TNT Equipment Inc. v. Amerisure Mutual Insurance Company et al
ORDER granting 35 Motion for summary judgment; denying 40 Motion for summary judgment. Signed by Judge Roy B. Dalton, Jr. on 9/21/2016. (SN)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TNT EQUIPMENT INC.,
Case No. 6:15-cv-1461-Orl-37DAB
AMERISURE MUTUAL INSURANCE
COMPANY; and LIBERTY SURPLUS
This cause is before the Court on the following matters:
Amerisure Mutual Insurance Company’s Motion for Summary Judgment
with Incorporated Memorandum of Law (Doc. 35), filed February 10, 2016;
Plaintiff TNT Equipment Inc.’s Response in Opposition to Defendant
Amerisure Mutual Insurance Company’s Motion for Summary Judgment
and TNT’s Motion for Summary Judgment on Amerisure’s Duty to Defend
(Doc. 40), filed March 7, 2016; and
Amerisure Mutual Insurance Company’s Response in Opposition to TNT
Equipment, Inc.’s Cross-Motion for Summary Judgment on the Issue of the
Duty to Defend (Doc. 44), filed March 23, 2016.
Upon consideration, the Court concludes that summary judgment is due to be
granted in favor of Amerisure Mutual Insurance Company (“Amerisure”) and against TNT
Equipment Inc. (“TNT”).
TNT filed this action to obtain a declaratory judgment as to the parties’ rights and
obligations under two insurance policies: (1) a Commercial General Liability policy
(“CGL”) issued by Amerisure; and (2) a CGL policy issued by Liberty Surplus Insurance
Corporation (“Liberty”). (Doc. 1.) In particular, TNT maintains that the claims asserted
against it in an underlying state court lawsuit are covered by each CGL policy and
therefore trigger the insurers’ duty to defend and indemnify TNT. The Court disagrees.
Procedural Posture and Nature of Claims
This dispute traces back to an accident that occurred at the construction site of an
Embassy Suites hotel located in Kissimmee, Florida (“the Project”). (Doc. 1-2.) While
performing stucco work at the Project on March 23, 2012, Mario Aguiar (“Aguiar”) fell
approximately forty to fifty feet and was seriously injured when the mast climber
scaffolding equipment (“Mast Climber”), to which he was harnessed, suddenly collapsed
(“the Accident”). (Id. at 5.) At the time of the Accident, the Mast Climber was under lease
from TNT to Stowell Company, Inc. (“Stowell”)—a primary subcontractor responsible for
various components of the Project, including stucco work. (Id.)2 Stowell contracted the
stucco work to Forum Construction Group, Inc. (“Forum”), which, in turn, subcontracted
the work to Magic Stucco, Inc. (“Magic Stucco”)—Aguiar’s employer. Under each
Unless noted otherwise, the facts included in this section are undisputed and
have been gleaned from the parties’ filings. They are recited solely for the purpose of
resolving the pending motions and should not be construed as factual findings of the
2 The Lease Agreement between TNT and Stowell (“TNT Lease”), a copy of which
is attached to the Complaint, required Stowell to indemnify TNT for any claims arising out
of the use or maintenance of the Mast Climber by Stowell or any party acting on its behalf.
(See Doc. 1-2 at 26–29.)
subcontract, Stowell ultimately remained responsible for the stucco work and provided
the equipment necessary for its execution—including the Mast Climber. (Doc. 35-2.)
Following the Accident, Aguiar and his wife filed a state court personal injury
lawsuit in 2013 (“Liability Action”).3 The complaint in the Liability Action sets forth
negligence, gross negligence, and loss of consortium claims against TNT and Stowell
and accuses both of concealing “safety issues associated with the mast climber,” and
failing to properly maintain it. (Doc. 1-2.) The Liability Action complaint also advances
claims against Forum and Hardin Construction Company, LLC (“Hardin”). (Id.) Hardin
was the general contractor for the Project that subcontracted stucco, metal framing,
drywall, and other work to Stowell. (Doc. 1-4 (“Stowell/Hardin Agreement”).)4
Contending that the claims in the Liability Action are covered by the policies,
TNT tendered its defense to Amerisure and Liberty. (Doc. 1, p. 5.) Following their
respective rejection of its tender, TNT filed the instant action. (Doc. 1.) In its two-count
Complaint, TNT specifically requests that the Court declare that: (1) TNT is an “Additional
Insured” or should be treated as one under each policy; (2) TNT’s liability and expenses
arising from the Liability Action are covered by each policy; and (3) the Liability Action
The Liability Action, Case No. 2013-CA-803, remains pending in the Ninth
Judicial Circuit Court in and for Osceola County, Florida.
