United States District Court, S.D. Florida
GREAT DIVIDE INSURANCE COMPANY, for itself and on behalf of Aventura Construction Corporation, Plaintiff,
AMERISURE INSURANCE COMPANY and DRAWDY CONCRETE CONSTRUCTION, LLC, Defendants.
L. Rosenberg United States District Judge.
April 23, 2018, this Court held a one-day bench trial on
GREAT DIVIDE INSURANCE COMPANY's (“Great
Divide”) breach of contract claim against DRAWDY
CONCRETE CONSTRUCTION, LLC (“Drawdy”).
See DE 1 (Count III of the Complaint for Declaratory
Relief and Damages). The Court, having otherwise disposed of
Great Divide's other claims,  issues the following
findings of fact and conclusions of law on Great Divide's
breach of contract claim against Drawdy for failing to
indemnify Aventura Construction Corp.
(“Aventura”), Great Divide's
Master Contract. Aventura was the general
contractor hired by Cumberland Farms, Inc. (“Cumberland
Farms”) to build a convenience store located in
Sebastian, Florida (the “Project”). See
Master Contract, Defendant's Exhibit No.
26. Under the Master Contract, Aventura was responsible
for constructing the Project in accordance with drawings,
plans, and specifications. Id. at 2 (“Scope of
Work”). Aventura was not responsible for the design of
the Project, and had no inspection responsibilities.
Id; see also Trial Transcript at
Subcontract. Aventura subcontracted all of
the concrete work to Drawdy, including all work related to
A.D.A. ramps and A.D.A. curb ramp flares. See
Subcontract, Plaintiff's Exhibit No. 1;
see also TT at 20:1-3; 205:17 to 206:6. Pursuant to
the Subcontract, Drawdy was required to “[p]rovide all
labor, material, equipment, and supervision necessary to
perform all CONCRETE work as per plans and
specifications.” Exhibit No. 1 at 1. The
Subcontract also states that Drawdy is to
“[p]rovide/coordinate all inspections as necessary to
achieve sign-offs.” Id.
Referenced and incorporated into the Subcontract were the
Project's plans and drawings, including plans and
drawings related to a concrete A.D.A. ramp and A.D.A. curb
ramp flare located at the outside entrance of the convenience
store. Id. at 13 (Plan CFG9.1), 15 (Plan A0.4).
Under the “DETAIL NOTES”, the plans stated that
the A.D.A. ramp and A.D.A. curb flare are to be constructed
“PER A.D.A. STANDARDS … AND FLORIDA BUILDING
CODE STANDARDS”. Id. at 13 (Plan CFG9.1).
Subcontract also contains an “Indemnification”
clause that states that Drawdy “expressly agrees to
indemnify and save harmless
Aventura … from all claims,
demands, suits, costs or expenses because of bodily
injury … sustained by any person(s) …
arising out of his operations, work or
materials under this
Subcontract…..” Id. (emphasis
Underlying Personal Injury Lawsuit. A little
over a month after the Cumberland Farms opened to the public,
Bruce Henkle (“Henkle”), a customer, allegedly
tripped on a concrete A.D.A. curb flare, fell, and seriously
injured himself. DE 86 at 3-4 (the Project was substantially
completed on October 7, 2014 and Mr. Henkle allegedly tripped
and fell on November 13, 2014); see also Complaint,
Plaintiff's Exhibit No. 2.
Henkle initiated a lawsuit against Cumberland Farms,
Aventura, and others.See Complaint, Plaintiff's
Exhibit No. 2. As to the claims against Aventura, Mr.
Henkle alleged that he “was injured” when he
“tripped and fell over a ‘flared' curb
… located immediately adjacent to an ADA entrance
ramp.” Id. at ¶ 20. He further alleged
that Aventura, “through its agents, servants, and/or
employees” was negligent “[i]n constructing
… the premises in violation of applicable building
codes, statutes and ordinances.” Id. at ¶
terms of damages, Mr. Henkle claimed to incur over $300, 000
in past medical bills and expenses, future medical expenses
estimated at over $400, 000 (due to the need for future
surgeries), and significant pain and suffering damages.
See TT at 30:22 to 31:2. Overall exposure was
estimated to be in excess of one million dollars.
Id. at 30:16-18.
Liability Theories Advanced In Underlying Personal
Injury Lawsuit. Mr. Henkle retained Ronald Bertone,
a licensed architect, to provide expert opinions related to
the subject concrete “ADA Curb Ramp” located at
the Project. See Affidavit of Bertone,
Plaintiff's Exhibit No. 9 at 2 (¶¶
2-3); see also Photographs Identifying the Subject A.D.A.
Curb Flare, Plaintiff's Exhibit No.
