22 Fla. L. Weekly Supp. 403a
Online Reference: FLWSUPP 2203COADInsurance — Property — Standing — Assignment — Language in assignment that makes insured responsible for any difference between amount contractor/assignee is able to recover from insurer and contractor’s charges does not impair or diminish validity of assignment — Policy provision that prohibits assignment of policy without consent of insurer does not prohibit assignment of benefits without insurer’s consent — Action by contractor while claim is in appraisal is not premature — Section 713.32, which addresses obligation of insured to pass along to contractor any payments made by insurer for contractor’s work, does not create exclusive remedy for contractor and foreclose contractor’s breach of contract suit against insurer
UNITED RECONSTRUCTION GROUP INCORPORATED, A/A/O SHAWN COADY, Plaintiff, vs. FIRST PROTECTIVE INSURANCE COMPANY, D/B/A FRONTLINE HOMEOWNERS INSURANCE, Defendant. County Court, 20th Judicial Circuit in and for Collier County, Civil Division. Case No. 2014-CC-000359. August 25, 2014. Honorable Janeice T. Martin, Judge. Counsel: Ana Christina Torres, Cohen Battisti, Attorneys at Law, Winter Park, for Plaintiff. Monica B. Sablon, Sheehan & Associates, P.A., Lake Mary, for Defendant.
ORDER DENYING MOTION TO DISMISS COMPLAINT AND DENYING MOTION TOSTRIKE PRAYER FOR ATTORNEYS FEES
This cause having come on to be heard on the Defendant’s Motion to Dismiss Complaint and Motion to Strike Prayer for Attorneys Fees, and the Court having heard extensive argument from both parties and considered all authorities submitted by the parties, it is hereby ORDERED and ADJUDGED:
For the reasons set forth below, the Court finds that a valid assignment of benefits has been alleged by the Plaintiff’s Complaint, and a legally sufficient claim for Breach of Contract has been made, such that the Defendant’s Motion to Dismiss and its Motion to Strike Prayer for Attorneys Fees must each be DENIED. The Defendant shall have twenty (20) days in which to file an Answer to the Complaint.1
The Court predicates this Order upon its conclusion that Plaintiff has sufficiently alleged a valid assignment. The majority of the grounds raised in the Defendant’s Motion to Dismiss and in its Motion to Strike Prayer for Attorneys Fees hinge upon a single argument: that the assignment alleged in, and attached to, the Plaintiff’s Complaint was defective and/or insufficient to convey the rights that Plaintiff asserts in its Complaint. Based upon the plain language of the purported assignment, and based upon the Supreme Court of Florida’s analysis in Continental Casualty Co. v. Ryan Inc. Eastern, 974 So. 2d 368 (Fla. 2008) [33 Fla. L. Weekly S59a], the Court finds that the allegations contained within the four corners of the Plaintiff’s Complaint do state a proper claim for Breach of an Assigned Contract.
For its conclusion that a proper assignment has, in fact, been alleged by Plaintiff, the Court turns first to the plain language of the assignment, attached as Page 1 of Exhibit A to the Plaintiff’s Complaint: “I hereby assign all rights and benefits in relation to such Services to URG completely and without reservation.” “Services” is defined to mean “the labor, services and/or materials provided to me by URG and its subcontractors.” This is a clear, unequivocal and complete assignment of the benefits that the Insured might receive from the Defendant/Insurer directly to the Plaintiff/provider. This language is sufficient to place the Plaintiff fully in the shoes of the Insured such that the Insured no longer has any claim or standing with regard to the Services delivered by Plaintiff.
While Defendant points to subsequent language in the purported assignment that places the Insured on the hook for any difference between what Plaintiff is able to collect from Defendant and what Plaintiff has charged overall, this language does not impair or diminish the total transfer of rights from the Insured to the Plaintiff to collect whatever it can from the Defendant. These excess charges, if any, will be entirely between the Plaintiff and the Insured, and will have no bearing on the contractual liability of the Defendant. Accordingly, the purported assignment attached to Plaintiff’s Complaint is sufficient to effect a complete transfer of all rights that the Insured has with regard to Plaintiff’s portion of this claim from the Defendant.
Support for the Court’s conclusions is found throughout the Supreme Court of Florida’s opinion in Continental, which explained, “An assignment has been defined as ‘a transfer or setting over of property, or of some right or interest therein, from one person to another.’ ” Continental, 974 So. 2d at 376 (further citations omitted). The Court continued, “Importantly, once transferred, the assignor no longer has a right to enforce the interest because the assignee has obtained all ‘rights to the thing assigned.’ ” Id. (further citations omitted).
Such is the case with the purported assignment in the instant case. It achieves a complete transfer of rights with regard to the work done by Plaintiff vis-à-vis the Defendant. The Insured no longer has any right to claim against the Defendant for any work done by the Plaintiff, as a result of this document. Defendant’s concern that the purported assignment addresses only Plaintiff’s portion of the claim related to this specific loss, does not impair the validity of the assignment. As to Plaintiff, the transfer of rights from the Insured with regard to Defendant’s obligations is complete, which is all that the assignment must achieve to be valid.