4 The Liability Action complaint alleges that Magic Stucco entered into a “Master
Independent Contractor’s Agreement” with Forum under which: (1) Stowell “was
considered the General Contractor for purposes of the stucco work”; (2) Forum was
designated as a subcontractor; and (3) Magic Stucco was designated as a
sub-subcontractor (“Forum Agreement”). (Doc. 1-2, ¶¶ 15–16.)
Although the Forum Agreement was purportedly attached to the Liability Action
complaint (Doc. 1-2, ¶ 15), it was not appended to TNT’s Complaint. Rather, a copy of
the Forum Agreement is attached to Amerisure’s Motion for Summary Judgment.
(Doc. 35-2.) The Forum Agreement specified that Stowell would provide to Magic Stucco
“all equipment required to perform work on all elevations.” (Id. at 2.)
does not fall within the limitations or exclusions of either policy. (Id. at 7, 10.)
TNT’s and Amerisure’s cross-motions for summary judgment regarding
Amerisure’s duty to defend (Docs. 35, 40) were preceded by Liberty’s Motion to Dismiss
(Doc. 12). During the pendency of these dispositive motions, Amerisure also filed a
Motion to Stay Discovery (Doc. 36), which was denied by Magistrate Judge David Baker
on May 13, 2016. (Doc. 50.)
On September 8, 2016, the Court heard oral argument on: (1) Amerisure’s Motion
for Summary Judgment; (2) TNT’s Cross-Motion for Summary Judgment; (3) Liberty’s
Motion to Dismiss Count II of the Complaint; and (4) Amerisure’s Motion to Vacate the
Magistrate Judge’s Order denying its Motion to Stay Discovery. (Doc. 51.) At the
conclusion of the hearing, the Court issued an ore tenus ruling granting Liberty’s Motion
to Dismiss and dismissed with prejudice TNT’s claim against Liberty. (See D.E. 58.)5
Notwithstanding the dismissal of the claim against Liberty, some elaboration of Liberty’s
involvement with the Project is necessary as it relates to the Amerisure CGL coverage
Competing Summary Judgment Arguments
As to Amerisure’s alleged duty to defend, TNT first points to a provision of the TNT
Lease that required Stowell to include TNT as an Additional Insured under a general
liability policy. (Doc. 40, p. 7; see also Doc. 1, pp. 4–5; Doc. 1-2, p. 28.) By virtue of the
TNT Lease, TNT surmises that it “is, was, should have been and/or was known to be” an
The Court took the motions for summary judgment under advisement and also
denied Amerisure’s motion to vacate the Order denying a stay of discovery, noting the
parties’ agreement at the September 8 hearing that no further discovery was needed on
the duty to defend issue. The Court explained that the parties would be permitted leave
to request a stay of discovery regarding indemnification issues if necessary.
Additional Insured under the CGL policy that Amerisure issued to Stowell (Doc. 1-3,
pp. 1–81 (“Amerisure CGL”).) (Doc. 1, p. 5.) Because the Liability Action allegedly falls
within the Amerisure CGL’s scope of coverage for Additional Insureds, TNT asserts that
summary judgment should be granted in its favor. (Doc. 40, p. 6.)
Conversely, Amerisure contends that TNT’s purported coverage is excluded
pursuant to the Amerisure CGL’s Operations Included Within a Controlled Insurance
Program Exclusion (“OCIP Exclusion”), which states:
The following exclusion is added to SECTION I –
COVERAGES, COVERAGE A BODILY INJURY AND
This insurance does not apply to “bodily injury” or “property
damage” arising out of either your ongoing operations or
operations included within the “products completed
operations hazard” if such operations were at any time
included within a “controlled insurance program” for a
construction project in which you are or were involved.
This exclusion applies whether or not the “controlled
insurance program” provides:
(1) Coverage identical to that provided by this Coverage Form;
(2) Limits adequate to cover all claims; or
(3) Coverage that remains in effect.
The following is added to Section V – Definitions
“Controlled insurance program” means a construction,
erection or demolition project for which the prime
contractor/project manager or owner of the construction
project has secured general liability insurance covering some
or all of the contractors or subcontractors involved in the
project, otherwise referred to as an Owner Controlled
Insurance Program (O.C.I.P.) or Contractor Controlled
Insurance Program (C.C.I.P.).