8. According to Mr. Bertone's affidavit
and expert report, he offered three expert opinions related
to liability. See Affidavit of Bertone,
Plaintiff's Exhibit No. 9.
First, the slope of the concrete A.D.A. curb flare “at
the location where [Mr. Henkle] tripped and fell … was
not uniform” and “exceeded and violated the
maximum allowable slope requirement of 10% [as] set forth in
Florida's Accessibility Code For Building
Construction….” Id. at 4 (¶ 4(k)).
In support of this opinion, Mr. Bertone took photographs that
showed that the concrete A.D.A. curb flare violated A.D.A.
Standards and the Florida Building Code. Id. at
23-27. Ultimately, Mr. Bertone concluded that the concrete
A.D.A. ramp and A.D.A. curb flare contained “multiple
violations of the Florida Accessibility Code for Building
Construction.” Id. at 5 (¶ 4(o)).
Second, the concrete A.D.A. curb flare was not painted.
Id. at 3 (¶ 4(g)) (“the top surface of
the curb should have been painted ‘safety
Third, the A.D.A. Access Aisle was too wide, painted to be
eight feet instead of five feet. Id. at 5 (¶
Aventura Tenders To Drawdy. On April 13,
2017, approximately three months after first receiving notice
of Mr. Henkle's claims, Aventura tendered the defense of
the Henkle suit to Drawdy and demanded indemnification from
Mr. Henkle's claims. See Tender Letter,
Plaintiff's Exhibit No. 6 at 3 (“demand is
hereby made upon Drawdy … to defend and indemnify
Aventura”); see also TT at 54:5-23. The tender
letter cited to the “Indemnity” clause of the
Subcontract and explained that the request for
indemnification was due to the fact that Mr. Henkle's
claims arose out of Drawdy's operations and work. See
Tender Letter, Plaintiff's Exhibit No. 6 at
Drawdy received notice of the tender and was afforded the
opportunity to participate in litigation and settlement of
the underlying personal liability claim; however, Drawdy
never responded and refused to indemnify Aventura in any way.
Id.; see also Pre-Trial Stipulation, ¶
5(g) (DE 99); TT at 8:20-23; 82:7-14.
Settlement Of Underlying Personal Injury
Lawsuit. On June 29, 2017, Aventura settled the
underlying case for $150, 000.00,  which was paid by Great
Divide, who initiated the instant contractual indemnity
action to recover the settlement amount paid, and
attorneys' fees and costs incurred in defending the
underlying action and in prosecuting the instant indemnity
Reasonableness Of Settlement. The parties
stipulated to the fact that Aventura's underlying
settlement of Mr. Henkle's case in the amount of $150,
000 was reasonable. DE 99 at 6 (¶ 5(h)); see also
TT at 19:22 to 20:19.
Potential Liability. Frank DeMeyer, the
President of Aventura, testified that he worked closely with
defense counsel in the underlying personal injury case to
understand plaintiff's liability theories, assisted
counsel in understanding technical construction issues, and
independently analyzed his own company's potential
liability. See TT at 31:17 to 32:8. In doing so, he
reviewed the underlying complaints filed by Mr. Henkle,
pleadings and motions filed in the case, orders entered in
the case, and the affidavit executed by Mr. Henkle's
expert. Id. at 26:19 to 28:1; 31:21 to 33:1. He
ultimately concluded that Mr. Henkle's claim created
significant exposure in excess of one million dollars, and
that Mr. Henkle was seeking to hold his company, Aventura,
vicariously liable for the allegedly improper work completed
by his subcontractor, Drawdy. Id. at 27:23 to 28:15;
terms of Mr. Henkle's liability theories, Mr. DeMeyer
testified that the only liability theory advanced by Mr.
Henkle in the underlying personal injury case that created
the potential for liability to be placed on his company,
Aventura, was Mr. Henkle's claim that the concrete A.D.A.
curb flare “at the location where [Mr. Henkle] tripped
and fell … was not uniform” and “exceeded
and violated the maximum allowable slope requirement of 10%
[as] set forth in Florida's Accessibility Code For
Building Construction….” TT at 41:19 to
43:25; see also Affidavit of Bertone,
Plaintiff's Exhibit No. 9 at 4 (¶ 4(k)). He
further testified that the evidence gathered and submitted by
Mr. Henkle's expert was significant and compelling in
that it included photographs that depicted violations of
A.D.A. Standards and the Florida Building Code. See
TT at 61:9-15; see also Affidavit of Bertone,
Plaintiff's Exhibit No. 9 at 23-27.
for Mr. Henkle's other liability theories, Mr. DeMeyer
testified that they did not create the potential for
liability to be placed on his company, Aventura. See
TT at 53:11-24.
With respect to the A.D.A. curb flare not being painted, Mr.
