202 So. 3d 877
Fla. Dist. Ct. App.2016Background
- Grover owned commercial property insured by Aspen under an all-risk commercial policy that included an "Entrustment Exclusion" excluding loss caused by dishonest or criminal acts by "you ... or anyone to whom you entrust the property for any purpose."
- Grover leased the premises and certain business personal property to Carma, LLC (tenant) under a lease giving Carma exclusive possession during the lease term.
- While vacating, Carma removed the leased personal property and damaged Grover’s real property; Grover reported the loss as theft and vandalism.
- Aspen denied coverage relying on the Entrustment Exclusion, asserting the lease constituted entrustment to the tenant.
- Grover sued for breach of contract; the trial court entered final summary judgment for Aspen. On appeal, Grover argued the Entrustment Exclusion is ambiguous and does not encompass ordinary landlord–tenant leasing.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the policy's "Entrustment Exclusion" bars coverage for loss caused by a tenant who removed/damaged landlord's property | Entrustment is distinct from leasing; policy language does not explicitly include tenants, so exclusion is ambiguous and should not be applied to a landlord–tenant lease | The lease manifested entrustment: Grover surrendered possession and trusted Carma to use/return property lawfully, so tenant's dishonest acts fall within the exclusion | The exclusion is unambiguous under its plain meaning; leasing to a tenant constituted entrustment, so the exclusion precludes coverage |
Key Cases Cited
- Swire Pac. Holdings, Inc. v. Zurich Ins. Co., 845 So. 2d 161 (Fla. 2005) (insurance contracts construed by plain policy language)
- Siegle v. Progressive Consumers Ins. Co., 819 So. 2d 732 (Fla. 2002) (policy terms read in ordinary, nontechnical sense)
- Taurus Holdings, Inc. v. U.S. Fid. & Guar. Co., 913 So. 2d 528 (Fla. 2005) (clear policy provisions enforced as written)
- Deni Assocs. of Fla., Inc. v. State Farm Fire & Cas. Ins. Co., 711 So. 2d 1135 (Fla. 1998) (court will not rewrite clear policy language)
- Castillo v. State Farm Fla. Ins. Co., 971 So. 2d 820 (Fla. 3d DCA 2007) (burden shifts to insurer to prove a loss falls within an exclusion)
- Kapner v. State Farm Ins. Co., 558 So. 2d 186 (Fla. 4th DCA 1990) (different policy language; court declined to extend any special distinction between entrustment and renting to this policy)