Defendant's Attorney: Craig Christopher Minko, Jenna Marie Updike, W. Taylor Loe

Description: Fort Fauderdale, Florida insurance law lawyer represented the Plaintiff who sued the Defendant


This case arises from an allegedly fraudulent or misleading Certificate of Insurance (the “COI”) that Defendant issued to non-party James A. Jones, a general contractor. (See generally Second Am. Compl. (“SAC”) [ECF No. 43]; Pl.'s Mot. SOF, Ex. E, COI [ECF No. 75-5]). As described below, Jones later assigned to Plaintiff any claims it might have against Defendant stemming from the COI. (See Def.'s Mot. SOF ¶ 7). In this action, Plaintiff asserts those assigned claims. (See generally SAC).

By way of background, in early 2018, Jones - the general contractor on a construction project (the “Project”) - engaged the services of non-party Central Florida Siding Pros, LLC (“CFSP”) as a subcontractor on the Project. (See Def.'s Mot. SOF ¶ 5). Jones required proof of workers' compensation insurance from subcontractors in the form of certificates of insurance verifying the subcontractor's insurance coverage. (See id. ¶ 22).[2] General contractors may require these certificates as a method of verifying a subcontractor's insurance status. (See, e.g., Def.'s Reply SOF ¶ 63).

CFSP had a workers' compensation policy issued by non-party NorGuard, an insurer. (See Def.'s Mot. SOF ¶ 8). CFSP obtained the policy through Defendant, an insurance agent. (See Id. ¶ 3). At the time the policy was obtained, the coverage period was April 29, 2017 through April 29, 2018. (See id.). On February 6, 2018, Defendant issued the COI to Jones, verifying CFSP's insurance status and stating the coverage period was April 29, 2017 through April 29, 2018. (See id. ¶ 24). The COI also contained multiple disclaimers regarding the language and information it provided. (See generally COI). After receiving the COI, Jones did nothing further to verify the information regarding CFSP's insurance. (See Def.'s Mot. SOF ¶ 41).[3]

At the time the COI was issued, CFSP's workers' compensation insurance policy was in jeopardy. (See id. ¶¶ 11, 16; Pl's Resp. SOF ¶ 11). In short: under the terms of CFSP's coverage, CFSP was to run payroll and pay its insurance premiums through Defendant. (See Def.'s Mot. SOF ¶ 11). Should CFSP fail to pay its premiums, Defendant was required to notify NorGuard. (See id. ¶ 9). Further, Defendant knew that reporting this information to NorGuard might “result in [CFSP's] loss of coverage and/or non-renewal of coverage.” (Id. (alteration added; citations omitted)).

Defendant was also aware that once it notified NorGuard of CFSP's noncompliance, NorGuard would likely soon cancel the policy. (See id. ¶ 11; Pl.'s Resp. SOF ¶ 11). How “soon” that cancellation could occur, as well as how “aware” Defendant was of this possibility, are disputed. (Compare Def.'s Mot. SOF ¶ 11 with Pl.'s Resp. SOF ¶ 11).

As of January 16, 2018, CFSP had failed to run payroll and pay its premiums, and on January 23, 2018, Defendant informed NorGuard of CFSP's noncompliance. (See Def.'s Mot. SOF ¶ 16). Thus, on January 24, 2018, NorGuard sent a Notice of Cancellation to CFSP, indicating the policy coverage would expire on February 10, 2018. (See id. ¶ 19). The parties dispute when Defendant in fact obtained knowledge of this pending expiration date. (Compare Id. with Pl.'s Resp. SOF ¶ 18). The parties also dispute the extent to which Defendant can monitor the status of policies - like CFSP's at the time - which are pending cancellation, and whether Defendant may include that information in issued certificates. (See, e.g., Pl.'s Resp. SOF ¶ 30).

Despite the pending cancellation, the COI stated that CFSP's insurance would run through April 29, 2018. (See COI). The policy was cancelled on February 10, 2018. (See Def.'s Mot. SOF ¶ 20). On April 24, 2018, Plaintiff was injured while working on the Project. (See id. ¶ 52).

In the ensuing workers' compensation proceedings,[4] the JCC determined that, at the time of the injury, CFSP employed Plaintiff; CFSP did not have workers' compensation insurance; Jones was to be considered Plaintiff's employer; and Jones did not carry the required workers' compensation coverage for non-lease employees - making Jones liable for Scott's injuries.[5] (See id. ¶ 54; compare Pl.'s Resp. SOF ¶ 64 with Def.'s Reply SOF ¶ 64; see also Pl.'s Mot. SOF, Ex. A, JCC Compensation Order [75-1] 25).[6] Following the JCC's Compensation Order, Jones and Plaintiff entered a joint stipulation, approved by the JCC, which stated there were $1.85 million in damages to Plaintiff, for which Jones was liable. (See Def.'s Mot. SOF ¶ 59; Pl.'s Resp. SOF ¶ 59). After the stipulation's approval, Jones and Plaintiff settled their dispute. (See Def.'s Mot. SOF ¶ 7). By the terms of their settlement, Jones assigned to Plaintiff all claims Jones might have against Defendant. (See id.).

Plaintiff alleges four claims for relief arising from Defendant's “misrepresent[ation] [of] the status of the insurance policy” on the COI. (SAC ¶ 16 (alterations added)). First, Plaintiff asserts that Defendant fraudulently misrepresented the material fact of the expiring insurance coverage when it provided the COI. (See id. ¶¶ 35-43). Second, Plaintiff alleges that Defendant negligently misrepresented this material fact and “should have known the statement was false.” (Id. ¶ 47; see also id. ¶¶ 44-51). Third, Plaintiff asserts Defendant negligently provided “inaccurate and misleading” information in the COI. (Id. ¶ 55; see also id. ¶¶ 52-57). Finally, Plaintiff asserts that Defendant “negligently supplied” the “false and misleading information for the guidance of” others - namely, Jones. (Id. ¶ 60; see also id. ¶¶ 58-67).

Outcome:
ORDERED AND ADJUDGED that Plaintiff's Motion for Partial Summary Judgment [ECF No. 74] is GRANTED in part and DENIED in part. Defendant's Motion for Final Summary Judgment [ECF No. 78] is DENIED. The Court treats affirmative defenses 1-3, 6, 7, 9, 10, and 20 as specific denials; and grants summary judgment in favor of Plaintiff on affirmative defenses 4, 5, 8, 14, 18, 19, 21, 22, and 29-34. Triable issues of fact remain regarding affirmative defenses 11-13, 15-17, and 23-28.
Scott v. Paychex Ins. Agency, 22-62052-CIV-ALTONAGA/Strauss (S.D. Fla. Aug 08, 2023)

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