No. 05-7123 COSO (60). March 28, 2007. Sharon L. Zeller, Judge.
ORDER
THIS CAUSE having come before the Court on Defendant’s Motion to Dismiss Plaintiff’s Complaint, and the Court having considered same, having heard argument of counsel and being otherwise duly advised in premises, finds and decides as follows;
Plaintiff has filed the instant complaint seeking declaratory decree that notice pursuant to the policy of insurance was proper. Defendant is now moving to dismiss the complaint, arguing that plaintiff’s complaint raises questions of fact and an action for declaratory relief is inappropriate to resolve questions of fact. For the reasons stated below, defendant’s motion is denied.
One of the earliest cases deciding the issue of availability, in cases involving insurance policies, of a declaratory judgment to try disputed questions of fact was the case of Columbia Casualty Co. v. Zimmerman, 62 So.2d 338 (Fla. 1952). In that case, Mary Yates drove a car owned by Martin and Erma Wiltse and collided with a bus, causing injury to the bus driver and ten passengers. Id. at 338. Upon suit being filed against Yates and Martin Wiltse, Yates and her insurance company made a demand on Columbia Casualty, Wiltse’s insurer, to defend the suits. Id. Columbia Casualty declined to defend Yates because her conduct fell under an exclusion in the policy. Yates and her insurer filed a declaratory judgment action to determine Columbia Casualty’s obligation to defend the pending and potential future suits against Yates. Id. The trial court granted a motion to dismiss the suit for failure to state a cause of action under the declaratory judgment statute. Id.
In affirming the dismissal, the Supreme Court relied exclusively on Florida Statutes section 87.021 and held that the declaratory judgment statute did not extend to cover such a case, reasoning:
The complaint in this case shows on its face that there is no doubt as to the meaning of the contract. The only doubt which is shown to exist is whether or not the automobile was being driven with, or without, the knowledge and consent of the insured. This is not a doubt as to the meaning of the contract or as to the proper interpretation of the contract. It is simply a doubt as to what will be the ultimate outcome of a consideration of the facts bearing on the question of whether or not the automobile was being driven with the knowledge and consent of the insured.
Id. at 340. The Supreme Court set forth the rule that for a declaratory judgment of an insurance policy to lie, there must be a question of the construction of the policy and not only fact issues for resolution.
In more recent times, the trend in the case law has been to accord broader scope to the declaratory judgment act in reaching fact issues. State Farm Fire and Casualty Co. v. Higgins, 788 So.2d 992, 996 (Fla. 4th DCA 2001). In Higgins, Cheryl Ingalls filed a complaint against Charles Higgins, seeking damages for the intentional torts of assault and battery. Id. at 944. The property where the alleged events occurred was covered by a homeowner’s policy issued to Higgins by State Farm Fire and Casualty Company. On the basis of his homeowner’s policy, Higgins demanded that State Farm defend and indemnify him in the action brought by Ingalls. In response, State Farm filed a declaratory action seeking a determination of fact issues pertaining to coverage and a declaratory decree as to whether it had a duty to defend and indemnify Higgins under the policy. Id. The declaratory relief action proceeded to a jury trial, with the jury making the factual finding that Higgins intended or expected to cause the injuries for which Ingalls was seeking damages and that Higgins “willfully and maliciously” caused those injuries. Id. at 995. Post-trial Ingalls moved for a new trial based on remarks of State Farm’s counsel to the jury during opening statements that a settlement had already been reached between Ingalls and Bradley. The circuit court found that the remark violated section 768.041(3), Florida Statutes (1999), and granted a new trial. Id. State Farm appealed the order granting a new trial and Higgins and Ingalls cross-appealed on numerous points.
On appeal both Higgins and Ingalls argued that the trial court should have granted their motions for directed verdict on the issue of State Farm’s duty to defend the action against Higgins, its insured. The Fourth District Court of Appeal agreed that the trial court erred in failing to grant a directed verdict on the issue of State Farm’s duty to defend.
Higgins and Ingalls also argued that the declaratory judgment action was not a proper vehicle to decide whether Higgins’ conduct was excluded from coverage under the policy relying on the case of Columbia Casualty, supra, and the case of Smith v. Milwaukee Insurance Co., 197 So.2d 548 (Fla. 4th DCA 1967). The Fourth District examined the holding of Columbia Casualty, and the cases that followed over the years and found that “case law in the last twenty years has moved in the direction of more freely allowing declaratory judgment suits as a vehicle for resolving fact issues deciding the existence of insurance coverage.” Id. at 1001. In looking at the recent trend away from the holding of Columbia Casualty, the Fourth District cited decisions by the First, Second, and Fifth District Courts of Appeal. The Fourth District found that the declaratory action was a proper vehicle to decide whether Higgins’ conduct was excluded from the duty to indemnify coverage of the policy. The Fourth District also certified the same question the Fifth District in Allstate Insurance Co. v. Conde, 595 So.2d 1005, 1008 (Fla. 5th DCA 1992) certified to the Supreme Court:
May the insurer pursue a declaratory action in order to have declared its obligation under an unambiguous policy even if the court must determine the existence or nonexistence of a fact in order to determine the insurer’s responsibility?
In deciding the issue, the Supreme Court examined all of the sections of Florida’s declaratory judgments statutes, not simply the section relied upon in Columbia Casualty. Higgins v. State Farm Fire and Casualty Co., 894 So.2d 5 (Fla. 2004). The Supreme Court agreed with the Fourth District Court that Florida Statutes sections 86.011(2), 86.051, 86.071, and 86.101 support the conclusion that an insurer may pursue a declaratory action which requires a determination of the existence or nonexistence of a fact upon which the insurer’s obligations under an insurance policy depend. Id. at 11.
The Supreme Court concluded that “it is illogical and unfair to not allow insureds and insurers to have a determination as to whether coverage exists on the basis of the facts underlying a claim against an
insurance policy.” Id. The Supreme Court receded from the holding of Columbia Casualty and approved the decision of the Fourth District Court.
Applying the holding of Higgins to the instant action, this Court finds that the declaratory relief is available to determine whether coverage exists based on the facts of the underlying claim.
Accordingly, it is hereby
ORDERED AND ADJUDGED that Defendant’s Motion to Dismiss is DENIED.
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1Section 87.02, Fla. Stat. is similar to the present version of the statute found in section 86.021, Fla. Stat.
