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Kendall South Medical Center, Inc. v. Consolidated Insurance Nation, Inc.

Florida Court of Appeals, Third District

May 10, 2017

Kendall South Medical Center, Inc., Appellant,
v.
Consolidated Insurance Nation, Inc., d/b/a Insurance Nation, Appellee.

         Not final until disposition of timely filed motion for rehearing.

         An Appeal from the Circuit Court for Miami-Dade County, Antonio Marin, Judge. Lower Tribunal No. 13-10766

          Raul A. Montaner, for appellant.

          Fowler White Burnett, P.A., and June Galkoski Hoffman and Rory Eric Jurman (Fort Lauderdale), for appellee.

          Before ROTHENBERG, LAGOA and SCALES, JJ.

          SCALES, J.

         Kendall South Medical Center, Inc. ("Kendall South"), the plaintiff below, appeals a final order dismissing its Fourth Amended Complaint with prejudice for failure to state a cause of action against one of the defendants below, Consolidated Insurance Nation, Inc. d/b/a Insurance Nation ("Insurance Nation"). We have jurisdiction. See Fla. R. App. P. 9.110(k). Concluding that Kendall South has sufficiently stated a cause of action for negligent procurement of an insurance policy, we reverse.

         Underlying Facts[1]

         Kendall South operates a medical center on leased premises located in North Miami Beach, Florida. On January 3, 2013, the sprinkler system on the leased premises was undergoing maintenance when a leak occurred, resulting in significant water damage to both the physical improvements (i.e., walls, flooring, baseboards) and to the contents (i.e., equipment and machinery) located therein. Kendall South had a commercial property insurance policy with Nation Insurance-issued in August 2011, and later renewed-which provided $100, 000 of coverage for the physical improvements and contents of the subject property, and which contained a $1, 000 deductible and a 90 percent coinsurance clause.[2] As a result of the sprinkler leak, Kendall South suffered property damaging totaling approximately $260, 000. Kendall South made an insurance claim, purportedly expecting to receive a $100, 000 payout, but received only $16, 562.67 due to the policy's coinsurance clause.

         In March 2013, Kendall South filed a negligence claim against the management company for the leased premises, Equity One Realty & Management, FL., Inc., which allegedly undertook the work on the sprinkler system. As an affirmative defense, the management company asserted that Kendall South had failed to maintain sufficient insurance on the subject premises in compliance with the parties' lease agreement. In April 2013, Kendall South filed an Amended Complaint, adding a negligence claim against Countryside Power Sweeping, Inc., which allegedly performed the work on the sprinkler system. The matter was referred to mediation and later set for trial, which was rescheduled on numerous occasions.

         Before the trial was held, on January 20, 2015, Kendall South was granted leave to file a Second Amended Complaint in order to add claims for negligent procurement of insurance and breach of fiduciary duty against Kendall South's insurer, Insurance Nation. The lower court then struck the pending trial date.[3] On February 26, 2015, Insurance Nation moved to dismiss the two claims against it, claiming that Kendall South had failed to state causes of action. The trial court agreed, dismissing the Second Amended Complaint without prejudice.

         On July 31, 2015, Kendall South filed its Third Amended Complaint, again alleging a claim for negligent procurement of insurance against Insurance Nation, but dropping the claim for breach of fiduciary duty. Insurance Nation moved to dismiss the Third Amended Complaint, alleging that Kendall South had again failed to state a cause of action. The trial court agreed, dismissing the Third Amended Complaint without prejudice.

         On November 18, 2015, Kendall South filed its Fourth Amended Complaint, once again alleging a claim for negligent procurement of insurance against Insurance Nation. In this pleading, Kendall South alleged that it had met with Insurance Nation's agent, Humberto Torres, on or about August 10, 2011, in order to obtain a "a commercial property coverage policy of insurance in the amount of $100, 000[.]00 that would cover the property, equipment, supplies, and improvements" of Kendall South.

         At this meeting, after informing the agent that the subject premises had "office equipment, supplies and furnishings in excess of $100, 000.00 and that [Kendall South] had spent in excess of $100, 000.00 for the buildouts, betterments or improvements" thereon, Kendall South "requested from [agent] Torres insurance coverage of $100, 000.00 to cover the property, supplies, furnishings, betterments or improvements of Kendall South Medical Center, Inc." Thereupon, "Torres informed [Kendall South] that Defendant Insurance Nation would procure a commercial policy of insurance that would cover and protect all the property, ...


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