HIGHLANDS INSURANCE COMPANY, APPELLANT,
v.
MILDRED MCCUTCHEN, APPELLEE
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Highlands Insurance Company appeals a summary judgment awarding $100,000 plus attorney's fees and costs to Mildred McCutchen for punitive damages coverage under an insurance policy. The court reverses and remands because genuine factual issues remain about whether the employer's conduct rose to gross negligence or willful/wanton misconduct, which would exclude coverage.
Florida law permits insurance coverage for punitive damages when the insured employer is merely vicariously liable for another's wrongdoing, even if the employer's own conduct does not constitute gross negligence or willful/wanton misconduct. Summary judgment was improper because genuine factual issues remain regarding the extent of the employer's fault, and the insurer bore the burden of proving lack of coverage.
[1] An insurer remains obligated to pay punitive damages when the insured employer is vicariously liable for an employee's wanton and willful misconduct, even if the employer…
[2] When an insurer seeks to deny coverage for punitive damages based on the insured employer's fault, the burden rests on the insurer to prove that the employer's fault cons…
Previewing 2 of 3 headnotes on this case. FLexlaw’s editorially structured points of law — every proposition, pinpointed — are reserved for members.
Join FLexlaw to unlock all legal intelligence“where the claim for punitive damages is based on the wanton and willful misconduct of an employee and the employer is also at fault, but the employer's fault does not amount to gross negligence or willful or wanton misconduct, the insurer is not relieved of its legal obligation to pay.”
Establishes the core legal principle that insurers must cover punitive damages when the employer is only vicariously liable, not directly negligent at the gross negligence or willful/wanton level.
Previewing 1 of 3 key quotes on this case — the court’s exact language, pinpointed for members.
Join FLexlaw to unlock all legal intelligenceThis is the third appeal in a lengthy insurance coverage dispute. McCutchen sought punitive damages coverage under an Highlands Insurance policy based…
The full statement of facts, procedural history, and disposition for this case are member content.
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HENDRY, Judge.
Highlands Insurance Company appeals from the entry of a final summary judg ment which awarded $100,000, together with interest, attorney’s fees and costs, to appellee Mildred McCutchen. This is the third time this cause has been before this court. A full recitation of the facts and issues may be found in the prior opinions of Ten Associates v. McCutchen, 398 So. 2d 860 (Fla. 3d DCA), rev. denied, 411 So. 2d 384 (Fla.1981), and McCutchen v. Highlands Insurance Co., 424 So. 2d 26 (Fla. 3d DCA 1982), approved, 446 So. 2d 1073 (Fla.1984). We reverse and remand upon the following briefly stated analysis.
First, the second appeal established that:
where the claim for punitive damages is based on the wanton and willful misconduct of an employee and the employer is also at fault, but the employer’s fault does not amount to gross negligence or willful or wanton misconduct, the insurer is not relieved of its legal obligation to pay.
McCutchen v. Highlands Insurance, 424 So. 2d at 28. Stated another way, Florida law allows insurance coverage for punitive damages when the insured is merely vicariously liable for another’s wrong. Aetna Casualty & Surety Co. v. Wackenhut Corp., 418 So. 2d 1013 (Fla. 3d DCA 1982), approved, 442 So. 2d 192 (Fla.1983). This legal proposition is now settled as the law of the case. U.S. Concrete Pipe Co. v. Bould, 437 So. 2d 1061 (Fla.1983); Crabtree v. Aetna Casualty & Surety Co., 438 So. 2d 102 (Fla. 1st DCA 1983).
Second, we are remanding because the record reflects that there remain genuine issues of fact to be resolved. If, as seems clear from the record, the evidence raises a question as to whether the punitive damages claim is beyond the coverage of the policy, the burden is upon the insurer to show that there is no coverage. U.S. Concrete Pipe v. Bould, 437 So. 2d at 1065. Thus, on remand, it is appellant’s burden to prove that the insured employer’s fault in the underlying cause rose to the level of gross negligence or willful or wanton misconduct so as to show a lack of coverage.
Third, if appellant refuses to carry its burden on remand, as appellee asserts is what occurred after our remand in McCutchen v. Highlands Insurance, the trial court has a panoply of remedies available to it to make certain that our mandate is carried out.
Reversed and remanded.
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Mauricio Ungar v. Petro-Gas Industrienlagen GMBH & CO Betriebs KG Dusseldorf, 488 So. 2d 930 (Fla. 3d DCA 1986)…ts to rear-gue issues already settled by a prior appeal to this court. Ungar v. Petro-Gas Industrielagen GMBH, 467 So. 2d 1012 (Fla. 3d DCA 1985) (mem.). Accordingly, the doctrine of the law of the case applies. Highlands Insurance Co. v. McCutchen, 486 So. 2d 4 (Fla. 3d DCA 1986); 3M Electric Corp. v. Vigoa, 443 So. 2d 111 (Fla. 3d DCA 1983), review denied, 447 So. 2d 888 (Fla.1984). The final judgment of the trial court is Affirmed.…
Authorities Cited
- U.S. Concrete Pipe Co. v. Bould, 437 So. 2d 1061 (Fla. 1983)
- A.M. Crabtree, Jr. v. AETNA Cas. & Sur. Co., 438 So. 2d 102 (Fla. 1st DCA 1983)
- TEN Assocs. v. McCUTCHEN, 398 So. 2d 860 (Fla. 3d DCA 1981)
- AETNA Cas. & Sur. Co. v. The Wackenhut Corp., 418 So. 2d 1013 (Fla. 3d DCA 1982)
- ST. JOE Paper Co. & Theodore B. Gould v. Metro. Dade Cnty., 418 So. 2d 1013 (Fla. 3d DCA 1982)
- AETNA Cas. & Sur. Co. v. The Wackenhut Corp., 442 So. 2d 192 (Fla. 1983)
- McCUTCHEN v. Highlands Ins. Co., 424 So. 2d 26 (Fla. 3d DCA 1982)
- Highlands Ins. Co. v. McCUTCHEN, 446 So. 2d 1073 (Fla. 1984)