BRANNAN v. GEICO INDEMNITY COMPANY et al
Filing
43
ORDER granting 33 MOTION for Leave to Amend the Amended Petition for Declaratory Judgment & Relief filed by JAMES BRANNAN and terming as moot 9 First MOTION for Judgment on the Pleadings filed by GOVERNMENT EMPLOYEES I NSURANCE CO and 21 First MOTION for Judgment on the Pleadings filed by GEICO INDEMNITY COMPANY - Amended Pleadings due by 4/5/2013 and revised case management schedule due by 4/5/2013; signed by MAGISTRATE JUDGE GARY R JONES on 3/26/13. (tss)
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IN THE UNITED STATES DISTRICT COURT FOR THE
NORTHERN DISTRICT OF FLORIDA
GAINESVILLE DIVISION
JAMES BRANNAN,
Plaintiff,
v.
CASE NO. 1:12-cv-238-GRJ
GEICO INDEMNITY CO. AND
GOVERNMENT EMPLOYEES
INSURANCE CO.,
Defendants.
_____________________________/
ORDER
On March 25, 2013 the Court conducted a hearing to address Plaintiff’s Motion
For Leave To Amend The Amended Petition For Declaratory Judgment and Relief.
(Doc. 33.) For the reasons discussed on the record at the hearing, which are fully
incorporated into this order, and as summarized below, Plaintiff’s Motion For Leave to
Amend is due to be granted.
Background
This case is an action seeking a declaration concerning Plaintiff’s entitlement to
recover uninsured motorists benefits under his insurance contracts with GEICO
Indemnity Co. (“GEICO Indemnity”) and Government Employees Insurance Co.
(“GEICO”). GEICO Indemnity issued a policy insuring Plaintiff’s 2008 Suzuki
motorcycle with uninsured motorist limits of $10,000 for each occurrence. GEICO
issued a policy insuring three of Plaintiff’s automobiles with uninsured motorist limits of
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$100,000 for each occurrence.
The events which prompted this suit concern an October 2010 motor vehicle
accident in which the Plaintiff, while operating his motorcycle, was struck by a motor
vehicle operated by an uninsured motorist. Because the driver of the vehicle
responsible for the accident did not have insurance Plaintiff made demand on the
Defendants for payment of $110,000.00 in uninsured benefits – the full policy limits
under the motorcycle policy plus the full policy limits under the automobile policy –
contending that he was entitled to stack the uninsured motorist coverage under both
policies. GEICO Indemnity responded by tendering the $10,000.00 policy limits under
the policy insuring the motorcycle but denying the request to stack the insured motorist
benefits under the automobile policy.
Defendants position on this issue is very straightforward. According to
Defendants, the motorcycle policy provides uninsured motorist coverage with a limit of
$10,000.00 per occurrence, which may be “stacked” on the automobile policy only if the
accident involved one of the three automobiles listed in the policy. Where, as here, the
accident involved the motorcycle, Defendants assert that the express terms of the
automobile policy do not permit the uninsured motorist benefits under that policy to be
“stacked” onto the motorcycle policy because the automobile policy expressly excludes
from coverage accidents involving other vehicles owned by Plaintiff not listed in the
automobile policy. Further, Defendants contend that the automobile policy expressly
includes language that the benefits cannot be stacked.
Case No: 1:11-cv-238-GRJ
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While Plaintiff contends that he is entitled under the language in both policies to
stack the uninsured motorist benefits the real focus of Plaintiff’s argument in this case is
that Defendants violated a duty owed to Plaintiff to provide him with insurance policies
that could be stacked. Plaintiff asserts that when he took out the coverage on the
motorcycle policy he requested and relied upon GEICO to provide him with policies
which would permit the uninsured motorist coverage on both polices to be “stacked.”
