Stevenson v. Corporation of Lloyd's et al

Filing 8

ORDER: The bankruptcy court's order dismissing Counts I and II of The Trustee's second amended complaint is AFFIRMED. The Clerk is directed to terminate any pending motions as moot and close this case. Signed by Judge James S. Moody, Jr on 2/10/2016. (LN)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION

TRACI K. STEVENSON, as
Chapter 7 Trustee for Nasser Ayyoub
and Wendy Ayyoub,
Appellant,

v.

Case No: 8:15-cv-2745-T-30

CORPORATION OF LLOYD’S, et al.,
Appellees.
________________________________/

ORDER
THIS CAUSE comes before the Court on appeal of the bankruptcy court’s order
dismissing Counts I and II of Trustee Traci K. Stevenson’s second amended complaint
filed in an adversary proceeding against Appellees. 1 Upon review, the Court concludes
that the bankruptcy court’s decision should be affirmed.
The Court has jurisdiction over this appeal pursuant to 28 U.S.C. § 158(a).
STANDARD OF REVIEW
A district court reviews a bankruptcy court’s findings of fact for clear error and
conclusions of law de novo. See In re JLJ, Inc., 988 F.2d 1112, 1116 (11th Cir. 1993).

1

The Trustee’s second amended complaint contained five counts which were dismissed by the bankruptcy
court, but the Trustee only appeals dismissal of Counts I and II.

Similarly, issues related to preclusion, such as the application of res judicata are reviewed
de novo. See In re Piper Aircraft Corp., 244 F.3d 1289, 1295 (11th Cir. 2001).
BACKGROUND
Nasser and Wendy Ayyoub (the “Debtors”) owned a convenience store doing
business as Best for Less Food Mart, Inc. (“Best for Less”) in Apollo Beach, Florida. In
February 2007, the Debtors, through their general lines insurance agent Fernandez
Insurance, Inc. (“Fernandez”), obtained a surplus lines commercial package insurance
policy from Appellees (the “2007 Policy”) to provide coverage for Best for Less.
Fernandez procured the 2007 Policy from Tapco Underwriters, Inc.’s (“Tapco”) surplus
lines agent.
Prior to expiration of the 2007 Policy, Tapco sent Fernandez a quote to renew the
policy, which stated that coverage excluded “punitive” and “liquor” liability claims.
(December 3, 2007 Quote, Appellee’s Tab 1-1). Tapco also sent Fernandez a renewal
notice, which provided that the coverage would be “same as expiring.” (Renewal Notice,
Appellee’s Tab 3-1). The renewal notice instructed that coverage may be bound by faxing
a “binder request.” (Id.). On February 18, 2008, after receiving a second quote from Tapco
substantially similar to the first quote, Fernandez sent a signed “Renewal Binder FAX
Request,” which requested that Tapco bind insurance coverage pursuant to the renewal
offer. 2 (Renewal Binder Fax Request, Appellee’s Tab 3-2; February 18, 2008 Quote,
Appellee’s Tab 1-2).
2

These documents were not attached to the Trustee’s second amended complaint, but were attached to the
first amended complaint. The Trustee argues that the Court cannot consider these documents on appeal because they
were not attached to the second amended complaint, and therefore could not be considered by the bankruptcy court

2

That same day, Tapco sent Fernandez a Binder Invoice (the “Binder”). (Binder,
Appellant’s Tab B, Ex. F). The Binder provided: “Please note that this binder is for
temporary insurance for a twelve-day period. This binder exists on its own terms and
expires on its own terms, no coverage exists thereafter.” (Id.). As part of the renewal
process, Fernandez also sent Tapco a commercial package application (the “Application”)
and premium check, which Tapco received on March 4, 2008. (Application, Appellant’s
Tab B, Ex. D). The Application provided: “I . . . agree that if a policy issued pursuant to
this application, the application shall become part of the policy and any renewal or rewrite
thereof.” (Id.).
On February 28, 2008, while the Binder was in effect, but before the policy had
been officially issued, Best for Less through its employee Osama Ayyoub sold alcohol to
a minor. While intoxicated, the minor was involved in an automobile accident which
resulted in the death of Samuel Garcia. On March 6, 2008, Tapco issued Policy Number
TCN008768 (the “Policy”). The Policy expressly excluded coverage for liquor liability,
including “furnishing alcoholic beverages to a person under the legal drinking age or under
the influence of alcohol.”
On December 15, 2009, the Estate of Samuel Garcia (the “Garcia Estate”) initiated
a civil action against Best for Less, the Debtors, and Osama Ayyoub seeking damages for

