United States District Court, S.D. Florida
MT. HAWLEY INSURANCE COMPANY, Plaintiff,
MAITLAND CENTER, LLC, et. al., Defendants.
ORDER ON MOTION TO DISMISS
BLOOM UNITED STATES DISTRICT JUDGE
CAUSE is before the Court upon
Defendants' Motion to Dismiss or, in the alternative,
Motion to Stay Plaintiff Mt. Hawley Insurance Company's
Action, ECF No.  (“Motion”). The Court has
carefully reviewed the Motion, all opposing and supporting
materials, the record in this case, the applicable law, and
is otherwise fully advised. For the reasons set forth below,
the Motion is denied.
Mt. Hawley Insurance Company (“Plaintiff”), filed
an Amended Complaint for Declaratory Relief against
Defendants to determine whether there is insurance coverage
for certain alleged construction defects and deficiencies in
a conversion of apartments to condominiums. See ECF
No.  at ¶ 1. Specifically, Plaintiff issued
commercial general liability insurance policies to Defendants
Maitland Center & Visconti East, A Condominium
Association, as well as to Visconti West Condominium
Association, Inc. and an excess liability insurance policy to
Brainbridge Construction. Id. at ¶¶ 21-24.
All of these policies are at issue in this litigation.
Id. According to the Amended Complaint, Defendants
have been sued in two lawsuits that are currently pending in
Florida state court, No. 2015-CA-001481-O and No.
2015-CA-001484-O (collectively the “Underlying
Lawsuits”) Id. at ¶¶ 39, 40.
Count I of the Amended Complaint, Plaintiff seeks to enforce
a coverage exclusion pertaining to “products-completed
operations hazard” for buildings converted into
condominiums or co-operatives prior to, during, or after the
policy period. Id. at ¶¶ 79-86. Count II
seeks a declaration that the “Bainbridge
Entities” do not qualify as an insured under the
commercial general liability policies. Id. at
¶¶ 87-92. Similarly, Count III seeks a declaration
that Maitland Center does not qualify as an insured under the
2007-2008 policy issued to Visconti West while Count IV seeks
a declaration that neither Maitland Center nor the
“Bainbridge Entities” qualify as insureds under
the excess liability policy. Id. at ¶¶
93-101. In other counts, Plaintiff seeks to enforce other
coverage exclusions under the insurance policies, such as the
continuous or progressive injury and damage exclusion (Count
V), breach of contract exclusion (Count VI), and the damage
to property or damage to your work exclusion (Count VII).
Id. at ¶¶ 99-118. Finally, in Count VIII,
Plaintiff alleges that Defendants failed to comply with the
conditions of the “Tenants and Contractors - Conditions
of Coverage Endorsements.” Id. at ¶¶
119-123. In each of these counts, Plaintiff seeks a
declaration that it does not have a duty to defend or a duty
to indemnify Defendants for the claims asserted against them
in the Underlying Lawsuits. See generally ECF No.
Motion, Defendants seek dismissal of the Amended Complaint
because the Underlying Lawsuits are still ongoing in state
court. See ECF No. . They contend that there can
be no actual case or controversy, and consequently no
standing, until the underlying proceedings are concluded.
Id. For that reason, they ask the Court to dismiss
each count in the Amended Complaint as it pertains to the
issue of indemnity. Id. Alternatively, Defendants
ask the Court to stay all issues regarding indemnity until
such time as all factual matters are resolved in the
underlying proceedings. Id. Plaintiff timely filed
its Response in opposition. See ECF No. .
pleading in a civil action must contain “a short and
plain statement of the claim showing that the pleader is
entitled to relief.” Fed.R.Civ.P. 8(a)(2). Although a
complaint “does not need detailed factual allegations,
” it must provide “more than labels and
conclusions, and a formulaic recitation of the elements of a
cause of action will not do.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555 (2007); see Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) (explaining that Rule
8(a)(2)'s pleading standard “demands more than an
accusation”). Nor can a complaint rest on
“‘naked assertion[s]' devoid of
‘further factual enhancement.'”
Iqbal, 556 U.S. at 678 (quoting Twombly,
550 U.S. at 557 (alteration in original)).
reviewing a motion under Rule 12(b)(6), a court, as a general
rule, must accept the plaintiff's allegations as true and
evaluate all plausible inferences derived from those facts in
favor of the plaintiff. See Miccosukee Tribe of Indians
of Fla. v. S. Everglades Restoration Alliance, 304 F.3d
1076, 1084 (11th Cir. 2002); AXA Equitable Life Ins. Co.
v. Infinity Fin. Grp., LLC, 608 F.Supp.2d 1349, 1353
(S.D. Fla. 2009). However, this tenet does not apply to legal
conclusions, and courts “are not bound to accept as
true a legal conclusion couched as a factual
allegation.” Twombly, 550 U.S. at 555; see
Iqbal, 556 U.S. at 678; Thaeter v. Palm Beach Cty.
Sheriff's Office, 449 F.3d 1342, 1352 (11th Cir.
