Miami Yacht Charters, LLC, et al v. National Union Fire Insurance Company of Pittsburgh Pennsylvania
ORDER granting 48 50 Motions to Dismiss Counterclaims and to Strike. Signed by Magistrate Judge Jonathan Goodman on 4/24/2012. (dkc)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
CASE NO. 11-21163-CIV-GOODMAN
MIAMI YACHT CHARTERS, LLC,
and ALBERTO LAMADRID,
NA TIONAL UNION FIRE
INSURANCE COMPANY OF
ORDER GRANTING MOTIONS TO DISMISS COUNTERCLAIMS AND TO STRIKE
This cause is before the Court on Plaintiffs' Motion to Dismiss Defendant/Counter
Plaintiff's Amended Counterclaim and Motion to Strike Defendant's Amended Affirmative
Defenses Paragraphs 16 and 17. For the reasons below, the Court GRANTS the motions to
dismiss and to strike. Defendant shall have SEVEN DAYS to amend paragraphs 16 and 17 of its
affirmative defenses. 1
This is an action for breach of an insurance contract filed by Plaintiffs, the owners of an
insured yacht, against Defendant, the insurer of the yacht. On March 8, 2012, Defendant fi led its
Motion for Leave to File an Amended Answer and Counterclaim for Declaratory Judgment.
[ECF No. 38]. In that motion, Defendant sought leave to amend its affirmative defenses and
counterclaims based upon Plaintiffs' alleged intentional misrepresentation of material facts
The parties are directed to use the correct case caption, "CASE NO . 11-21163-CrV
GOODMAN" and "[CONSENT CASE]" on all future filings.
pertaining to the insurance claim, which Defendant claims violated the insurance agreement.
[See ECF Nos. 38-3, p. 17; 38-4, p. 9]. Plaintiffs did not oppose amendment as a procedural
matter but reserved the right to oppose the affirmative defenses and counterclaims substantively.
[ECF No. 38, p. 8]. The Court therefore granted the motion. [ECF No. 43].
Plaintiffs filed motions to dismiss and to strike on March 19 and March 22, 2012,
[ECF Nos. 48; 50].
Plaintiffs argue that the Court should dismiss Defendant's
counterclaims because Defendant does not actually seek a declaratory judgment and instead
improperly seeks judgment on the merits of Plaintiffs' claim. Plaintiffs also argue that the Court
should strike, or at least require clari fication of, paragraphs 16 and 17 of the amended affirmative
defenses because the defenses are based on fraud but do not satisfy Federal Rule of Civil
Procedure 9(b)' s pleading standard for fraud allegations.
Defendant filed a combined response to both motions, clarifying the factual basis of its
counterclaims and affirmative defenses and identifying case law standing for the proposition that
when an insured makes a material misrepresentation in a maritime insurance policy application,
it is grounds for the insurer to void the policy.
[ECF No. 52] . Defendant, however, did not
address directly the arguments Plaintiffs make in the motions.
a. DECLARATORY JUDGMENT
The Court has subject matter jurisdiction in this action based on the parties' diversity of
[See ECF No. I].
The Court must therefore apply federal law in resolving
procedural matters and Florida law in resolving issues of substantive law. McMahan v. Toto ,
256 F.3d 1120, 1131 (11th Cir. 200 I) (citing Erie R.R. Co. v. Tompkins, 304 U.S . 64 (1938)). 28
U.S.c. § 2201 authorizes a federal court to declare the rights and other legal relations of any
interested party in a case of actual controversy within its jurisdiction. See also Skelly Oil Co. v.
Phillips Petroleum Co., 339 U.S . 667, 67 J (1950) ("The operation of the Declaratory Judgment
Act is procedural only.") (internal quotation marks omitted). Section 86.021, Florida Statutes
(2011), "provides for a declaration of rights or status where a party to an agreement is in doubt as
to rights thereunder." City of Hollywood v. Florida Power & Light Co., 624 So. 2d 285, 286
(Fla. 3d DCA 1993); accord Fernando Grinberg Trust Success Int'l Props., LLC v. Scottsdale
Ins. Co., No. 10-20448-Civ, 2010 WL 2510662, at *1 (S.D. Fla. Jun. 21,2010); see also §
86.101, Fla. Stat. (20 II) ("This chapter is declared to be substantive").
In order to state a claim for declaratory judgment, a party must identify a genuine dispute
over "the existence or non-existence of some right or status." Kelner v. Woody, 399 So. 2d 35,
37 (Fla. 3d DCA 1991). Declaratory relief is not available "to settle factual issues upon which
coverage questions turn under an insurance contract which is clear and unambiguous." Travelers
Ins. Co. v. Emery, 579 So. 2d 798, 801 (Fla. I st DCA 1991). The party moving for declaratory
judgment must identify some provision of the insurance contract as to which it is in doubt and
therefore requires clarification. Tobon v. American Sec. Ins. Co., No. 06-61912-CIV, 2007 WL
1796250, at *2 (S.D. Fla. Jun. 20, 2007) (finding that a mere conclusory allegation that the
plaintiff is "in doubt" as to some unidentified term of a contract is insufficient to state a claim for
declaratory judgment). A court must dismiss a claim for declaratory judgment if it is duplicative
of a claim for breach of contract and, in effect, seeks adjudication on the merits of the breach of
contract claim. Fernando Grinberg Trust, 20 I 0 WL 2510662, at * I; see also Casualty Indem.