on a motion to dismiss. Because these documents are not central to the Court’s resolution of the appeal, the Court
need not decide whether these documents can be considered and refers to them only to provide a thorough discussion
of the background of this case. The Court notes, however, that the Eleventh Circuit has stated, albeit in an unpublished
decision, that “[a] . . . court ruling on a motion to dismiss is not required to disregard documents that the plaintiff
himself filed with his original complaint.” Gross v. White, 340 F. App’x 527, 534 (11th Cir. 2009) (unpublished).

3

Mr. Garcia’s death in Florida state court (the “Garcia lawsuit”). Nasser Ayyoub notified
Appellees of the Garcia lawsuit on December 16, 2009, and sought coverage under the
Policy. Appellees executed a non-waiver agreement, reserving their rights under the Policy
while investigating the claim to determine their obligations. Appellees agreed to provide
Best for Less, the Debtors, and Osama Ayyoub mutually agreeable defense counsel to
defend the Garcia lawsuit pursuant to the reservation of rights.
On March 23, 2010, Appellees filed a declaratory judgment action in the federal
district court for the Middle District of Florida to determine their obligations to defend and
indemnify the defendants in the Garcia lawsuit under the Policy (the “declaratory judgment
lawsuit”). See Certain Underwriters at Lloyd’s, London v. Best for Less Food Mart, Inc.,
No. 8:10-cv-688-T-30AEP (M.D. Fla. Mar. 23, 2010). The defendants failed to answer or
otherwise appear in the case and a clerk’s default was entered against them. On June 21,
2010, this Court entered an order granting default judgment in favor of Appellees and
concluding that Appellees owed no duty to defend Best for Less, the Debtors, or Osama
Ayyoub in the Garcia lawsuit.
Because the Garcia Estate had answered the complaint for declaratory judgment,
Appellees moved for summary judgment. Summary judgment was entered in favor of
Appellees because the Court concluded that the Policy’s liquor liability exclusion barred
coverage for the Garcia lawsuit as a matter of law. Therefore, the Appellees did not owe

4

any duty to defend or indemnify Best for Less, the Debtors, or Osama Ayyoub in the Garcia
lawsuit. The case was closed on August 23, 2010. 3
Appellees advised Best for Less, the Debtors, and Osama Ayyoub that they were
withdrawing their defense in the Garcia lawsuit. Appellees’ counsel moved to withdraw,
and unopposed, the state court granted the motion. On February 22, 2011, the state court
entered summary judgment against Best for Less, the Debtors, and Osama Ayyoub, finding
that each defendant was liable for the “willful and wanton sale of alcohol to a minor in
violation of Florida law resulting in the direct and proximate cause of the fatal injuries to
Samuel Garcia III.” Following a jury trial on damages, the jury awarded the Garcia Estate
damages apportioned as follows: (1) $35,823,605.05 against Best for Less, (2)
$250,765,235.35 against Nasser Ayyoub, (3) $35,823,605.05 against Wendy Ayyoub, and
(4) $143,294,420.20 against Osama Ayyoub.
In December 2013, the Trustee filed an adversary proceeding in the bankruptcy
court against Appellees seeking damages as a result of the judgment entered against the
Debtors, their business, and their employee in the Garcia lawsuit. After the Trustee’s first
amended complaint was dismissed, the Trustee filed a second amended complaint. In
Count I, the Trustee asserted that Appellees breached the Binder/Application (the Trustee
collectively refers to these documents as a “confirmation of insurance”), which the Trustee
contends provided coverage for the Garcia lawsuit separate and apart from the Policy. In
Count II, the Trustee asserted that Appellees violated their fiduciary duty to the Debtors by
3

On January 28, 2015, Appellant moved to vacate the default judgment pursuant to Federal Rule of Civil
Procedure 60(b)(4) arguing that the judgment was void because the Court lacked jurisdiction to entertain the claim for
declaratory judgment. The motion was denied.

