The Ohio Casualty Insurance Company v. Garden of Eat'n of Tampa, Inc. et al

Filing 41

ORDER: Ohio Casualty Insurance Company's Motion for Partial Summary Judgment on Sherri Gafford's Affirmative Defense of Estoppel 21 is GRANTED. Ohio Casualty Insurance Company's Motion for Summary Judgment 22 is GRANTED. Sherri G afford's Cross Motion for Summary Judgment 28 is DENIED. The Clerk is directed to enter Judgment in favor of Ohio Casualty Insurance Company and against Defendants. The Clerk is directed to terminate all pending deadlines and to CLOSE THE CASE. Signed by Judge Virginia M. Hernandez Covington on 9/2/2011. (KAK)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION
THE OHIO CASUALTY INSURANCE
COMPANY,
Plaintiff,
v.

Case No. 8:10-cv-2602-T-33TBM

GARDEN OF EAT’N OF TAMPA, INC.,
and SHERRI GAFFORD,
Defendants.
_______________________________/
ORDER
This matter comes before the Court pursuant to The Ohio
Casualty

Insurance

Company’s

Motion

for

Partial

Summary

Judgment on Sherri Gafford’s Affirmative Defense of Estoppel
and Motion to Strike Affirmative Defense or for More Definite
Statement (Doc. # 21), filed on February 9, 2011, and Sherri
Gafford’s Response in Opposition (Doc. # 29), which was filed
on March 15, 2011.

Also before the Court is Ohio Casualty’s

Motion for Summary Judgment (Doc. # 22), filed on February 9,
2011, and Gafford’s combined Response and Cross Motion for
Summary Judgment (Doc. # 28), which was filed on March 10,
2011.

Ohio Casualty filed a Response in Opposition to

Gafford’s Motion for Summary Judgment on March 24, 2011, and
Gafford filed a Reply (Doc. # 36) on April 21, 2011.
For the reasons that follow, the Court grants summary
judgment in favor of Ohio Casualty and denies Gafford’s motion

for summary judgment.
I. Background
A.

The Policy and Gafford’s Injury

Ohio Casualty issued a Commercial General Liability
Policy to the Garden of Eat’n of Tampa, Inc. on May 26, 2007,
with liability limits of $1,000,000.00 per occurrence.

The

Policy provides third-party liability coverage to the Garden
but also contains several exclusions, which follow:
2.

Exclusions
This insurance does not apply to:
d.
Workers’ Compensation And Similar Laws
Any obligation of the insured under
workers’
compensation,
disability
benefits or unemployment compensation law
or any similar law.
e.
Employer’s Liability
“Bodily injury” to:
(1) An “employee” of the insured arising
out of and in the course of:
(a) Employment
by
the
insured; or
(b) Performing duties related
to the conduct of the
insured’s business; ...
This exclusion applies:
(1) Whether the insured may
be liable as an employer
or in any other capacity;

(Doc. # 15 at 5).1
On April 24, 2008, while the Policy was still in effect,

1

Ohio Casualty attached a complete copy of the Policy to
the amended complaint. (Doc. # 15-1).
2

Gafford, an employee of the Garden, was injured on the
premises of the Garden. On that date, Gafford came in to work
at or around 1:00 p.m. and performed her usual duties,
including cashier work, stocking the store with fresh produce,
watering plants, and pruning plants. (Gafford Dep. Doc. # 22-3
at 17).

The Garden is open seven days a week and closes at

7:00 p.m. Id. at 19-20.

Gafford assisted Manger Pat Touchton

with closing the store at or around 7:00 p.m.

Id. at 19.

Around this time, Gafford picked up two items (a gallon of
milk and an onion) but did not pay for them in the same manner
as a usual Garden customer would. Rather, she wrote down that
she retrieved the two items and understood that the amount for
the items would be taken from her next paycheck. (Gafford Aff.
Doc. # 28-3 at ¶ 5).
Thereafter, Gafford and Touchston walked out of the store
together

and

engaged

in

a

social

approximately ten to fifteen minutes.
28-4 at 11).

conversation

for

(Touchston Dep. Doc. #

Gafford testified that the nature of the

conversation was “good night, have a good evening, see you
tomorrow.” (Gafford Dep. Doc. # 22-3 at 38).