(See Doc. 1-3, p. 67.)
Underscoring the undisputed fact that TNT performed no operations at the Project,
Amerisure maintains that the OCIP Exclusion applies because: (1) the claims against
TNT are based on bodily injury ultimately arising from Stowell’s operations; and (2)
Stowell’s operations were covered by a “controlled insurance program”—namely, a
General Liability “Wrap-Up” policy issued by Liberty to Project owner Sierra Land Group
(“Sierra OCIP”). (Doc. 35, pp. 2, 6–7; see also Doc. 12-1, pp. 2–13.) 6
TNT does not dispute Stowell’s coverage under the Sierra OCIP, nor does it
dispute Amerisure’s assertion that the Liability Action arose from Stowell’s use and control
of the Mast Climber. (Doc. 35, pp. 2–9; Doc. 40, pp. 1–2.) Rather, TNT simply contends
that the OCIP Exclusion does not apply to “Additional Insureds.” (Doc. 40, p. 2.) In
particular, TNT argues that the Amerisure CGL policy’s “Separation of Insureds”
provision7 and Contractors General Liability Extension Endorsement (“CGL Extension”)8
distinguish TNT as an Additional Insured. (Doc. 40, pp. 3–4; see also Doc. 1-3, pp. 36,
A “wrap up” policy is an insurance vehicle commonly used by owners of large
scale construction projects to provide standardized and economical insurance coverage
to all tiers of contractors and subcontractors. See Guarantee Ins. Co. v. Old Republic
Gen. Ins. Corp., No. 12-20189-civ, 2012 WL 4468352, at *1 (S.D. Fla. Sept. 26, 2012);
see also Patrick J. O’Connor, 2009 Insurance Law Survey, 4 AM. COLL. OF CONSTR.
LAWYERS J. 39, 156 (2010).
7 The Separation of Insureds provision states that “this insurance applies: (a.) As
if each Named Insured were the only Named Insured; and (b.) Separately to each insured
against whom claim is made or ‘suit’ is brought.” (Doc. 1-3, p. 36.)
8 The CGL Extension contains the following pertinent language: “Broaden[ing]
Who Is An Insured . . . Each of the following is also an insured: . . . (I) Any person or
organization who is the lessor of equipment leased to you to whom you are obligated by
virtue of a written contract to provide insurance such as is afforded by this policy, but only
with respect to their liability arising out of the maintenance, operation or use by you of
such equipment.” (Doc. 1-3, pp. 59–60) (emphasis added).
59–60.) Reasoning that the OCIP Exclusion applies only to the Named Insured (i.e.,
Stowell), TNT concludes that its coverage under the Amerisure CGL endures. (Doc. 40,
Summary judgment is appropriate only “if the movant shows that there is no
genuine dispute as to any material fact and that the movant is entitled to judgment as a
matter of law.” Fed.R.Civ.P. 56(a); Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). A
genuine dispute of material fact exists if “the evidence is such that a reasonable jury could
return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
To defeat a motion for summary judgment, the non-movant must “go beyond the
pleadings, and present affirmative evidence to show that a genuine issue of material fact
exists.” Porter v. Ray, 461 F.3d 1315, 1320 (11th Cir. 2006) (citation omitted). The Court
must view the evidence and all reasonable inferences drawn from the evidence in the
light most favorable to the non-movant. See Battle v. Bd. of Regents, 468 F.3d 755, 759
(11th Cir. 2006). However, “[a] court need not permit a case to go to a jury . . . when the
inferences that are drawn from the evidence, and upon which the non-movant relies, are
‘implausible.’” Mize v. Jefferson City Bd. of Educ., 93 F.3d 739, 743 (11th Cir. 1996).
The same standard applies where, as here, the parties submit competing motions
for summary judgment, and “the denial of one does not require the grant of another.” See
Perez-Santiago v. Volusia Cty., No. 6:08-cv-1868-Orl-28KRS, 2010 WL 917872,
at *2 (M.D. Fla. Mar. 11, 2010).
