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Twin City Fire Insurance Co. v. Plasencia

United States District Court, S.D. Florida

May 29, 2019

LEONEL R. PLASENCIA, P.A., et al., Defendants.



         THIS CAUSE came before the Court upon a sua sponte examination of the record. On January 8, 2019, the Plaintiff, Twin City Fire Insurance Company (“Twin City”), filed a Petition for Declaratory Relief [ECF No. 1], in which it seeks a declaration of its obligations under an insurance policy it issued to Leonel R. Plasencia, P.A. It has been nearly five months, however, and a “required party”-the Estate of Leonel R. Plasencia (the “Estate”)-has not been served pursuant to Federal Rule of Civil Procedure 4(m). Nor can it be, because a personal representative of the Estate has not yet been appointed.[1] For that reason, as laid out more fully below, the Court, pursuant to Fed.R.Civ.P. 4(m), hereby gives notice to Twin City that it intends to dismiss the Amended Petition without prejudice unless Twin City perfects service upon the Estate by June 12, 2019 or SHOWS CAUSE as to why the case should not be dismissed in the Estate's absence.


         According to the allegations in the Amended Petition for Declaratory Relief, on April 28, 2016, the law firm of Leonel R. Plasencia, P.A. (the “Insured”) received a settlement check of $475, 000 on behalf of its clients, Michael and Eileen Catinella (the “Catinellas” or “the tort claimants”). See Amended Petition for Declaratory Relief [ECF No. 4 at ¶ 11]. On August 24, 2017, the firm's sole proprietor, Leonel R. Plasencia, committed suicide; shortly thereafter, the Catinellas learned that Mr. Plasencia's trust account had been overdrawn. Am. Pet. ¶ 12; Catinellas Am. Compl. ¶ 14 [ECF No. 24-1]; Plasencia Certification of Death [ECF No. 37-1]. On February 23, 2018, averring that, as a result of Mr. Plasencia's malfeasance, they never received their portion of the settlement proceeds, the Catinellas filed a lawsuit against the Insured (the “underlying action”), in which they sought damages for Negligent Misrepresentation and Breach of a Fiduciary Duty. See generally Catinellas Am. Compl. [ECF No. 24-1]. On October 16, 2018, the Catinellas added the Estate as a defendant in the underlying action. Am. Pet. ¶ 14. The underlying action is still pending in the Circuit Court of the Fifteenth Judicial Circuit in and for Palm Beach County, Florida, Am. Pet. ¶ 10.

         At issue in this case is the Lawyers Professional Liability Policy (the “Policy”) that Twin City issued to the Insured. See generally Am. Pet [ECF No. 4]. Twin City received notice of the underlying action on April 10, 2018. Am. Pet. ¶ 13; [ECF No. 4-1 at 48-49]. It is undisputed that a personal representative has not yet been appointed to administer the Estate. Am. Pet. ¶ 3; Def. Answer ¶ 3.


         Twin City seeks a declaration that, under the terms of the Policy, it is not required to defend or indemnify either the Insured or the Estate in the underlying action. In their various motions before this Court, the parties direct the Court's attention to those portions of the Policy that define the scope and effect of the “Extended Reporting Period, ” which the Policy defines, in pertinent part, as follows:

6. Extended reporting period means a time immediately following the effective date of termination, cancellation, or non-renewal of this policy in which claims may be made against an insured and reported to us under this policy and are the result of a negligent act, error, omission, or personal injury which occurred prior to the end of the policy period and after the retroactive date and which are otherwise covered under this policy.

[ECF No. 4-1 at 8]. Section F of the Policy-which includes a coverage provision that kicks in when, as here, a sole practitioner[2] dies or becomes totally and permanently disabled-further provides that:

F. Extended Reporting Periods
* * *
c. Death or Disability Extended Reporting Period for a Sole Practitioner If you die or become totally and permanently disabled during the policy period, a death or disability extended reporting period for a sole practitioner shall be provided without additional charge. Coverage for reporting claims is extended until the executor or administrator of the estate is discharged or your disability ends. You or your estate must, within sixty (60) days after the end of this policy period, notify us in writing if this coverage is desired . . . [w]e also require: ii. [w]ritten proof of the date of your death.

[ECF No. 4-1 at 11] (emphasis added). The parties quibble over the precise meaning of these provisions-and, specifically, the clause requiring “written notice” by the deceased's estate. The Catinellas argue that, taken together, these provisions extended coverage immediately upon the death of Mr. Plasencia-with or without notice by the Estate. See generally Catinellas Mot. Summ. J. [ECF No. 37]. Twin City, for its part, says that the written notice provision contained in Section F is a prerequisite to any coverage extension See Am. Pet. ¶¶ 18-20. In short, then, the parties' dispute would require the Court to rule upon the scope and extent of the Estate's obligations under the Policy.

         Federal Rule of Civil Procedure 4 requires a plaintiff to serve copies of the summons and complaint on each defendant in the case. Fed.R.Civ.P. 4(b)-(c). Rule 4(m) further provides that, “[i]f a defendant is not served within 90 days after the complaint is filed, the court-on motion or on its own after notice to the plaintiff-must dismiss the action without prejudice against the defendant or order that service be made within a specified time.” Id. (emphasis added). This 90-day service period has long passed. And, while Twin City has perfected service upon both the Catinellas and the Insured, it has failed to serve the Estate. Indeed, because no personal representative has been appointed to administer the Estate, Twin City may not be able to serve the Estate for the foreseeable future. While Rule 4(m), by its own ...

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