22 Fla. L. Weekly Supp. 117b
Online Reference: FLWSUPP 2201HUFFInsurance — Personal injury protection — Declaratory judgment — Coverage — Medical expenses — Former husband who is named driver in PIP policy issued to ex-wife is entitled to coverage under ex-wife’s policy for injuries suffered while driving vehicle that was titled solely in name of ex-wife — Where former husband was allowed to use vehicle under terms of marital settlement agreement, but there was no agreement to sell vehicle or transfer title to him, former husband was not owner or beneficial owner of vehicle
PAUL HUFF, Plaintiff, v. STATE FARM FIRE & CASUALTY COMPANY, Defendant. County Court, 9th Judicial Circuit in and for Orange County. Case No. 2011-CC-12284-O. June 27, 2014. Honorable Andrew L. Cameron, Judge. Counsel: Hans Kennon, Morgan & Morgan, P.A., Orlando, for Plaintiff. Matthew J. Corker, Conroy, Simberg, Ganon, Krevans, Abel, et. al., Orlando, for Defendant
ORDER GRANTING PLAINTIFF’S MOTIONFOR FINAL SUMMARY JUDGMENTON PLAINTIFF’S ACTION FORDECLARATORY JUDGMENT
THIS CAUSE having come before the Court for hearing on May 21, 2014, the Court having heard argument of counsel and after reviewing the Plaintiff’s Motion for Final Summary Judgment, the applicable case law and the record evidence provided to the Court, the following findings were made:FINDINGS OF FACT
Plaintiff’s Complaint sought a declaration to determine whether Paul Huff as a named driver on the State Farm auto insurance policy issued to his ex-wife, Kady Huff Browne, was entitled to PIP coverage under the State Farm policy even though he was no longer a resident relative of the marital home and that he was driving a motor vehicle titled solely in her name despite the fact that a marital settlement agreement allowed him use of the vehicle sufficient for State Farm to claim that Paul Huff had become a “beneficial owner” of the vehicle and not entitled to coverage under the policy.
As to the following facts there are no material facts in dispute:
1. On or about November 24, 2008, Plaintiff was involved in a motor vehicle accident in Orange County, Florida, in which Plaintiff sustained personal injuries.
2. At time of the motor vehicle accident, Plaintiff was driving a 2005 Dodge Neon owned by Kady Huff. Ms. Huff was the titled owner of the vehicle and maintained the financing on the vehicle in her name only.
3. At time of the motor vehicle accident, Kady Huff and Paul Huff were divorced.
4. Paul Huff was at the time of the accident a named driver on the policy of insurance which carried $10,000.00 in PIP coverage.
5. There is a Martial Settlement Agreement entered into between Paul Huff and Kady Huff on or about April 28. 2008. Paragraph 10 of the Marital Settlement Agreement states:
Paragraph B. That the Husband shall retain the automobile in his possession, 2005 Dodge Neon titled solely in the wife’s name alone, and he shall be responsible for and make any all payments for said automobile, if applicable, for insurance, as they become due and owing.
6. State Farm denied coverage to Paul Huff based on State Farm’s determination that Paul Huff was the beneficial owner of the 2005 Dodge Neon.
7. Approximately four months after the motor vehicle accident, on March 19, 2009, Kady Huff filed a voluntary petition for bankruptcy in the United States Bankruptcy Court for Middle District of Florida. In that document filed with the federal court on page 11 of Schedule B relating to Personal Property, Kady Huff listed the 2005 Dodge Neon with an approximate value of $6,000.00 as her personal property.
8. On page 13 of the voluntary petition filed with the court under Schedule D listing creditors holding secured claims, Kady Huff listed the 2005 Dodge Neon on that schedule.
9. On page 35 of 49 of Kady Huff’s voluntary petition for bankruptcy, under the Chapter 7 Individual Debtor’s Statement of Intention, it is identified that as to the 2005 Dodge Neon that the property will be “surrendered”.
