150 F. Supp. 3d 1284
M.D. Fla.2015Background
- Policyholders allege insurers under Florida auto policies total losses by paying only the actual sales tax incurred, not the full tax that would apply to a vehicle comparable to the covered vehicle.
- Bastían’s 2013 total loss against Garrison shows initial settlement excluded full sales tax and referenced a comparison to the replacement vehicle’s tax amount; she later paid $120 tax and was reimbursed.
- Policies define loss and actual cash value; loss includes total loss but excludes loss beyond repair or replacement, and actual cash value is the cost to buy a comparable vehicle.
- USAA argues the policy and Florida law permit paying only actual incurred sales tax; plaintiffs argue the policy requires full tax for a replacement vehicle of comparable value.
- The court initially denied dismissal; after discovery, cross motions for summary judgment are briefing the interaction of policy language and §626.9743.
- Judge concludes the policy requires payment of the full sales tax that would be due for a vehicle comparable to the covered vehicle; discusses statutory subsections and public policy, and certifies an interlocutory appeal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether policy requires full sales tax for a replacement vehicle. | Bastian argues policy requires full tax for a comparable replacement. | USAA contends tax payment is governed by statute and actual incurred amount. | Policy requires full sales tax for a comparable vehicle. |
| Role of Florida Statutes 626.9743(5) and (9) in interpreting the policy. | Statute may be read to incorporate policy provisions for full tax. | Statute provides options; insurers may elect to pay tax as incurred; policy may not be trumped. | Statute does not compel reading (9) into the policy; policy controls and requires full tax. |
| Whether Florida case law supports incorporating statutes into an insurance policy. | Statutes may be incorporated where they provide essential substance. | Permissive language like (9) not automatically incorporated without express election. | Subsection (5) mandatory; subsection (9) not incorporated absent election. |
| Appropriateness of interlocutory appeal on the certified question. | Certification would delay or limit class action issues if resolved now. | Resolution would advance termination of litigation and avoid trial. | Order certified for interlocutory appeal under 28 U.S.C. § 1292(b). |
Key Cases Cited
- Mills v. Foremost Insurance Co., 511 F.3d 1300 (11th Cir.2008) (taxes form part of replacement cost under actual cash value definition)
- Virtual Imaging Servs. v. Kingsway Amigo Ins. Co., 141 So.3d 147 (Fla. 2013) (mandatory election requires policy notice; permissive language not incorporated automatically)
- Kingsway Amigo Ins. Co. v. Ocean Health, Inc., 63 So.3d 63 (Fla. 4th DCA 2011) (statutory options are not incorporated into a policy absent notice)
- Nichols v. State Farm Fla. Ins. Co., 21 So.3d 904 (Fla. 5th DCA 2009) (permissive statutory language not automatically incorporated)
- Grant v. State Farm Fire & Casualty Co., 638 So.2d 936 (Fla.1994) (Florida contract; statutes surrounding insurance influence interpretation)
- Campus Communications, Inc. v. Dep’t of Revenue, 473 So.2d 1290 (Fla.1973) (sales tax characterization as excise tax; statutory interpretation guidance)
- Allen v. USAA Casualty Insurance Co., 790 F.3d 1274 (11th Cir.2015) (classification of contract language within statutory framework)