Regarding Defendant’s suggestion that the plain language of the policy prohibits any such assignment without the express consent of the Defendant, the Court finds that the plain language of the policy merely prohibits assignment of the policy. ¶7 of Page 17 of 18 of the Homeowners 3 Special Form (page 70 of the Defendant’s 203-page submission for its Motion to Dismiss). Paragraph 6 immediately preceding speaks to “nonrenewal.” These provisions use the word “policy” and their context suggests they mean “policy” and not the mere benefits pertaining to a given claim. Conversely, ¶8 immediately following speaks to the “assignment of rights of recovery for a loss” indicating that such is distinct from assignment of a policy.
Likewise §627.422, Fla. Stat., does nothing to prohibit an insured from making an assignment such as the one alleged to have been made in the instant case. That Section merely indicates that, “A policy may be assignable, or not assignable, as provided by its terms.” §627.422, Fla. Stat. Further, this conclusion as to the limits of such a non-assignment clause has been upheld by Florida courts. See, e.g., Better Construction, Inc. v. National Union Fire Ins. Co. of Pittsburgh, 651 So. 2d 141, 142 (Fla. 3d DCA 1995) [20 Fla. L. Weekly D420a] (holding that “a provision against assignment of an insurance policy does not bar an insured’s assignment of an after-loss claim”).
Similarly, the Court must reject Defendant’s assertion that §627.405 prohibits the assignment of rights by an insured to a third party who does not own the property in question. The requirement that there be an “insurable interest” in the property before a person or entity can enforce a contract for insurance against the insurer simply requires the owner/policyholder to have such an interest. If they do hold an insurable interest in the property, and if they choose to assign their rights under the policy to a third party, they may do so without running afoul of §627.405, Fla. Stat.
Accordingly, the Court concludes that Plaintiff’s Complaint sufficiently alleges standing and privity. Its content is not inconsistent with its attachments, specifically the purported assignment. As such the adequacy of the Complaint’s allegation of an equitable assignment need not be reached at this time. Finally, the conclusion of a sufficiently alleged assignment also obviates the Defendant’s assertion that the Insureds are indispensable parties here. The assignment extinguishes any claim that they could make against Defendant for the work done by Plaintiff that is the substance of this suit. Having made a valid assignment, the Insureds are irrelevant to this matter.
Proceeding to the concern that this claim is currently in “Appraisal” making this suit premature, because the Court has found a valid assignment to have been alleged here, the existence of an Appraisal between the Defendant/Insurer and their Insureds is likewise not relevant. That portion of the claim related to the work performed by Plaintiff no longer involves the Insureds, who have fully assigned their rights to Plaintiff. Stated another way, Defendant has a complete defense to any attempt by the Insureds to collect for work done by Plaintiff that may be made in the Appraisal regarding this claim.2
Regarding the suggestion that Plaintiff must seek its remedy pursuant to Chapter 713, Fla. Stat., and cannot do so by bringing suit, the Court finds that Defendant misreads §713.32, Fla. Stat. That Section addresses the obligation of an Insured to pass along to a contractor payment that is made by an Insurer to an Insured for the contractor’s work. It does nothing to create an exclusive remedy for aggrieved contractors such as the Plaintiff.
Similarly, the Court rejects the argument of the Defendant that Plaintiff has failed sufficiently to plead a cause of action for Breach of Contract. Contrary to Defendant’s assertions in its Motion to Dismiss, the Complaint specifically alleges a failure or refusal of the Defendant to pay upon demand in Paragraphs 15 and 16 of the Complaint.
For all of these reasons, the Court denies the Defendant’s Motion to Dismiss, as stated above.
With regard to the Defendant’s Motion to Strike Prayer for Attorneys Fees, the same conclusions lead to the Court’s denial of that motion. Section 627.428, Fla. Stat., provides for the award of attorneys fees “in favor of any named or omnibus insured” who prevails against an insurer in a suit under a given policy. Defendant maintains that the infirmity of Plaintiff’s purported assignment forecloses any claim to fees under this Section. However, the Court has already concluded that the Plaintiff has sufficiently alleged a valid assignment here, and in doing so, the Court has relied upon the decision in Continental discussed above. That decision specifically held that “other third parties who claim policy coverage through an assignment are entitled to an award of fees under section 627.428.” Id. at 377 (other citations omitted). For these reasons, the Court denies the Defendant’s Motion to Strike Prayer for Attorneys Fees.
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1The entry of this Order marks the end of any de facto Protective Order that the Defendant has enjoyed by virtue of the pendency of these Motions, and discovery may proceed for both parties at this time.
2As an aside, the Court notes that any suggestion that Defendant has made a valid demand for Appraisal against the Plaintiff with regard to the subject matter of this suit will have to be raised in a subsequent motion.
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