According to Plaintiff, to the extent that it is determined that the policies cannot be
stacked – as Defendants suggest -- Plaintiff is entitled to recover against Defendants
for negligence and/or breach of their fiduciary duty for failing to provide him with the
requested coverage. Plaintiff asserts that even though the Defendants are insurance
companies they can be held liable under a theory of negligence or breach of fiduciary
duty because the Defendants acted in the role of both agent and insurance carrier
when Plaintiff requested insurance coverage.
At the time Plaintiff filed the instant motion for leave to amend, Defendants’
motions for judgment on the pleadings were pending before the Court. Plaintiff now
requests permission to amend the complaint to include his claims that the Defendants
breached their fiduciary duty and/or that they are liable for their negligent failure to
procure the requested uninsured motorist coverage.
Defendants vigorously oppose the request to amend contending that the motion
is untimely and if granted would be prejudice Defendants. Further, Defendants assert
that the motion is an attempt to circumvent their motions for judgment on the pleadings.
Case No: 1:11-cv-238-GRJ
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Lastly, Defendants argue that Plaintiff should not be permitted to amend because the
proposed claims are futile.
Discussion
The Federal Rules of Civil Procedure provide that leave to amend a pleading
“shall be freely given when justice so requires.”1 Case law confirms that such leave
should be given in the absence of compelling circumstances, such as “undue delay,
bad faith or dilatory motive on the part of the movant, repeated failure to cure
deficiencies by amendments previously allowed, undue prejudice to the opposing party
by virtue of allowance of the amendment, futility of amendment, etc.”2
Turning first to the timeliness of the requested amendment, although this case
was filed in state court in March 2012, this is the first request to amend the complaint
since the case was removed to this Court on October 16, 2012.3 Further, the deadline
for amending the pleadings is March 28, 2013, sixty days before the discovery deadline.
See, Rule 26 Joint Report, Doc. 15 and Scheduling Order, Doc. 16. Thus, the motion
was filed timely and consistent with the scheduling order in this case.
Defendants complain that the amendment is untimely because the facts alleged
1
F. R. C IV . P. 15(a).
McKinley v. Kaplan, 177 F.3d 1253, 1258 (11 th Cir. 1999) (quoting Foman v. Davis, 371 U.S.
178, 182 (1962)). See also Rowe v. Florida School for the Deaf and Blind, et al., 176 F.R.D. 646, 649
(M.D.Fla. 1997) (in determ ining whether to grant leave to file an am ended pleading, the Court considers:
(1) whether the am endm ent would be prejudicial to the opposing party, (2) whether there was bad faith or
undue delay on the part of the m oving party, and (3) whether the am endm ent sought is futile).
2
3
The Com plaint w as am ended in st at e court t o add GEICO as a part y but ot herw ise t he
allegat ions rem ained t he sam e.
Case No: 1:11-cv-238-GRJ
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have been known by Plaintiff since the inception of this case and therefore could have
been included in the original complaint. According to Defendants, the motivating reason
for the amendment is simply because Plaintiff now has additional counsel. While this
may be true there is no rule that prohibits a party from seeking to amend his claims to
make the claims more precise and to allege more properly the legal theories relevant to
the facts. The amendment here is clearly necessary to make the claims more precise
particularly in view of the fact that the original complaint is less than a model of
precision. Therefore, it is not only understandable that new counsel would want to
amend the pleadings but based upon what was included in the original complaint it was
absolutely necessary that the pleadings needed to be amended if Plaintiff wished to
have any realistic possibility of the case advancing.
With regard to the prejudice Defendants contend they will suffer if leave to
amend is granted, the only prejudice Defendants can point to is that Defendants will be
forced to engage in extensive discovery in this case. As the Court stated at the hearing,
simply having to engage in discovery – which will involve some expenditure of time and
money – standing alone is not sufficient to demonstrate prejudice. Rather, prejudice
from an amendment would be present where, for example, a party had completed all or
a majority of discovery and would be forced to redo the discovery already completed.
Here, that is not a problem because the parties have not engaged in any discovery thus
far.
