Southern-Owners Insurance Company v. Galati Yacht Sales, LLC et al
Filing
113
ORDER: Plaintiff Southern Owners Insurance Company's Motion for Summary Judgment (Doc. # 93) is DENIED. Defendant Galati Yacht Sales, Inc.'s Motion for Summary Judgment (Doc. # 92) is GRANTED as to the issue of Southern Owners' duty to defend and DENIED as to the issue of Southern Owners' duty to indemnify. Signed by Judge Virginia M. Hernandez Covington on 1/17/2023. (CKW)
Case 8:21-cv-02567-VMC-MRM Document 113 Filed 01/17/23 Page 1 of 24 PageID 4293
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION
SOUTHERN OWNERS INSURANCE
COMPANY,
Plaintiff,
v.
Case No. 8:21-cv-2567-VMC-MRM
GALATI YACHT SALES, LLC,
JEFFCO MARINE SERVICES, INC.,
and JEFFERSON FORAKER,
Defendants.
______________________________/
ORDER
This matter comes before the Court upon consideration of
Plaintiff Southern
Owners Insurance Company’s Motion for
Summary Judgment (Doc. # 93), and Defendant Galati Yacht
Sales, LLC’s Motion for Summary Judgment. (Doc. # 92). Galati
responded
to
Southern
Owners’
Motion
(Doc.
#
100),
and
Southern Owners has replied. (Doc. # 102). Southern Owners
has responded to Galati’s Motion for Summary Judgment. (Doc.
# 99). For the reasons that follow, Southern Owners’ Motion
is denied, and Galati’s Motion is granted to the extent stated
herein.
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I.
Background
This
case
involves
an
insurance
dispute
and
an
underlying tort lawsuit between Jefferson Foraker and Galati.
A. The Parties
Jeffco Marine Services was incorporated under Florida
law on December 22, 2008. (Doc. # 93-2). Mr. Foraker was its
owner and served as its President at all relevant times.
(Id.). Mr. Foraker, through Jeffco, performed services for
Galati from 2007 to 2020. (Doc. # 93-11 at 7:19-21).
In
October
2009,
Jeffco
and
Galati
entered
into
a
Subcontractor Agreement. (Doc. # 93-3). The Subcontractor
Agreement stated that it is “attached to and forms a part of
every work order or change order executed by the parties.”
(Id. at 1). The Subcontractor Agreement also provided that
Galati would be “named as an Additional Insured on all of the
Subcontractor’s
compensation)
policies
and
the
of
insurance
policies
shall
(except
provide
workers
insurance
coverage, on a primary basis, to Galati, and shall not require
Galati’s policies to contribute in the event of a loss.” (Id.
at 2). Payments for Mr. Foraker’s work were always issued to
Jeffco (Doc. # 93-20). Mr. Foraker was compensated by the
job, not by the amount of time he worked (Doc. # 93-11 at
82:21-83:1; Doc. # 93-13). Galati did not provide standard
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employee benefits like health insurance (Doc. # 93-11 at 30:613).
Galati created work orders containing the description of
the work it offered to Jeffco. (Doc. # 93-11 at 23:23-24:7).
Jeffco reviewed the work orders and had a right of first
refusal for all detail work. (Id. at 92:18-93:15). The work
orders
included
tasks
such
as
painting,
detailing,
and
washing boats that were in Galati’s control. (Doc. # 93-13).
Mr. Foraker reviewed the orders every day. (Doc. # 93-11 at
35:9-23). Galati would place the work orders in order of
priority. (Id. at 65:14-19). Mr. Foraker performed the tasks
in the order in which Galati placed the work orders. (Id. at
23-24). Jeffco performed work on boats Galati owned and boats
that belonged to Galati’s customers. (Doc. # 93-14). Galati
dictated the priority of Mr. Foraker’s work each day (Doc. #
93-11 at 65:20-25), and Galati managers and employees “would
look at [his] work when it was completed.” (Id. at 37:10-11).
