Florida Record

Sunday, September 22, 2019

Florida district court rules in excess coverage case

By Richard Jones | Apr 20, 2017

PENSACOLA — The U.S. District for the Northern District of Florida granted a summary judgment in favor of American Casualty Insurance Co. and denied a similar motion for the Tudor Insurance Co. in a case to determine whether American Casualty was required to contribute to the monetary settlement of a claim in involving a party insured by both companies. 

In the decision, the parties stipulated that there were no issues of material fact in dispute but it was simply a question of joint liability.

In 2011, a 17-year-old boy was murdered in a common parking area of the Royal Crest Apartments, according to court records. The property manager, Strategic Management Partners LLC (SMP), along with the property owner Woods Hill Pensacola LLC, were sued for wrongful death. The family of the victim alleged that negligence on the part of SMP played a part in the teen's death.

As the primary insurer on record Tudor Insurance settled the case and paid the plaintiffs $637,500 in compensation. The settlement gave rise to the current dispute as Tudor Insurance sought to seek payment from American Casualty.

American Casualty’s policy with SMP contained a clause declaring the policy “excess” to any other general liability coverage. Tudor Insurance crossed claimed that American Casualty was not “secondary” but a co-primary insurer in the matter. The court citing the holding in Coker v Am Gaur. & Liability Insurance Company ruled that since Tudor’s financial liability did not exceed the policy coverage limits American’s “excess coverage did not trigger.

“The Court rejects out of hand Tudor’s initial argument that the American Casualty policy’s excess clause is unenforceable as a matter of law as a 'super excess' clause," the court wrote. "The potential pitfalls of dueling excess clauses are not of concern in this case because there is no argument that Tudor’s policy provides only excess coverage, and the American Casualty excess clauses do not contain any language indicating that either clause could operate as a super excess clause if the situation allowed it. Thus, the argument lacks merit."

Because SMP was covered by Tudor Insurance as an added insured in the course of its duties as management agent of the property, the owner of the property was contractually obligated to include SMP in its liability coverage.

The court ordered the clerk to enter summary final judgment in favor of  American Casualty, enter an order against Tudor Insurance and close the case.

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U.S. District Court for the Northern District of Florida, Gainesville Division