State National Insurance Co. et al v. White

Filing 87

ORDER DENYING in part 40 White's MOTION for Summary Judgment with respect to his Third Party Claims against the County, and GRANTING in part as to the County's Counterclaims for contribution and subrogation. Signed by Judge James D. Whittemore on 11/18/2011. (KE)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION
STATE NATIONAL INSURANCE
COMPANY and STAR INSURANCE
COMPANY,
Plaintiffs/Counter-Defendants,
Case No. 8:10-cv-894-T-27TBM

vs.
KEVIN WHITE,
Defendant, Counter-Plaintiff,
Third Party Plaintiff, and
Third Party Counter-Defendant,
vs.
HILLSBOROUGH COUNTY, FLORIDA,
Third Party Defendant and
Third Party Counter-Plaintiff.

----------------------------~/
ORDER
BEFORE THE COURT is Kevin White's Motion for Summary Judgment (Dkt. 40) with
respect to claims involving Hillsborough County, Florida (the "County").' In the motion, Kevin
White ("W hite") claims that he is entitled to summary judgment on (I) his third-party claims agai nst
the County for declaratory judgment and breach of contract, and (2) the County's counterclaims for
subrogation and contribution. For the reasons set forth below, Kevin White' s Motion for Summary
Judgment (Dkt. 40) is DENIED with respect to hi s claims against the County and GRANTED as
to the County's counterclaims for contribution and subrogation.

1 The Court has separately addressed Kevin White 's Motion for Summary Jud gment w ith respect to the
Plainti ffs. See, e.g. , Okt. 69.

Factual Background

2

White was at all relevant times a member of the Board of Commissioners for the County.
As a public official employed by the County, White was an " Insured" under a " Public Entities
Excess" insurance policy held by the County (the "Policy"). The Policy contained a Self-Insured
Retention Endorsement (Form SNS 10 I 0) (the "SIR Endorsement") which modified the insurance
coverage under the Policy, providing that coverage was limited to amounts in excess of a self-insured
retention of $35 0,000 per occurrence (the "SIR Retention"). The SIR Endorsement also provided:
4.

Tn the event of any occurrence which, in the opinion of any
INSURED, is likely to give rise to liability under thi s Policy,
no costs or expenses, other than for immediate first aid to
others, shall be incurred by any INSURED, except at his or
her own cost, peril and expense, without the written consent
of the company. The NAMED INSURED shall be obligated
to
A.

provide {Ill adequate defellse alld illvestigatioll of
allY actioll for or lIotice of allY actual, potelltial or
alleged damages, allll

B.

accept any reasonable offer or settlement within the
NAMED INSURED'S self-insured retention ,

and , in the event of any NAMED INSURED ' S failure to
comply with any part of this paragraph, the company shall not
be liable for any damages or costs or expenses resulting from
such occurrence.
SIR Endorsement (emphasis added).
In May, 2008, Alyssa L. Ogden ("Ogden"), a former aid of White, filed suit against White
and the County in state court asserting claims for (a) sex discrimination in viol ation of 42 U.S.C.
§§ 1983 and 1988, (b) sexual harassment in violation of the Florida Civil Rights Act of 1992, Fla.

2

For a more detailed factual and procedural background, see the Court' s Order entered on October 19, 20 II

(Dkt. 69).

2

Stat.§§ 760.01 -760.11 ("FCRA"), and (c) retali atory discharge in violation of the FCRA. See, e.g. ,
Second Amended Complaint (Dkt. 37-2) ("O gden Complaint"). The defendants removed the action
to federal court. See Ogden v. Hillsboro ugh County, Flo rida, and White, No. 8:08-cv-11 87-RALTBM (M. D. Fla.) (hereinafter, the "O gden Litigation").
Although Ogden asserted c laims under both § 1983 and the FCRA, only Ogden 's claims
under § 1983 were subm itted to the jury. See Ogden Liti gation (Dkt. 144), Trial Transcript IV
(Okt. 37-1 9), pp. 283 -84 . The jury ultimately returned a verdict in favor of Ogden, fi nding that
( I) Ogden was subj ected to sexual harassment or unwelcome advances by White, and (2) Ogden was
terminated as part of the sexual harassment or because she rejected Whi te's unwelcome sexual
advances. See Ogden Verdict (4 8-4), p. I. Final judgment was entered against the County and
White in the amount of $75 ,000.

