Travelers Indemnity Company of Connecticut et al v. Attorney's Title Insurance Fund, Inc. et al
Filing
49
ORDER denying 38 Defendants, Attorneys' Title Insurance Fund, Inc. and Florida Title Company's Motion to Dismiss for Misjoinder. Signed by Judge Sheri Polster Chappell on 12/19/2013. (LMF)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
FORT MYERS DIVISION
TRAVELERS INDEMNITY COMPANY
OF CONNECTICUT and ST. PAUL
FIRE & MARINE INSURANCE
COMPANY,
Plaintiffs,
v.
Case No: 2:13-cv-670-FtM-38DNF
ATTORNEYS TITLE INSURANCE
FUND, INC., FLORIDA TITLE CO.,
SECTION 10 JOINT VENTURE,
LLP, SKY PROPERTY VENTURE,
LLC and CAS GROUP, INC.,
Defendants.
/
ORDER1
This matter comes before the Court on Defendants, Attorneys' Title Insurance
Fund, Inc. and Florida Title Company's Motion to Dismiss for Misjoinder (Doc. #38) filed
on November 14, 2013. Plaintiffs filed a response in opposition (Doc. #44) filed on
November 27, 2013. This motion is ripe for review.
Standard
District Courts are authorized “to dismiss any misjoined party or claim at any stage
of a lawsuit.” Harris v. Johns, Nos. 3:06-cv-433-J-32MCR, 3:07-cv-30-J-32MCR, 2007
WL 2310784, at *3 (M.D. Fla. Aug. 8, 2007). Misjoinder occurs when parties fail to satisfy
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ceases to work or directs the user to some other site does not affect the opinion of the court.
Federal Rule of Civil Procedure 20(a). Id. at *3. Rule 20(a)(2) provides that defendants
may be joined in an action if, “(A) any right to relief is asserted against them jointly,
severally, or in the alternative with respect to or arising out of the same transaction,
occurrence, or series of transactions or occurrences; and (B) any question of law or fact
common to all defendants will arise in the action.” In addition, courts are permitted to grant
judgments according to the parties’ respective rights and liabilities. Fed.R.Civ.P.
20(a)(2)(B).
When evaluating whether a misjoinder has occurred in an action, courts lean
toward the “broadest possible scope of action consistent with fairness to the parties.”
Alexander v. Fulton County, GA., 207 F.3d 1303, 1323 (11th Cir. 2000) (quoting United
Mine Workers v. Gibbs, 383 U.S. 715, 724 (1966)). “The touchstone of Rule 20
joinder/severance analysis is whether the interests of efficiency and judicial economy
would be advanced by allowing the claims to travel together, and whether any party would
be prejudiced if they did.” Fisher v. Ciba Specialty Chemicals Corp., 245 F.R.D. 539, 542
(S.D. Ala. 2007). Further, “the persons who are joined as defendants must be interested
in claims that arise out of the same transaction or occurrence, or series of transactions or
occurrences; and, all the parties joined must share in common at least one question of
law or fact.” Union v. Montenegro, No. 2:10-cv-734-FtM-99SPC, 2012 WL 2401784, at *4
(M.D. Fla. June 25, 2012) (citing Alexander v. Fulton County, 207 F.3d 1303, 1323 (11th
Cir. 2000), overruled on other grounds, Manders v. Lee, 338 F.3d 1304 (11th Cir. 2003)).
Discussion
Defendant Attorneys' Title Insurance Fund, Inc (hereinafter “ATIF”) and Defendant
Florida Title Company (hereinafter “Florida Title”) move to dismiss this action against
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them on the grounds that they no longer have any interest in the dispute. These two
defendants entered into a settlement agreement with Co-Defendant Section 10 Joint
Venture, LLP and Co-Defendant Sky Property Venture, LLC. (Doc. #37, ¶37). Defendants
ATIF and Florida Title assigned their rights and their causes of action against plaintiffs to
these two listed co-defendants. (Doc. #37-21, ¶5). Therefore, Defendants ATIF and
Florida Title argue they have no interests in the coverage litigation initiated in this action.
Defendants support their argument by citing to two cases, Panopoulos v. Lexington Ins.
Co., No. 8:13-cv-700-T-33TGW, 2013 WL 2708688 (M.D. Fla. June 12, 2013) and
Acciard v. Whitney, No. 2:07-cv-476-UA-DNF, 2008 WL 5120820 (M.D. Fla. Dec. 4,
2008). Defendants also contend dismissing them from this action would support judicial
efficiency. Further, Defendants contend if they continue in this matter now then they will
incur the expenses and negative consequences of litigation and this incurrence will
prejudice them.
Plaintiffs oppose the motion with the contention that the settlement agreement
between the defendants is invalid because the settlement agreement is collusive,
unreasonable, and was negotiated in bad faith. Relying on Citizens Property Ins. Co. v.
Ifergane, Nos. 3D10-1195, 3D09-3293, 2012 WL 4010964 (Fla. 3d DCA Sept. 12, 2012),
Plaintiffs contend this Court must first determine if the contract between the defendants
is invalid before analyzing the misjoinder argument. Accordingly, Plaintiffs contend
defendants’ motion is premature at best.
The Court agrees with Plaintiffs. Although it is clear in Florida post-loss insurance
contracts can be assigned without the consent of the insured, it is unclear from the record
thus far whether the settlement agreement and assignment therein is valid. Professional
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Consulting Services, Inc. v. Hartford Life and Accident Ins. Co., 849 So.2d 446, 447 (Fla.
2d DCA 2003) (“Florida law generally authorizes assignments of after-loss claims under
insurance policies.”) (citing Lexington Ins. Co. v. Simkins Indus., Inc., 704 So.2d 1384,
1386 n.3 (Fla. 1998); Gisela Inv. N.V. v. Liberty Mut. Ins. Co., 452 So.2d 1056, 1057 (Fla.
3d DCA 1984)); see also, Professional Consulting Services, Inc., 849 So.2d at 447
(stating that if the assignment was valid, then the assignee stands in the shoes of the
assignor and has the same rights and status that the assignor had.) (citing Foster v.
Foster, 703 So.2d 1107, 1109 (Fla. 2d DCA 1997)). The validity of the settlement
agreement is at the crux of this litigation. This settlement agreement is the result of an
action made in concert by Defendants ATIF, Florida Title, Section 10 Joint Venture, LLP
and Sky Property Venture, LLC. Thus, whether the assignment is valid is a question
related to these defendants. Therefore, if the settlement agreement or the assignment
clause therein is found to be invalid then releasing Defendant ATIF and Defendant Florida
Title from this litigation now would be improper and would not support efficiency or judicial
economy. Consequently, at this time the Court finds Defendant ATIF and Defendant
Florida Title have properly been joined in this matter.
Accordingly, it is now ORDERED:
Defendants, Attorneys' Title Insurance Fund, Inc. and Florida Title Company's
Motion to Dismiss for Misjoinder (Doc. #38) is DENIED.
DONE and ORDERED in Fort Myers, Florida this 18th day of December, 2013.
Copies: All Parties of Record
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