Jeffco did not secure workers compensation insurance for
2020. (93-5 at 30:12-14). Neither Jeffco nor Mr. Foraker
applied for a Notice of Election to be Exempt through the
Department
of
Financial
Services,
Compensation. (Doc. # 93-4).
3
Division
of
Workers’
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B. The Insurance Policy
Southern Owners issued a Garage Liability Policy (the
“Policy”) to Jeffco that was effective from March 25, 2020,
until March 25, 2021. (Doc. # 93-6). The Policy contains an
Additional Insured Endorsement, stating that Galati is an
additional insured under the Policy “but only with respect to
liability arising out of [Jeffco’s] work for that insured by
or for [Jeffco].” (Doc # 79-1 at 21). The Policy provides
that Southern Owners “will pay those sums that you become
legally obligated to pay as damages because of bodily injury
or property damage to which this insurance applies.” (Id. at
28).
The
Policy
also
contains
an
Employer’s
Liability
exclusion, which excludes from coverage “Bodily injury to:
(a) [a]n employee of any insured arising out of and in the
course of employment by any insured.” (Id. at 32).
Finally, the Policy also contains a Workers Compensation
exclusion, which provides that the insurance policy does not
apply to “[a]ny obligations that would be payable under . .
. worker’s compensation law[.]” (Id. at 30).
C. The Underlying Lawsuit
On October 9, 2020, Galati requested that Mr. Foraker
buff the isinglass of the Red Lion, a yacht owned by one of
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Galati’s customers. (Doc. 93-8 at 4-5). Mr. Foraker was
injured while working on the yacht. (Doc. # 93-5 at 4).
Galati entered into a service agreement with the owner
of the Red Lion. (Doc. # 93-9). The boat was on Galati’s
property as part of that agreement. (Doc. # 93-10 at 99:525, 100:1-6). The isinglass was not mentioned in the service
agreement. See (Doc. # 93-9) (detailing service work to be
provided). Instead, after the service work was complete, the
Red
Lion’s
captain
“report[ed]”
that
the
isinglass
was
scratched. (Doc. # 93-10 at 90:20). “[T]o make it go away,”
Galati chose to fix the scratch. (Id.). When asked if the
“captain basically asked Galati to take care of” the scratch,
Mike Galati (Galati’s corporate representative) responded,
“No. I think the captain was reporting [the scratch].” (Id.
at 90:25-91:2). The purchase order issued for Jeffco’s work
shows that it was billed as an internal work order and that
no customer was charged. (Doc. # 93-19; Doc. # 93-10 at 89:1320).
On August 19, 2021, Mr. Foraker sued Galati in Florida
state court for negligence (the “Underlying Lawsuit”). (Doc.
# 93-7). In his Underlying Complaint, Mr. Foraker alleged
that, through his business, Jeffco Marine Services, Inc., he
performed marine detailing work for Galati as a contractor.
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(Id. at 1-2). Mr. Foraker alleges he was injured doing exactly
the work he agreed to perform for Galati. See (Id. at ¶ 16)
(“While
Plaintiff
was
performing
work
under
Defendant’s
orders, at the direction of Defendant, and on the vessel ‘Red
Lion’ which was under Defendant’s ownership or control, he
slipped
and
fell
from
the
top
of
the
tower/ladder”).
Specifically, he alleged that he slipped due to the shoe
coverings Galati required him to wear. (Id. at 3).
The
parties’ memoranda indicate that the Underlying Lawsuit is
still open and active.
Pursuant to the Additional Insured clause in the Policy,
Galati sought a defense and indemnification from Southern
Owners in the Underlying Lawsuit. (Id. at ¶¶ 15, 17).
D. The Instant Complaint and Counterclaim
In its second amended complaint, Southern Owners seeks
a
declaratory
judgment
on
three
points.
First,
Southern
Owners claims that the allegations in the Underlying Lawsuit
arise out of Galati’s general business practices and thus are
excluded from coverage under the plain language of the Policy.
(Doc. # 79-1 at 5-6). Second, it argues that the Employer’s
Liability
exclusion
serves
to
bar
coverage
because
Mr.
