FLORIDA LAW WEEKLY

VOLUME 43, NUMBER 39

CASES FROM THE WEEK OF SEPTEMBER 28, 2018

LOADERS ARE DANGEROUS INSTRUMENTALITIES.

Newton v. Caterpillar Financial Services Corp., 43 Fla. L. Weekly S415a (Fla. September 27, 2018):

Plaintiff was working as an independent contractor for a hauling company clearing debris. He and one of the hauling company’s agents were using a multi-terrain loader leased from Caterpillar Financial Services.

While trying to move a tree stump into the disposal trailer, the plaintiff was inside packing down the debris. The man working with him did not know he was in the disposal trailer, and as he attempted to climb out of it, the stump rolled over his hand and severed his middle finger.

Plaintiff sued Caterpillar, alleging it was liable for the injury because the loader was a dangerous instrumentality. On competing cross motions for summary judgment, the trial court granted summary judgment for Caterpillar.

The Florida Supreme Court said that the question of whether loaders are dangerous instrumentalities was a pure question of law.

It then discussed the factors for applying the dangerous instrumentality doctrine. One of the most important factors is whether the instrumentality is a “motor vehicle.” Courts also consider whether the instrumentality is frequently operated near the public (the court noted that the incident under review did not have to occur on public property for the instrumentality to be dangerous). Another factor is the instrumentality’s peculiar dangers relative to other objects that courts have also found to be dangerous instrumentalities, namely based on a practical fact that the owner of an instrumentality which has the capability of causing death or destruction, should have to answer for the misuse of the instrumentality by anyone operating it with its knowledge and consent.

Because loaders are self-propelled and powered by an engine, common knowledge and plain language demonstrate that loaders, like farm tractors and forklifts, are “motor vehicles” for the purpose of the dangerous instrumentality doctrine. They are also heavy pieces of construction equipment weighing thousands of pounds that can move heavy load across streets and unimproved surfaces.

The loader in this case weighed 8,000 lbs. and had treads at the time of the accident, though it could have been modified to operate on tires. Machines as powerful as loaders have the ability to cause serious injury when operated near or over a public street, just like any other motor vehicle operated on a public highway.

Also, even as an independent contractor, plaintiff was still protected under the dangerous instrumentality doctrine. The doctrine does not treat construction workers as separate from the general public when injured in public places.

While Plaintiff may not have been a member of the unsuspecting public, his accident did occur on a public street. His employment also did not disqualify his accident from coverage under the doctrine.

WHERE AN INSURED IS INJURED WHILE OCCUPYING AN OWNED VEHICLE THAT IS NOT LISTED ON THE POLICY, THE INSURED IS STILL ENTITLED TO UM COVERAGE EVEN IF HE WOULD NOT HAVE BEEN ENTITLED TO LIABILITY COVERAGE--BECAUSE THE ELECTRONIC WAIVER FAILED TO TRACK THE PRECISE LANGUAGE OF THE STATUTE, IT WAS INVALID, BUT EVIDENCE THAT INSURED ORALLY REJECTED UM COVERAGE WAS RELEVANT TO SUPPORT INSURER’S CLAIM OF UM REJECTION.

Geico Indemnity Co. v. Perez, 43 Fla. L. Weekly D2187 (Fla. 3rd DCA September 20, 2018):

Prior to the accident, the injured victim had called Geico. He spoke with a sales representative about purchasing automobile insurance for three vehicles that he owned. At the time, he had a motorcycle policy that included UM coverage of $10,000, but his vehicles were insured by another carrier. There was no recording of the call, and no one had any independent recollection of the call.

Geico’s sales representative testified that the normal practice of Geico is to discuss, explain and recommend that the customer purchase UM coverage. The customer then informs Geico about whether or not he or she wants to purchase or reject the coverage.

If the customer declines UM coverage, the customer is told that he or she must sign a UM form by midnight, or Geico unilaterally adds the coverage to the policy. The plaintiff testified that the sales representative never discussed UM coverage during that phone call.

During the phone call, though, plaintiff provided Geico with his wife’s email address. At the end of the call, a unique and secure personal identification number was generated by Geico and a welcome email was sent to the wife’s email address. The welcome email provided that he could create an online account using the unique and secure pin.