To prevail on its declaratory judgment claims under Florida law, 9 TNT must
establish that a loss or exposure—such as the Accident and resulting Liability Action—is
covered by the policy issued by Amerisure.10 See State Farm Mut. Auto. Ins. Co.
v. Pridgen, 498 So. 2d 1245, 1247–78 (Fla. 1986). If TNT establishes the existence of a
covered loss, then Amerisure must comply with its duties to defend and indemnify TNT in
accordance with the terms of the Amerisure CGL. Id.; see also Kropilak v. 21st Century
Ins. Co., 806 F.3d 1062, 1067 (11th Cir. 2015).
The broad duty to defend is triggered if “the relevant pleadings allege facts that
fairly and potentially bring the suit within policy coverage.” Lawyers Title Ins. Corp. v. JDC
(Am.) Corp., 52 F.3d 1575, 1580 (11th Cir. 1995); see also Trizec Props., Inc. v. Biltmore
Constr. Co., 767 F.2d 810, 811–12 (11th Cir. 1985) (noting that “the duty to defend is
triggered” by factual allegations that create “potential coverage under the policy”).
Because the duty to defend is broad, insurers must provide a defense even when: (1) the
facts alleged in the complaint fall partially within and partially outside the scope of
coverage; and (2) doubts exist as to whether the complaint triggers the duty to defend.
The parties agree that Florida law applies, as the Amerisure CGL was delivered
and executed in this State. Accordingly, the Court looks “first for case precedent from the
Florida Supreme Court.” Composite Structures, Inc. v. Cont'l Ins. Co., 560 F. App’x 861,
864 (11th Cir. 2014) (internal quotations omitted). Absent such precedent, the Court
adheres “to decisions of [Florida’s] intermediate appellate courts” unless a persuasive
indication exists that the Florida Supreme Court “would decide the issue otherwise.” Id.
In insurance disputes like this one, the Court may “consider the case law of other
jurisdictions that have examined similar policy provisions” if there are no “precedents from
Florida’s intermediate appellate courts” or the Florida Supreme Court. Guideone Elite Ins.
Co. v. Old Cutler Presbyterian Church, Inc., 420 F.3d 1317, 1326 n.5 (11th Cir. 2005).
10 A declaratory judgment action is considered “a valuable procedure for the
resolution of insurance coverage disputes.” See Higgins v. State Farm Fire & Cas. Co.,
894 So. 2d 5, 10–15 (Fla. 2004).
See Trailer Bridge, Inc. v. Ill. Nat’l Ins. Co., 657 F.3d 1135, 1141 (11th Cir. 2011); see
also Mid-Continent Cas. Co. v. Am. Pride Bldg. Co., 601 F.3d 1143, 1149
(11th Cir. 2010).
Evidence of actual loss is irrelevant to the duty to defend. See Jones v. Fla. Inc.
Guar. Ass’n, Inc., 908 So. 2d 435, 443 (Fla. 2005). Rather, such evidence pertains to the
narrower duty to indemnify. See WellCare of Fla., Inc. v. Am. Int’l Specialty Lines Ins. Co.,
16 So. 3d 904, 906 (Fla. 2d DCA 2009). However, where a duty to defend does not arise,
a duty to indemnify cannot exist. Id.; see also Trailer Bridge, 657 F.3d 1135 at 1146.
To determine the scope of coverage provided by an insurance policy, courts read
the policy “in its context and as a whole” and give effect to its plain meaning. Swire Pac.
Holdings Inc. v. Zurich Ins. Co., 845 So. 2d 161,165 (Fla. 2003); see also Westport Ins.
Corp. v. VN Hotel Grp., 513 F. App’x 927, 930 (11th Cir. 2014) (explaining that the scope
and extent of coverage is determined by the policy language the parties bargained for).
Generally, unless the language in an insurance policy is “susceptible to more than
one reasonable interpretation, one providing coverage and the [other] limiting coverage,”
no ambiguity exists. Westport Ins. Corp., 513 F. App’x 927, at 931. If ambiguity does exist
despite resort to the ordinary rules of construction, then the policy is ordinarily construed
in favor of coverage and against the insurer. See Taurus Holdings, Inc. v. U.S. Fidelity &
Guar. Co., 913 So. 2d 528, 532 (Fla. 2005); see also Fayad v. Clarendon Nat. Ins. Co.,
899 So. 2d 1082, 1085–86 (Fla. 2005) (stating that “ambiguous exclusionary clauses are
construed even more strictly against the insurer than coverage clauses”).