After the

conversation was over, around 7:15 to 7:30 p.m., Gafford began
walking to her car.

Although it was still light outside,

Gafford did not see uneven pavement and a hole in the parking
3

lot. (Touchston Dep. Doc. # 28-4 at 10).
fell on to the ground.

Gafford tripped and

Gafford stood up, brushed herself

off, and stated that she would be fine. Id. at 19.

No

ambulance was called to the scene. Id. at 21.
A few days later, Gafford reported to work but noted that
she could not lift one of her arms due to the injuries she
sustained on the night in question.

Id.

At the direction of

her supervisor, Gafford went to the emergency room. Id. at 22.
She continued to try to do her job but ultimately gave up
because she could not perform due to her injuries. Id. at 34.
She underwent neck surgery on or about March 5, 2008, and
submitted a claim to Ohio Casualty.

Gafford contends,

Because I did not have health insurance coverage, I
was told to contact Garden of Eat’n’s insurance
company about medical treatments. I spoke with a
person from Garden of Eat’n’s insurance company and
advised them that I was injured after working at
Garden of Eat’n. The person I spoke with told me
that I was eligible for benefits under the Garden
of Eat’n insurance policy.
I received medical
treatments which were paid by Garden of Eat’n’s
insurance company.
(Gafford Aff. Doc. # 28-3 at ¶¶ 10-13).
B.

Insurance Correspondence

On June 12, 2008, Ohio Casualty informed Gafford that
“There was no negligence on the part of Garden of Eat’n.
Therefore,

we

will

be

unable

4

to

honor

any

claim

under

liability.” (Doc. # 28-7).

In the same letter, Ohio Casualty

indicated, “Our insured’s policy does provide a no-fault,
Medical Payment Benefit to assist with any medical expenses
incurred (i.e. necessary medical, hospital, surgical, x-ray)
submitted to us for review up to a $10,000 limit.” Id.
On June 27, 2008, the Gafford sent Ohio Casualty a letter
pursuant to Florida Statute Section 627.4137 asking for a
disclosure regarding whether coverage would be available under
the Policy for her injuries, and if an exclusion applies,
naming

2

such

exclusion.

(Doc.

#

28-6).2

Ohio

Casualty

Florida Statute Section 627.4137 states:

(1)
Each insurer which does or may provide
liability insurance coverage to pay all or a
portion of any claim which might be made shall
provide, within thirty days of the written request
of the claimant, a statement, under oath, of a
corporate officer or the insurer’s claims manager
or superintendent setting forth the following
information with regard to each known policy of
insurance, including excess or umbrella insurance:
(a)
(b)
(c)
(d)

(e)
In

The name of the insurer.
The name of each insured.
The
limits
of
the
liability
coverage.
A statement of any policy or
coverage defense which such insurer
reasonably believes is available to
such insurer at the time of filing
such statement.
A copy of the policy.
addition,

the

insured,
5

or

her

or

his

responded on January 28, 2009, that no coverage would be
available: “[I]t appears your client’s, Ms. Sherri Gafford,
injuries arose out of her own contributory negligence while
working as an employee at our named insured’s

Garden of

Eat’n, location in Tampa, Florida.” (Doc. # 28-5 at 2).
C.

The Court Proceedings

Gafford filed a negligence action against the Garden in
State Court on February 26, 2009.3

Therein, she alleged that

she was “an invitee” who suffered “serious and permanent
bodily injury” on April 24, 2008, after tripping and falling

insurance agent, upon written request of the
claimant or the claimant’s attorney, shall disclose
the name and coverage of each known insurer to the
claimant and shall forward such request for
information as required by this subsection to all
affected insurers. The insurer shall then supply
the information required in this subsection to the
claimant within 30 days of receipt of such request.
(2) The statement required by subsection (1) shall
be amended immediately upon discovery of facts
calling for an amendment to such statement.
Florida Statute Section 627.4137.
3

Ohio Casualty represents that it is currently defending
the Garden against Gafford’s State court case under a
reservation of rights to withdraw the defense and deny
coverage. (Doc. # 22 at 3, n. 1). Gafford notes in her Reply
Memorandum that Ohio Casualty has not filed a copy of the
reservation of rights letter.
(Doc. # 36 at 5). However,
Gafford does not appear to actually challenge Ohio Casualty’s
representation that such letter was submitted to the Garden.
6

due to the presence of a pothole and uneven pavement in the
parking lot.

