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On July 31, 2013, the 4th DCA in Elisias v. GEICO, 38 Fla. L. Weekly D1630a (Fla. 4th DCA July 31, 2013), affirmed a final declaratory judgment in GEICO's favor after determining that the GEICO policy did not cover Elisias. The 4th DCA also analyzed the manner of determining the amount in controversy in a declaratory judgment action as part of its analysis of whether the circuit court had subject matter jurisdiction over the proceeding.

GEICO initiated the declaratory judgment action to determine whether coverage existed under a policy after Elisias filed a personal injury lawsuit against GEICO's insured. The declaratory judgment action was filed in the same circuit court in which the underlying personal injury lawsuit was filed.

The trial court entered a declaratory judgment in GEICO's favor and Elisias appealed, raising two issues. First, Elisias argued that she did not meet the definition of an "insured" under the policy and should not have been excluded from coverage. The 4th DCA affirmed the trial court's decision on that issue without discussion of the specific facts of the case.

Elisias also argued that the circuit court lacked subject matter jurisdiction because the amount in controversy related to an insurance policy with bodily injury limits of $10,000 while the threshold required to invoke the jurisdiction of the circuit court is $15,000. Pursuant to § 34.01(c), Fla. Stat., the county court has exclusive jurisdiction over any claim that does not exceed the sum of $15,000 exclusive of interest costs and attorney's fees.

The 4th DCA noted that no Florida appellate court had previously addressed this issue; therefore, it looked to federal case law for guidance. The 4th DCA cited Stonewall Ins. Co. v. Lopez, 544 F. 2d 198 (5th Cir. 1976), which stated that in a declaratory coverage action, the amount in controversy is determined from the insurer's perspective. Thus, the monetary value of the obligation to defend a separate lawsuit is properly considered in determining the jurisdictional amount in controversy. (This analysis has been utilized by Federal District Courts in both the Middle and Southern Districts of Florida.)

As a result, the 4th DCA held that although the subject policy had a $10,000 limit, the value of the cost of GEICO's defense of its insured in the underlying personal injury lawsuit was also at issue in the declaratory action. Therefore, the amount in controversy exceeded the $15,000 jurisdictional threshold.



This summary was prepared by Elizabeth Stuart of our firm.


Elizabeth Stuart

 

 

38 Fla. L. Weekly D1630a

 

Insurance -- Coverage -- Declaratory judgment -- Jurisdiction -- No merit to claim that circuit court lacked subject matter jurisdiction to determine whether personal injury liability policy excluded plaintiff from coverage because the amount in controversy, excluding the insurer's cost of providing its insured with a defense, did not meet the jurisdictional threshold -- Pecuniary value of insurer's obligation to tender a defense to its insured in the underlying suit is properly considered in determining existence of jurisdictional amount in an action to determine coverage

YOLENE ELISIAS, Appellant, v. GEICO GENERAL INSURANCE CO. and PROMENE CHARLES, Appellees. 4th District. Case No. 4D11-4461. July 31, 2013. Appeal from the Circuit Court for the Seventeenth Judicial Circuit, Broward County; David Krathen, Judge; L.T. Case No. 09-4690 (09). Counsel: Ronald D. Rodman of Friedman, Rodman & Frank, P.A., and Pamela Beckham of Beckham & Beckham, P.A., Miami, for appellant. Sharon C. Degnan of Kubicki Draper, Fort Lauderdale, for appellee GEICO General Insurance Co.

(Damoorgian, C.J.) This appeal arose out of a declaratory action to determine coverage under a bodily injury insurance policy issued by Geico General Insurance Co. ("GEICO"). GEICO initiated the declaratory action after Appellant, Yolene Elisias, filed a personal injury suit against its insured. The declaratory action was filed in the circuit court where the personal injury action was also filed. After determining that the GEICO policy did not cover Elisias, the trial court entered a final declaratory judgment in GEICO's favor. Elisias appeals the declaratory judgment, raising two issues. First, Elisias argues that the trial court improperly concluded that she met the definition of an "insured" under the policy and, therefore, was excluded from coverage. Second, Elisias argues that the circuit court lacked subject matter jurisdiction because the amount in controversy was based upon the policy limit which was $10,000.00. We affirm.

As to the issue of coverage, we hold without further discussion that the trial court correctly determined that Elisias was excluded from coverage under the terms of the policy

Turning to the issue of the trial court's subject matter jurisdiction, Elisias argues that the amount in controversy is under the $15,000.00 threshold required to invoke the jurisdiction of the circuit court. § 34.01(1)(c), Fla. Stat. (2010) (the county court has exclusive jurisdiction over a claim that "does not exceed the sum of $15,000, exclusive of interest, costs, and attorney's fees"). In reaching this conclusion, Elisias relies upon the undisputed fact that the GEICO insurance policy had a $10,000 limit, and cites to United Automobile Ins. Co. v. Kendall S. Med. Center, 54 So. 3d 543 (Fla. 3d DCA 2011). GEICO counters that the cost of providing its insured with a defense in the underlying personal injury suit was also at issue in the declaratory action. By including this cost, the amount in controversy exceeded the $15,000 jurisdictional threshold.

Elisias' reliance on United Automobile is misplaced. There, the appellate court held that the circuit court did not have subject matter jurisdiction to determine whether medical providers were required to mediate a PIP claim before filing a breach of contract action against the insurer since the maximum liability the insurer faced under the PIP policy was less than $15,000. Id. at 544. There was no underlying suit against the insured implicating the insurer's contractual duty to tender a defense. Id. Thus, United Automobile is not instructive as the court did not consider whether the cost of tendering a defense could be included in the amount in controversy for jurisdictional purposes. Id. Indeed, no Florida court has considered this issue. However, federal courts have addressed the matter, and we find guidance in those cases.

In Stonewall Ins. Co. v. Lopez, 544 F.2d 198, (5th Cir. 1976), the Fifth Circuit, applying federal jurisdiction statutes, noted that in a declaratory coverage action, the amount in controversy is determined from the insurer's perspective. Id. at 198. Thus, it held that "[t]he pecuniary value of the obligation to defend the separate lawsuit is properly considered in determining the existence of the jurisdictional amount." Id. at 199. The Federal District Courts for the Middle and Southern Districts of Florida held the same in Dairlyland Ins. Co. v. Chadwick, 2008 WL 912428, *3 (M.D. Fla. April 1, 2008), and Clarendon America Ins. Co. v. Miami River Club, Inc., 417 F.Supp.2d 1309, 1316 (S.D. Fla. 2006), respectively.

Adopting the Fifth Circuit Court's reasoning in Stonewall, we hold that the pecuniary value of an insurer's obligation to tender a defense to its insured in the underlying suit implicating the coverage issue is properly considered in determining the existence of the jurisdictional amount in an action to determine coverage.

Affirmed. (Ciklin and Conner, JJ., concur.)






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