322 So.3d 604
Fla.2021Background
- Peoples Gas System (PGS), a member-operator, settled a personal-injury claim by a Posen Construction employee after a Posen excavation ruptured a PGS gas pipeline and caused severe injury.
- PGS then sued Posen under the Florida Underground Facility Damage Prevention and Safety Act (Chapter 556), seeking recovery of the settlement payment under sections 556.106(2)(a)–(b).
- The Act creates a statewide one-call notification system and imposes duties on excavators and member operators (e.g., advance notice, marking, careful excavation).
- Sections 556.106(2)(a) and (b) subject an excavator to liability for the “total sum of the losses” if the excavator violates specified duties; (2)(a) creates a rebuttable presumption of negligence for certain notice violations.
- The federal district court dismissed PGS’s claim, concluding the Act did not create a statutory indemnity remedy; the Eleventh Circuit certified the question to the Florida Supreme Court.
Issues
| Issue | Plaintiff's Argument (PGS) | Defendant's Argument (Posen) | Held |
|---|---|---|---|
| 1) Does Chapter 556 create a standalone cause of action? | The Act authorizes an independent statutory cause of action allowing recovery under its terms. | The Act only clarifies common-law negligence and does not create a separate statutory cause of action. | Yes. The Court held the Act implicitly creates a standalone cause of action based on the text, structure, and purpose. |
| 2) What is the nature of that cause of action (negligence vs statutory indemnity)? | The Act allows recovery (including indemnity) for losses a member-operator pays to third parties, independent of the member-operator’s fault. | The Act imposes negligence-based liability on excavators and does not create a statutory indemnity shifting a member-operator’s third-party liability onto excavators. | The cause of action sounds in negligence; the Act does not create a statutory indemnity remedy as PGS urged. |
| 3) Are recoverable “losses” limited (e.g., exclude pure economic losses or third-party settlements)? | “Losses” is broad; it includes settlement payments to third parties and purely economic damages. | Recoverable losses are those normally computed for damage to facilities, equipment, revenue, or use—not a broad indemnity for third-party settlements. | “Losses” can include purely economic damages; the term is broad, but recoverability is constrained by negligence principles and other statutory limits (e.g., $500,000 caps for revenue/use). |
| 4) Are claims under the Act subject to proximate causation and comparative fault? | PGS argued it could recover its settlement without regard to its own fault. | Posen asserted that common-law tort principles (causation, fault apportionment) apply. | The Court held negligence claims under the Act require proximate causation and are subject to comparative-fault principles. |
Key Cases Cited
- Murthy v. N. Sinha Corp., 644 So. 2d 983 (Fla. 1994) (statutory creation of a cause of action depends on legislative intent from text, structure, and purpose)
- Houdaille Indus., Inc. v. Edwards, 374 So. 2d 490 (Fla. 1979) (common-law indemnity is barred between joint tortfeasors; plaintiff’s fault can preclude indemnity)
- Hoffman v. Jones, 280 So. 2d 431 (Fla. 1973) (adoption of comparative fault in Florida tort law)
- Holmes v. Sec. Investor Prot. Corp., 503 U.S. 258 (1992) (courts presume statutory causes of action are limited by proximate causation absent clear legislative intent)
- Associated Gen. Contractors of Cal., Inc. v. California State Council of Carpenters, 459 U.S. 519 (1983) (damages under a statute are limited to natural, proximate, and legal results)
- Lexmark Int’l, Inc. v. Static Control Components, Inc., 572 U.S. 118 (2014) (statutory causes of action generally limited to plaintiffs whose injuries were proximately caused by the statute’s violation)