25 Fla. L. Weekly Supp. 823a
Online Reference: FLWSUPP 2509EGARInsurance — Personal injury protection — Application — Misrepresentations — Materiality — Insured’s failure to disclose household resident age 15 or older on application despite being asked three times to disclose all such residents constitutes material misrepresentation where there is no evidence that insurer was aware of unlisted resident, and affidavit of insurer’s underwriter avers that policy would have been issued at higher premium or would not have been issued at all if insured had disclosed resident on application — Where insured did not allege in reply to insurer’s answer and affirmative defenses that insurer had waived right to rescind policy but raised waiver issue for first time in motion for summary judgment, waiver issue was not properly pled and will not be considered
HENDZ IN MOTION, INC., a/a/o Emanuel Garcia, Plaintiff, v. WINDHAVEN INSURANCE COMPANY, Defendant. County Court, 11th Judicial Circuit in and for Miami Dade County, Civil Division. Case No. 15-010602-CC-05 (6). November 1, 2017. Wendell M. Graham, Judge. Counsel: Felipe Diez and Kevin W. Whitehead, Miami, for Plaintiff. Bridgid Napier and Cristina Lombillo, Miami, for Defendant.
ORDER GRANTING DEFENDANTS MOTION FORFINAL SUMMARY JUDMGENT REGARDINGMATERIAL MISREPRESENTATION
This Cause, having come before the Court upon Defendant’s Motion for Summary Final Judgment Regarding Material Misrepresentation on October 17, 2017, and the Court after reviewing the motions, the record, the applicable case law, and after hearing argument of counsel for the parties, and being otherwise fully advised in the premises, makes the following findings of fact and conclusions of law:
FACTS
On or about July 13, 2012, Sofia Mejia applied for an insurance policy with Windhaven Insurance Company (“Windhaven”). Pursuant to the Defendant’s policy application, all residents age 15 or older must be disclosed on the application. The insurance application contained three (3) separate provisions for Ms. Mejia to disclose all household residents 15 years of age or older. Ms. Mejia only listed herself and Pedro Garcia as drivers and/or members of the household when asked to list drivers included on the policy and household resident information. When asked “Are there any residents of the household age 15 & older who are not listed as drivers or as excluded drivers?” Ms. Mejia answered “no.” When asked to list persons excluded from the insurance policy, Ms. Mejia did not list any person. In reliance on the information that Ms. Mejia provided in this signed application, Defendant issued the subject policy to run from July 13, 2012 through January 13, 2013 at a premium rate of $1,121.00.
On November 8, 2012, Emanuel Garcia was involved in a car accident and sought treatment from Plaintiff for injuries sustained in the accident, and subsequently made claims for personal injury protection (“PIP”) benefits with Windhaven. During Windhaven’s investigation of the claim, Windhaven discovered that on the date of policy inception, Emanuel Garcia was a resident of Ms. Mejia’s household and was 15 years of age or older. However, Ms. Mejia did not disclose Emanuel Garcia as a household member aged 15 years or older.
Windhaven has determined that had Ms. Mejia disclosed Emanuel Garcia on the application for insurance, the premium would not have been issued at the same rate, thus constituting a material misrepresentation. Specifically, had Emanuel Garcia been disclosed on the policy application as a household resident age 15 or older, the premium would have increased whether Emanuel Garcia was included or excluded from the policy. During her deposition, Ms. Mejia confirmed that Emanuel Garcia was residing at the policy address on the date of inception. She further confirmed that Emanuel Garcia was age 15 or older at the time the policy application was completed.
Defendant’s policy application, as well as its policy jacket, expressly provides that the Defendant may deny coverage where there is a misrepresentation on the application of insurance. Pursuant to section 627.409, Florida Statutes (2014), a Notice of Flat Cancellation, along with a policy refund check in the amount of $1,252.77 (representing the premium that had been paid to date) was mailed Ms. Mejia on December 18, 2012.
