April 21st, 2017

Policy Interpretation

By, Meagan R. Cyrus

It is well established in Florida that ambiguities in policy language are to be strictly construed against the insurer, and in favor of broader coverage for the insured. Auto-Owners Ins. Co. v. Anderson, 756 So. 2d 29, 34 (Fla. 2000). The Florida Supreme Court further expanded on this notion in Washington Nat’l Ins. Corp. v. Ruderman, 117 So. 3d 943 (Fla. 2013), again ruling in favor of policyholders, finding that insurers could not clarify an ambiguity through the use of extrinsic evidence. However, prior to the court’s determination as to the ambiguity of the language at issue, can extrinsic evidence be used to the advantage of the insured? The answer is possibly, and depending on the jurisdiction.

Interpretive and drafting history materials in the hands of the insurer can show that an insured’s interpretation is a reasonable one, creating ambiguity. It is difficult for an insurer to argue against an alternative interpretation that it itself considered in the writing of the policy. This battle is won at the discovery stage. The Middle District ruled in favor of the insurer on this issue, finding that an insured’s request for documents used to interpret the meaning of the policy were irrelevant to coverage issues, relying on Ruderman. Evanston Ins. Co. v. Frank’s Lab., Inc., No. 5:12–cv–603–Oc–UAMHPRL, 2013 WL 5556225, at *1 (M.D. Fla. Oct. 8, 2013). The Southern District, however, decided conversely, granting an insured’s discovery request for such materials: “[c]ontrary to [insurer’s] position, drafting history and extrinsic evidence of interpretive materials is discoverable at this early stage of the litigation when questions concerning ambiguity have not been resolved.” Viking Yacht Co. v. Affiliated FM Ins. Co., 07-80341-CIV-Marra/Johnson, 2008 WL 8715540, at *2 (S.D. Fla. Feb. 7, 2008).

The relevant inquiry at issue as to the discoverability and consideration of interpretative and drafting materials is whether or not the court has determined the policy to be ambiguous. If not, such materials are often crucial for an insured to prove an argument for reasonableness of interpretation. This is distinguishable from Ruderman, in which the court had made a determination of ambiguity, and the insurer sought to refute that finding.

August 19th, 2015


Recently, Florida’s Second District Court of Appeal in Florida Farm Bureau Gen. Ins. Co. v. Peacock’s Excavating Serv., Inc., 2015 WL 4497721 (Fla. 2d DCA 2015) addressed the issue of what constitutes a final appealable order under Rule 9.110(k), Florida Rules of Appellate Procedure.  There, the insurer, Florida Farm Bureau Insurance Company (“Florida Farm Bureau”), and insured, Peacock’s Excavating Service, Inc., (“Peacock”), both filed competing declaratory actions that requested a determination of Florida Farm Bureau’s duty to defend and indemnify Peacock under several commercial general liability policies (“CGL” policy(ies)). The dispute centered on what triggered coverage under the CGL policy. Florida Farm Bureau contended that the manifestation of the injury triggered coverage whereas Peacock argued that the injury itself triggered coverage under the CGL policies. The trial court ultimately entered a partial final judgment that declared Florida Farm Bureau had a duty to defend Peacock under certain CGL policies. The partial final judgment did not address Florida Farm Bureau’s duty to indemnify Peacock under the CGL policies. Nevertheless, Florida Farm Bureau filed an appeal of the partial final judgment.



On appeal, the Second District dismissed the appeal for lack of jurisdiction. Because Florida Farm Bureau appealed from a partial final judgment, the appellate court’s jurisdiction hinged on whether Florida Farm Bureau could appeal the partial final judgment under Rule 9.110(k), Florida Rules of Appellate Procedure. Rule 9.110(k) provides:


Except as otherwise provided herein, partial final judgments are reviewable either on appeal from the partial final judgment or on appeal from the final judgment in the entire case. A partial final judgment, other than one that disposes of an entire case as to any party, is one that disposes of a separate and distinct cause of action that is not interdependent with other pleaded claims. If a partial final judgment totally disposes of an entire case as to any party, it must be appealed within 30 days of rendition.



Fla. R. App. P. 9.110(k). The court started its analysis by providing the framework with which litigants can use to determine whether a partial final judgment possesses the requisite finality to constitute an appeal order. Specifically, the court stated that the following three factors guide its jurisdiction analysis:


  1. Whether the claim disposed of by the partial final judgment could be maintained independently of the remaining claims;


  1. Whether one or more parties were removed from the action when the partial final judgment was entered; and


  1. Whether the claims could be separately disposed of based on the same or different facts.


With this framework in mind, the court proceeded to analyze each factor. As to the first factor, the court concluded that Florida Farm Bureau’s duty to defend was not a separate and independent cause of action from its duty to indemnify. In support of this reasoning, the court noted that the very function of a count for declaratory relief “is to afford an opportunity to obtain a final resolution of all aspects of a controversy between litigants in a single action.” Id. at *2. To bolster this conclusion, the court pointed to how both Florida Farm Bureau and Peacock file a single count of declaratory relief that encompassed Florida Farm Bureau’s duty to defend and indemnify. Accordingly, the court concluded the first factor did not weigh in favor of accepting jurisdiction.


The court easily determined the second factor did not weigh in favor of accepting jurisdiction because the partial final judgment did not “effectively remove[]” any party from the underlying trial court litigation. Finally, with regard to the third factor, the court concluded that facts necessary to Florida Farm Bureau’s duty to defend and duty to indemnify overlapped. As such, the duty to defend and duty to indemnify, while being separate legal duties, were not amenable to separate dissolution.


Accordingly, the court concluded the partial final judgment failed to meet the threshold indicators of finality and dismissed the appeal for lack of jurisdiction.


Peacock is significant for several of reasons. First, it clarified the law within the Second District Court of Appeal. Prior to Peacock, a split existed within the Second District. Some cases had held that a partial final judgment as to an insurer’s duty to defend was a final appealable order. Accord Transcontinental Ins. Co. v. Jim Black & Associates, Inc., 888 So. 2d 671 (Fla. 2d DCA 2004); Aetna Commercial Ins. Co. v. American Sign Co., 687 So. 2d 834 (Fla. 2d DCA 1996). Peacockclarified the applicability of Transcontinental and American Sign to scenarios where a partial judgment exists only as to an insurer’s duty to defend. Second, it removed the conflict that previously existed with the Fourth District Court of Appeal, which in Nationwide Mut. Ins. Co. v. Harrick, 763 So. 2d 1133 (Fla. 4th DCA 1999), held a partial final judgment that determines only an insurer’s duty to defend is not an appealable order. Id. at 1134. Finally, the Court noted that a partial final judgment addressing only an insurer’s duty to defend is neither reviewable under Rule 9.1130, Florida Rules of Appellate Procedure, nor by certiorari review.







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