3 Fla. L. Weekly Supp. 611b
Insurance — Automobile — Insolvent insurers — Attorney’s fees, costs, and interest — Statute providing for award of attorney’s fees to insured who prevails in litigation against insurer does not apply to Florida Insurance Guaranty Association except in those cases where FIGA has denied a covered claim or any portion thereof — FIGA is not liable for penalties and interest — FIGA is not liable for court costs unless underlying policy includes those costs as a recoverable item
FLORIDA INSURANCE GUARANTY ASSOCIATION, a Florida Corporation, Appellant, vs. MAGALY GUILLEN, Appellee. 11th Judicial Circuit in and for Dade County, Appellate Division. Case No. 94-288 AP. Opinion filed January 12, 1996. Appeal from the County Court in and for Dade County, Lawrence A. Schwartz, Judge. Counsel: Walton Lantaff Schroeder & Carson and John P. Joy, attorneys for Appellant. Kuvin Lewis Restani & Stettin, P.A., and R. Fred Lewis, for Appellee.
(Before STEVEN D. ROBINSON, ALLEN KORNBLUM and GERALD D. HUBBART, JJ.)
(STEVEN D. ROBINSON, Judge.) FLORIDA INSURANCE GUARANTY ASSOCIATION (FIGA) appeals the trial court’s summary judgment against it for attorney’s fees, interest and costs, deriving from an automobile insurance claim against Ocean Casualty Insurance Company. Ocean Casualty became insolvent after an initial judgment was entered against it in favor of the appellee, MAGALY GUILLEN. The trial court had substituted FIGA for the original defendant carrier and adjudged that the fees, interest and court costs it had awarded against Ocean Casualty would be retained in its judgment against FIGA. FIGA appeals this award of fees, interest and costs, as well as additional attorney’s fees incurred in the litigation against FIGA after FIGA was substituted as a party. The principal of Guillen’s claim was not in issue because Ocean Casualty paid it to Guillen before it became insolvent, and thus before FIGA became a party.
We are required to interpret the relationship of section 631.70, Florida Statutes, as a limitation on section 627.428, Florida Statutes. Section 627.428 awards reasonable attorneys fees to an insured forced into litigation against his or her insurance company. Section 631.70 says, “The provisions of s. 627.428 providing for an attorney’s fee shall not be applicable to any claim presented to the association . . . except when the association denies by affirmative action, other than delay, a covered claim or a portion thereof.”
The plain language of section 631.70 is unmistakably clear. To repeat it says that a section 627.428 attorney’s fee “shall not be applicable against FIGA.” Another panel of this court recently made the same interpretation of this language. Munoz v. American Harbor Insurance Company f/k/a/ Guardian Property and Casualty Insurance Company, 3 Fla. L. Weekly Supp. 146 (1995). The only difference between the instant case and Munoz is that in Munoz the attorney’s fee had not been reduced to judgment before the insolvency, whereas here it was so reduced against the insolvent carrier before FIGA was substituted. This cannot be a dispositive distinction. We interpret the language of section 631.70 to mean that FIGA is not liable to pay an insured any attorney’s fee unless it denies the principal part of a claim.
Guillen argues that a long line of cases defines attorneys fees as required by section 627.428 to be “in effect a part of every insurance policy in Florida. See Old Republic Insurance Co. v. Monsees, 188 So.2d 893, 895 (Fla. 4th DCA 1966). State Farm Fire & Casualty Co. v. Palma, 629 So.2d 830, 832 (Fla. 1993) held, “We agree with the Cincinnati court [Cincinnati Insurance Co. v. Palmer, 297 So.2d 96 (Fla. 4th DCA 1974)] that the terms of section 627.428 are an implicit part of every insurance policy issued in Florida.” We reconcile by holding that section 631.70 supersedes the case law Guillen cites, limiting the previous broad impact of section 627.428. Section 631.70 states that attorney’s fees are applicable against FIGA if FIGA litigates a “covered claim” but not otherwise. A logical reading of the statute is impossible if “covered claim” still includes an attorney’s fee within its definition.
Section 627.428 only applies to cases relating to Chapter 627. It does not cover insurance contracts covered by other chapters of Florida Statutes and certain contracts excluded in section 627.401. In the excluded cases FIGA still is responsible for awarded attorney’s fees, and courts have implicitly so held. Therefore, we distinguish Florida Insurance Guaranty Association v. Gustiner, 390 So. 2d 420 (Fla. 3d DCA 1980), cited by Guillen, in which FIGA was held responsible for an attorney’s fees under section 440.34, Florida Statutes. As here, the insurer became insolvent after an attorney’s fee judgment had been awarded. Dilme v. SBP Service, Inc., 649 So. 2d 934 (Fla. 1st DCA 1995), shows the distinction between chapter 627 and chapter 440 insurance contracts even more clearly, reiterating that section 627.428 does not apply to worker’s compensation claims, governed by chapter 440.
FIGA also challenges the court’s award of interest and court costs. Section 631.57(1)(b), Florida Statutes states that FIGA is not “liable for any penalties or interest.” The statute is plainly worded. We hold that the above language excludes all interest awarded in the original judgment against Ocean Casualty. See Florida Insurance Guaranty Association v. Gustinger, supra.
For a different reason we must also reverse the award of court costs. FIGA stands “in the shoes” of the insolvent insurer only “to the extent of its obligation on the covered claims.” Section 631.57(l)(b), Florida Statutes (emphasis added). If the underlying policy does not include court costs as a recoverable item, there appears to be no statutory basis for claiming costs against FIGA. Guillen cited Florida Insurance Guaranty Association, Inc. v. Johnson, 654 So.2d 239 (Fla. 4th DCA 1995), for the idea that costs are FIGA’s responsibility under the facts of this case. The facts in Johnson are distinguishable. The policy in Johnson included coverage for “expenses incurred at [the insurer’s] request.” The Guillen policy has no similar term. We hold that court costs are not within the coverage of Guillen’s policy.
As a result of the above holdings, we must also disallow and reverse the trial court’s award against FIGA for the additional fees Guillen incurred in prosecuting her now unsuccessful claim against FIGA.
REVERSED. (KORNBLUM and HUBBART, JJ. concur.)
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