Searching over 5,500,000 cases.

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Atain Specialty Insurance Co. v. Sanchez

United States District Court, M.D. Florida, Tampa Division

April 27, 2018

LOYDA SANCHEZ, et al., Defendants.



         Clara Candelario's car allegedly rear-ended another car and caused a chain reaction that pinned Mirian Dominguez between a churro cart and the Latin American Supermarket. In state court, Dominguez sued Candelario, the supermarket, and Luis and Loyda Sanchez (the owners of the shopping plaza). Atain denied Loyda Sanchez's claim for coverage under her commercial general liability insurance policy. Atain sues (Doc. 1) for a declaration that the policy creates no duty to defend or indemnify Loyda Sanchez in the state-court action. The defendants, except for Candelario, move (Docs. 22 and 27) to dismiss the complaint or to stay the action until the resolution of the state-court action.


         The duty to defend is broad and determined solely by comparing the insurance policy to the complaint against the insured., Inc. v. Travelers Cas. Co. of Am., 845 F.3d 1099, 1107 (11th Cir. 2017). The duty to indemnify is determined “by the underlying facts adduced at trial or developed through discovery during litigation.” Stephens v. Mid-Continent Cas. Co., 749 F.3d 1318, 1325 (11th Cir. 2014) (internal quotations omitted). Arguing that the claim is not ripe for adjudication, the defendants move for dismissal or a stay of Atain's request for a declaration on the duty to indemnify. (Docs. 22 at 5 and 27 at 5)

         1. Declaratory judgment on indemnification is premature.

         The jurisdictional and prudential components of the ripeness doctrine protect “federal courts from engaging in speculation or wasting their resources through the review of potential or abstract disputes.” Dig. Props., Inc. v. City of Plantation, 121 F.3d 586, 589 (11th Cir. 1997). Article III jurisdiction requires a definite and concrete case or controversy that permits a definite and concrete resolution and not “‘an opinion advising what the law would be upon a hypothetical state of facts.'” Provident Life & Accident Ins. Co. v. Transamerica-Occidental Life Ins. Co., 850 F.2d 1489, 1491 (11th Cir. 1988) (quoting Aetna v. Haworth, 300 U.S. 227, 240-41 (1937)).

         Atain aspires to define the duty to indemnify before the imposition of liability on the insured. “But it is not the function of a United States District Court to sit in judgment on these nice and intriguing questions which today may readily be imagined, but may never in fact come to pass.” Am. Fid. & Cas. Co. v. Pa. Threshermen & Farmers' Mut. Cas. Ins. Co., 280 F.2d 453, 461 (5th Cir. 1960).[1] In effect, Atain requests an advisory opinion - forbidden by Article III - of the parties' respective rights and liabilities if the insured incurs liability. See Watermark Constr, L.P. v. Southern-Owners Ins. Co., 2018 WL 1305913, at *6 (M.D. Fla. Mar. 13, 2018) (Byron, J.) (finding that a request for a declaration before a finding of liability is “nothing more than a request for an impermissible advisory opinion”); see also Jacksonville Prop. Rights Ass'n v. City of Jacksonville, 635 F.3d 1266, 1276 (11th Cir. 2011) (rejecting issuance of a declaration “on an issue that might never impact [the plaintiffs'] substantive rights”). But if the insured incurs no liability, the question of the duty to indemnify for that unincurred liability remains forever hypothetical and, for that reason, remains a question unavailable for resolution under Article III. See J.B.D. Const., Inc. v. Mid-Continent Cas. Co., 571 Fed. App'x 918, 927 (11th Cir. 2014) (“The duty to indemnify is dependent upon the entry of a final judgment, settlement, or a final resolution of the underlying claims.”) (citing Northland Cas. Co. v. HBE Corp., 160 F.Supp.2d 1348, 1360 (M.D. Fla. 2001) (Presnell, J.)); see also Mid-Continent Cas. Co. v. G.R. Constr. Mgmt., Inc., 278 F.Supp.3d 1302, 1306 (M.D. Fla. 2017) (Chappell, J.) (finding that a request for declaration on the duty to indemnify before the conclusion of the underlying state-court action presents no “actual controversy”). But see Emp'rs Mut. Cas. Co. v. All Seasons Window & Door Mfg., Inc., 387 F.Supp.2d 1205, 1210 (S.D. Ala. 2005) (Steele, J.) (finding a justiciable controversy “despite the absence of a verdict or settlement” in the underlying action but dismissing on precedential grounds).