(Doc. # 15-2, ¶¶ 4-10).

Thereafter, on November 22, 2010, Ohio Casualty filed the
instant action for declaratory relief against the Garden and
Gafford. (Doc. # 1).

After fruitless default proceedings,

Ohio Casualty filed a one-count amended complaint on January
3, 2011, seeking a declaration that the Policy does not
require Ohio Casualty to defend or indemnify the Garden from
Gafford’s State court negligence action. (Doc. # 15).
Gafford filed her answer and affirmative defenses on
January 25, 2011. (Doc. # 17).

Gafford asserts estoppel and

waiver affirmative defenses. (Doc. # 17).

This case is set

for a jury trial during the Court’s February 2012, trial term.
Cross Motions for Summary Judgment are before the Court.
II. Legal Standard
Summary judgment is appropriate if the pleadings, the
discovery and disclosure materials on file, and any affidavits
show that there is no genuine issue as to any material fact
and that the movant is entitled to judgment as a matter of
law. Fed. R. Civ. P. 56(a).
An issue is genuine if the evidence is such that a
reasonable jury could return a verdict for the nonmoving
party.

Mize v. Jefferson City Bd. of Educ., 93 F.3d 739, 742
7

(11th Cir. 1996) (citing Hairston v. Gainesville Sun Publ’g
Co., 9 F.3d 913, 918 (11th Cir. 1993)).

A fact is material if

it may affect the outcome of the suit under the governing law.
Allen v. Tyson Foods, Inc., 121 F.3d 642, 646 (11th Cir.
1997).
The Court must draw all inferences from the evidence in
the light most favorable to the non-movant and resolve all
reasonable doubts in that party's favor.
461 F.3d 1315, 1320 (11th Cir. 2006).

See Porter v. Ray,

The moving party bears

the initial burden of showing the Court, by reference to
materials

on

file,

that

there

are

no

genuine

material fact that should be decided at trial.

issues

See id.

of

When

a moving party has discharged its burden, the non-moving party
must then go beyond the pleadings, and by its own affidavits,
or by depositions, answers to interrogatories, and admissions
on file, designate specific facts showing there is a genuine
issue for trial.

See id.

In this diversity case, the Court applies the substantive
law of the forum state unless federal constitutional or
statutory law compels a contrary result. Tech. Coating Apps.,
Inc. v. United States Fid. & Guar. Co., 157 F.3d 843, 844
(11th Cir. 1998).

Furthermore, this Court must apply Florida

law in the same manner that the Florida Supreme Court would
8

apply it. Brown v. Nichols, 8 F.3d 770, 773 (11th Cir. 1993).
Under Florida law, the interpretation of an insurance contract
is a matter of law to be decided by the court. Gas Kwick, Inc.
v. United Pac. Inc. Co., 58 F.3d 1536, 1539 (11th Cir. 1995).
Courts must construe an insurance contract in its entirety,
striving to give every provision meaning and effect. Id.
(citing Dahl-Eimers v. Mut. of Omaha Life Ins. Co., 986 F.2d
1379, 1382 (11th Cir. 1993)).
III.

Analysis
A.

The Duty to Defend and the Duty to Indemnify

The duty to defend is broader than the duty to indemnify.
Sinni v. Scottsdale Ins. Co., 676 F. Supp. 2d 1319, 1323 (M.D.
Fla. 2009).

The decision of whether an insurer has a duty to

defend “is determined solely by the claimant’s complaint if
suit has been filed.” Higgins v. State Farm Fire and Cas. Co.,
894 So. 2d 5, 9-10 (Fla. 2004).

An insurer’s duty to

defendant against a legal action is triggered “when the
complaint alleges facts that fairly and potentially bring the
suit within policy coverage.” Jones v. Fla. Ins. Guar. Ass’n,
Ins., 908 So. 2d 435, 442-43 (Fla. 2005).
The insurer must defend even if the complaint allegations
are factually incorrect and without merit. Smithers Constr.,
Ins. v. Bituminous Cas. Corp., 563 F. Supp. 2d 1345, 1348-49
9

(S.D. Fla. 2008). “Any doubts regarding the duty to defend
must be resolved in favor of the insured.” Id.