The parties argued several points during the hearing, which this Court will address seriatim.ANALYSIS
I. DEFENDANT ESTABLISHED MATERIAL MISREPRESENTATION UNDER FLORIDA STATUTE § 627.409
Fla. Stat. § 627.409 (2014) provides for rescission of an insurance policy if an insured makes a material misrepresentation in the application for the insurance policy.
(1) Any statement or description made by or on behalf of an insured. . . in an application for an insurance policy. . . is a representation and not a warranty. . . [A] misrepresentation, omission, concealment of fact or incorrect statement may prevent recovery under the contract or policy only if any of the following apply:
(a) The misrepresentation, omission, concealment or statement is fraudulent or is material to the acceptance of the risk or to the hazard assumed by the insurer.
(b) If the true facts had been known to the insurer pursuant to a policy requirement or other requirement, the insurer in good faith would not have issued the policy or contract, would not have issued it at the same premium rate, would not have issued a policy or contract in as large an amount, or would not have provided coverage with respect to the hazard resulting in the loss.
a. The Court finds Defendant established misrepresentation.
The Court has reviewed the deposition transcript of Ms. Mejia’s deposition attached to Defendant’s Motion for Summary Judgment, which affirmatively established that: 1) Emanuel Garcia resided with Ms. Mejia on the date of inception; 2) Emanuel Garcia was age 15 or older on the date of inception; and 3) Ms. Mejia did not disclose Emanuel Garcia as a household resident age 15 or older. Further, the record evidence attached to Defendant’s motion establishes that Defendant’s policy application specifically asked Ms. Mejia three times about household residents age 15 or older several times, to which each time she replied no. This evidence is undisputed as Plaintiff failed to file any evidence to rebut these facts. Moreover, there is no affirmative duty for the Insurer to make sure each question on the application is read and understood by the applicant. No party to a written contract can defend against its enforcement on the sole ground that he/she signed it without reading it. Allied Van Lines, Inc. v Bratton, 351 So. 2d 344 (Fla. 1977). Therefore, Defendant has established its burden that a misrepresentation under Florida Statute § 627.409 occurred.
b. The Court finds that there was no knowledge or mistake imputed to Windhaven.
In its review of the deposition transcript of Ms. Mejia, the Court finds that no knowledge or mistake was imputed to Windhaven. Nowhere in the deposition transcript does Ms. Mejia allege that Government Insurance Agency, where Ms. Mejia purchased the insurance policy at issue, had any knowledge of the unlisted household member, Emanuel Garcia. There is no evidence to indicate that Ms. Mejia told Government Insurance Agency about Emanuel Garcia’s existence. There are not even any allegations that Ms. Mejia told Government Insurance Agency about Emanuel Garcia’s existence. The facts here are different than those in the case proffered by Plaintiff, Beneby v. Midland Nat’l Life Ins. Co., 402 So. 2d 1193 (Fla. 3d DCA 1981). In Beneby, there was testimony from the insurer’s agent that was contested by the insured’s husband, which gave rise to “disputed questions of fact.” Id. at 1194. Here, however, there is no such dispute. Ms. Mejia, per her own testimony, never told Government Insurance Agency about Emanuel Garcia. Accordingly, there is no knowledge or mistake to be imputed to Windhaven. There is no question of fact.
c. The Court finds Defendant established materiality as a matter of law, which is a subjective determination to the Insurer.
