Geico General Insurance Company v. Kelly Paton
150 So. 3d 804
Fla. Dist. Ct. App.2014Background
- On Jan. 1, 2008 Kelly Paton was injured by an underinsured driver; the driver’s insurer (GEICO) paid its $10,000 limit.
- Paton’s mother had $100,000 UM coverage with GEICO; Paton demanded policy limits, GEICO repeatedly offered $1,000 (later $5,000 briefly) and did not accept reduced demands.
- At the UM trial the jury found for Paton and awarded total damages of $469,247; judgment was entered and limited to the $100,000 UM policy, which GEICO paid.
- Paton amended to add a first-party bad faith claim under Fla. Stat. § 624.155; she moved to exclude fresh proof of damages in the bad faith trial, relying on the UM verdict as fixing damages.
- The trial court excluded relitigation of damages; at the bad-faith trial the jury decided liability issues (notice and bad faith) but the court reserved awarding damages to the extent allowed by law based on the earlier UM verdict.
- The court entered final judgment for the excess amount of the UM verdict (the verdict minus policy limits) plus prejudgment interest; GEICO appealed, arguing deprivation of procedural due process and the right to challenge damages.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the jury’s damages determination in the underlying UM trial is binding in the subsequent first-party bad faith trial | The UM jury’s damage finding fixes the plaintiff’s total damages for bad faith and need not be proved again | GEICO: relitigation of damages in bad faith trial is required; denying relitigation denies due process and appellate rights | The court held the UM trial’s damage determination fixes damages in the bad faith action and need not be retried |
| Whether treating the UM verdict as conclusive deprived GEICO of procedural due process or appellate review | Paton: GEICO had full opportunity to challenge damages in the UM trial (including motion for new trial/appeal) and did not preserve objections | GEICO: inability to challenge the excess portion on appeal from UM judgment violated its rights | The court rejected GEICO’s due process/appellate argument because GEICO did not move for new trial or appeal the UM damage award and thus failed to preserve the issue |
| Whether damages in a first-party bad faith action may include amounts in excess of policy limits | Paton: statutory and case law allow recovery of total damages, including excess over policy limits | GEICO: (implicitly) excess amounts should be subject to further proof or review in bad faith trial | The court affirmed that statutes and Florida Supreme Court precedent treat total damages (including excess) as recoverable in bad faith claims |
Key Cases Cited
- State Farm Mut. Auto. Ins. Co. v. Laforet, 658 So. 2d 55 (Fla. 1995) (statutes and precedent establish that first-party bad faith damages include total claimant damages, including amounts exceeding policy limits)
- Blanchard v. State Farm Mut. Auto. Ins. Co., 575 So. 2d 1289 (Fla. 1991) (bad faith cause of action does not accrue until underlying liability and damages are determined)
- Geico General Ins. Co. v. Bottini, 93 So. 3d 476 (Fla. 2d DCA 2012) (discusses disparity between jury verdict and policy limits; addresses appellate review concerns)
- Progressive Select Ins. Co. v. Shockley, 951 So. 2d 20 (Fla. 4th DCA 2007) (recognizes liability and extent of damages as elements of statutory bad faith)
- State Farm Mut. Auto. Ins. Co. v. O’Hearn, 975 So. 2d 633 (Fla. 2d DCA 2008) (first-party bad faith claim accrues only after final determination of liability and damages)