Foraker was Jeffco’s employee, Mr. Foraker was acting in the
scope of his employment when he was injured, and Mr. Foraker
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was
thus
either
Galati’s
“statutory
employee”
or
actual
employee for purposes of Policy coverage. (Id. at 6-7). Third,
Southern
Owners
alleges
that
the
Worker’s
Compensation
exclusion bars coverage because Mr. Foraker was injured while
performing
work
requested
by
Galati,
Mr.
Foraker
was
therefore Galati’s statutory or actual employee, and Galati
is liable under Florida’s workers compensation law to Mr.
Foraker. (Id. at 8-9).
Furthermore,
Southern
Owners
seeks
a
declaratory
judgment that (1) the Policy does not provide insurance
coverage for the claims alleged in the Underlying Suit or any
and all other claims arising from the incident that occurred
on October 9, 2020; and (2) that Southern Owners has no duty
to defend or indemnify Galati for any and all claims alleged
in the Underlying Suit or any and all other claims arising
from the incident that occurred on October 9, 2020. (Id. at
6, 7-8, 9).
The parties now both seek entry of summary judgment in
their favor. (Doc. ## 92, 93). Each party has responded (Doc.
## 99, 100) and Southern Owners has replied. (Doc. # 102).
The Motions are ripe for review.
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II.
Legal Standard
Summary judgment is appropriate “if the movant shows
that there is no genuine dispute as to any material fact and
the movant is entitled to judgment as a matter of law.” Fed.
R. Civ. P. 56(a). A factual dispute alone is not enough to
defeat a properly pled motion for summary judgment; only the
existence of a genuine issue of material fact will preclude
a grant of summary judgment. Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 247–48 (1986).
An issue is genuine if the evidence is such that a
reasonable jury could return a verdict for the non-moving
party. Mize v. Jefferson City Bd. of Educ., 93 F.3d 739, 742
(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 moving party bears the initial burden of showing
the court, by reference to materials on file, that there are
no genuine issues of material fact that should be decided at
trial. Hickson Corp. v. N. Crossarm Co., 357 F.3d 1256, 1260
(11th Cir. 2004) (citing Celotex Corp. v. Catrett, 477 U.S.
317, 323 (1986)). “When a moving party has discharged its
burden,
the
non-moving
party
8
must
then
‘go
beyond
the
Case 8:21-cv-02567-VMC-MRM Document 113 Filed 01/17/23 Page 9 of 24 PageID 4301
pleadings,’ and by its own affidavits, or by ‘depositions,
answers
to
interrogatories,
and
admissions
on
file,’
designate specific facts showing that there is a genuine issue
for trial.” Jeffery v. Sarasota White Sox, Inc., 64 F.3d 590,
593–94 (11th Cir. 1995) (quoting Celotex, 477 U.S. at 324).
If there is a conflict between the parties’ allegations
or evidence, the non-moving party’s evidence is presumed to
be true and all reasonable inferences must be drawn in the
non-moving party’s favor. Shotz v. City of Plantation, 344
F.3d 1161, 1164 (11th Cir. 2003). If a reasonable fact finder
evaluating the evidence could draw more than one inference
from the facts, and if that inference introduces a genuine
issue of material fact, the court should not grant summary
judgment. Samples ex rel. Samples v. City of Atlanta, 846
F.2d 1328, 1330 (11th Cir. 1988). But, if the non-movant’s
response consists of nothing “more than a repetition of his
conclusional
allegations,”
summary
judgment
is
not
only
proper, but required. Morris v. Ross, 663 F.2d 1032, 1034
(11th Cir. 1981).
Finally,
the
filing
of
cross-motions
for
summary
judgment does not give rise to any presumption that no genuine
issues of material fact exist. Rather, “[c]ross-motions must
be considered separately, as each movant bears the burden of
9
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establishing that no genuine issue of material fact exists
and that it is entitled to judgment as a matter of law.” Shaw
Constructors v. ICF Kaiser Eng’rs, Inc., 395 F.3d 533, 53839 (5th Cir. 2004); see also United States v. Oakley, 744
F.2d 1553, 1555 (11th Cir. 1984) (“Cross-motions for summary
judgment
will
not,
granting
summary
in
themselves,
judgment
unless
warrant
one
of
the
the
court
in
parties
is
entitled to judgment as a matter of law on facts that are not
genuinely disputed[.]” (citation omitted)).
