STATE FARM MUTUAL AUTOMOBILE INSURANCE CO., PETITIONER,
v.
NORMAN K. RUTKIN, RESPONDENT
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State Farm sought to exclude costs of establishing damages in an arbitration proceeding under an uninsured motorist insurance policy. The Florida Supreme Court held that an insured is entitled to recover not only actual damages but also costs reasonably necessary to establish those damages in arbitration, as these would have been recoverable from an uninsured motorist with proper insurance.
An insured is entitled to recover under an uninsured motorist policy all damages recoverable from an offending motorist with liability insurance, including costs reasonably and necessarily incurred to properly establish such damages in arbitration proceedings, provided such costs are not excessive compared to litigation costs.
“An agreement of an insured to arbitrate a claim with an insurer under an auto liability insurance policy containing uninsured motorist coverage necessarily contemplates application of the statute governing the extent of such coverage.”
Establishes that arbitration agreements must be read in light of uninsured motorist coverage statutes
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Join FLexlaw to unlock all legal intelligenceState Farm issued an auto liability insurance policy with uninsured motorist coverage to Rutkin. A dispute arose regarding Rutkin's claim under the un…
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The decision of the District Court of Appeal, Third District in this case, report*706ed in 195 So.2d 221, was certified to us by that court as passing upon' a question of great public interest.
We agree with the opinion of the District Court and approve its decision. An agreement of an insured to arbitrate a claim with an insurer under an auto liability insurance policy containing uninsured motorist coverage necessarily contemplates application of the statute governing the extent of such coverage. That is to say, F.S. Section 627.0851, F.S.A. The District Court points out that under said Section the insured is entitled to recover under the policy all damages he or she would have been able to recover from the offending motorist if that motorist had maintained a policy of auto liabililty insurance. Such damages necessarily include, not only actual damages arising “because of bodily injury, sickness or disease, including death,” but also costs reasonably incident to the proper establishment in the arbitration proceedings of such actual damages or losses as, for example, costs of the kind itemized in the footnote to the District Court opinion. F.S. Chapter 57, F.S.A., the arbitration statute, should not be read to authorize reduction of the amounts representing the actual damages or losses incurred by the insured or any costs necessarily incurred in establishing such damages in the arbitration proceedings inasmuch as F.S. Section 627.0851, F.S.A. contemplates all are included in uninsured motorist coverage and would have been recoverable from the uninsured motorist if he had maintained auto liability insurance. It would be unreasonable not to allow an insured motorist costs which he necessarily has to incur in order to properly establish before the arbitrators or the umpire the extent of his bodily injuries. Of course, incurrence of such costs may be obviated in many arbitrations, but where they are reasonably and necessarily incurred in order to substantiate a disputed claim in an arbitration proceeding and are not out of line with costs in litigated cases they should be allowed as a matter of right and justice. F.S. Section 57.17, F.S.A. of the arbitration statute, is in accord with this conclusion.
THORNAL, C. J., and THOMAS and DREW, JJ., concur.
O’CONNELL and CALDWELL, JJ., dissent.
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Cited By (17 total)
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Daignault v. Allstate Ins. Co., 484 So. 2d 43 (Fla. 5th DCA 1986)…y. Appellant claims and the record confirms that the arbitration panel did not require compensation for claimant’s future medical expenses and taxable costs in pursuing the arbitration claim. See State Farm Mutual Automobile Insurance Co. v. Rutkin, 199 So. 2d 705 (Fla.1967); Bennett v. Florida Farm Bureau Casualty Insurance Co., 477 So. 2d 608 (Fla. 5th DCA 1985); American Indemnity Co. v. Comeau, 419 So. 2d 670 (Fla. 5th DCA 1982). While we recognize there is some possibility that appellant will not benefit…
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Sellers v. Gov't Emps. Ins. Co., 214 So. 2d 879 (Fla. 1st DCA 1968)…So. 2d 244, 246, 247. . Government Employees Insurance Company v. Sweet (Fla.App.1966), 186 So. 2d 95. . Hilton v. Citizens Insurance Co. of New Jersey (Fla.App.1967), 201 So. 2d 904. . State Farm Mutual Automobile Ins. Co. v. Rutkin (Fla.1967), 199 So. 2d 705.…
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Eagle Star Ins. Co. v. Nannette Parker and Melvin Parker, 365 So. 2d 780 (Fla. 4th DCA 1978)…pe derivative claim. There is a separate issue raised upon appeal: whether one may recover the arbitration costs. There appear to be three Florida cases: Rutkin v. State Farm Mutual Automobile Insurance Co., 195 So. 2d 221 (Fla. 3d DCA 1967), aff’d 199 So. 2d 705 (1967); American Service Mutual Insurance Co. v. Wilson, 323 So. 2d 645 (Fla. 3d DCA 1975); and McNair v. Continental Insurance Co., 245 So. 2d 634 (Fla. 1st DCA 1971). Rutkin and McNair hold that the arbitration costs may be recovered. American Ser…
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- Walker v. Buckeye Cellulose Corp., 195 So. 2d 221 (Fla. 1st DCA 1967)