2006). Moreover, “courts may infer from the factual
allegations in the complaint ‘obvious alternative
explanations,' which suggest lawful conduct rather than
the unlawful conduct the plaintiff would ask the court to
infer.” Am. Dental Ass'n v. Cigna Corp.,
605 F.3d 1283, 1290 (11th Cir. 2010) (quoting Iqbal,
556 U.S. at 682). A court considering a Rule 12(b) motion is
generally limited to the facts contained in the complaint and
attached exhibits, including documents referred to in the
complaint that are central to the claim. See Wilchombe v.
TeeVee Toons, Inc., 555 F.3d 949, 959 (11th Cir. 2009);
Maxcess, Inc. v. Lucent Techs., Inc., 433 F.3d 1337,
1340 (11th Cir. 2005) (“[A] document outside the four
corners of the complaint may still be considered if it is
central to the plaintiff's claims and is undisputed in
terms of authenticity.”) (citing Horsley v.
Feldt, 304 F.3d 1125, 1135 (11th Cir. 2002)).
their Motion, Defendants seek dismissal or a stay of
Plaintiff's claims for declaratory relief regarding the
duty to indemnify. Defendants acknowledge that Plaintiff may
seek a declaration as to its duty to defend at this juncture.
See ECF No.  at 12 (“At best, only the
issue of Mt. Hawley's duty to defend should proceed, as a
determination of Mt. Hawley's defense obligation is
confined to an ‘eight corners' review of the
Underlying Action Complaints and the Policies”). Thus,
the Court will only address whether Plaintiff's claims
involving the duty to indemnify are subject to dismissal or a
insurer's duty to indemnify is narrower than its duty to
defend and must be determined by analyzing the policy
coverages in light of the actual facts in the underlying
case.” Sinni v. Scottsdale Ins. Co., 676
F.Supp.2d 1319, 1323 (M.D. Fla. 2010) (citing State Farm
Fire & Cas. Co. v. CTC Dev. Corp., 720 So.2d 1072,
1077 n. 3 (Fla. 1998) and Hagen v. Aetna Cas. & Sur.
Co., 675 So.2d 963, 965 (Fla. 5th DCA 1996)). “The
duty to indemnify is dependent upon the entry of a final
judgment, settlement, or a final resolution of the underlying
claims by some other means.” Northland Cas. Co. v.
HBE Corp., 160 F.Supp.2d 1348, 1360 (M.D. Fla. 2001)
(citing Travelers Ins. Co. v. Waltham Indus. Lab.
Corp., 883 F.2d 1092, 1099 (1st Cir. 1989)). If the
insured can show that it did not suffer a covered loss, then
there is no duty to indemnify. Id. “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.” Id. (citing Bankwest v.
Fid. & Deposit Co. of Md., 63 F.3d 974, 981-82 (10th
is, however, one exception to this general rule: “if
the allegations in the complaint could under no circumstances
lead to a result which would trigger the duty to
indemnify” then the court can assess the duty prior to
the conclusion of the underlying lawsuit. Id.; see also
IDC Construc., LLC v. Admiral Ins. Co., 339 F.Supp.2d
1342, 1351 (S.D. Fla. 2004) (same). Put another way,
“‘a court's determination that the insurer
has no duty to defend requires a
finding that there is no duty to indemnify.'”
Mt. Hawley Ins. Co. v. Miami River Pt. Terminal,
LLC, 228 F.Supp.3d 1313, 1326 (S.D. Fla. 2017) (emphasis
in original) (quoting Trailer Bridge, Inc. v. Ill.
Nat'l Ins. Co., 657 F.3d 1135, 1146 (11th Cir.
2011)). See also David R. Farbstein, P.A. v. Wesport Ins.
Corp., 16-CV-62361, 2017 WL 3425327, at *9 (S.D. Fla.
Aug. 9, 2017) (concluding that the insurer did not owe the
insured a duty to indemnify even though the underlying
proceedings were still ongoing pursuant to
“Florida's well-settled principle that there cannot
be a duty to indemnify without a duty to defend”).
with these principles, several decisions within this district
have concluded that when a party seeks a declaration as to
its duty to defend and duty to indemnify, the Court can
assert jurisdiction and decide the duty to defend. However,
it cannot consider the duty to indemnify until the earlier of
the final disposition of the underlying case or a ruling on
the duty to defend. See Safeco Ins. Co. of Am. v.
Weissman, CV 17-62032-CIV, 2018 WL 816827, at *1 (S.D.
Fla. Feb. 9, 2018) (“[T]he Court will not consider the
duty-to-indemnify issue until the earlier of (a) final
disposition of the underlying state-court action; or (b) a
ruling on the duty to defend, at which time the Court will
entertain any motion that the parties may wish to file
concerning the duty to indemnify claims.”); Atain
Specialty Ins. Co. v. Kenneth Russell Roof Contracting,
LLC, CV 16-23627-CIV, 2017 WL 2363013, at *2 (S.D. Fla.
May 30, 2017) (same); Smithers Const., Inc. v. Bituminous
Cas. Corp., 563 F.Supp.2d 1345, 1349 (S.D. Fla. 2008)
(“In light of the ongoing Underlying Liability Action,
this Court will ...