III. Analysis
At the outset, the Court notes that both parties failed
to follow the requirements the Court laid out in its order
regarding summary judgment briefing. (Doc. # 33). In its
“Statement of Material Facts” section, Galati failed to list
each material fact in separate, numbered paragraphs. See (Id.
at 1) (“The statement of material facts must list each
material fact alleged not to be disputed in separate, numbered
paragraphs.”).
For
its
part,
Southern
Owners
failed
to
include evidence in its statement of material facts that is
material and that it references at several points in its
Motion. The Court is not required to consider this evidence.
See (Id. at 3) (“When resolving a motion for summary judgment,
the Court has no independent duty to search and consider any
10
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part of the record not otherwise referenced and pinpoint cited
in the statement of material facts and response thereto.”).
Several times, both parties cite to record evidence that does
not relate to the material fact it supposedly supports.
The Court now turns to the merits of the Motions.
A. Southern-Owner’s Motion for Summary Judgment
Southern Owners moves for summary judgment on the basis
that three exclusions in the Policy bar coverage for Mr.
Foraker’s
claim.
Employer’s
apply
First,
Liability
because
Mr.
and
Southern
Workers
Foraker
is
Owners
argues
Compensation
either
Galati’s
that
the
exclusions
statutory
employee or its actual employee. (Doc. # 93 at 14-25). Second,
it
argues
that
the
Additional
Insured
clause
prevents
coverage because Galati’s “general business practice” of
requiring shoe coverings – not Mr. Foraker’s work for Galati
– caused the accident. (Id. at 25-26).
1. Additional Insured Clause
Southern Owners argues that Galati is not an Additional
Insured for Mr. Foraker’s claims. The Additional Insured
clause states that Galati is an Additional Insured under the
Policy “but only with respect to liability arising out of
[Jeffco’s] work for that insured by or for [Jeffco].” (Doc.
# 79-1 at 72). Southern Owners contends that liability arises
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from Galati’s business practice of requiring workers to wear
shoe coverings on boats, “not because of Jeffco’s scope of
work.” (Doc. # 93 at 25).
In
a
diversity
substantive
law
of
action,
the
the
forum
Court
must
state.”
apply
Tech.
“the
Coating
Applicators, Inc. v. U.S. Fid. & Guar. Co., 157 F.3d 843, 844
(11th Cir. 1998). Here, Florida law governs whether Southern
Owners owes Galati a duty to defend and indemnify against Mr.
Foraker’s claims. Under Florida law, the terms used in an
insurance contract are given their ordinary meaning, and the
policy must be construed as a whole “to give every provision
its full meaning and operative effect.” Auto-Owners Ins. Co.
v. Anderson, 756 So. 2d 29, 34 (Fla. 2000). An unambiguous
policy provision is “enforced according to its terms whether
it is a basic policy provision or an exclusionary provision.”
Hagen v. Aetna Cas. & Sur. Co., 675 So. 2d 963, 965 (Fla. 5th
DCA 1996).
Southern
Owners
cites
Great
American
Insurance
v.
National Union Fire Insurance Company, 574 F. Supp. 2d 1294
(S.D. Fla. July 7, 2008), to support its contention that Mr.
Foraker’s injuries do not arise out of his work for Galati.
(Doc. # 93 at 25-26). In Great American, the court determined
that the contractor was not covered as an additional insured
12
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when the subcontractor was injured while doing work outside
the scope of the subcontracting agreement. Great Am., 574 F.
Supp. 2d at 1299. That case can be distinguished from the
case at bar. Here, Mr. Foraker alleges he was injured doing
exactly the work he agreed to perform for Galati. See (Doc.