Later, Geico’s welcome email was forwarded from the wife’s email address to their daughter’s address. An online account was created using the secure pin and minutes later UM coverage was rejected for the plaintiff’s policy via electronic signature. The review and sign screen contained a blue hyperlink to an already completed UM form which rejected UM coverage, but the link was never opened.

The online user viewed the coverage summary and logged off. Geico then sent an email containing the coverage for the policies which reflected no UM coverage. There was liability coverage of $50,000 for each of the insured vehicles but no UM. It is undisputed that the plaintiff paid no premium for the UM. Six months later, the policy was renewed on the same terms.

The plaintiff was then seriously injured while operating his motorcycle when he collided with an under-insured driver. Geico offered the $10,000 in UM coverage, but plaintiff sought $150,000. Geico maintained that Perez rejected UM coverage and filed two summary judgment motions arguing (1) that the policy did not provide UM coverage while he was riding his motorcycle and (2) that Geico was entitled to a conclusive presumption of the rejection by virtue of the electronic signature on the UM rejection form. Plaintiff cross-moved for summary judgment.

The trial court entered three separate summary judgment orders, two denying Geico’s motions for summary judgment, and one granting plaintiff’s cross-motion. On the cross-motion, the court held that Geico’s UM rejection form violated Florida’s statutory law and that the eSignature process utilized by Geico was ambiguous and did not provide proper notice.

The court set the case for trial, and bifurcated it into two phases. In the first phase, the jury was going to decide whether the plaintiff made a knowing oral rejection of UM coverage, and in the second phase, the jury would decide the tort liability and damages.

Plaintiff filed several motions in limine seeking to limit the introduction of evidence about the phone call with the Geico representative. Specifically, plaintiff sought to exclude all evidence with respect to the electronically signed UM rejection form, including the email exchange, the creation of the online account, etc. Plaintiff sought to preclude Geico from eliciting any testimony or introducing any evidence regarding the plaintiff’s understanding of UM coverage. The trial court granted them.

The jury found that plaintiff had not orally waived the statutory requirement of written rejection, and concluded that plaintiffs were entitled to stacking UM. The jury then awarded over $1.7 million in damages and entered final judgment against Geico.

Geico argued that the motorcycle was not a scheduled vehicle under the automobile policy, but said the plaintiff was covered by a separate Geico motorcycle policy.

Citing to Mullis v. State Farm, the court reminded us that whenever an insured is injured by a negligent uninsured/under-insured motorist, the insured has UM coverage under the automobile policy’s UM provisions, under certain circumstances. When an insured is injured while occupying an owned vehicle that is not listed on the policy, the insured is entitled to UM coverage, even if he would not have been entitled to liability coverage had the accident in question been his own fault.

The court then rejected Geico’s argument that the policy did not provide UM coverage because of an exclusion contained with the UM rejection that was electronically signed. The court found Geico waived the issue because it never made any argument about it in the lower court (with respect to an express UM coverage exclusion).

Even if the argument had been preserved, Geico failed to present sufficient evidence to entitle it to summary judgment. Geico failed to present any evidence of the policy language approved by the Office of Insurance Regulation to effectively exclude the UM coverage. Perez’s policy contained no UM coverage at all, and Geico did not proffer a copy of the policy that would have been issued had the coverage been provided containing the statutorily authorized language excluding non-scheduled vehicles from UM coverage.

Geico then argued that the insured’s daughter electronically signed the UM rejection form on behalf of her father, entitling Geico to the conclusive statutory presumption that the UM coverage was rejected under the policy.

The trial court found that even though the UM rejection form had been approved by Florida’s Department of Insurance Regulation, the form failed to comply with the statute because it failed to track the precise language of the statute, i.e., the bolded 12 point type stated “BODILY INJURY LIMITS” instead of “BODILY INJURY LIABILITY LIMITS” and the language “PLEASE READ IT CAREFULLY” instead of “PLEASE READ CAREFULLY.” The court found the trial judge was correct as a matter of law to read the policy so strictly pursuant to section 627.727(1).

Even though the UM rejection form complied with the statute in all material ways, the court said that section 627.727(1) is unambiguous, and unequivocally provides that the conclusive presumption only applies if the form includes the specific quoted language.

Finally, however, the court did find that the trial judge erred in excluding all the evidence about the oral knowing rejection of UM coverage. The court observed that oral rejection is certainly a more “nuanced question” than a knowing written rejection.