5

failing to provide conflict free counsel to each of the defendants in the Garcia lawsuit prior
to their withdrawal of a defense.
Appellees moved to dismiss the second amended complaint, and on September 24,
2015, the bankruptcy court announced in a bench ruling that it was dismissing the second
amended complaint with prejudice, concluding that as to Counts I and II the
Application/Binder merged into the Policy and incorporated its terms, conditions, and
exclusions, and there was no other agreement between the parties. Finding that the Policy
was the controlling agreement, the bankruptcy court concluded that Counts I and II were
precluded under the doctrine of collateral estoppel based on the final decision rendered in
the declaratory judgment lawsuit. This appeal ensued.
DISCUSSION
I. Dismissal of Count I
The Trustee asserts that the bankruptcy court erred in concluding that the
Application/Binder, which the Trustee contends provided insurance coverage on its own
terms separate and apart from the Policy, merged with the Policy such that the terms of the
Policy applied to determine whether coverage existed for the Garcia lawsuit. Because the
bankruptcy court found that the Trustee failed to demonstrate that the Application/Binder
was an insurance contract separate and apart from the Policy, the bankruptcy court
concluded that the Trustee’s breach of contract claim was precluded by the doctrine of
collateral estoppel based on the final judgment rendered in the declaratory judgment
lawsuit. Although the Court is inclined to agree with the bankruptcy court’s conclusion in
this regard, the Court need not reach the merits of the bankruptcy court’s decision because
6

the Trustee’s breach of contract claim under Count I is precluded by the doctrine of res
judicata and the compulsory counterclaim rule. 4
Because the declaratory judgment lawsuit was filed and adjudicated in the Middle
District of Florida, the preclusive effect of that judgment is governed by Florida law. See
Semtek Int’l Inc. v. Lockheed Martin Corp., 531 U.S. 497, 508 (2001) (holding that “federal
common law governs the claim-preclusive effect of a dismissal by a federal court sitting in
diversity” and “adopting, as the federally prescribed rule of decision, the law that would
be applied by state courts in the State in which the federal diversity court sits”); see also
Taylor v. Sturgell, 553 U.S. 880, 891 n.4 (2008) (“For judgments in diversity cases, federal
law incorporates the rules of preclusion applied by the State in which the rendering court
sits.”). 5
The doctrine of res judicata (which is used in the present case to describe generally
the preclusive effect of a prior judgment) “is founded upon the sound proposition that there
should be an end to litigation and that in the interest of the State every justiciable
controversy should be settled in one action in order that the courts and the parties will not

4
The Court can “affirm the judgment of the [lower] court on any ground supported by the record, regardless
of whether that ground was relied upon or even considered by the [lower] court.” Kernel Records Oy v. Mosley, 694
F.3d 1294, 1309 (11th Cir. 2012); see also Fishermen Against Destruction of Env’t, Inc. v. Closter Farms, Inc., 300
F.3d 1294, 1296-97 (11th Cir. 2002) (noting that a lower court’s decision can be affirmed based “on any adequate
ground, even if it is other than the one on which the court actually relied” (internal quotation marks omitted)).
5
The Trustee asserts the declaratory judgment exception to the doctrine of res judicata applies. (Reply Br. at
14). However, the Trustee relies on law from the Eleventh Circuit applying federal preclusion principles instead of
Florida preclusion principles. Although the Eleventh Circuit has noted that Florida law and federal law regarding the
preclusive effect of prior judgments are “largely identical,” SFM Holdings, Ltd. v. Banc of Am. Secs., LLC, 764 F.3d
1327, 1336-37 (11th Cir. 2014), Florida does not recognize the declaratory judgment exception to the doctrine of res
judicata, and instead, the Florida Supreme Court has held that “a declaratory judgment is res judicata of all matters at
issue between the parties and their privies.” Canal Ins. Co. v. Reed, 666 So. 2d 888, 891 (Fla. 1996).