# 93-7 at ¶ 16) (“While Plaintiff was performing work under
Defendant’s orders, at the direction of Defendant, and on the
vessel ‘Red Lion’ which was under Defendant’s ownership or
control,
he
slipped
and
fell
from
the
top
of
the
tower/ladder”); see also (Doc. # 93-10 at 90:4-7) (“I know
Dan and Mike talked about it, . . . and Mike didn’t have his
equipment on property to do it, so Dan asked Mikey to get it
and asked Jeffco to buff [the isinglass].”).
Further, under Florida law, the phrase “arising out of”
as used in the Policy “should be interpreted broadly.” James
River Ins. Co. v. Ground Down Eng’g, Inc., 540 F.3d 1270,
1275 (11th Cir. 2008). “The term ‘arising out of’ is broader
in meaning than the term ‘caused by’ and means ‘originating
from,’ ‘having its origin in,’ ‘growing out of,’ ‘flowing
from,’ ‘incident to’ or ‘having a connection with.’” Taurus
Holdings, Inc. v. U.S. Fid. & Guar. Co., 913 So. 2d 528, 539
(Fla. 2005) (quoting Hagen v. Aetna Cas. &. Sur. Co., 675 So.
2d 963, 965 (Fla. 5th DCA 1996)). The Court declines to read
13
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the phrase “arising out of” so narrowly as to prevent coverage
when Mr. Foraker was injured doing exactly the work Galati
asked of him.
2. Employer’s Liability and Workers Compensation
Exclusions
Southern Owners contends that the Employer’s Liability
and Workers Compensation exclusions bar coverage under the
Policy because Mr. Foraker was either Galati’s statutory
employer or his actual employer. (Id. at 14-25). Therefore,
Southern Owners argues, it is entitled to a declaration that
it has no duty to defend or indemnify Galati. Specifically,
it argues that Galati is a statutory employer because it had
a contractual agreement with the owner of the Red Lion and
sublet to Jeffco its obligation to clean the isinglass.
Additionally, it argues that the evidence shows Mr. Foraker
was Galati’s actual employee.
“Under Florida law, employees of a statutory employer
are ‘treated identically to actual employees in relation to
standard employee exclusion clauses’ in commercial insurance
policies.” Mid-Continent, 824 F. App’x at 647 (11th Cir. 2020)
(quoting Stephens v. Mid-Continent Cas. Co., 749 F.3d 1318,
1322–23 (11th Cir. 2014)). Florida’s Workers’ Compensation
Law provides:
14
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In case a contractor sublets any part or parts of his or
her contract work to a subcontractor or subcontractors,
all
of
the
employees
of
such
contractor
and
subcontractor or subcontractors engaged on such contract
work shall be deemed to be employed in one and the same
business or establishment, and the contractor shall be
liable
for,
and
shall
secure,
the
payment
of
compensation to all such employees, except to employees
of a subcontractor who has secured such payment.
Fla. Stat. § 440.10(1)(b). “[B]ecause contract work must be
sublet to form the basis for statutory employer immunity under
Section
440.10(1)(b),
the
statute
requires
that
the
contractor must sublet an obligation that is a part of a
contract, express or implied in fact.” Rabon v. Inn of Lake
City, Inc., 693 So. 2d 1126, 1130 (Fla. 1st DCA 1997) (citing
Woods v. Carpet Restorations, Inc., 611 So. 2d 1303 (Fla. 4th
DCA 1992)).
When there is a dispute regarding the existence of an
employer-employee relationship, Florida courts apply a multifactor test to determine whether an individual is an employee
or an independent contractor. See Cantor v. Cochran, 184 So.