10. The vehicle was in fact repossessed at some point in March of 2009.RECORD EVIDENCE CONSIDERED
In coming to its determination, the Court considered record evidence in the form:EXHIBITS TO PLAINTIFF’SMOTION FOR FINAL SUMMARYJUDGMENT
Exhibit “A” Deposition of Kady Huff Browne taken on October 25, 2013 and Exhibits attached thereto;
Exhibit “B” Deposition of Paul Huff taken on October 28, 2013 and exhibits attached thereto
Exhibit “C” Deposition of Rhonda McAlpine taken on July 24, 2012 and exhibits attached thereto;
CASE LAW CONSIDERED BY THE COURT
As to Plaintiff’s first argument that Paul Huff’s status as a named driver on the policy is sufficient to afford him PIP coverage under the State Farm policy and State Farm’s arguments to the contrary, the Court considered the following case law:
State Farm Mutual Automobile Insurance Company v. Hartzog, 917 So. 2d 363 (Fla. 1st DCA 2005) [31 Fla. L. Weekly D129a](holding that even a sale which is not fully consummated by virtue of the seller holding title until the buyer pays off the vehicle can make the buyer the beneficial owner of the vehicle.)
McCall v. Garland, 371 So. 2d 1080 (Fla. 4th DCA 1979)(holding that although title remained in the seller at the time of transfer to a third party purchaser that beneficial ownership was to the buyer prior to the accident with a tender and acceptance of a down payment and surrender of sole authority and control finding, the seller was not liable for negligent operation of the automobile and his insurance policy did not cover the purchaser.)
Register v. Redding, 126 So. 2d 289 (Fla. 1st DCA 1961)(holding that summary judgment was improper because a question was presented as to whether beneficial ownership had been transferred to the purchaser when the automobile was involved in an accident while being driven by purchaser’s wife.)
St. John v. Michaels, 178 So. 2d 193 (Fla. 1965)(Florida Supreme Court held that issues of material fact as to ownership at the time of the accident precluded summary judgment for the defendant.)
Bowen v. Taylor-Christensen, 98 So. 3d 136 (Fla. 5th DCA 2012) [36 Fla. L. Weekly D1898a](holding that an ex-husband was vicariously liable as co-owner where he was listed on the car title for a car that he had no possession, custody or control since the date of purchase.)
Palmer v. R.S. Evans, Jacksonville, Inc., 81 So.2d 635 (Fla. 1955)(Florida Supreme Court recognized what the 5th DCA characterized as an “extremely limited” exception that would allow a title holder to be relieved of liability if the title holder had consummated a “common law sale” even if that sale did not meet the formalities of Florida statutes.)
As to Plaintiff’s second argument that the State Farm policy is ambigious and that coverage must be afforded due to the fact that the term “named driver” is not defined in the State Farm policy, the Court considered the following cases:
Lenhart v. Federated National Insurance Company, 950 So. 2d 454, 457 (Fla. 4th DCA 2007) [32 Fla. L. Weekly D460b]. (“Insurance contracts are construed in accordance with the plain meaning of the language in the policy for which the parties bargained. Insuring or coverage clauses are understood to achieve the maximum coverage coherent with the plain meaning of the words used. If there is more than one reasonable interpretation of policy language — one affording coverage and one ruling out coverage — the policy is ambiguous and coverage is inferred. When an insurer fails to define a policy term having more than one meaning, the insurer cannot argue a narrow or restrictive interpretation of the coverage provided. To ascertain the meaning of policy text, courts should read the whole policy and attempt to give every provision the full meaning and import of its words.”)
State Farm Mutual Automobile Insurance Company v. Menedez 70 So. 3d 556, 569-70 (Fla. 2011). [36 Fla. L. Weekly S469a] (But where “the language used in an insurance policy is plain and unambiguous, a court must interpret the policy in accordance with the plain meaning of the language used so as to give effect to the policy as written.”)
