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Bodden v. Travelers Property Casualty Co. of America

United States District Court, S.D. Florida

September 6, 2019

Eddie Bodden and others, Plaintiffs,
v.
Travelers Property Casualty Company of America, Defendant.

          ORDER DENYING MOTION TO DISMISS

          Robert N. Scola, Jr., United States District Judge.

         Plaintiffs Eddie Bodden, Feliz Terrero, Francisco Ortega, Marcelino Susana, Victor Lacayo Lopez, and Julio Bringuez, all foreign nationals, seek to recover damages from Defendant Travelers Property Casualty Company of America which insured a cargo barge and tugboat on which they all worked- Bodden as captain; the others as crew. (Am. Compl., ECF No. 17.) While on its way to Haiti, the tugboat, the Billy G, ran out of fuel near Cuba. The Cuban Coast Guard towed the Billy G to Cuba, where the Plaintiffs all remained stranded for nearly a year, suffering various injuries, some very serious, and other losses. The Plaintiffs obtained a judgment, in state court, against the operator and manager of the Billy G and its barge-Suncoast Shipping LLC- and now seek recovery from Travelers-Suncoast's insurer. In response, Travelers asks the Court to dismiss the Plaintiffs' complaint for several reasons. As best the Court can discern, Travelers' objections to the complaint can be summarized as follows: the Plaintiffs generally fail to state a claim upon which relief may be granted; the Plaintiffs have no right to bring a direct action under Florida Statutes section 627.4136; the Plaintiffs' claims are barred by res judicata; the Plaintiffs lack standing; and the policy the Plaintiffs rely on is void. (Def.'s Mot., ECF No. 25.) After a careful review of the record, including the Plaintiffs' response (ECF No. 26) and Travelers' reply (ECF No. 30), the Court is not persuaded that this case should be dismissed and denies Travelers' motion (ECF No. 25).

         1. Background [1]

         The Plaintiffs, a captain and five crewmembers, set sail on the Billy G tugboat in early June 2013 to deliver cargo from Fort Pierce, Florida, to Gonaives, Haiti. (Am. Compl. at ¶ 28.) Near Moa, Cuba, the Billy G ran out of fuel and was left adrift until the Cuban Coast Guard towed it to the Port of Moa. (Id. at ¶ 30.) The Plaintiffs were stranded there without money, food, supplies, or medical treatment for nearly a year until they were eventually repatriated to their home countries. (Id.) During that year they ate rats and insects in order to survive; suffered various illnesses and injuries that were left untreated; and suffered losses of maintenance, cure, and wages. (Id. at ¶ 31.)

         In December 2013, the Plaintiffs filed suit against Suncoast in Florida state court seeking damages for Suncoast's failure to repatriate them, failure to provide maintenance and cure, and failure to provide medical treatment; unseaworthiness; Jones Act negligence; and other claims. (Id. at ¶ 34.) Although not the owner of the barge, Suncoast operated, controlled, managed, and maintained the Billy G and its barge. (Id. at ¶¶ 11, 12.) In preparation for the voyage to Haiti, Suncoast procured insurance to cover the vessel and the crew. (Id. at ¶ 23-25.) The Plaintiffs attach the policy to the complaint. (Policy, Ex. 1, ECF No. 17-1, 36.) The policy provides that Travelers will “make good to [Suncoast] . . . all such loss and/or damage and/or expense as [Suncoast] shall as owners of the vessel named herein have become liable to pay and shall pay on account of liabilities, risks, events, and/or happenings” as set forth in the policy. (Id.) The Plaintiffs maintain the coverage provisions of the policy encompass their injuries, illnesses, medical expenses, repatriation expenses, Jones Act compensation, and other damages. (Am. Compl. at ¶¶ 27, 35; Policy at 36.)

         Travelers adjusted a small portion of the Plaintiffs' claims, and initially defended the state-court suit against Suncoast. (Am. Compl. at ¶ 39, 41.) But ultimately, in September 2014, Travelers filed an action for declaratory relief, against Suncoast, in federal court, seeking to void the policy. (Id. at ¶ 39-43.) Travelers did not, however, name the Plaintiffs as parties. (Id. at ¶ 44.) The District Court for the Southern District of Florida, in May 2015, entered a default judgment, voiding the policy as to Suncoast's claims for the loss of the vessels. (Id. at ¶ 45.) Afterwards, Travelers stopped defending the state-court action and closed the Plaintiffs' claims without further payment. (Id. at ¶ 46.) The state court entered final judgment in that case, against Suncoast and in favor of the Plaintiffs. (Id. at ¶ 47.) The Plaintiffs posit that this judgment affords them standing to bring a direct action against Travelers. (Id. at ¶ 48.)