         However, neither Article III nor the federal Declaratory Judgment requires adjudication of Atain's duty to indemnify. Wilton v. Seven Falls Co., 515 U.S. 277, 286 (1995) (explaining that a district court has “unique and substantial discretion in deciding whether to declare the rights of litigants”). And prudence strongly disfavors resolving the unripe question of Atain's duty to indemnify. “[A]n insurer's duty to indemnify is not ripe for adjudication unless and until the insured or putative insured has been held liable in the underlying action.” Pa. Nat'l Mut. Cas. Ins. Co. v. King, 2012 WL 280656, at *5 (S.D. Ala. Jan. 30, 2012) (Steele, J.); Interstate Fire & Cas. Co. v. McMurry Constr. Co., 2017 WL 821746, at *3 (M.D. Fla. Mar. 2, 2017) (Mendoza, J.); see also Northland, 160 F.Supp.2d at 1360 (“Because an insurer's duty to indemnify is dependent on the outcome of a case, any declaration as to the duty to indemnify is premature unless there has been a resolution of the underlying claim.”).

         Atain argues that Higgins v. State Farm Fire and Cas. Co., 894 So.2d 5 (2004), changes the law. (Docs. 28 at 8 and 32 at 6) Claiming a need to expeditiously resolve a coverage dispute, Higgins permits a Florida trial court to determine indemnity before the resolution of the underlying tort action. 894 So.2d at 16-18. But federal procedural law governs this federal action under the federal Declaratory Judgment Act. Burlington Ins. Co. v. Wiliford Roofing Co., 2015 WL 12546284, at *2 (M.D. Fla. Mar. 11, 2015) (Davis, J.) (limiting Higgins to the Florida Declaratory Judgment Act); Mid-Continent Cas. Co. v. Nassau Builders, Inc., 2017 WL 1191383, at *7 (M.D. Fla. Mar. 31, 2017) (Howard, J.) (finding that Higgins is irrelevant to an action under the federal Declaratory Judgment Act).

         Also, Ameritas Variable Life Insurance Company v. Roach, 411 F.3d 1328, 1331 (11th Cir. 2005), requires consideration of “federalism, efficiency, and comity, ” which are not considered by Higgins. Ameritas, 411 F.3d at 1331 (11th Cir. 2005) (internal quotations omitted);[2] see also First Mercury Ins. Co. v. Excellent Computing Distribs., Inc., 648 Fed. App'x 861, 866 (11th Cir. 2016) (noting that the Eleventh Circuit has “never held that the Ameritas factors apply only when reviewing parallel actions”). With deference to federalism, efficiency, and comity, the Ameritas factors, applied to this case favor dismissal of Atain's unripe request. Although the duty to defend depends on the underlying complaint only, an informed resolution of Atain's duty to indemnify depends on facts that the state-court litigation likely will resolve.

         The unresolved but determinative facts include whether the injury arises “out of or in connection with any ‘auto'” or from “[p]arking an ‘auto' on, or on the ways next to” the premises. (Doc. 1 at 7-8) The underlying action alleges that Candelario was negligent in her driving and that the property owners were negligent in their maintenance of the parking lot. (Doc. 1-1 at 3-6) Whether Dominguez's injuries are attributable to driving or parking directly informs the underlying suit and touches on both the legal causation of the injury and the apportionment of fault. The state court has a strong interest in resolving these factual issues under state law without encroachment from a federal court.

         Although clarification of the indemnity question might expedite a settlement, [3]that uncertain prospect must yield to the benefits of dismissal. See Nassau Builders, 2017 WL 1191383, at *7 (finding that the possibility of facilitating settlement was outweighed by considerations of federalism, efficiency, and comity); Am. Cas. Co. of Reading v. Allen, 2014 WL 10450887, at *5 (N.D. Ala. Dec. 29, 2014) (Putnam, J.) (finding that the possibility of facilitating settlement “alone is not a sufficient justification for addressing premature, unripe issues”); Employers Mut., 387 F.Supp.2d at 1212 (noting that the possibility of facilitating settlement was a concern in nearly all cases declining jurisdiction prior to a determination of liability).

         Atain's unripe requests for a declaratory judgment are dismissed without prejudice. This action will proceed only as to Atain's duty to ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.