2d 173, 174 (Fla. 1966). In Cantor, the Florida Supreme Court
reaffirmed its approval of Restatement (Second) of Agency §
220 (1958), which sets out the factors to be considered in
determining whether one is an employee or an independent
contractor:
15
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1. the extent of control which, by the agreement, the
master may exercise over the details of the work;
2. whether or not the one employed is engaged in a
distinct occupation or business;
3. the kind of occupation, with reference to whether, in
the locality, the work is usually done under the
direction of the employer or by a specialist without
supervision;
4. the skill required in the particular occupation;
5. whether the employer or workman supplies the
instrumentalities, tools and a place of work for the
person doing the work;
6. the length of time for which the person is employed;
7. the method of payment, whether by time or job;
8. whether or not the work is part of the regular
business of the employer;
9. whether or not the parties believe they are creating
the relation of master and servant;
10. whether the principal is or is not in business.
See 4139 Mgmt. Inc. v. Dep’t of Lab. & Emp., 763 So. 2d 514,
516 (Fla. 5th DCA 2000) (listing Cantor factors).
First, Southern Owners has failed to show that it is
entitled to a declaration that it has no duty to defend
Galati. Under Florida law, “[t]he duty to defend must be
determined from the allegations in [the underlying action].”
Jones v. Fla. Ins. Guar. Ass’n, Inc., 908 So. 2d 435, 443
(Fla. 2005) (citations omitted). In other words, the duty to
defend “is determined solely by the allegations against the
insured, not by the actual facts, nor the insured’s version
of the facts.” Irvine v. Prudential Prop. & Cas. Ins. Co.,
630 So. 2d 579, 579–80 (Fla. 3d DCA 1993) (citation omitted).
Therefore, “[w]hen the actual facts are inconsistent with the
16
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allegations
complaint
in
the
control
complaint,
in
the
determining
allegations
the
insurer’s
in
the
duty
to
defend.” Baron Oil Co. v. Nationwide Mut. Fire Ins. Co., 470
So. 2d 810, 814 (Fla. 1st DCA 1985) (citations omitted).
“The duty to defend arises when the relevant pleadings
allege facts that fairly and potentially bring the suit within
policy coverage.” Stephens v. Mid-Continent Cas. Co., 749
F.3d 1318, 1323 (11th Cir. 2014) (quotation marks omitted).
“If the underlying suit brings even one claim that falls
within the scope of coverage, the insurer is obligated to
provide a defense for the entire dispute.” Land’s End at
Sunset Beach Cmty. Ass’n v. Aspen Specialty Ins. Co., 289 F.
Supp. 3d 1259, 1265 (M.D. Fla. 2017). Any doubt about the
duty to defend must be resolved in favor of the insured. Id.
“[W]hen
coverage,
it
an
insurer
has
the
relies
burden
on
of
an
exclusion
demonstrating
to
that
deny
the
allegations of the complaint are cast solely and entirely
within the policy exclusion and are subject to no other
reasonable interpretation.” Castillo v. State Farm Fla. Ins.
Co., 971 So.2d 820, 824 (Fla. 3d DCA 2007).
Southern Owners is incorrect when it argues that the
allegations in the Underlying Complaint “give rise to the
applicability
of
the
Employer’s
17
Liability
and
Worker’s
Case 8:21-cv-02567-VMC-MRM Document 113 Filed 01/17/23 Page 18 of 24 PageID 4310
Compensation exclusions.” (Doc. # 99 at 11). The Underlying
Complaint states that (1) “Foraker was an owner of and
performed marine detailing services for Jeffco,” and (2)
“Foraker performed marine detailing work for Galati through
his
company,
Jeffco
Marine
Services,
Inc.
under
a
‘subcontractor agreement’ between Galati and Jeffco.” (Doc.
# 93-7 at ¶¶ 6-7). It does not, however, state that Galati
was performing contract work. Instead, it states only that
Mr. Foraker “entered onto a marine vessel known as the ‘Red
Lion’ which was under the custody and control of Galati.”
(Id. at ¶ 5).
To show that Galati was a statutory employer, Southern
Owners
must
show
that
Galati
itself
had
a
contractual
obligation that it sublet to Jeffco. See Rabon, 93 So. 2d at
1131) (“[T]he clear implication in this part of the Act is
that there must be a contractual obligation on the part of
the contractor, a portion of which he sublets to another.”