         2. Legal Standard

         A court considering a motion to dismiss, filed under Federal Rule of Civil Procedure 12(b)(6), must accept all allegations in the complaint as true, construing them in the light most favorable to the plaintiff. Pielage v. McConnell, 516 F.3d 1282, 1284 (11th Cir. 2008). Although a pleading need only contain a short and plain statement of the claim showing that the pleader is entitled to relief, a plaintiff must nevertheless articulate “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). Faced with a motion to dismiss, a court should therefore “1) eliminate any allegations in the complaint that are merely legal conclusions; and 2) where there are well-pleaded factual allegations, ‘assume their accuracy and then determine whether they plausibly give rise to an entitlement to relief.'” Am. Dental Ass'n. v. Cigna Corp., 605 F.3d 1283, 1290 (11th Cir. 2010) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 662 (2009)).

         3. Discussion

         Travelers urges the Court to dismiss the amended complaint on a number of bases, which are all somewhat interrelated. Underlying most of Travelers' arguments seems to be its contention that the Plaintiffs fail to properly plead their right to bring a direct action against it. This is because, as Travelers maintains, (A) this type of policy does not afford coverage to the Plaintiffs under Florida's nonjoinder statute; (B) the policy was voided by the default judgment entered against Suncoast in federal court; (C) the Plaintiffs lack standing; and (D) the policy is null and void because Suncoast mispresented material facts in procuring it. After a thorough review, the Court finds Travelers' arguments all miss their marks.

         A. Statutory Right of Direct Action

         Under Florida Statutes section 627.4136, someone who is “not an insured under the terms of [a] liability contract, ” cannot sue a “liability insurer” until he or she “first obtain[s] a settlement or verdict against a person who is an insured under the . . . policy.” Travelers maintains the Plaintiffs have no right to bring a direct action under this statute section because the policy at issue here is a “policy of indemnity not liability.” (Def.'s Mot. at 7.) The Court is not persuaded.

         The policy here provides that Travelers will “make good to [Suncoast] . . . all such loss and/or damage and/or expense as [Suncoast] shall as owners of the vessel named herein have become liable to pay and shall pay on account of liabilities, risks, events, and/or happenings” as set forth in the policy. (Policy at 36.) The policy then identifies fourteen categories of losses, injuries, expenses, damages, charges, and penalties that are covered by the policy. (Id. at 36-40.) Eleven of these provisions are specifically introduced as “Liability for” whatever the corresponding damage is. (Id.) The Florida Supreme Court, in a case Travelers itself even cited (albeit for another proposition), long ago evaluated nearly identical language and concluded “the policy is one of protection against liability rather than against loss actually paid.” DaCosta v. Gen. Guar. Ins. Co. of Florida, 226 So.2d 104, 106-07 (Fla. 1969). As the court in DaCosta noted, “The repetitive appearance after the initial assuring provision of fourteen clauses, twelve of which begin with the words ‘liability for,' necessarily gives the policy reader the overall impression that protection is in the nature of liability indemnity rather than loss paid indemnity.” The policy here also has nearly a dozen provisions that begin with the words, “liability for.” And, like the policy in DaCosta, “[w]ith the exception of the initial assuring provision quoted [above], the policy appears to insure against liability rather than against loss actually paid.” Id. As the court in DaCosta did, this Court too, “resolve[s] the ambiguity and confusion in favor of providing the greater indemnity to the Assured- indemnity against liability.” Id.; Lake v. Fid. & Deposit Co. of Md., 430 F.2d 1251, 1255 (5th Cir. 1970) (“When an indemnity agreement is reasonably susceptible of two equally fair interpretations, one which will provide indemnity and one which will deny it, the interpretation which provides liability must be applied.”) (citing DaCosta, 226 So.2d 104). Because of this, the Court finds Travelers' argument unavailing: the Plaintiffs have properly pleaded their right to bring a direct action under Florida Statute section 627.4136.[2]

         B. The Declaratory ...


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