See Judgment in Civil Action (Ok!. 48-11 ) (the "Ogden

Judgment").
The County's insurer di savowed any duty to de fend or indemni fy White under the Po licy and
the County refused to furni sh White a defense with respect to Ogden's clai ms. T hus, White was
required to pay fo r his own defense costs in the Ogden Litigati on. The County subsequently agreed
to pay $278,000 to satisfY the Ogden Judgment and settl e Ogden 's c la im fo r attorney's fees and
costs.

See Full and Complete Waiver and Release of Li ability (Ok!. 4 1- 1) (the " Ogden

Settlement"), p.I .3
Procedural Bac1<ground
The Co unty's insurers commenced thi s action by filing a two count complaint fo r declaratory
relief (Ok!. 5). White subseq uently fi led a Th ird Party Com plaint against the County asserting

) The Ogden Sett lement ex pressly provides th at by agreeing to the sett lement "[Ogden] do[es] no t waive any
ri ghts or release Kevin White, th e co-d efendant in th e lawsuit." Ogden Settl ement, p. 3.

3

claims for declaratory relief and breach of contract whereby he seeks payment and/or reimbursement
of the attorney's fees and costs he incurred in the Ogden Litigation (Okt. 6). The County filed
counterclaims against White for subrogation, equitable indemnification, and contribution seeking
to recover its costs and expenses incurred in settling the Ogden Litigation (Ok!. 17).
The Court previously dismissed the County's counterclaim for equitable indemnification with
prejudice. See Ok!. 29. White now moves for summary judgment on his claims against the County
as well as the County's claims for subrogation and contribution. The County did not file a motion
for summary judgment.
Standard

011

Summary Judgment

Summary judgment is proper if, following discovery, the pleadings, depositions, answers to
interrogatories, affidavits and admissions on file show that there is no genuine issue as to any
material fact and that the moving party is entitled to judgment as a matter of law. Celolex Corp. v.

Calrel/ , 477 U.S. 317,322 (1986); Fed. R. Civ. P. 56( c). "An issue of fact is 'material' if, under the
applicab le substantive law, it might affect the outcome. of the case." Hickson Corp. v. N. Crossarm

Co. , 357 FJd 1256, 1259-60 ( II th Cir. 2004). "All issue of fact is ' genuine' if the record taken as
a whole could lead a rational trier of fact to find for the nonmoving party." Id. at 1260. All the
evidence and factual inferences reasonably drawn from the evidence must be viewed in the light
most favorable to the nonmoving party. Adickes v. S.H Kress & Co., 398 U.S. 144, 157 (1970);

Jackson v. BellSoulh Telecomms., 372 FJd 1250, 1280 (11th Cir. 2004).
Once a party properly makes a summary judgment motion by demonstrating the absence of
a genuine issue of material fact, the nonmoving party must go beyond the pleadings through the use
of affidavits, depositions, answers to interrogatories alld admissions on file, and designate specific
facts showing that there is a genuine issue for trial. Celolex, 477 U.S. at 323-24. The evidence must
4

be significantly probative to support the claims. Anderson v. Liberty Lobby, In c., 477 U.S. 242, 249
(1986).
The Court will not weigh the evidence or make findings offact. Anderson, 477 U.S. at 249;
Morrison v. Amway Corp., 323 F.3d 920, 924 (II th Cir. 2003). Rather, the Court's role is limited
to deciding whether there is sufficient evidence upon which a reasonable jury could find for the nonmoving party. Id.
Discussion

White's Third-Party Claims Agaillst the COlillty
White moves for summary judgment on his declaratory judgment and breach of contract
claims in which he alleges that the County had a duty to defend him in the Ogden Litigation and, as
a result, is now obligated to reimburse him for the attorney ' s fees and costs he incurred. Under
Florida law, there is no common law duty to defend. See, e.g. , Allstate Ins. Co. v. RJT Entell}., Inc.,
692 So.2d 142, 144 (Fla. 1997); Budget Rent A Cal' Sys., Inc. v. Taylor, 626 So.2d 976, 979 (Fla. 4th
DCA 1993). Thus, White must point to an express contractual provision that obligated the County
to provide him with a defense in the Ogden Litigation.
White attempts to establish a contractual duty to defend based on the SIR Endorsement and
his alleged status as a third-party beneficiary. Specifically, White argues that he was a third-party