Here, the duty

to defend is triggered because Gafford’s complaint alleges
that she was injured on the premises of the Garden, not as a
an employee, but as an invitee.
However,

“the

duty

to

defend

does

not

continue

indefinitely.” Scottsdale Ins. Co. v. GFM Operations, Inc.,
Case No. 10-cv-20204, 2011 U.S. Dist. LEXIS 39696, at *11-12
(S.D. Fla. Apr. 12, 2011).

A insured has the duty to defend

a claim until it is “certain” that the claim is not covered by
the policy at issue. Nationwide Mut. Fire Ins. Co. v. Keen,
658 So. 2d 1101, 1103 (Fla. 4th DCA 1995).

That is, “the duty

to defend ceases when it is shown that there is no potential
for coverage i.e., when there is no duty to indemnify.”
Underwriters at Lloyds London v. STD Enters., 395 F. Supp. 2d
1142, 1146-47 (M.D. Fla. 2005).

Because “the covenant of

coverage informs the duty to defend,” whether Ohio Casualty
has a continuing duty to defend the Garden in State Court will
depend on whether Ohio Casualty has a duty to indemnify the
Garden against the loss for Gafford’s claimed injuries. Keen,
658 So. 2d at 1103.
In contrast to the duty to defend, the duty to indemnify
is not determined by reference to the claimant’s complaint,
10

but rather by reference to the actual facts and circumstances
of the injury.

STD Enters., 395 F. Supp. 2d at 1147.

In this

context, “insurance contracts are to be construed in a manner
that is reasonable, practical, sensible, and just. . . .
Terms used in a policy are given their plain and ordinary
meaning and read in the light of the skill and experience of
ordinary people.

Provisions that exclude or limit liability

of an insurer are construed more strictly than provisions that
provide coverage.” United States Fire Ins. Co. v. Freedom
Vill. of Sun City Ctr., 279 F. App’x 879, 880-881 (11th Cir.
2008)(internal citations omitted). Furthermore, if provisions
in an insurance contract are “reasonably susceptible of more
than one meaning, they are ambiguous and construed in favor of
the insured.

That rule applies if a genuine inconsistency,

uncertainty, or ambiguity in meaning remains after a review of
the plain language.” Id. at 881.
B.

Florida Workers’ Compensation Statute

Under Florida Statute Section 440.11:
The liability of an employer prescribed in s.
440.10 shall be exclusive and in place of all other
liability, including vicarious liability, or such
employer to a third-party tortfeasor and to the
employee, the legal representative thereof, husband
or wife, parents, dependents, next of kin, and
anyone otherwise entitled to recovery damages from
such employer at law or in admiralty on account of
such injury or death . . .
11

(emphasis added).
“[T]he fundamental proposition embodied in Section 440.11
[is] that where an injury is suffered in the course and scope
of employment, workers’ compensation is the exclusive remedy
for recovery against the employer.” Chiang v. Wildcat Groves,
703 So. 2d 1083, 1087-88 (Fla. 2nd DCA 1997).

In addition to

showing that the injury suffered was in the course and scope
of the employment, a workers’ compensation claimant must also
show that “the employment constituted a major contributing
cause

of

the

accident

or

injury.”

Perez

v.

Publix

Supermarkets, 673 So. 2d 938, 939-40 (Fla. 3d DCA 1996).

In

Perez, an employee slipped and fell after clocking out and
during her walk to the parking lot.

She was on the premises

of her employer. The court indicated, “travelling to and from
work is essential to the performance of an employee’s duties
and is reasonably necessary for that purpose.” Id. at 940.
The court held that the employee was entitled to workers’
compensation benefits even though her shift was over.
A long line of Florida cases describe how an employee,
though not actively working, is still entitled to workers’
compensation benefits if that employee (1) is about to begin
work or has just finished their duties; (2) is preparing to
begin work or leave for the day; and (3) is injured on the
12

premises of the employer. See City of St. Petersburg

v.