In United Auto. Ins. Co. v. Salgado, 22 So. 3d 594, 599-601 (Fla. 3d DCA 2009) [34 Fla. L. Weekly D1578a] the Court held that Fla. Stat. § 627.409 applies to the Florida Motor Vehicle No-Fault Law and that, “where a misstatement or omission materially affects the insurer’s risk, or would have changed the insurer’s decision whether to issue the policy and its terms, the statute may preclude recovery.” Additionally, “[t]he law is well settled that if the misrepresentation of the insured were material to the acceptance of the risk by the insurer or, if the insurer in good faith would not have issued the policy under the same terms and premium, then rescission of the policy by the insurer is proper.” New York Life Ins. Co. v. Nespereira, 366 So. 2d 859, 861 (Fla. 3d DCA 1979). The determination of materiality under Fla. Stat. § 627.409(1)(b) is based on “the subjective view of what a particular insurer would or would not have deemed material if it had known the true facts.” Moustafa v. Omega Ins. Co., 201 So. 3d 710, 715 (citing Singer v. Nationwide Mut. Fire Ins. Co., 512 So.2d 1125, 1129 (Fla. 4th DCA 1987) (emphasis supplied)). Furthermore, there is no private cause of action for disputing the way an insurer rates its premiums. Serchay v. State Farm Ins. Co., 25 So. 3d 652 (Fla. 4th DCA 2010) [35 Fla. L. Weekly D129a]. Pursuant to Fla. Stat. § 627.371, the appropriate remedy is through a written request directly to the insurer, with a subsequent complaint to the Office of Insurance Regulation if needed.
Accordingly, where the evidence is clear and uncontradicted, the materiality of the misrepresentation shall be decided as a question of law de Guerrero v. John Hancock Mut. Life Ins. Co., 522 So. 2d 1032, 1033 (Fla. 3d DCA 1988) (citing Continental Assur. Co. v. Carroll, 485 So. 2d 406, 409 (Fla.1986); 7 Couch on Insurance 2d. § 35:94 (rev. ed. 1985)). Thus, an affidavit of an underwriter averring as to the materiality of the risk is sufficient to establish materiality. GRG Transp., Inc. v. Certain Underwriters at Lloyd’s, London, 896 So. 2d 922, 925 (Fla 3d DCA 2005) [30 Fla. L. Weekly D600a] (affirming the award of summary judgment where Lloyd’s introduced of the uncontradicted affidavit of one its underwriters who averred that Lloyd’s would not have issued the policy if it would have known of the non-renewal and cancellation).
Here, Windhaven introduced the affidavit of its underwriter which averred that “[p]er the applicable Underwriting Guidelines which govern the underlying policy, the Underwriting Department determined that if SOFIA MEJIA had disclosed EMMANUEL GARCIA on the policy application as a resident age 15 or older, the policy would have been issued at a higher premium or would not have been issued at all.” It does not matter whether Emanuel Garcia was licensed at the time of policy inception. Windhaven determined that Emanuel Garcia’s residence at the policy address was a material risk that would have increased the premium whether he was listed as included driver or not. Again, this affidavit was uncontroverted as Plaintiff did not introduce a single piece of evidence to rebut this affidavit. Therefore, Windhaven established materiality under Florida Statute § 627.409 as a matter of law.
II. PLAINTIFF HAS NOT PROPERLY PLED WAIVER IN AVOIDANCE OF DEFENDANT’S MATERIAL MISREPRESENTATION DEFENSE
Florida Rule of Civil Procedure 1.100(a) states that “If an answer or third-party answer contains an affirmative defense and the opposing party seeks to avoid it, the opposing party must file a reply containing the avoidance.” (emphasis added). When the factual matters plead in the answer raise a new point that is previously outside the pleadings, avoidance by reply is required. See American Salvage & Jobbing Co. Inc. v. Salomon, 295 So. 2d 710, 712 (Fla. 3rd DCA 1974).
Wavier is just such an avoidance that must be plead in a reply. See Gamero v. Foremost Insurance Company, 208 So. 3d 1195, 1197 (Fla 3rd DCA 2017) [42 Fla. L. Weekly D158b]; Frisbie v. Carolina Casualty Insurance Co., 162 So. 3d 1079, 1081 (Fla 5th DCA 2015) [40 Fla. L. Weekly D917b]. Defendant filed its answer and affirmative defenses asserting that the subject policy was rescinded due to the material misrepresentation made on the policy application by named insured on August 5, 2015. Plaintiff’s reply did not allege Defendant had waived its right to rescind the policy.
Since Plaintiff failed to plead waiver in reply, the trial court will not consider the issue. Garnero at 1197. Nor is it proper to bring waiver to the courts attention through a motion for summary judgment as Plaintiff has attempted to do here. Frisbie at 1081.