Here, TNT asserts that the terms “you” and “your” in the OCIP Exclusion refer only
to Stowell as the Named Insured under the Amerisure CGL. (Doc. 40, p. 6.) TNT then
turns to the “Separation of Insureds” provision and the CGL Extension Endorsement to
underscore TNT’s status as an Additional Insured and the parties’ alleged intention to
remove Additional Insureds from the scope of the OCIP Exclusion. (Doc. 1-3, pp. 36,
TNT’s suggested interpretation of the foregoing provisions not only strains credulity
but ignores admittedly unambiguous language of the Amerisure CGL. Moreover, TNT’s
status as an Additional Insured as opposed to a Named Insured is a distinction without a
difference with respect to the breadth and application of the OCIP Exclusion.
First, the Separation of Insureds provision merely clarifies that the policy applies
separately to “each insured.” It does not identify TNT or any other party as an Additional
Insured and does not distinguish the rights of any insureds regarding coverage of a
personal injury claim arising out of Project operations. More pointedly, there is nothing in
the Separation of Insureds provision which limits or impacts the scope of any exclusion,
much less the OCIP Exclusion. Indeed, TNT offers no explanation or credible argument
to the contrary.
The CGL Extension also has no apparent bearing on the OCIP Exclusion. Rather,
it extends the Amerisure CGL coverage to equipment lessors like TNT “but only with
respect to their liability arising out of the maintenance, operation or use by you [that is,
Stowell] of such equipment.” (Doc. 1-3, p. 60.) It is both unreasonable and ironic for TNT
to simultaneously rely on the CGL Extension to obtain coverage of claims arising from
Stowell’s operations and attempt to escape the OCIP Exclusion on the ground that it
applies only to Stowell’s operations. Furthermore, TNT’s interpretation of the CGL
Extension and OCIP Exclusion would have Amerisure cover claims arising from the
operations of Stowell’s subcontractors and exclude claims arising from the operations of
Stowell itself. TNT offers no legal authority or factual basis to disregard this apparent
absurdity in determining the duty to defend.
Even if the Court adopted TNT’s construction of the foregoing terms and
provisions, the claims against TNT would nevertheless come within the scope of the OCIP
Exclusion because it expressly extends beyond the Named Insured. Specifically, the
exclusion pertains to Stowell’s “ongoing operations or operations included within the
‘products-completed operations hazard’” that were at any time “included within a
‘controlled insurance program.’” (Doc. 1-3, p. 67) (emphasis added). Furthermore, the
OCIP Exclusion plainly states that it “applies regardless of whether such operations are
or were conducted by [Stowell] or on [Stowell’s] behalf.” (Id.) This provides a very clear
intention to extend the OCIP Exclusion beyond Stowell to other parties otherwise covered
by the Amerisure CGL—irrespective of whether a controlled insurance program supplied
adequate coverage or coverage identical to that of the Amerisure CGL. (Id.)
Again, it is beyond dispute that the entire Project was covered by the Sierra
OCIP—a “Wrap-Up” owner controlled insurance program issued by Liberty. It is also clear
that TNT seeks coverage of claims ultimately arising out of Stowell’s operations, or at
least operations performed on its behalf. Indeed, TNT does not dispute that point.
Therefore, lending plain meaning to the straight-forward language of the policy, the Court
concludes that the OCIP Exclusion bars coverage to TNT and extinguishes Amerisure’s
duty to defend. Such a conclusion is consistent with Florida jurisprudence enforcing clear
exclusionary language to effectuate the contracting parties’ intentions. See, e.g.,
Travelers Commercial Ins. Co. v. Harrington, 154 So. 3d 1106, 1111 (Fla. 2014) (stating
that unambiguous policy exclusions in an insurance policy are applied as written); Perrine
Food Retailers v. Odyssey Re (London) Ltd., 721 So. 2d 402, 404 (Fla. 3d DCA 1998)
(stating that when the plain language of an exclusion applies, an insurer has no coverage
obligation to an insured).
Accordingly, it is hereby ORDERED AND ADJUDGED that:
Amerisure Mutual Insurance Company’s Motion for Summary Judgment
(Doc. 35) is GRANTED.
TNT’s Motion for Summary Judgment on Amerisure’s Duty to Defend
(Doc. 40) is DENIED.
The Clerk is DIRECTED to enter judgment in favor of Defendant Amerisure
Mutual Insurance Company and against Plaintiff TNT Equipment Inc.,
terminate all pending motions, and CLOSE the file.
DONE AND ORDERED in Chambers in Orlando, Florida, on September 21, 2016.
Counsel of Record
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