Dickson v. Economy Premier Assurance Company, 36 So. 3d 789, 790 (Fla. 5th DCA 2010) [35 Fla. L. Weekly D1106b]. (Courts must construe policy language not “in isolation, but instead in light of the policy as a whole, giving every provision its full meaning and operative effect.”)
Auto Owners Insurance Company v. Anderson, 756 So. 2d 29, 34 (Fla. 2000) [25 Fla. L. Weekly S211a]. (“If the relevant policy language is susceptible to more than one reasonable interpretation, one providing coverage and the other limiting coverage, the insurance policy is considered ambiguous. Ambiguous policy provisions are interpreted liberally in favor of the insured and strictly against the drafter who prepared the policy. Likewise, ambiguous insurance policy exclusions are construed against the drafter and in favor of the insured. In fact, exclusionary clauses are construed even more strictly against the insurer than coverage clauses.”)
State Farm Fire and Casualty Insurance Company v. Deni Associates of Florida, Inc., 678 So. 2d 397, 401 (Fla. 4th DCA 1996) [21 Fla. L. Weekly D1640a]. (Thus, the current Florida rule is that strict construction is required of exclusionary clauses in insurance contracts only in the sense the insurer is required to make clear precisely what is excluded from coverage. If the insurer fails in the duty of clarity in by drafting an exclusion that is capable of being fairly and reasonably read both for and against coverage, the exclusionary clause will be construed in favor of coverage. If the insurer makes clear that it has excluded a particular coverage, however, the court is obliged to enforce the contract as written.”)CONCLUSION OF LAW
State Farm relies primarily on the 1st DCA’s opinion in State Farm Mutual Automobile Insurance Company v. Hartzog, 917 So. 2d 363 (Fla. 1st DCA 2005) [31 Fla. L. Weekly D129a]. In that case, the Court held that even a sale which is not fully consummated by virtue of the seller holding title until the buyer pays off the vehicle can make the buyer the beneficial owner of the vehicle.
State Farm has applied Hartzog to covert Mr. Huff into the beneficial owner of a vehicle titled solely in his ex-wife’s name for which there was no agreement of sale or expected transfer of title.
In Hartzog, Barbara Hartzog agreed to purchase a Ford pick-up truck from Donny Welch by paying installments of between $50.00 and $100.00 a month. Ms. Hartzog did take delivery of the truck but she did not purchase any insurance for it. Mr. Welch kept the title in his own name and maintained the car insurance on the truck with State Farm. Neither Ms. Hartzog or Mr. Welch notified State Farm of the potential sale or that Ms. Hartzog was driving the vehicle.
Approximately two months after the purchase agreement, Ms. Hartzog had an accident while the driving the truck and sustained injuries and the truck was a total loss. Ms. Hartzog continued to make payments on the truck totaling approximately $1,000.00 to Mr. Welch even after the accident occurred.
Ms. Hartzog then made a claim for PIP benefits under the State Farm policy issued to Mr. Welch. State Farm denied coverage on the ground that Ms. Hartzog and not Mr. Welch was the owner of the vehicle. According to State Farm because the policy was issued only to Welch, it did not provide coverage to Hartzog as owner.
The trial court ruled originally in Hartzog’s favor because Ms. Hartzog did not consider the vehicle hers and that she still owed a substantial amount of money on the vehicle. Even though Ms. Hartzog drove the vehicle the trial court found that she did not have a legal right to exclusive possession of the vehicle. The trial court determined that Ms. Hartzog was entitled to coverage and State Farm appealed.
The 1st DCA reversed the trial court. The appellate court determined that the name on the title was not the definitive test for determining who owned the vehicle for insurance purposes. The appellate court focused on the fact that Ms. Hartzog took “immediate, exclusive possession and control of the truck upon making the purchase agreement with Welch.” Id. at 365.