DeMeyer explained that the painting of the A.D.A. curb flare
was not included in Aventura's scope of work as set forth
in the Master Contract, that the plans and drawings did not
state that painting was required, and that the concrete
A.D.A. curb flare was not required to be painted under the
A.D.A. Standards or the Florida Building Code. TT at
49:24 to 51:4. In other words, the work was completed
according to the plans and drawings and complied with the
A.D.A. Standards and the Florida Building Code. Id.
at 50:11 to 51:4. As such, this liability theory did not
create the potential for liability to be placed on
Aventura. Id. at 53:16-18. Drawdy did not
put forth any evidence to contradict this assertion.
With respect to the A.D.A. Access Aisle being “too
wide”, painted to be eight feet instead of five feet,
Mr. DeMeyer explained that the painting of the A.D.A. Access
Aisle was included in Aventura's scope of work as set
forth in the Master Contract. TT at 51:5 to 53:10.
However, he demonstrated that plans and drawing provided by
Cumberland Farms stated that the A.D.A. Access Aisle was to
be eight feet wide. Id. at 51:25 to 52:5; see
also Subcontract, Plaintiff's Exhibit No. 1
at 12 (Plan CFG4.0). Mr. DeMeyer explained that although the
standard notes on the plans mention a five-foot A.D.A. Access
Aisle, a five-foot width is a minimum requirement under the
A.D.A. Standards and that the width noted in the actual plans
and drawings would govern construction. TT at
52:10-17. Even more, he explained that the parking space
located next to the A.D.A. Access Aisle was a
twelve-foot-wide “van-accessible parking space”
and that under A.D.A. Standard 502.2, an eight-foot A.D.A.
Access Aisle is required when adjacent to a
“van-accessible parking space”. Id. at
51:16-24. In other words, the work was completed according to
the plans and drawings and complied with the A.D.A. Standards
and the Florida Building Code. Id. at 53:3-10. As
such, this liability theory did not create the potential for
liability to be placed on Aventura. Id. at 53:22-24.
Drawdy did not put forth any evidence to contradict this
There was also no evidence put forth that Mr. Henkle's
claims arose out of Aventura's actions or inactions, nor
was there any evidence that Aventura's independent
actions or inactions created the potential for liability in
the underlying case. TT at 123:3-15. In fact, the
evidence put forth by Aventura demonstrated that when
independent inspectors identified slope issues with the
concrete A.D.A. ramp and A.D.A. curb flare, Aventura
immediately put Drawdy on notice of the issue and requested
that they remedy any issues before the Project would be
opened to the public. See Punchlist E-Mail,
Plaintiff's Exhibit No. 11 (inspector's
issuance of punchlist to Aventura, which states in relevant
part, “The curb ramp appears to be non-ADA
complaint.”); Punchlist Letter,
Plaintiff's Exhibit No. 3; Punchlist
Request to Drawdy, Plaintiff's Exhibit No.
4 (Aventura's request that Drawdy complete all
punchlist items); see also TT at 71:22 to 72:10;
179:7-14. In response, Drawdy advised Aventura that the
concrete A.D.A. ramp and A.D.A. curb flare issues were
resolved and issued a warranty to Aventura. See
Warranty, Plaintiff's Exhibit No. 5;
see also TT at 74:16-22; 182:2-16.
a settlement is paid, the party seeking indemnification has
the burden to show that the settlement, or portions thereof,
fell within the coverage of the indemnity clause.”
Bankers Ins. Co. v. Am. Team Managers, Inc., 2012 WL
2179117, at *6 (M.D. Fla. June 13, 2012) (citing Metro.
Dade County v. Florida Aviation Fueling Co., Inc., 578
So.2d 296, 298 (Fla. 3d DCA 1991)). In such a case,
“the indemnitee is entitled to indemnity upon proof of
its potential liability to the original plaintiff and the
reasonableness of the settlement.” Id. at *9;
see also Camp, Dresser & McKee, Inc. v. Paul N.
Howard Co., 853 So.2d 1072, 1079 (Fla. 5th DCA 2003)
(“courts generally agree that a party seeking
indemnification must establish that the settlement was made
based on his potential liability to the plaintiff.”).
Accordingly, “[t]he indemnitee may settle for a
reasonable amount and then recover that amount from the
indemnitor by showing it was not liable on any theory outside
the indemnity agreement and was potentially liable on a
theory covered by the agreement.” Id. at 1080.
The Indemnity Clause At Issue - Scope Of Coverage
Florida, courts construe indemnity contracts according to
ordinary rules of contract construction.” Fid.
& Guar. Ins. Co. v. Ford Motor Co., 707 F.Supp.2d
1300, 1313 (M.D. Fla. 2010). The intent of the
parties and the scope of the indemnification provision are
derived from the language of the contract and the
circumstances in which it was made. Id. The duty to
indemnify must be measured by the facts developed through