Stephens Ex Rel. Estate of Becker v. Mid-Continent Casualty Co.
2014 U.S. App. LEXIS 7697
| 11th Cir. | 2014Background
- Becker, employed by Team Fritz, was injured and died while installing a modular home on Kirkland property; Stephens sued Anchorage in Florida state court.
- Anchorage held a Mid-Continent general liability policy; the policy excludes coverage for injuries to the insured's employees, including statutory employees.
- Mid-Continent refused to defend/indemnify Anchorage, asserting Becker was a statutory employee and thus excluded from coverage.
- Stephens and Anchorage reached a mediated settlement under a Coblentz agreement assigning Anchorage’s rights to Stephens for indemnification from Mid-Continent; Stephens sought a judgment for $4,350,000.
- The district court granted Mid-Continent summary judgment, ruling Becker was excluded as a statutory employee and thus Mid-Continent owed no indemnity; Stephens appealed.
- The Eleventh Circuit affirmed, holding the exclusion applies to statutory employees and Mid-Continent had no duty to indemnify Anchorage.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does Florida law apply the employee exclusion to statutory employees? | Stephens argues the exclusion applies only to actual employees. | Mid-Continent argues the exclusion extends to statutory employees under Florida law. | Yes; exclusion applies to statutory employees. |
| Does Mid-Continent have a duty to indemnify Anchorage for Becker's death? | Stephens contends policy covers Becker's death due to Anchorage's contract. | Mid-Continent contends Becker was a statutory employee; no indemnity obligation. | No indemnity obligation. |
| Did Anchorage act as general contractor vis-à-vis Team Fritz to create a statutory employment relationship? | Stephens claims no contractor-subcontractor relationship; Fritz was hired independently. | Mid-Continent presents evidence that Anchorage was general contractor with subcontractor Fritz. | Anchorage served as general contractor; statutory relationship with Fritz established. |
| Is there a genuine dispute of material fact about Anchorage and Fritz’s relationship? | Stephens points to various evidentiary items suggesting no subcontractor relationship. | Mid-Continent cites undisputed contract and payments showing contractor-subcontractor relationship. | No genuine dispute; record supports contractor-subcontractor relationship. |
Key Cases Cited
- Coblentz v. American Surety Co. of New York, 416 F.2d 1059 (5th Cir.1969) (consent judgment against insurer when insured not defended)
- Revoredo v. Florida Insurance Guaranty Ass'n, 698 So.2d 890 (Fla. 3d DCA 2006) (statutory employees treated as ordinary employees for exclusion purposes)
- Motchkavitz v. L.C. Boggs Indus., Inc., 407 So.2d 910 (Fla.1981) (statutory employer-employee concept under workers' comp)
- Orama v. Dunmire, 552 So.2d 924 (Fla. 1st DCA 1989) (contractor-subcontractor relationship can be established without a written contract)
- Lingold v. Transamerica Ins. Co., 416 So.2d 1271 (Fla. 5th DCA 1982) (owner contracting does not destroy contractor-subcontractor relationship)
- Jones v. Florida Insurance Guaranty Ass'n, Inc., 908 So.2d 435 (Fla.2005) (duty to defend governed by pleadings and potential coverage)
- James River Ins. Co. v. Ground Down Eng’g, Inc., 540 F.3d 1270 (11th Cir.2008) (insurance contract interpretation is a law question)
- First Specialty Ins. Corp. v. 633 Partners, Ltd., 300 F.App’x 777 (11th Cir.2008) (exceptional cases where extrinsic facts outside complaint affect coverage)