The appellate court focused on the fact that there was “exclusive possession and control” which was found to be a key factor in determining benefits or ownership of the vehicle regardless of who held legal title. In this case, Mr. Huff had possession and limited control until Ms. Huff took the car back and surrendered the car in bankruptcy. In addition, there was never any sales agreement, no arms-length sales transaction, no payment was ever made by Mr. Huff to purchase the vehicle, there was no promise to title the vehicle in Mr. Huff’s name and Mr. Huff was listed on the State Farm policy as a named driver.
There are four other cases in the State of Florida which address a similar issue but are not really instructive to the Court beyond the basic holdings as these three cases deal with liability in third party liability cases but bear mentioning. In McCall v. Garland, 371 So. 2d 1080 (Fla. 4th DCA 1979), the 4th DCA found it of interest that the vehicle was never returned to the seller after the accident and that the purchaser continued on and concluded making the payments on the vehicle. In this case, Ms. Huff surrendered the vehicle back to the lender in bankruptcy and Mr. Huff made no payments to buy the vehicle.
In Register v. Redding, 126 So. 2d 289 (Fla. 1st DCA 1961), and in St. John v. Michaels, 178 So. 2d 193 (Fla. 1965), the 1st DCA and the Florida Supreme Court, respectively, held that issues of material fact as to ownership at the time of the accident precluded summary judgment for the defendant. In this case, if summary judgment is not granted to the Plaintiff based on a lack of material facts in dispute, then there may be a question of whether any “ownership” was transferred at all to Mr. Huff.
In the recent case of Bowen v. Taylor-Christensen, 98 So. 3d 136 (Fla. 5th DCA 2012) [36 Fla. L. Weekly D1898a], the 5th DCA held that an ex-husband was vicariously liable as co-owner where he was listed on the car title for a car for which he had no possession, custody or control since the date of purchase. The underlying Bowen case deals with the issue of liability for personal injury or property damage arising from the use of a motor vehicle. There does not appear to be any question that if Mr. Huff had caused an accident in the vehicle that Kady Huff would be liable for any damages caused because she still held legal title to the vehicle.
As the Bowen court stated, whether Ms. Huff used the vehicle or not is immaterial. The issue is whether she had the right to control the actual disposition of the vehicle. Clearly, Ms. Huff retained that right as evidenced by the bankruptcy filing where she surrendered the car back to the finance company. While there is nodisagreement that Mr. Huff was a beneficial user of the vehicle, the Bowen case, even though set in a third-party liability discussion, clearly shows that Ms. Huff was still the owner of the vehicle.ANALYSIS
The fundamental issue for the Court to consider is whether Paul Huff as a named driver on the State Farm auto insurance policy issued to his ex-wife, Kady Huff Browne, was entitled to PIP coverage under the State Farm policy for the motor vehicle accident of November 24, 2008.
There is no question that Paul Huff was the “beneficial user” of the 2005 Dodge Neon but that is far from being a “beneficial owner.” In addition, it is undisputed by State Farm that Paul Huff was a listed driver on the insurance policy at issue and would reasonably be entitled to benefits as a named driver by virtue of that fact alone.
There was no agreement for the sale of the vehicle to Mr. Huff by Kady Huff. Even the Martial Settlement Agreement acknowledges that the vehicle was titled solely in Kady Huff’s name. There is no assertion in the agreement that even if all payments were made on the 2005 Dodge Neon that title would ever transfer to Mr. Huff upon completion of those payments.
In addition, there is no sales agreement between two as arm’s length parties such as is noted in all of the cases distinguished by Plaintiff in its Motion. The 2005 Dodge Neon was owned by Kady Huff prior to the marriage and at no time was there any transfer of title or any agreement to ever transfer title to Mr. Huff.