The court never had to reach that question though. Geico never maintained that the plaintiff orally waived the statutory requirement that UM coverage be rejected in writing. Geico always maintained that Perez made a knowing written rejection of UM coverage and told the sales representative during the preliminary phone call that he was going to.

Geico stated the issue for the jury should have been whether Perez made a written rejection of coverage on behalf of all insureds under the policy, which was a valid theory of defense that Geico was entitled to support with the evidence that the trial court ended up excluding.

While the written rejection is a conclusive presumption, there was a fact question about whether the plaintiff made a knowing written rejection of UM coverage. Thus, the evidence about that phone call and the subsequent emails, was directly relevant to the rejection and it was error for the court to exclude it.

NO MINIMUM CONTACTS - LACK OF PERSONAL JURISDICTION.

Highland Stucco and Lime Products v. Onorato, 43 Fla. L. Weekly D2155 (Fla. 3rd DCA September 20, 2018):

Plaintiffs filed a products liability action against the defendant, alleging that the plaintiff had developed mesothelioma from his exposure between 1972 to 1976 of asbestos-containing products that were manufactured, distributed and/or sold by the defendant in the state of Florida.

In support of the defendant’s motion to dismiss for lack of personal jurisdiction, the defendant submitted a sworn affidavit which explained that the company had dissolved in 2009, but had been acquired in the mid-1960s. The affiant averred that he had been the president in 1992 after serving many other offices.

The affidavit also stated that Highland was never a resident of the state of Florida; was always a resident of the state of California with his principal place of business there; had no owners, agents or employees in Florida; never owned or operated a facility outside of California; never transacted any business in Florida; never negotiated, entered into or performed any contracts in Florida; never owned, used or possessed real or personal property in Florida; never maintained a place of business in Florida; was never registered to conduct business in Florida; never maintained any bank accounts, offices, post office boxes, telephone numbers or any other business facility in Florida; never advertised in a Florida publication or on Florida radio and television stations; and did not ever directly solicit business in Florida. The affidavit also stated that the company never manufactured, distributed, sold or supplied or even installed any asbestos-containing products in Florida and had no connection with Florida.

In response, the plaintiff submitted excerpts from the plaintiff’s deposition where he testified that Highland’s products were commercially available for purchase in Florida during the time of his exposure; a 1959 trade journal advertisement for Highland’s acoustical plaster that was distributed by Highland of Florida; an article from the same trade journal referencing a plant in Fort Lauderdale operated by Highland’s of Florida; and an excerpt from the Highland president’s deposition which was taken in connection with a 2000 lawsuit.

Highland replied with documents demonstrating that Highland’s of Florida was dissolved in 1964, approximately eight years prior to the plaintiff’s alleged exposure, which was a key document to the court’s consideration.

In analyzing the two-step process for determining whether personal jurisdiction exists, the court reminded us that there must be sufficient jurisdictional facts to bring the action within the purview of Florida’s long arm statute, and there must also be a determination about whether the forum corporation possesses sufficient minimum contacts with Florida to satisfy federal constitutional due process requirements.

To get specific jurisdiction under the long arm statute (section 48.193(1)(a)), there must be a number of possibilities, like operating or conducting business in Florida, committing a tortious act of the state, owning or possessing real property, contracting in Florida, soliciting business in the state, or consuming products in the state.

Because Highland adequately contested the allegations, the burden shifted back to the plaintiffs to refute the evidence submitted by it. The plaintiffs conducted no jurisdictional discovery, and the only evidence submitted to rebut the affidavit was listed above. Even if plaintiffs had established that the Florida entity was a subsidiary of Highland, the mere presence of a subsidiary in Florida by itself is insufficient to subject a non-Florida corporate parent to Florida’s long arm jurisdiction.

Additionally, the plaintiffs were unable to show that Highland purposefully directed its products towards Florida (it is not enough that such products may have found their way into Florida or that the defendant may have predicted they could reach Florida), and the plaintiff had to show that Highland actually targeted Florida.

Because the plaintiffs never established the link between Highland and the product he used, and never showed that Highland’s contacts with Florida were such that the maintenance of the suit did not offend traditional notions of fair play and substantial justice, plaintiffs failed to make the requisite showing of personal jurisdiction to sue Highland in Florida.