(quoting Jones v. Florida Power Corp., 72 So. 2d 285, 289
(Fla. 1954))). Additionally, the Underlying Complaint does
not
demonstrate
that
Mr.
Foraker
was
Galati’s
actual
employee. It alleges that Mr. Foraker was not an employee of
Galati,
that
he
performed
his
work
for
Galati
under
a
subcontractor agreement between Galati and Jeffco, and that
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he was not eligible for workers compensation benefits. (Doc.
# 93-7 at ¶¶ 7-9). Southern Owners has not met its burden of
demonstrating
that
the
allegations
in
the
Underlying
Complaint are solely within the Policy’s exclusions and,
therefore, that it has no duty to defend Galati.
Second, Southern Owners has failed to show that it is
entitled to a declaration that it has no duty to indemnify
Galati at this stage of the case. When determining the duty
to indemnify, Florida courts examine “the underlying facts .
. . developed through discovery during the litigation” to
determine an insurer’s “narrower” duty to indemnify. U.S.
Fire Ins. Co. v. Hayden Bonded Storage Co., 930 So. 2d 686,
691 (Fla. 5th DCA 2006). There are several material facts in
dispute regarding Mr. Foraker’s employment status.
Based on the record evidence the Court has reviewed,
there is a genuine dispute regarding whether Galati was under
a contractual obligation to polish the isinglass on the Red
Lion. The Court notes here that Southern Owners’ statement of
material facts does not include evidence that shows Galati
had such a contractual obligation.
Even if the Court considers evidence outside of the
statement of material facts, there still appears to be a
genuine dispute. Galati entered into a service agreement with
19
Case 8:21-cv-02567-VMC-MRM Document 113 Filed 01/17/23 Page 20 of 24 PageID 4312
the owner of the Red Lion. (Doc. # 93-9). The boat was on
Galati’s property as part of that agreement. (Doc. # 93-10 at
99:5-25, 100:1-6). However, the isinglass was not mentioned
in the service agreement. See (Doc. # 93-9) (detailing service
work
to
be
provided).
Instead,
the
Red
Lion’s
captain
“report[ed]” that the isinglass was scratched and, “to make
it go away,” Galati chose to fix the scratch. (Doc. # 93-10
at 90:20). When asked if the “captain basically asked Galati
to take care of” the scratch, Mr. Galati responded, “No. I
think the captain was reporting [the scratch].” (Id. at 90:2591:2). Additionally, the purchase order issued for Jeffco’s
work shows that it was billed as an internal work order and
that no customer was charged. (Doc. # 93-19; Doc. # 93-10 at
89:13-20).
From
these
facts,
a
reasonable
jury
could
determine either that Galati had a contractual obligation to
the owner of the Red Lion or that it chose to undertake
additional work outside of any contractual agreement to fix
a reported issue to avoid the displeasure of a long-time
customer. Because there is a genuine dispute over whether
Galati had a contractual agreement to fix the isinglass, the
Court cannot determine as a matter of law that Galati was Mr.
Foraker’s statutory employer.
20
Case 8:21-cv-02567-VMC-MRM Document 113 Filed 01/17/23 Page 21 of 24 PageID 4313
Furthermore,
there
is
a
genuine
dispute
regarding
whether Mr. Foraker was Galati’s actual employee. While some
of the Cantor factors point to Mr. Foraker being Galati’s
employee, some of the factors favor Mr. Foraker being an
independent contractor. For instance, Galati appears to have
exercised a fair amount of control over the details of Mr.
Foraker’s work. Galati dictated the priority of Mr. Foraker’s
work each day (Doc. # 93-11 at 65:20-25), Galati managers and
employees “would look at [his] work when it was completed”
(Id. at 37:10-11), and Mr. Foraker worked for Galati from at
least 2007 to 2020. (Doc. # 93-11 at 7:19-21). However, Galati
and Jeffco entered a subcontractor agreement (Doc. # 93-3),
payments for Mr. Foraker’s work were always issued to Jeffco
(Doc. # 93-20), Mr. Foraker was compensated by the job (Doc.