Cashman, 71 So. 2d 733 (Fla. 1954)(an injury is deemed to have
occurred in the course of employment if it is sustained by a
workman, on an employer’s premises while preparing to begin a
day’s work or while doing other acts which are preparatory or
incidental

to

performance

of

his

duties,

and

which

are

reasonably necessary for such purpose); Doctor’s Business
Serv., Inc. v. Clark, 498 So. 2d 659 (Fla 1st DCA 1986)(the
course of employment, for employees having a fixed time and
place of work, embraces a reasonable interval before and after
working hours while the employee is on the premises engaged in
preparatory or incidental acts); Johns v. State, 485 So. 2d
857 (Fla. 1st DCA 1986)(an employee going to and from work
while on the premises where his work is to be performed and
within a reasonable time before and after working hours is
presumed to be in the course and scope of his employment).
Here, Gafford’s shift ended at or around 7:30 p.m., and
her injury happened on the premises of the Garden at or around
7:40 p.m.

Ohio Casualty contends that, under any reasonable

interpretation of Florida workers’ compensation law, the Court
must find that Gafford’s injury of tripping on the way to her
car after completing her shift falls under the worker’s
compensation statute.
13

Gafford, on the other hand, argues that her actions of
(1) buying milk and an onion from the Garden and (2) having a
social conversation with Touchston remove her injury from
within the parameters of the workers’ compensation statute.
She argues that her actions of shopping and conversing are a
“significant deviation” operating like an “intervening cause”
that “broke the scope and course chain of performing actions
incidental to employment and in furtherance of the employer’s
business interest.” (Doc. # 28 at 9).
Gafford cites a number of inapposite cases in support of
her

position.

She particularly relies upon Gray v. E.

Airlines, Inc., 475 So. 2d 1288 (Fla. 1st DCA 1985), where the
court found an off-duty flight attendant was entitled to
workers’ compensation when he was injured at a YMCA while
playing basketball.

The Court indicated that activities such

as playing sports, taking breaks, and buying food and drinks
at a store did not constitute a personal errand (in the case
of an employee “whose work entails travel away from the
employer’s premises), so as to remove the injury from the
ambit of the workers’ compensation statute. Id. at 1290.

In

this case, the record does not reflect that Gafford’s work
required her to leave the premises of the Garden.
Gafford also relies upon Aloff v. Neff-Harmon, Inc., 463
14

So. 2d 291 (Fla. 1st DCA 1985).
inapposite.

This case is also factually

There, a cocktail waitress was raped, assaulted,

and robbed by five armed assailants at 4:00 a.m.

Id. at 293.

Her shifted ended at or around 2:00 a.m. that morning and she
was “expected by the owner” to leave the bar by 2:30 a.m. Id.
at 292.

It was the normal procedure for all of the cocktail

waitresses to leave together, however, the plaintiff, a lone
waitress, was asked to stay behind by her manager, who was
also her “personal friend.” Id.
In that case, the trial court’s entry of summary judgment
was reversed so that a jury could determine whether her claims
should be limited to workers’ compensation because there was
an issue of fact as to whether she was acting within the scope
of her employer at the time of her injury, which occurred over
two hours after the end of her shift. Id. at 294.

See also

American Legion v. Gailey, 498 So. 2d 1321, 1322 (Fla. 1st DCA
1985)(bartender not entitled to workers’ compensation when,
two

hours

after

his

shift

and

after

consuming

two

complimentary beers and then consuming two Scotch whisky
drinks that he paid for as a normal customer, he was injured
in a bar brawl).

In contrast, Gafford suffered her injury

between ten to fifteen minutes after the end of her shift.
If the Court were sitting as the trier of fact, it would
15

likely conclude that Gafford’s claim falls under the Policy
Exclusion stating: “This insurance does not apply to: Workers’
Compensation.”

However, Florida case law indicates that the

issue of “[w]hether an injured workman is an employee whose
injury arise out of and in the scope of his employment is
ordinarily a question of fact to be decided by the trier of
fact, be that judge, jury, or deputy commissioner.” Grady v.
Humana, Inc., 449 So. 2d 984, 985 (Fla. 1st DCA 1984); see
also Rogers v. Barrett, 46 So. 2d 490 (Fla. 1950).

In

addition, Gafford has cast some doubt on whether her injury
arose from the scope of her employment because, after working,
she shopped and engaged in a social conversation.

With a

potential dispute as to this issue, the Court will not reach
a finding as to whether her claims are workers’ compensation
claims.

However, summary judgment in favor of Ohio Casualty

is still appropriate under the Employer Liability Policy
Exclusion.
C.