Defendants also argue that they will be prejudiced because there is insufficient
Case No: 1:11-cv-238-GRJ
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time remaining to take discovery. According to Defendants, they have not conducted
any discovery because there was no need to do so in a case, like this one, involving
only a single claim for declaratory relief which requires nothing more than a
straightforward interpretation of the terms of insurance policies, issues that are
traditionally issues of law reserved for the Court. There are only 60 days remaining
before the discovery cutoff and thus Defendants assert that they will be prejudiced if the
amendment is permitted at this late stage of the case. However, to the extent that the
limited amount of time remaining for discovery might prejudice Defendants’ ability to
defend themselves in this case the prejudice can be mollified by extending the
discovery deadline for a reasonable period of time. In this regard, the Court advised the
parties at the hearing that the Court would permit an enlargement of the discovery
deadline so that Defendants would have sufficient time to conduct discovery and avoid
any prejudice. Consequently, the Court directed the parties to confer and submit an
amended case management report extending the discovery deadline as well as the
other applicable deadlines.
Lastly, with regard to futility, Defendants contend that the claims for breach of
fiduciary duty and negligent procurement of the insurance coverage fail because the
relationship between an insured and insurance company is that of debtor-creditor and
not that of fiduciary. Plaintiff argued that the general proposition does not apply in this
case because the Defendants acted in the additional role as an agent thus creating a
duty owed to Plaintiff, other than that of debtor-creditor.
Case No: 1:11-cv-238-GRJ
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Additionally, Defendants argue that the last count of the proposed amended
complaint – purporting to allege a claim for violation of the disclosure requirements of
Fla. Stat. §627.428 – is futile because the statute does not apply to first party insurance
policies and in any event does not apply to uninsured motorist coverage. While Plaintiff
conceded at the hearing that Plaintiff is not aware of any Florida case holding that the
statute creates a cause of action for first party claims involving uninsured motorist
coverage, Defendants have candidly conceded in their memorandum in opposition that
this issue has not yet been expressly addressed by a Florida court.
Under these circumstances the Court concludes that the appropriate procedural
avenue to address whether these claims state causes of action is in the context of a
motion to dismiss or a motion for summary judgment and not in the context of a motion
for leave to file an amended complaint. Because cases ought to be resolved on the
merits a party should be granted leave to amend at least one time, particularly where a
party has provided the Court with specific and articulable facts purporting to support the
alleged claims. Whether the claims in the amended complaint will have any traction
remains to be seen but at this juncture the Court cannot say that Plaintiff should be
denied the opportunity (at least one more time) to attempt to plead claims supporting
his theory that the Defendants bear some responsibility for providing uninsured motorist
coverage which may be stacked in the event it is determined that the policies, as
written, do not provide stacked uninsured motorist coverage.
For these reasons, the Court concludes that the Plaintiff’s Motion for Leave to
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amend is due to be granted.
Accordingly, upon due consideration, it is ORDERED:
1. Plaintiff’s Motion For Leave To Amend The Amended Petition For
Declaratory Judgment and Relief (Doc. 33) is GRANTED. Plaintiff must file his
Amended Petition or Complaint by April 5, 2013. Defendants must file their responses
to the amended complaint within twenty (20) days of service of the amended complaint.
2.
The parties are directed to confer regarding a revised case management
schedule and must file by April 5, 2013 an amended joint scheduling report addressing
revised dates for the discovery deadline, the deadline for filing dispositive motions and
a proposed revised trial date.
3.
Because Plaintiff has been granted leave to file an amended complaint the
pending motions for judgment on the pleadings (Docs. 9 & 12) are MOOT. This is
without prejudice to Defendants’ right to raise the same arguments in a motion to
dismiss or a motion for summary judgment. The clerk is directed to terminate these
motions (Docs. 9 & 12) as pending motions.
DONE AND ORDERED this 26th day of March 2013.
s/ Gary R. Jones s/GaryR.Jone
GARY R. JONES
United States Magistrate Judge
Case No: 1:11-cv-238-GRJ
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