1:20-cv-21549
S.D. Fla.May 10, 2021Background:
- GEICO issued a Florida family automobile policy to Monika and Jesse Acuna with BI limits of $10,000 per person / $20,000 per occurrence.
- On July 4, 2016, Minor Acuna drove a 1987 golf cart with passengers and collided with a car; passengers sued and obtained a state‑court judgment exceeding policy limits.
- GEICO defended Minor Acuna under a reservation of rights, then filed this declaratory‑judgment action (Apr. 11, 2020) denying coverage, arguing the golf cart is not a “private passenger auto” under the policy.
- Defendants counterclaimed for breach of contract (alleging GEICO refused to settle and indemnify).
- Magistrate Judge Torres recommends granting GEICO’s summary‑judgment motion in full and denying Defendants’ motion, concluding the golf cart is not covered and GEICO had no duty to defend or indemnify.
Issues:
| Issue | Plaintiff's Argument (GEICO) | Defendant's Argument (Acunas) | Held |
|---|---|---|---|
| Whether the golf cart qualifies as a “private passenger auto” under the policy | Defined subparts (private passenger/farm/utility auto) implicitly require vehicles to be designed to be driven legally and safely on public highways; golf cart lacks roadworthiness and statutory equipment so it is not covered | The definition includes any four‑wheel private passenger vehicle; “auto” is undefined creating ambiguity and courts should construe against insurer (Pearl) | Court adopts GEICO: golf cart does not qualify because it was not shown to meet roadworthy/public‑highway requirements; no coverage |
| Whether policy is ambiguous because Section II defines “motor vehicle” differently | Section II (PIP) definitions do not control Section I (liability); even if compared, both sections require highway licensure/design — no ambiguity | Different section definitions create ambiguity that favors insured | Court rejects ambiguity; reads sections consistently and applies statutory/precedent meaning; no ambiguity |
| Validity of Defendants’ breach‑of‑contract counterclaim (refusal to settle/indemnify) | No contractual duty to settle; GEICO had no duty to defend/indemnify because no coverage; bad‑faith/breach claims premature if coverage unresolved | GEICO previously issued a May 2017 letter acknowledging coverage and then reversed; GEICO therefore breached | Court grants GEICO summary judgment on counterclaim: where no duty to defend/indemnify exists, there can be no breach; prior investigatory statements not shown to create estoppel |
Key Cases Cited
- Martin v. Nationwide Mut. Fire Ins. Co., 235 So.2d 14 (Fla. 2d DCA 1970) (interpreting policy definitions for private‑passenger/farm/utility autos to implicitly require capacity for lawful/safe public‑highway use)
- Fireman’s Fund Ins. Cos. v. Pearl, 540 So.2d 883 (Fla. 4th DCA 1989) (where policy used undefined singular term “auto,” an ambiguity existed as to coverage for a golf cart and ambiguity was construed for insured)
- Baldassini v. State Farm, [citation="545 F. App'x 842"] (11th Cir. 2013) (golf cart designed and manufactured for off‑road use and not conforming to FMVSS was not "designed for use mainly on public roads," so no coverage under an express policy definition)
- Grant v. State Farm Fire & Cas. Co., 638 So.2d 936 (Fla. 1994) (definitions in one policy section may not apply to another; courts may look to statute to supply applicable definitions)
- Taurus Holdings, Inc. v. U.S. Fid. & Guar. Co., 913 So.2d 528 (Fla. 2005) (insurance contracts construed according to plain, ordinary meaning; ambiguity exists only if term reasonably susceptible to two meanings)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (U.S. 1986) (summary‑judgment standard: nonmovant must present evidence on which a jury could reasonably find for it)