The Employer Liability Policy Exclusion

The Florida Supreme Court has held that in the context of
Commercial General Liability Policies, such as the Garden’s
Policy, the term “arising out of” should be read broadly and
requires only “some causal connection, some relationship.”
Taurus Holdings, Inc. v. U.S. Fid. & Guar. Co., 913 So. 2d
16

528, 539-40 (Fla. 2005).
The reasoning underlying this broad interpretation of
employer’s liability exclusions like the one here is the
purpose of the exclusion-–the only coverage intended, and the
only coverage for which a premium has been paid, is for
liability to the public as opposed to liability to the
insured’s employees. Fla. Ins. Guar. Ass’n v. Revoredo, 698
So. 2d 890, 892 (Fla. 3d DCA 1997).

As stated in Sinni v.

Scottsdale Ins. Co., 676 F. Supp. 2d 1319, 1333 (M.D. Fla.
2009), “[A]n employer’s liability exclusion for bodily injury
to

an

employee

‘arising

out

of

and

in

the

course

of

employment’ encompasses claims that are potentially broader
than workers’ compensation obligation and may only have a
limited causal relationship to employment.”
In

the

case

of

Gafford’s

injuries,

irrespective

of

whether Gafford’s injuries amounted to an obligation under
Florida’s

workers’

compensation

statute,

the

Employer

Liability Exclusion in the Policy precludes coverage because
Gafford’s injury has at least a “limited causal relationship
to employment.” Id.

Gafford was injured when she tripped on

a pothole and uneven pavement in the parking lot on her
employer’s premises within fifteen
of her shift.

minutes of the completion

This factual scenario fits squarely within the
17

broad reading of the Employer Liability Policy Exclusion’s
“arising out of language,” especially because that Exclusion
only requires that the injury “arise out of performing duties
related to the conduct of the insured’s business.”
Other courts have construed similar exclusions found in
Commercial General Liability Policies under the circumstances
of injuries sustained after leaving work for the day.

See

Scottsdale Ins. Co. v. GFM Operations, Inc., Case No. 10-cv20204, 2011 U.S. Dist. LEXIS 39696 (S.D. Fla. Apr. 12,
2011)(finding exclusion in General Commercial Liability Policy
precluded coverage for employee who was shot on the employer’s
premises on the way to his car, but after performing a
“personal task”); Sinni, 676 F. Supp. 2d at 1333 (holding
exclusion precluded coverage for employee who slipped and fell
on pathway to parking lot after finishing work).
The Court determines that Gafford’s injuries are likely
covered under the Workers’ Compensation Policy Exclusion and
are certainly covered under the Employer’s Liability Policy
Exclusion and therefore, the Court grants Ohio Casualty’s
Motion for Summary Judgment (Doc. # 22). However, the Court’s
analysis does not end here.

Also before the Court is Ohio

Casualty’s Motion for Partial Summary Judgment as to Gafford’s
Estoppel and Waiver Affirmative Defenses.
18

D.

Estoppel and Waiver

Based on common law as well as Florida Statute Section
627.426 (the claims administration statute), and Florida
Statute Section 627.4137 (the insurance disclosure statute),
Gafford asserts several variations on the affirmative defenses
of estoppel and waiver.
1.

(Doc. # 17).

Promissory Estoppel

Court may apply the doctrine of “equitable estoppel to
insurance contracts . . . to prevent a forfeiture of insurance
coverage,

but

not

[to]

affirmatively

create

or

extend

coverage” where such coverage does not exist. Crown Life Ins.
Co. v. McBride, 517 So. 2d 660, 661-62 (Fla. 1987).

On the

other hand, the Court may utilize promissory estoppel “to
create insurance coverage where to refuse to do so would
sanction fraud or other injustice.” Id. at 662.
Since the Court determines that the Employer’s Liability
Policy Exclusion applies, the Court will consider the elements
of promissory estoppel, rather than equitable estoppel. “Under
the doctrine of promissory estoppel, a party is estopped from
denying liability where that party makes a promise which it
should reasonably expect to induce action or forbearance of a
definite and substantial character on the part of the promisee
and which does induce such action or forbearance and injustice
19

can be avoided only by enforcement of the promise.” Centimark
Corp. v. Gonzalez, 10 So. 3d 644, 645 (Fla. 1st DCA 2009).
The Florida Supreme Court has characterized promissory
estoppel as a “very narrow exception” to the general rule, and
to create insurance coverage under the doctrine of promissory
estoppel, the elements of promissory estoppel must be proved
by clear and convincing evidence. AIU Ins. Co. v. Block Marina
Inv., Inc., 544 So. 2d 998, 1000 n.1 (Fla. 1989).
In addition, the doctrine of promissory estoppel may be
asserted by third parties to an insurance contract, such as
Gafford,

only

under

a

narrow

set

of

circumstances.