5

beneficiary under the Policy and that the County breached its alleged duty to provide a defense under
the SIR Endorsement.'
Initially, it must be noted that White's attempt to establi sh hi s status as a third-party
beneficiary under the SIR Endorsement is incons istent with hi s undisputed status as an insured under
the Policy. Nonetheless, because the Court concludes that the SIR Endorsement does not impose
any duty on the County vis-a-vis White under the Policy, the result is the same whether White seeks
to enforce the SIR Endorsement against the County as either an additional insured or a third-party
beneficiary.
The plain language of the SIR Endorsement imposes on the County a duty to defend any
claim arising from an occurrence that is likely to give rise to li abi lity under the Po licy. SIR
Endorsement,

~

4.a. Thus, the Co unty's obligation to defend is clear vis-a-vis the insurance

company. It is equally clear, however, that thi s provision was not intended to give White additional
rights under the Policy vis-a-vis the County.

The plain language of the SIR Endorsement

demonstrates that the provision at issue was included to protect the insurance company from excess
liability that might arise if the County fa iled to adequately respond to and defend claims prior to the
time the SIR Retention was satisfied. See id., ' 14 ("in the event of any of the NAMED INSURED'S

4

The fo llowing elements are required for a calise of action for breach of a third party beneficiary contract in

Florida:
I) a contract between A and B; 2) th e clear or manifest intent of A and B that the
contract primarily and d irect ly benefit the third party; 3) breach of th e contract by
A or B; and 4) damages to the third-party beneficiary resulting ITom the breach.
Foundation Health v. Westside EKG Associates, 944 So.2d 188, 194-95 (Fla.
2006). It is importan t to note that the third party need not be mentioned by name
in the contract to be deemed a third party beneficiary. Polo Ralph Lauren, L.P. v.
Tropical Shipping & Canst. Co., Ltd. , 2 15 F.3d 12 17, 1222 ( II oh Cir. 2000).

;itlantic Marine Florida, LLC v. Evanston Ins. Co., 721 F.Supp.2d 1244, 1250 (M.D. Fla. 20 10) (internal footnotes
omitted). The Court rejects White's argument that the undisputed evidence revea ls that "i t was the 'clear and manifest'
intent of the Co unty to 'primar ily and direct ly benefit' White under the S IR Endorsement." Dkt. 40, p. 2 1.

6

failure to comply with any part of this paragraph, the company shall not be liable for any damages
or costs or expenses resulting from any such occurrence").' As a result, White has failed to
demonstrate that based on the undisputed facts he was an intended third-party beneficiary of the SIR
Endorsement or that he is otherwise entitled to enforce the SIR Endorsement against the County.

The County's Coullterclaims for Contributioll ami Subrogation 6
The County's claims for contribution and subrogation are essentially alternative claims and
the proper legal theory to be applied depend s on whether the County and White were joint
tortfeasors' with respect to damages awarded in the Ogden Litigation. s That is, contribution9 is the

5 This interpretation is consistent with Florida law that allows the County to provide a defen se for its employees,
but requires the County to reimburse an employee's legal fees and costs only if the employee prevails in the underlying
litigation. See Fla. Stat. §§ 111.07 and 111.071 . In contrast, reading the SIR Endorsement to require the County to

defend White would be inconsistent with Florida law that pennits th e County to recover defen se costs paid from public
fund s on behalfofan emp loyee " who is found to be personally li ab le by virrue or acting outside the scope of his or her
employment, or was acting in bad fa ith, with malicious purpose, or in a manner exhibiting wanton and willfu l disregard
of human ri ghts, safety, or properry .... " Fla. Stat. § 111.07
6 The Court summaril y rejects White's argument that he is entitled to summary judgment on the County's claims
for contribution and subrogation because the County did not satisfy the entire Ogden Judgment. See Fla. Stat. §

