OMAR ORDONES, APPELLANT,
v.
AMERICAN INTERSTATE INSURANCE COMPANY, A CORPORATION, APPELLEE

Fla. 4th DCA | 2006-12-27
No. 4D05-3530
STEVENSON, C.J., and WARNER, J., concur.
950 So. 2d 427 Florida District Court of Appeal, Fourth District (2006)

AI-generated. These summaries, headnotes, and key points are machine-generated and may contain errors or omissions. Always verify against the full opinion text below. Not legal advice.

Synopsis

An employee who was injured after his employer's workers' compensation insurance was cancelled sued for coverage. The trial court granted summary judgment for the insurer based on the employer's alleged breach of contract for failing to notify the insurer of the lawsuit, but the appellate court reversed, holding that the insured was relieved of all contractual duties including notice obligations when the insurer repudiated the contract by canceling coverage.


Holding

The insured company was relieved of all contractual duties, including the duty to notify the insurer, when the insurer repudiated the contract through cancellation. Therefore, the insured did not breach its duty to provide notice of the lawsuit.


Headnotes

[1] A party's repudiation of a contract relieves the non-breaching party of all obligations to tender performance under the contract.

[2] When an insurer repudiates a workers' compensation policy by canceling coverage, the insured is relieved of its contractual duty to provide notice of a subsequent lawsuit…

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

Key Quotes

“When one party repudiates a contract, the non-breaching party is relieved of all obligations to tender performance under the contract and has an immediate cause of action for breach.”

Establishes the fundamental legal principle that repudiation of a contract extinguishes the non-breaching party's obligations under that contract.

Previewing 1 of 3 key quotes on this case — the court’s exact language, pinpointed for members.

Join FLexlaw to unlock all legal intelligence

Facts & Procedural History

American Interstate issued a workers' compensation policy to Bella Marine in July 2000. In October 2000, the insurer issued notices of cancellation ef…

The full statement of facts, procedural history, and disposition for this case are member content.

Join FLexlaw to unlock all legal intelligence

© FLexlaw, Inc. — AI-generated enrichments are proprietary. All rights reserved.


Opinion of the Court
TAYLOR, J.

TAYLOR, J.

This case concerns an action on a consent judgment entered against the insured, Bella Marine, under a workers’ compensation policy. We find that the trial court erred when it held as a matter of law that the insured owed a duty to notify the insurer, appellee, American Interstate, of a pending action by Ordones, appellant, against Bella Marine after appellee had repudiated the contract. Therefore, we reverse the trial court’s order granting summary judgment in favor of appellee.

Appellee issued a workers’ compensation policy to Bella Marine in July 2000. In October 2000, appellee issued two notices of cancellation of the policy, effective November 14, 2000, to Bella Marine. On December 12, 2000, appellant, an employee of Bella Marine, was injured on the job. American Interstate refused to provide coverage for appellant’s injuries. Bella Marine and appellant agreed to a consent judgment under which appellant was assigned Bella Marine’s rights to proceed against appellee.

In the motion for summary judgment that is the subject of this appeal, appellee asserted that it properly cancelled the contract under sections 440.42 and 627.4133(l)(b), Florida Statutes. The trial court held as a matter of law that section 627.4133(1)(b) does not apply to workers’ compensation, and that appellee did not validly cancel the contract. The court further held, however, that Bella Marine breached its contractual duty under the policy to provide appellee with notice of its suit with appellant. Accordingly, it en tered summary judgment in favor of appel-lee.

When one party repudiates a contract, the non-breaching party is relieved of all obligations to tender performance under the contract and has an immediate cause of action for breach. See Hosp. Mortgage Group v. First Prudential Dev. Corp., 411 So. 2d 181 (Fla.1982). Here, appellee repudiated the contract by canceling coverage. Bella Marine was thus relieved of its duty to provide notice as required by the contract. Therefore, the trial court erred in granting summary judgment for appellee on the ground that Bella Marine continued to owe a duty of performance under the contract.

We leave for another day the issue of whether the insured’s failure to give notice also violates Coblentz v. American Surety Co. of New York, 416 F. 2d 1059 (5th Cir. 1969), and its progeny.

Reversed.

STEVENSON, C.J., and WARNER, J., concur.


Cases With Similar Vibessemantic neighbors from the corpus


Citator

Authorities Cited

Full citator, related cases, and AI research tools

Open in FLexlaw