7

be pothered for the same cause by interminable litigation.” Gordon v. Gordon, 59 So. 2d
40, 44 (Fla. 1952). The doctrine applies under Florida law “when all four of the following
conditions are present: (1) identity of the thing sued for; (2) identity of the cause of action;
(3) identity of persons and parties to the action; and (4) identity of quality in persons for or
against whom claim is made.” Fla. Bar v. Rodriguez, 959 So. 2d 150, 158 (Fla. 2007)
(internal quotation marks omitted).
At issue in the present case is whether there is identity of the causes of action.
Generally, “‘[i]dentity of the causes of action is established where the facts which are
required to maintain both actions are identical.’” Gold v. Bankier, 840 So. 2d 395, 397
(Fla. 4th DCA 2003) (quoting Cole v. First Dev. Corp. of Am., 339 So.2d 1130, 1131 (Fla.
2d DCA 1976) (citing Gordon, 36 So. 2d at 776)). But the Florida Supreme Court has also
applied a transactional test in res judicata cases to determine identity of the causes of action.
See Tyson v. Viacom, Inc., 890 So. 2d 1205, 1214 (Fla. 4th DCA 2005) (Gross, J.,
concurring); Leahy v. Batmasian, 960 So. 2d 14, 17 (Fla. 4th DCA 2007).
Under the transactional test, there is an identity of the cause of action not only as
to every question which was decided in an earlier lawsuit, but “also as to every other matter
which the parties might have litigated and had determined, within the issues as [framed]
by the pleadings or as incident to or essentially connected with the subject-matter” of the
first litigation. Hay v. Salisbury, 109 So. 617, 621 (1926). “This rule applies to every
question falling within the purview of the original action, both in respect to matters of claim
and defense, which could have been presented by the exercise of due diligence.” Id.

8

In the declaratory judgment lawsuit, the issue as framed by the pleadings was
whether Appellees had a duty to defend and indemnify the Debtors in the Garcia lawsuit.
Although the declaratory judgment lawsuit looked specifically at whether such a duty arose
pursuant to the Policy, the Application and Binder were part of the process used in
ultimately obtaining the Policy. To the extent Debtors believed that the Application/Binder
provided coverage for the Garcia lawsuit separate from the Policy, that question should
have been raised as a defense or as a separate counterclaim in the declaratory judgment
lawsuit. This claim—that the Binder/Application provided coverage for the Garcia lawsuit
such that Appellees had a duty to defend and indemnify the Debtors in that cause of
action—was essentially connected to the subject matter of the declaratory judgment lawsuit
such that the Debtor’s failure to raise it precludes subsequent litigation of that claim. The
Trustee cannot argue in good faith that the Debtors lacked the facts necessary at the time
of the declaratory judgment action to assert this defense or claim.
Under the facts of this case, it would be manifestly unjust to allow the Trustee to
relitigate, years after the fact, the question already answered in the declaratory judgment
lawsuit—whether Appellees had a duty to defend or indemnify the Debtors in the Garcia
lawsuit. Had the Debtors asserted their right to receive a defense and indemnification from
Appellees in the declaratory judgment lawsuit based on the Application/Binder theory, that
argument would go to the same issue raised by the Appellees: whether coverage existed
for the Garcia lawsuit. A finding in favor of the Debtors on that issue would have prevented
the relief requested by Appellees in the declaratory judgment lawsuit—a declaration that

9

Appellees did not owe the Debtors a duty to defend and indemnify them in the Garcia
lawsuit.
Even if the Trustee’s claim had not satisfied the transactional test such that it was
precluded by res judicata, the claim would still be waived as a compulsory counterclaim
that should have been asserted in the declaratory judgment lawsuit. Florida law provides
that the failure to bring a compulsory counterclaim precludes a subsequent lawsuit on that
claim. See Inter-Active Servs., Inc. v. Heathrow Master Ass’n, Inc., 809 So. 2d 900, 904
(Fla. 5th DCA 2002); Fla. R. Civ. P. 1.170(a). Specifically, Florida Rule of Civil Procedure
1.170(a) instructs: “A pleading shall state as a counterclaim any claim which at the time of
serving the pleading the pleader has against any opposing party, provided it arises out of
the transaction or occurrence that is the subject matter of the opposing party’s claim.” 6
Among other considerations, a claim is part of the same transaction or occurrence
such that it is compulsory if there is a logical relationship between the claim and the
counterclaim. See Londono v. Turkey Creek, Inc., 609 So. 2d 14, 20 (Fla. 1992).
“[A] claim has a logical relationship to the original claim if it arises out of
the same aggregate of operative facts as the original claim in two senses: (1)
that the same aggregate of operative facts serves as the basis of both claims;
or (2) that the aggregate core of facts upon which the original claim rests
activates additional legal rights in a party defendant that would otherwise
remain dormant.”
Id. (quoting Neil v. S. Fla. Auto Painters, Inc., 397 So. 2d 1160, 1164 (Fla. 3d DCA 1981)).
In Florida, the “aggregate of operative facts” that can serve as a basis for a compulsory

6

Florida’s rule governing compulsory counterclaims is modeled after the federal rule. See Fed. R. Civ. P
13(a). Because the law governing compulsory counterclaims is the same under federal and Florida law, the Court
need not specifically determine which rule applies, and will refer to both federal and Florida law addressing
compulsory counterclaims.