As stated above, Mr. Huff was clearly a beneficial user of the vehicle but by no means was he an owner of the vehicle. There is nothing suggesting that any payments, actions, or otherwise by Mr. Huff would result in any form of titled ownership of the 2005 Dodge Neon or even exclusive possession or control.
In March of 2009 Kady Huff filed a petition for bankruptcy and listed the vehicle solely as her asset and surrendered the 2005 Dodge Neon. If, in fact, Mr. Huff was the “owner” or even “beneficial owner” of the 2005 Dodge Neon then Kady Huff would have no right to surrender the vehicle which State Farm says was Mr. Huff’s vehicle.
As to Plaintiff’s second argument that the State Farm policy is ambigious and that coverage must be afforded due to the fact that the term “named driver” is not defined in the State Farm policy, the Court provides the following analysis:
There is no dispute that Paul Huff was a listed driver on the insurance policy at the time of the motor vehicle accident. State Farm has failed to define the term “driver” in its policy. The fact that the policy fails to define the term “driver” would make the term ambiguous. This would reasonably lead a person to believe that he or she was covered as a listed driver under the insurance policy.
There is nothing in the policy or testimony that suggests that any family or residential relationship needs to be maintained in order to be listed as a driver under the insurance policy. There is nothing to suggest that Mr. Huff needed to be a household resident or relative in order to obtain “driver” status and coverage under the State Farm policy.
The cases are clear that an insurance policy is to be construed against the drafter and that the courts when faced with a question of policy construction, even while considering the policy as a whole, are obligated to find coverage if there is an ambiguity in the policy. The cases are clear on this issue as stated above.
The testimony of Ms. McAlpine identifies State Farm’s erroneous position that Mr. Huff was the “owner” of the 2005 Dodge Neon. State Farm agrees that Mr. Huff was a named “driver” on the State Farm policy but is unable to articulate as to what the term “driver” means under the policy. As to whether the State Farm policy is ambiguous due to the lack of a definition of “driver,” and what coverage is afforded to a “driver” the reasonable interpretation is that PIP coverage is afforded.
Based on the lack of the definition of “driver” within the State Farm policy, the Court finds that coverage should be extended on this basis alone as a matter of law, but with no less reason than extending coverage based on the foregoing determination that Mr. Huff was not an “owner” as that term is defined in the case law and Florida statutes. Since the term “driver” is not defined, this Court is obligated to construe the insurance policy against the drafter and find coverage for Paul Huff as a listed “driver” under the policy.
There are no issues of material fact that suggest that Kady Huff was anything but the titled owner of the 2005 Dodge Neon, no question that she surrendered the car pursuant to a bankruptcy petition months after the accident, and no question that there was no agreement that title would ever transfer to Mr. Huff at anytime. In addition, there was no written sales agreement and it is not an arm’s length transaction as discussed in all the cases cited by the Plaintiff
.CONCLUSION
Based on the above findings of fact and conclusions of law it is ORDERED AND ADJUDGED:
Plaintiff’s Motion for Final Summary Judgment seeking a declaratory judgment is GRANTED. The Court issues a declaration finding that:
A. Paul Huff is a named driver on the State Farm policy;
B. that Kady Huff was the titled owner of the 2005 Dodge Neon;
C. that Kady Huff was the contracted debtor for the 2005 Dodge Neon;
D. that Kady Huff listed the vehicle as her possession secured by a creditor in a bankruptcy petition;
E. that there was no written agreement for sale of the vehicle;
F. that there was no agreement to transfer the title to the 2005 Dodge Neon to Paul Huff;
G. that State Farm as failed to define the term “driver” in its policy;.
H. that Paul Huff is entitled to receive coverage under the State Farm insurance policy at issue in this case as “named driver”;
I. that Paul Huff is entitled to receive coverage under the State Farm insurance policy at issue in this case as he was not “owner” or “beneficial owner” of the 2005 Dodge Neon; and
J. that plaintiff is entitled to recover attorney’s fees and costs pursuant to Section 627.428.