768.3 I (2)(d) ("A tortreasor who enters into a settlement with a cla imant is not entitled to recover contribution from

another tort feasor whose liabi lity for the injury or wrongfu l death is not extinguished by the settlement ... ."); Dade
CO l/nty School Bd. v. Radio Station WQBA, 73 1 So.2d 638, 646 (F la. 1999) (ho ldin g that subrogation is only proper
when subrogee has paid of entire underl ying debt). The evidence of record reflects that the County did satisfy the Ogden
Judgment and strollgly suggests that the Ogden Settlement resolved Ogden's claim for attorney's fees and costs. There
was no order entered in the Ogden Litigation establishing the amount of attorney's fees recoverable from the County
and/or White and it is unclear whether Ogden intends (or remains entitled) to pursue a separate claim for attorney's fees
agai nst White. At a minimum, disputed issues of material fact ex ist as to whether the County satisfied the entire Ogden
Judgment.
7 A § 1983 claim is not based on a statutory violat ion per se, but rather amounts to a constitutiona l tort. See,
e.g, Katkav. Mills, 422 F.Supp.2d 1304 , 1310 (N.D. Ga. 2006) (noting that claims unde r sec tion 1983 are based on

constitutional tOI15).
8 Florida law does not recognize a right of subrogation between joint tortfeasors and an y right of recovery
between joint tortfeasors must be through the legal remedy of contribution which is provided in § 768.31, Florida
Statutes. See Florida Patients Compensation Fund v. SI. Paul Fire and !vlarine Ins. Co. , 535 So.2d 335, 336 (F la. 4th
DCA 1988), decision approved, 559 So.2d 195, 197-99 (F la. 1990).
9 Sect ion 768.31, Florida Statutes, provides: "Except as otherwise provided in thi s action, when two or more
persons become jointly or severally liable in tort for the same injury to person or property, or for the same wrongfu l
death, there is a right of contribution ... in favor ofa tortfeasor who has paid more than her or his pro rata share of the
common li abi lity .... " Fla. Stat. § 768.3 1(2).

7

proper legal theory if the County and White were joint tortfeasors, while subrogation'O is the proper
legal theory if White and the County were not joint tot1feasors. Because the jury verdict in the
Ogden Litigation did not apportion fault between White and the County," the Court must initially
determine whether the jury verdict in the Ogden Litigation conclusively established that the County
was at least partly at fault for the sexual harassment and discrimination complained of by Ogden (i.e.,
whether the County was ajoint tortfeasor).
A review of the record, including the judgment imposing joint and several liability against
White and the County, establishes that the County was at least partly at fault for the violation of
Ogden's civil rights and , as such, was a joint tort feasor for purposes of Florida law governing
contribution. This conclusion is bolstered by the fact that political subdivisions may not be held
liable under § 1983 based on a theory of re~pondeat superior or vicarious liability. See Monell v.

Department a/Social Services, 436 U.S. 658, 690-94 (1978). While the Ogden Court's instruction
to the jury could be interpreted to adopt a respondeal superior theory of liability, 12 this instruction
was based on the Ogden COUl1's conclusion that the County failed to offer a meaningful review
process to respond to Ogden's claim that she was unlawfully terminated by White. See Maschmeir

to Equitable subrogation is generally appropriate when: (I) the subrogee made the payment to protect his or her
own interest, (2) the subrogee did not act as a volunteer, (3) the subrogee was not primarily liable for the debt , (4) the
subrogee paid off the entire debt, and (5) subrogation would not work any injustice to the rights ofa third party. Dade
Counly School Bd. v. Radio Slolion WQBA , 731 So.2d 638, 646 (Fla. 1999).
II As the Court previously noted in denying White's motion to dismiss, section 768.3 I (4)(a), Florida Statutes,
expressly allows a contribution claim to be enforced in a separate action. See Fla. Stat. § 768.31 (4)(a) ("Whether or not

judgment has been entered in an action against two or more tortfeasors for the same injury or wrongful death,
contribution may be enforced by se parate action."). As a result , the Court cannot conclude as a matt er of law that the
Cou nty waived its claim for contribution by failing to request that the jury apportion fault in th e Ogden Litigation. Cj
Fla. Stat. § 768.31(4)(1) ("The judgment of the coul1 in determining the liability of several defendants to the claimant

for an injury or wrongful death shall be binding as among such defendants in detennining their right to contribution.").
12

The Ogden Court instructed the jury: "When sexual harassment is carried out by a public official with

immediate or success ively higher authority over a Plaintiff culminating in an adverse tangible employment action against
the Plaintiff, the Defendant employer is responsible under law for such behavior. An adverse tangibl e employment action
includes the tennination of employ men!." Ogden Jury Instructions (Ok!. 37-10), p. 9.

