ROBERT SHUPACK, APPELLANT,
v.
ALLSTATE INSURANCE COMPANY, A FOREIGN CORPORATION FOR PROFIT, APPELLEE
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Appellant sought punitive damages from an insurance company for alleged bad faith failure to pay personal injury protection (PIP) benefits after an automobile accident. The court affirmed summary judgment for the insurer, holding that Florida law does not create a cause of action for punitive damages in such disputes, which are characterized as debtor-creditor relationships rather than fiduciary relationships.
The court held that appellant had no cause of action for punitive damages against Allstate for alleged bad faith refusal to pay. Section 627.736, Florida Statutes, provides for interest and attorney's fees for an insurance company's failure to pay but does not create a cause of action for punitive damages. The relationship between the parties was a debtor-creditor or adversary relationship rather than a fiduciary relationship.
[1] A bad faith claim for punitive damages against an insurer for failure to pay benefits does not lie when the parties' relationship is adversarial rather than fiduciary.
[2] Statutory provisions for interest and attorney's fees for an insurer's failure to pay do not create a cause of action for punitive damages.
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Join FLexlaw to unlock all legal intelligence“Under these circumstances, the parties were more in the nature of a debtor-creditor or adversary relationship than in a fiduciary relationship.”
Establishes the legal characterization of the insurance relationship that precludes punitive damages liability.
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Join FLexlaw to unlock all legal intelligenceAppellant was injured in an automobile accident and filed a PIP claim with Allstate. After paying $2,000, Allstate stopped making payments despite app…
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KEHOE, Judge.
Appellant, plaintiff below, brings this appeal from an adverse final summary judgment entered on his claim for punitive damages arising out of appellee’s, defendant below, bad faith failure to pay personal injury protection (PIP) benefits. We affirm.
Appellant, after being injured in an automobile accident, filed a PIP claim with appellee for the medical expenses incurred. After paying $2000 on the claim, appellee stopped making payments although appellant’s expenses were greater than the $5000 maximum under the policy. Thereafter, appellant filed suit for breach of the insurance contract. Appellee answered setting out, among other things the affirmative defense that appellant’s conduct had contributed to the injuries and, therefore, relieved appellee of its obligations under the policy. Appellant then amended his complaint to reflect a tort claim for bad faith failure to pay, claiming that appellee had arbitrarily stopped payment even though it had actual knowledge of the remaining expenses. Appellee moved to strike the tort claim, and its motion was denied. Appellant, during this time, obtained a partial final summary judgment on his breach of contract claim and appellee satisfied this judgment. Subsequently, appellee filed an answer to the amended complaint, generally denying the allegations, but not reasserting its affirmative defense. Appellee then moved for and obtained an order granting summary judgment. Thereafter, after an attempted appeal of this order, the trial court entered a final summary judgment in favor of appellee on appellant’s tort claim. From this judgment, appellant appeals.
Appellant contends: (1) that the pleadings before the trial court at the time when it entered the judgment appealed created question of material fact about appellee’s bad faith arbitrary refusal to pay; and (2) that appellee’s conduct coupled with appellant’s requests for payment constituted bad faith, as contemplated by Section 627.736, Florida Statutes (1977), which entitled him to punitive damages in tort.
In our opinion, the trial court properly entered its final summary judgment in favor of appellee because, under the facts of this case, appellant had no cause of action for punitive damages against appellee for its alleged bad faith refusal to pay. Under these circumstances, the parties were more in the nature of a debtor-creditor or adversary relationship than in a fiduciary relationship. See Baxter v. Royal Indemnity, 285 So. 2d 652 (Fla. 1975). Section 627.736, among other things provides for interest and attorney’s fees for an insurance company’s failure to pay, but, in our opinion, it does not create a cause of action for punitive damages. Accordingly, the trial court properly entered summary judgment in favor of appellee. Affirmed.
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Time Ins. Co. v. Burger, 712 So. 2d 389 (Fla. 1998)…coverable by a health insurance policyholder against an insurance carrier were limited to breach of contract damages and attorney’s fees. Industrial Fire & Cas. Ins. Co. v. Romer, 432 So. 2d 66 (Fla. 4th DCA 1983); Shupack v. Allstate Insurance Co., 367 So. 2d 1103 (Fla. 3d DCA 1979). The fact that the legislature has specifically authorized first parties to recover damages in bad faith actions suggests that it may have contemplated more than the recovery of the same damages already available in a breach of co…
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Indus. Fire & Cas. Ins. Co. v. Romer, 432 So. 2d 66 (Fla. 4th DCA 1983)…ercent interest per annum, while in the latter section, any insured who successfully obtains a judgment against his insurance company, is entitled to attorney’s fees. Certainly the Third District’s choice of language in Shupack v. Allstate Ins. Co., 367 So. 2d 1103, 1104 (Fla. 3d DCA 1979), would appear to suggest that since the statutes create no punitive damages remedy — there is none available. We also agree with the late Judge Wig-ginton’s analysis of the somewhat comparable uninsured motorist aspect of a…
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Smith v. Standard Guar. Ins. Co., 435 So. 2d 848 (Fla. 2d DCA 1983)…Co. v. Romer, 432 So. 2d 66 (Fla. 4th DCA 1983); United States Fire Insurance Co. v. Clearwater Oaks Bank, 421 So. 2d 783 (Fla. 2d DCA 1982); Travelers Insurance Co. v. Habelow, 405 So. 2d 1361 (Fla. 5th DCA 1981); Shupack v. Allstate Insurance Co., 367 So. 2d 1103 (Fla. 3d DCA 1979); Lumilite Industries, Inc. v. Southeast Life Insurance Co., 365 So. 2d 1083 (Fla. 3d DCA 1979); Allstate Insurance Co. v. Gibbs, 340 So. 2d 1202 (Fla. 4th DCA 1976); Midwest Mutual Insurance Co. v. Brasecker, 311 So. 2d 817 (Fla.…
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Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- Foy Baxter and Annie Smith Baxter v. Royal Indem. Co., 285 So. 2d 652 (Fla. 1st DCA 1973)