For

example, in Masonry v. Miller Constr., 558 So. 2d 433, 434
(Fla. 1st DCA 1990), Liberty Mutual provided Masonry, a
subcontractor, with workers’ compensation coverage. Id. at
434. Liberty Mutual cancelled the policy due to nonpayment of
premiums, but mistakenly sent a renewal policy to Masonry.
Id.

Masonry

presented

the

renewal

policy

to

Miller

Construction, a general contractor, as proof of workers’
compensation insurance (even though no such coverage existed).
Id. Thereafter, a Masonry worker was injured on the job. Id.
Miller Construction’s workers’ compensation carrier paid the
injured

worker

for

his

injures

and

sought

and

obtained

reimbursement from Liberty Mutual on the ground that Liberty
20

Mutual should be estopped from denying coverage under an
erroneously issued policy. Id.

Liberty Mutual appealed and

argued that Miller could not argue estoppel because the
representation of insurance coverage (albeit erroneous) was
made to Masonry.
On

appeal,

the

court

held

that

third

parties

who

detrimentally rely on an insurer’s false representations may
assert estoppel.

In so holding, the court did not permit

Miller to assert estoppel because Miller was prejudiced by
Masonry’s reliance on the false representation of coverage.
Rather, the Court zeroed in on the fact that Miller personally
relied

to

its

detriment

on

Liberty

Mutual’s

erroneous

representation of coverage.
Although Gafford has been given ample opportunity, she
has failed to submit to the Court evidence of a clear and
convincing nature supporting her estoppel arguments. Although
she vaguely claims in her affidavit that she spoke to someone
who stated she would be covered, Gafford never identified the
nameless person she allegedly spoke to about the Garden’s
insurance Policy and fails to indicate the date of the call.
In addition, Gafford has not supplied the Court with evidence
that Ohio Casualty paid any medical bills in excess of
$10,000.00 under its no-fault provision (as opposed to the
21

$1,000,000.00 liability limits). Thus, she has not identified
a representation (either to the Garden or to her) by Ohio
Casualty or its agents which Ohio Casualty could reasonably
expect to induce action or forbearance and which did induce
such action or forbearance.

Accordingly, her common law

promissory estoppel argument fails.

The Court will now

address whether any failure to comply with Florida insurance
statutes sustain Gafford’s estoppel and waiver arguments.
2.

Florida’s
627.426

Claims

Administration

Statute

§

Gafford urges the Court to find coverage under the ruling
of Florida Municipal Insurance Trust v. Village of Golf, 850
So. 2d 544 (Fla. 4th DCA 2003): an insurer, when the policy
excludes coverage, can be estopped from denying coverage if it
negligently investigates a claim before suit is filed, and the
insured is prejudiced. The Court determines that the facts of
the present case fall outside of the holding above.

There,

the court emphasized, “If an insurer erroneously begins to
carry out these duties [including defense of a claim] and the
insured, as required, relies upon the insurer to the insured’s
detriment, then the insurer should not be able to deny the
coverage to which it earlier acknowledged.” 850 So. 2d at 547.
Gafford has not supplied the Court with any evidence of

22

negligent claims handling on the part of Ohio Casualty and has
not supplied the Court with evidence that Ohio Casualty ever
“acknowledged” coverage for her claim.

To the contrary, the

only documents from Ohio Casualty that are in the Court’s file
are documents in which Ohio Casualty denies coverage for
Gafford’s claim.4
Importantly, the Florida Municipal case appeared to limit
its holding to relief for the insured, as follows: “we clearly
state that the insured must demonstrate that the insurer’s
assumption
insured.

of

the

insured’s

defense

has

prejudiced

the

It is the fact that the insured has been prejudiced

which estops the insurer from denying the indemnity obligation
of the insurance policy.” 850 So. 2d 547.