#
93-13),
and
Galati
did
not
provide
standard
employee
benefits like health insurance. (Doc. # 93-11 at 30:6-13).
Therefore, a reasonable jury could find either that Mr.
Foraker was an actual employee of Galati or an independent
contractor.
Based on these facts, a reasonable jury could find either
that Mr. Foraker was Galati’s employee or that he was an
independent contractor. These genuine disputes of material
fact preclude summary judgment on the issue of Southern
21
Case 8:21-cv-02567-VMC-MRM Document 113 Filed 01/17/23 Page 22 of 24 PageID 4314
Owners’ duty to indemnify. See Metsker v. Carefree/Scott
Fetzer Co., 90 So. 3d 973, 982 (Fla. 2d DCA 2012) (reversing
summary judgment where multiple Cantor factors pointed to the
existence of an employee relationship, despite the parties’
independent contractor agreement); Alexander v. Morton, 595
So. 2d 1015, 1016–18 (Fla. 2d DCA 1992) (reversing summary
judgment predicated on a finding that an air-conditioning
installer was an independent contractor where several of the
Cantor factors raised a fact question about the existence of
an employer-employee relationship); Pate v. Gilmore, 647 So.
2d 235, 236 (Fla. 1st DCA 1994) (reversing summary judgment
based on a finding that a part-time stable hand was an
independent contractor where several of the Cantor factors
were more consistent with the status of an employee than an
independent contractor).
The Court denies Southern Owners’ Motion for Summary
Judgment. (Doc. # 93).
B. Galati’s Motion for Summary Judgment
Galati moves for summary judgment on the basis that the
Policy provides coverage for Mr. Foraker’s claim against
Galati
because
Compensation,
and
the
Employer’s
Additional
coverage.
22
Insured
Liability,
clauses
do
Workers
not
bar
Case 8:21-cv-02567-VMC-MRM Document 113 Filed 01/17/23 Page 23 of 24 PageID 4315
For the reasons stated above, Southern Owners failed to
meet its burden of showing it has no duty to defend. It has
not
demonstrated
that
the
allegations
in
the
Underlying
Complaint are cast “solely and entirely within [a] policy
exclusion.” Acosta, 39 So. 3d at 574. The Underlying Complaint
alleges that Mr. Foraker was an independent contractor and
that his injuries arose out of his work for Galati; these
allegations
do
not
indicate
that
any
Policy
exclusion
applies. Accordingly, Southern Owners has a duty to defend
Galati in the underlying case. See Castillo, 971 So.2d at 824
(“[W]hen an insurer relies on an exclusion to deny coverage,
it has the burden of demonstrating that the allegations of
the complaint are cast solely and entirely within the policy
exclusion
and
are
subject
to
no
other
reasonable
interpretation.”); see also St. Paul Fire & Marine Ins. Co.
v. Rosen Millennium, Inc., 337 F. Supp. 3d 1176, 1183 (M.D.
Fla. 2018) (“An insurer’s duty to defend is distinct from and
broader than the duty to indemnify.”). The Court grants
Galati’s Motion for Summary Judgment as to Southern Owners’
duty to defend.
However, as discussed above, a reasonable jury could
find either that Mr. Foraker was a statutory or actual
employee of Galati or that he was an independent contractor.
23
Case 8:21-cv-02567-VMC-MRM Document 113 Filed 01/17/23 Page 24 of 24 PageID 4316
Therefore, the Court denies Galati’s Motion as to Southern
Owners’ duty to indemnify.
Accordingly, it is
ORDERED, ADJUDGED, and DECREED:
(1)
Plaintiff Southern Owners Insurance Company’s Motion for
Summary Judgment (Doc. # 93) is DENIED.
(2)
Defendant Galati Yacht Sales, Inc.’s Motion for Summary
Judgment (Doc. # 92) is GRANTED as to the issue of
Southern Owners’ duty to defend and DENIED as to the
issue of Southern Owners’ duty to indemnify.
DONE and ORDERED in Chambers in Tampa, Florida, this
17th day of January, 2023.
24
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