Exch. v. High Croft Enters. , Inc., 714 F. Supp. 1190, 1193 (S.D. Fla. 1989) (noting "the
declaratory remedy is not a tactical device whereby a party who would be a defendant in a
coercive action may choose to be a plaintiff if he can beat the other pat1y to the courthouse").
b. PLEADING FRAUD CLAIMS
Federal Rule of Civil Procedure 9(b) provides as follows:
(b) Fraud or Mistake; Conditions of Mind. In alleging fraud or
mistake, a party must state with particularity the circumstances
constituting fraud or mistake. Malice, intent, knowledge, and other
conditions of a person's mind may be alleged generally.
Rule 9(b) applies to claims and defenses. Chetu, Inc. v. Salihu, No. 09-60588-CIV, 2009 WL
3448205, at *4 (S.D. Fla. Oct. 26, 2009); see also LaFayette v. Bank of Boston Int'l
Supp. 1461, 1467 (S.D. Fla. 1989) (striking fraud-based affirmative defense aJ leged in
conclusory terms). A court may strike an affirmative defense as insufficient as a matter of law if
it fails to comply with Rule 9(b). Fed. R. Civ. P. 12(f); United Fixtures Co., Inc. v. Base Mfg.,
No. 6:08-cv-506-0rl-28GJK, 2008 WL 4550212, at *4 (M.D . Fla. Oct. 8,2008).
To satisfy Rule 9(b), a fraud-based claim or defense must specify:
(I) precisely what statements were made in what documents or oral
representations or what omissions were made, and (2) the time and
place of each such statement and the person responsible for making
(or, in the case of omissions, not making) same, and (3) the content
of such statements and the manner in which they misled the
plaintiff, and (4) what the defendants obtained as a consequence of
Mizzaro v. Home Depot, Inc., 544 F.3d 1230,1237 (lIth Cir. 2008).
a. MOTION TO DISMISS
Defendant's Amended Counterclaim for Declaratory Judgment contains three counts.
[ECF No . 38-4]. Defendant alleges in its first and second counts that the insurance policy does
not cover Plaintiffs' claimed damages. In its third count, Defendant alleges that the policy is
void because Plaintiffs concealed and misrepresented material facts by submitting, as part of the
insurance claim, invoices that are unrelated to the subject incident. Defendant, however, does
not contend that any part of the insurance agreement is ambiguous and in need of construction.
To the contrary, Defendant appears to assume that these provisions are clear because Defendant
essentially requests relief for these counterclaims in the form of a factual determination that
Defendant is not liable under the terms of the agreement.
Identification of a contractual provision in need of construction is necessary to state a
claim for declaratory judgment, but Defendant identifies none. See Tobon, 2007 WL 1796250, at
*2 (dismissing declaratory relief claim that "does not identify any provision of the insurance
contract in doubt and in need of construction").
The Court therefore GRANTS Plaintiffs'
motion to dismiss. 2
b. MOTION TO STRIKE
Plaintiffs contend that the following affirmative defenses lack detail sufficient to satisfy
16. The policy of marine insurance referenced in Plaintiffs'
Complaint is void due to misrepresentations(s) and/or failure(s) to
disclosure [sic] of material facts.
17. The policy of marine insurance referenced in Plaintiffs '
Complaint is void due to Plaintiffs' intentional misrepresentation
of material facts relating to the contract of insurance, which
intentional misrepresentation occurred after the loss referenced in
the Complaint. The Plaintiff has intentionally and fraudulently
misrepresented the extent of the damages alleged to have been
caused by or to have resulted from the incident described in the
[ECF No. 38-3, p. 3].
In the alternative, the Court finds that the purported declaratory rei ief claims would
require resolution of the same factual issues underlying Plaintiffs' breach of contract claim and
dismisses these claims as subsumed within Defendant ' s defense to the breach of contract claim.
Cj Fernando Grinberg Trust, 2010 WL 2510662, at *1 ("Since the Plaintiffs' claim for
declaratory judgment is subsumed within its claim for breach of contract, the declaratory action
must be dismissed ."). Defendant tacitly admits that its counterclaims are actually affirmative
defenses by raising the identical claims as affirmative defenses. [See ECF No . 38-3] .
The Court finds that affirmative defense paragraphs 16 and 17 allege fraud but do not
satisfy Rule 9(b)'s patticularity requirements. Defendant states in paragraph 17 that Plaintiffs
made the alleged misrepresentations after their loss occurred, but Defendant does not identify
whether the misrepresentations were written or oral , the content of the misrepresentations, how
the misrepresentations misled Defendant, or what, if anything, Defendant contends Plaintiffs
obtained by making the statements. Defendant describes some or all of these alleged facts in
other filings, including its response to the motion to strike, and the Court and the parties have
discussed these facts during hearings, but Rule 9(b) is a pleading standard and Defendant must
therefore allege details sufficient to satisfy Rule 9(b) within each affirmative defense.
Consequently, the Court GRANTS the motion to strike paragraphs 16 and 17 of
Defendant's affirmative defenses.
Because it appears that Defendant could amend these
defenses to satisfy Rule 9(b), Defendant may amend paragraphs 16 and 17 of its affirmative
For the reasons above, the Court GRANTS Plaintiffs' motions to dismiss and to strike.
Defendant shall have SEVEN DAYS to amend paragraphs 16 and 17 of its
DONE and ORDERED, in Chambers, in Miami , Florida, this
J n 1an Goodman
Un ' ed States Magistrate Judge
Copies furnished to:
AU Counsel of Record
day of April,
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