Here, the insured

is the Garden, and although it is named as a Defendant, it is
a dissolved corporation, and it has not stated a position in
this matter.
Gafford has not presented a plausible theory as to why
the holding in Florida Municipal should be extended to a third
party. In addition, it should be noted that Florida’s claims

4

Ohio Casualty’s representation that $10,000.00 may be
available under the no-fault bodily injury policy for medical
expenses does not constitute an acknowledgment that Gafford’s
injury claims are covered under the Commercial General
Liability Policy in question, with Policy limits of
$1,000,000.00.
23

administration statute, Section 627.426(2), “was not intended
to create or resurrect coverage . . . . where there was no
coverage in the first place.” Block Marina Inv., Inc., 544 So.
2d at 999-1000.5

Further, an insurer’s “failure to comply

with the requirements of [Florida Statute Section 627.426(2)]
will not bar an insurer from disclaiming liability where . .
. the coverage sought is expressly excluded or otherwise
unavailable under the policy or under existing law.” Id. at
1000.
3.

Florida’s
627.4137

Insurance

Disclosure

Statute

§

In a final effort to preclude the entry of summary
judgment in favor of Ohio Casualty, Gafford argues that
coverage should be created by the Court due to a delay on the
part of Ohio Casualty in identifying the specific exclusion,
which appears on the face of the Policy, under which it
ultimately denied coverage.
In June 2008, Ohio Casualty explained that it was denying
coverage (Doc. # 28-7) and in January 2009, Ohio Casualty

5

Florida Statute Section 627.426(2) (a) states, “A
liability insurer shall not be permitted to deny coverage
based on a particular coverage defense unless: (a) Within 30
days after the liability insurer knew or should have known of
the coverage defense, written notice of reservation of rights
to assert a coverage defense is given to the named insured
. . .”
24

clarified, in a letter directed to Gafford’s counsel, that
coverage was denied because Gafford’s injuries were sustained
while working as an employee of the Garden.

Although it took

Ohio Casualty some time to clarify its position as to why
coverage was denied, it should be noted that, at no point in
time (at least as reflected from this Court’s file) did Ohio
Casualty represent to Gafford or to the Garden that Gafford’s
injuries would be covered by the Policy.6
Gafford points to two cases unfavorable to insurers which
are inapposite. See United Auto Ins. Co. v. Rousseau, 682 So.
2d 1229 (Fla. 4th DCA 1996)(policy defense not available to an
insurer that failed to provide a copy of the applicable
insurance policy to a claimant); Figueroa v. U.S. Security
Ins., 664 So. 2d 1130 (Fla. 3d DCA 1995)(insurer, who admitted
coverage, failed to provide a copy of the policy, resulting in
reversal of summary judgment that was issued in favor of the
insurer).

The Court does not have evidence before it showing

that Ohio Casualty failed to tender the Policy upon request or
that

Ohio

Casualty

failed

to

6

make

a

specific

statutory

Gafford’s nebulous affidavit statement that she talked
to an unidentified representative of Ohio Casualty on an
unknown date and that such representative “told me I was
eligible for benefits under the . . . policy” is insufficient
to support her affirmative defenses. (Doc. # 28-3 at ¶ 12).
25

disclosure.
Here, the coverage sought was excluded by a valid Policy
Exclusion, which is unambiguous and appears on the face of the
Policy. Accordingly, and for the reasons stated above, the
Court

rejects

Gafford’s

wavier

and

estoppel

affirmative

defenses.
Accordingly, it is hereby
ORDERED, ADJUDGED, and DECREED:
(1)

Ohio Casualty Insurance Company’s Motion for Partial
Summary Judgment on Sherri Gafford’s Affirmative Defense
of Estoppel (Doc. # 21) is GRANTED.

(2)

Ohio Casualty Insurance Company’s Motion for Summary
Judgment (Doc. # 22) is GRANTED.

(3)

Sherri Gafford’s Cross Motion for Summary Judgment (Doc.
# 28) is DENIED.

(4)

The Clerk is directed to enter Judgment in favor of Ohio
Casualty Insurance Company and against Defendants.

(5)

The Clerk is directed to terminate all pending deadlines
and to CLOSE THE CASE.
DONE and ORDERED in Chambers, in Tampa, Florida, this 2nd

day of September, 2011.

26

Copies:
All Counsel and Parties of Record

27