BEAZLEY INSURANCE COMPANY, INC., PETITIONER,
v.
TAPAN BANERJEE AND A & B ENGINEERING, INC., RESPONDENTS
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Beazley Insurance Company challenged a trial court's denial of its motion to dismiss a declaratory judgment claim added by plaintiff Banerjee in an underlying negligence lawsuit. The appellate court held that Florida Statute § 627.4136(1) barred joinder of the insurer because no settlement or verdict had been obtained against the insured at the time of joinder, and an exception applied requiring a separate action when the insurer denies coverage or defends under a reservation of rights.
The court held that joinder was barred by § 627.4136(1) because Banerjee had not obtained a settlement or verdict against A & B at the time of joinder in July 2012. Additionally, an exception under § 627.4136(4) applies where the insurer denies coverage or defends under a reservation of rights, requiring that a separate action be commenced against the insurer to litigate the coverage issue.
[1] A declaratory judgment claim against an insurer is barred if the claimant has not obtained a settlement or verdict against the insured, unless an exception applies.
[2] An exception to the prohibition on direct claims against an insurer exists when the insurer denied coverage or defended under a reservation of rights.
Previewing 2 of 4 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“at the time Beazley was added as a defendant to the lawsuit in July 2012, joinder was barred by section 627.4136(1), because Banerjee had not obtained a "settlement or verdict" against A & B, the insured.”
Establishes that the timing of joinder is critical—it must occur after a settlement or verdict against the insured.
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Join FLexlaw to unlock all legal intelligenceBanerjee filed a negligence lawsuit against A & B Engineering in December 2006. A & B obtained a professional liability insurance policy from Beazley …
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Respondent Tapan Banerjee commenced an automobile negligence lawsuit on December 19, 2006, against several defendants, including A & B Engineering, Inc. In February 2008, A & B applied for a professional liability insurance policy with Beazley Insurance Company, Inc.; Beaz-ley, in turn, issued a policy at the end of February, with a one-year policy period of March 4, 2008 through March 4, 2009. In April 2008, A & B provided Beazley with copies of the summons and complaint in the Banerjee action and the insurance *1185company commenced a defense, subject to a reservation of rights. On July 22, 2008, Beazley denied coverage.
In 2012, Banerjee sought leave to add Beazley as a party defendant on a declaratory judgment claim. On July 16, 2012, the trial court granted Banerjee’s motion, thereby adding a declaratory judgment claim to the 2006 action. Beazley responded with a motion to dismiss, claiming that the declaratory judgment claim was in violation of section 627.4136(1), Florida Statutes (2012).
In September 2012, Banerjee and A & B entered into a settlement agreement providing for the entry of a final judgment against A & B for $2.75 million. That same month, Beazley removed the case to federal court, but the federal court remanded the action to state court because removal was untimely, apparently using the date that the lawsuit was filed in 2006 rather than July 16, 2012, the date Beazley became a party to it. On February 6, 2013, the circuit court denied Beazley’s motion to dismiss.
Certiorari relief may be appropriate when the effect of a court’s ruling is to defeat a litigant’s ability to remove an action to federal court. See GEICO Gen. Ins. Co. v. Harvey, 109 So.3d 236, 238 (Fla. 4th DCA 2013). In this case, there was a departure from the essential requirements of law for two reasons. First, at the time Beazley was added as a defendant to the lawsuit in July 2012, joinder was barred by section 627.4136(1), because Banerjee had not obtained a “settlement or verdict” against A & B, the insured. Second, an exception to the rule allowing joinder after “a judgment is entered or a settlement is reached” occurs where “the insurer denied coverage under the provisions of s. 627.426(2) or defended under a reservation of rights pursuant to s. 627.426(2).” § 627.4136(4), Fla. Stat. (2012). A separate action must be commenced against Beazley to litigate the issue of coverage. See DeMeo v. Frenchy’s Worldwide Helmets, Inc., 732 So.2d 12, 13-14 (Fla. 4th DCA 1999).
We therefore grant the petition for writ of certiorari, quash the order denying dismissal, and remand to the circuit court.
DAMOORGIAN, C.J., GROSS and LEVINE, JJ., concur.
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Safeco Ins. Co. OF Ill. v. Earle Rader, Jr., 132 So. 3d 941 (Fla. 1st DCA 2014)…ble harm in cases involving removal. In Beazley Insurance Co., Inc. v. Banerjee, the court held that “[cjertiorari relief may be appropriate when the effect of a court’s ruling is to defeat a litigant’s ability to remove an action to federal court.” 123 So. 3d 1184, 1185 (Fla. 4th DCA 2013) (emphasis added). Again, here, assuming, ar-guendo, the trial court erred, at worst, Safeco’s ability to remove this case has been delayed, not defeated. Note, too, that in Banerjee and Harvey, the petitioners were joined…
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Safeco Ins. Co. OF Ill. v. Beare, 152 So. 3d 614 (Fla. 4th DCA 2014)…yers Armature Works, Inc., 658 So. 2d 646, 648-49 (Fla. 2d DCA 1995). Id. at 1132. We have held several times that the loss of the right to remove a case to federal court constitutes a material irreparable injury. See Beazley Ins. Co. v. Banerjee, 123 So. 3d 1184, 1185 (Fla. 4th DCA 2013); GEICO Gen. Ins. Co. v. Harvey, 109 So. 3d 236, 238 (Fla. 4th DCA 2013); Sunrise Mills (MLP) Ltd. P’ship v. Adams, 688 So. 2d 464, 465 (Fla. 4th DCA 1997). In nearly identical circumstances to those present in this case, th…
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- GEICO Gen. Ins. Co. v. Harvey, 109 So. 3d 236 (Fla. 4th DCA 2013)
- DeMEO v. Frenchy's Worldwide Helmets, Inc., 732 So. 2d 12 (Fla. 4th DCA 1999)