10

counterclaim has been broadly construed because the rule “is designed to foreclose the
possibility of duplicative litigation . . . . [and] Florida courts encourage a ‘broad, realistic
interpretation of the rule.’” Puff ‘N Stuff of Winter Park, Inc. v. Fed. Trust Bank, F.S.B.,
945 F. Supp. 1523, 1530 (M.D. Fla. 1996) (quoting Montgomery Ward Dev. Corp. v.
Juster, 932 F.2d 1378, 1381 (11th Cir. 1991)). “The hallmark of this approach is its
flexibility.” Plant v. Blazer Fin. Servs., Inc. of Ga., 598 F.2d 1357, 1361 (5th Cir. 1979)
(internal quotation marks omitted). 7
Here, the Trustee’s claim arises out of the same transaction and occurrence that was
the subject matter of the declaratory judgment action—i.e., whether Appellees were
required to defend and indemnify the Debtors in the Garcia lawsuit—because it arises out
of the same aggregate of operative facts. Cf. Educ. Mgmt., Inc. v. Scottsdale Ins. Co., 264
F. App’x 376, 377 (5th Cir. 2008) (concluding that a claim that coverage arose under a
different policy was a compulsory counterclaim and precluded from being raised in
subsequent litigation where the party failed to raise the claim in a prior declaratory
judgment action regarding the issue of insurance coverage under a different policy).
Nothing prevented the Debtors from seeking coverage under this Application/Binder
theory in the declaratory judgment lawsuit.
The Trustee argues that the breach of contract claim is not waived as a compulsory
counterclaim because the claim was not mature at the time the declaratory judgment lawsuit
was filed. According to the Trustee, the claim did not mature until Appellees breached the
7

In Bonner v. City of Pritchard, 661 F.2d 1206, 1207 (11th Cir. 1981) (en banc), the Eleventh Circuit adopted
as precedent the decisions of the former Fifth Circuit rendered prior to October 1, 1981.

11

Application/Binder by withdrawing their defense in the Garcia lawsuit following the final
decision in the declaratory judgment lawsuit. The Trustee’s assertion is based on an overly
strict interpretation of the compulsory counterclaim rule.
Currently, the Trustee asserts a claim for breach of contract. For the Trustee to
succeed on a breach of contract claim under Florida law, the Trustee must demonstrate: (1)
the existence of a contract under the Application/Binder providing coverage for the Garcia
lawsuit, (2) breach of that contract, and (3) damages. Cf. Beck v. Lazard Freres & Co.,
175 F.3d 913, 914 (11th Cir. 1999) (applying Florida law). But if the Debtors had
counterclaimed for declaratory judgment in the declaratory judgment lawsuit based on the
Application/Binder theory of coverage, the Debtors would have been required to
demonstrate a right to coverage which would have in turn required them to demonstrate
the existence of a contract under the Application/Binder. See Tindall v. Allstate Ins. Co.,
472 So. 2d 1291, 1292 (Fla. 2d DCA 1985) (“Disagreements concerning coverage under
insurance policies are proper subjects for a declaratory judgment.”).
The essential element required to succeed under an action for declaratory judgment
is the same essential element at issue in the Trustee’s breach of contract claim. In other
words, the breach of contract claim would require resolution of whether the
Application/Binder provided coverage for the Garcia lawsuit, which is the same question
that would have been resolved upon declaratory judgment had the Debtors asserted that
counterclaim in the declaratory judgment lawsuit. Thus, the breach of contract claim has
a logical relationship to the declaratory judgment lawsuit because a claim for declaratory
judgment on the Application/Binder theory was a compulsory counterclaim in that action
12

and resolution of that claim would resolve the essential element of the Trustee’s breach of
contract claim. This interpretation upholds the purpose of the compulsory counterclaim
rule in that it minimizes the litigation and prevents a multiplicity of suits as to the very
same subject matter—whether Appellees had a duty to defend and indemnify the debtors
in the Garcia lawsuit.
The Trustee’s breach of contract claim is precluded from the adversary action
because it is either barred under the doctrine of res judicata or as a compulsory
counterclaim that should have been asserted in the declaratory judgment lawsuit. Although
the bankruptcy court dismissed this claim on different grounds, because the Trustee’s claim
should have been precluded, the bankruptcy court’s dismissal of this claim should be
affirmed.
II. Dismissal of Count II
The Trustee contends that the bankruptcy court erred in dismissing Count II because
Appellees had a duty to provide conflict free counsel during the period Appellees were
defending the Debtors under a reservation of rights regardless of whether it was ultimately
determined that Appellees had no duty to defend or indemnify the Debtors. The Trustee
correctly asserts that where an insurer undertakes to defend a lawsuit on behalf of its
insureds, the insurer owes a fiduciary duty to make decisions regarding the handling of the
litigation in good faith and with due regard for the insureds’ best interests. 8 See Berges v.
Infinity Ins. Co., 896 So. 2d 665, 668-69 (Fla. 2004). Because the Garcia lawsuit was filed
8

