208 F. Supp. 3d 1268
S.D. Fla.2016Background
- Laboss Transportation purchased a commercial auto policy from Global Liberty effective March 12, 2014; driver list initially excluded driver Errol Ward after underwriting review.
- Ward’s license was reinstated March 13, 2014; he drove for Laboss thereafter though not yet added to the policy; agent crossed Ward’s name off the original application.
- On March 17, 2014, while Ward was driving a Laboss van, passenger William Wilson’s wheelchair flipped during acceleration and Wilson was injured; Ward had used the Q’Straint system.
- Laboss’s agent requested Ward be added to the policy after the accident; Global issued an endorsement adding Ward on March 18, 2014, but earlier denied coverage for Wilson’s claim as not a covered “accident.”
- Global never rescinded or refunded premium, later renewed the policy with Ward listed, and Laboss sued for declaratory judgment seeking coverage, defense, and indemnity.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Ward was an insured under the policy | Ward was a permissive driver with Laboss’s permission and thus an insured under the policy’s definition | Coverage limited to listed/approved drivers; Ward was not listed at time of loss | Court: Policy expressly covers permissive drivers; Ward was an insured despite not being listed |
| Whether Wilson’s injury was an “accident” under the policy | The wheelchair flipping during vehicle use flowed from/originate from use of covered auto and thus is an accident | No “automobile accident”; fact that driver said "no accident" controls | Court: Term "accident" ambiguous; construed for insureds; injury arose out of use of vehicle and is covered |
| Applicability of the professional services exclusion | Securing wheelchairs is not a “professional” service requiring advanced intellectual training; exclusion does not apply | Training/use of Q’Straint and regulatory licensing make the activity a professional service excluded from coverage | Court: Exclusion not applicable; securing/transporting wheelchair-bound clients here is manual/operational, not a professional medical service |
| Material misrepresentation/waiver of rescission under Fla. Stat. § 627.409 | Omission of Ward as listed driver was immaterial because he was a permissive, lawful driver; Global waived right to rescind by retaining premiums and renewing policy | Omission was material and would justify rescission/denial of coverage | Court: Omission not material given policy language; Global waived rescission by acting inconsistent with forfeiture (accepting premiums, adding/renewing Ward) |
Key Cases Cited
- Taurus Holdings, Inc. v. U.S. Fid. & Guar. Co., 913 So.2d 528 (Fla. 2005) (insurance contracts construed by plain meaning; ambiguities against insurer)
- State Farm Fire & Cas. Co. v. CTC Dev. Corp., 720 So.2d 1072 (Fla. 1998) (term "accident" construed in favor of insured; encompasses injuries neither expected nor intended)
- Heritage Mut. Ins. Co. v. State Farm Mut. Auto. Ins. Co., 657 So.2d 925 (Fla. 1st DCA 1995) (coverage exists where injury "flows from," "originates from," or "grows out of" use of vehicle)
- Nat'l Merch. Co. v. United Serv. Auto. Ass'n, 400 So.2d 526 (Fla. 1st DCA 1981) (terms like "auto" and "accident" are not so precise that insurer can demand narrow interpretation without explicit policy language)
- Celotex Corp. v. Catrett, 477 U.S. 317 (1986) (summary judgment standard; burden on nonmoving party to show genuine dispute)