8

v. SCOII, 269 Fed. Appx. 941,943 -45 (11'h Cir. 2008) (unpublished); Templeton v. Bessemer Water
Serv., 154 Fed. Appx. 759, 764-66 (ll'h Cir. 2005) (unpublished); see also Martinez v. City o/OpaLocka, 971 F.3d 708, 715 ( 11 'h Cir. 1992)." Thus, the County's remedy, if any, against White is
limited to the legal remedy of contribution.
White argues that he is entitled to summary judgment on the County's claim for contribution
because federal law does not provide for contribution in cases arising under 42 U.S .C. § 1983. See

Northwest Airlines, Inc. v. Transport Workers Union, 451 U.S. 77 ( 1981). In response, the County
argues that even though federal law does not provide a private right to contribution under § 1983,
Florida law allowing contribution between joint tortfeasors should be app lied to " fill the gap" in
federal law under 42 U.S .C. § 1988.14
While the County suggests there is a spl it of authority as to whether there is a right to
contribution under 42 U.S.c. § 1983, the vast majority of courts to have addressed the issue have
found that no claim for contribution is available in actions arising under § 1983. See, e.g., Crews
v. Countyo/Nassau, 612 F.Supp.2d 199, 208 (E.D.N. Y. 2009) (collecting cases); Hurley v. Horizon

Project, Inc. , No. CV -08-1365-ST, 2009 WL 55 11 205 , at *3 (D. Or. Dec. 3, 2009) (collecting cases).
The Court agrees with the majority of courts to have addressed the issue and concludes that the

IJ

In denying the County's motion for entry ofjudgment as a matter of law, the Ogden Co urt suggested that the

County's liability arose, at least in part, from th e County's failure to have in place a meaningful review process capable

of overtu rning White's decision to tem,inate Ogden. See Order (Dkt. 37-22), p. 5; see atso id at p. 7 ("The Court
continues to be puzzled by the County's argument that becau se it was not the "moving force" behind White 's predatory
acts of di scrimination resulting in Ogden's terminat ion, it cannot be liable for damage s sustained by Ogden as a
consequence of White's acts.").
14 Section 1988 allows federal court s to apply state law when federal law "is not adapted to the object
[protecting and vindicating civil ri glHs), or are deficient in the provisions necessary to furnish suitable remedies and
punish offenses against law .... "

9

County may not pursue a claim for contribution agai nst White for cl aims arising under § 1983."

Accordingly, it is ORDERED AND ADJUDGED that:
(I)

Kevin White 's Motion for Summary Judgment (Dkt. 40) is DENIED with respect

to his Third Party Claims against the County and GRANTED as to the County's Counterclaims for
contribution and subrogation.
(2)

Within fourteen (14) days from the date of this Order, White is directed to show

cause why summary judgment shou ld not be entered in favor of the County on all claims asserted
by White in the Third Party Complaint. See Fed. R. Civ. P. 56(f)( 1).

J f) 7J;:..
DONE AND ORDERED in chambers this ....Lt1...- day of November, 2011 .

~ITTEMORE
Umted States District Judge

Co pies to:
Counse l of Reco rd

Il The Court dec lines th e County's invitati on to in voke § 1988 and apply Florida law allowing contribution
between joint tortfeaso rs. Invok ing § 1988 to " furn ish a suitable remedy" between two defendants that both were found
respons ible for violatin g an individual's con stitutional ri ghts wou ld be inconsistent with express language of § 1988 and
the purposes of § 1983. See Wriglu v. Reynolds, 703 F.Supp. 583 , 592 (N.D. Tex. 1988)(" Secti on 1988 does not speak
to the rights of those who violated th e civil ri ghts of another."); Mason v. City 01 New York , 949 F.Supp. 1068, 1077
(S.D.N. Y. 1996) (noting that perm itting a right to contributio n in the § 1983 context may weaken one of the primary
purposes of § 1983 (i.e. , deterrence)); see also Banks ex rei. Banks v. Yokemick, 177 F.Supp.2d 239, 249 (S.D.N.Y.
20 II ) ("[Section 1983's] central aim may be viewed as a double edged sword whose du al aspect is des igned to protect
and deter, to benefit the victim whi le penalizing th e offender.").

10