The parties contest whether this duty applies where it is found that the insurance policy does not provide
coverage. Because the resolution of this issue is not dispositive, the Court assumes for the purpose of this appeal that
Appellees owed the Debtors a duty of good faith while defending the Debtors pursuant to a reservation of rights.

13

against Best for Less, the Debtors, and Osama Ayyoub, the Trustee argues that in holding
with their fiduciary duty, Appellees were required to appoint counsel for each defendant to
avoid conflicts of interest. Namely, because Florida employs a comparative fault system
which allows for apportionment of fault among all the parties, the Trustee claims that the
Debtors were prejudiced by the assignment of a single defense counsel for all defendants
in the Garcia lawsuit.
The Trustee relies on University of Miami v. Great American Assurance Co., 112
So. 3d 504 (Fla. 3d DCA 2013), for the proposition that Appellees were required to appoint
independent counsel for each defendant in the Garcia lawsuit. But the facts of Great
American differ from the facts of the present case. In Great American, the University of
Miami (“UM”) and MagiCamp were named insureds under an insurance policy issued by
Great American Assurance Co. (“Great American”). Id. at 505. When UM and MagiCamp
were sued for personal injuries covered under the policy, Great American appointed one
law firm to represent both insureds. MagiCamp filed an answer asserting that the injuries
were caused by the fault of UM and requesting apportionment of damages based on the
percentage of fault and requested indemnification and contribution from UM for damages.
UM informed Great American that there was a conflict of interest in single
representation of UM and MagiCamp and requested that Great American appoint UM
independent counsel. Id. at 506. Great American refused taking the position that no
conflict of interest existed. The appellate court concluded that a conflict of interest did
exist because the two insureds had adverse legal theories of defense and counsel would
have been forced to argue conflicting legal positions. Id. at 507-08.
14

Contrary to the Trustee’s assertion, Great American does not stand for the
proposition that the apportionment of fault among defendants creates a conflict of interest. 9
If that were true, there would be a conflict of interest in almost every case where an insurer
appoints counsel to represent multiple parties. 10 That position is simply untenable under
Florida law. The problem in Great American was that the two insureds’ positions were
diametrically opposed in that each insured asserted that the other insured was completely
at fault. The same is not true of the present case. Unlike the insureds in Great American,
the Trustee has not established that the theories of defense relied upon by the defendants
in the Garcia lawsuit were adverse.
Even if the Debtors were entitled to independent counsel, the Trustee has not
demonstrated how the failure to appoint independent counsel resulted in damages to the
Debtors, especially damages for the entirety of the judgment entered against the Debtors.
Appointed counsel withdrew before the issue of apportionment of fault was decided, and
the Trustee has not shown that appointed counsel failed to raise a defense or claim that
would have limited the Debtors’ liability in the Garcia lawsuit
Because the Trustee has not established that a conflict of interest existed, the
Debtors were not entitled to appointment of independent counsel in the Garcia lawsuit and
the bankruptcy court did not err in dismissing Count II.

9
In fact, the court in Great American took great pains to point out that the holding was limited to the unique
facts of that case. Great American, 112 So. 3d at 508.
10
Appellant tries to avoid this consequence by asserting that the duty to appoint counsel for each defendant
would only arise where it appears that damages will be within the policy limits. The addition of this limitation is
unavailing.

15

CONCLUSION
Accordingly, it is therefore ORDERED AND ADJUDGED that:
1.

The bankruptcy court’s order dismissing Counts I and II of The Trustee’s

second amended complaint is AFFIRMED.
2.

The Clerk is directed to terminate any pending motions as moot and close

this case.
DONE and ORDERED in Tampa, Florida, this 10th day of February, 2016.

Copies furnished to:
Counsel/Parties of Record

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