NIAGARA FIRE INSURANCE COMPANY, APPELLANT,
v.
ALLIED ELECTRICAL COMPANY, APPELLEE
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Niagara Fire Insurance appealed a trial court's decision reforming its insurance contract with Allied Electrical to eliminate a water-borne loss exclusion that would have barred recovery for a truck-crane lost at sea in 1966. The appellate court affirmed, holding that clear and convincing evidence supported the finding of mutual mistake and rejecting Niagara's defenses based on lack of meeting of the minds and laches.
The trial court did not err in reforming the insurance contract. Clear and convincing evidence supported the finding of mutual mistake requiring reformation. The claim was not barred by laches because Allied did not learn of the facts giving rise to the cause of action until 1973, and Niagara suffered no injury or prejudice from the delay.
[1] Reformation of an insurance contract requires clear and convincing evidence sufficient to overcome the presumption that the policy accurately reflects the parties' intent…
[2] A mutual mistake may warrant reformation of an insurance contract to eliminate an exclusion clause.
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Join FLexlaw to unlock all legal intelligence“The applicable rule for reformation is that the evidence must be clear and convincing and sufficient to overcome a strong presumption arising from the policy that it correctly expresses the intention of the parties.”
Establishes the legal standard for insurance contract reformation that the trial court properly applied.
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Join FLexlaw to unlock all legal intelligenceIn 1966, a truck-crane obtained by Allied Electrical on a lease-purchase basis from Neff Machinery slipped from a barge and sank in salt water offshor…
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PER CURIAM.
Niagara Fire Insurance Company, third-party defendant, appeals from a final judgment after non-jury trial reforming its insurance contract with defendant, third-party plaintiff, Allied Electrical Company to eliminate an exclusion clause. This action stems from a 1966 incident in which a truck-crane obtained by Allied on a lease-purchase basis from Neff Machinery, Inc., the original plaintiff, slipped from a barge and sank in salt water offshore of the Florida Keys.
The sole issue presented on appeal is whether the trial court erred in finding that there was a mutual mistake requiring reformation of the insurance contract. The court reformed the contract by deleting the “water-borne loss” exclusion which otherwise would have barred recovery for Allied. Niagara contends that there was not sufficient legal basis to reform the contract of insurance and delete the “water-borne” exclusion because prior to, and at the time of the insurance contract, there was no meeting of the minds or communication between Allied and Niagara on the portion of the contract that is sought to be reformed and, therefore, there can be no mutual mistake. Niagara also contends that Allied’s claim against it is barred by laches as the loss occurred in 1966 and the claim against Niagara for the reformation of the insurance contract was not brought until 1973. There is no contention that the insurance agent with whom Allied placed the coverage was not the agent of Niagara, but Niagara contends that he did not have the authority to bind the insurance company to a nonstandard insurance contract.
We hold that the trial court did not err in reforming the insurance contract to eliminate the exclusion clause. The applicable rule for reformation is that the evidence must be clear and convincing and sufficient to overcome a strong presumption arising from the policy that it correctly expresses the intention of the parties. Continental Casualty Company v. City of Ocala, Fla.1930, 99 Fla. 851, 127 So. 894; Old Colony Insurance Company v. Trapani, Fla.App.1960, 118 So. 2d 850, 853; Sobel v. Lobel, Fla.App.1964, 168 So. 2d 195, 197; Allstate Insurance Company v. Vanater, Fla.1974, 297 So. 2d 293, 295. We are of the opinion that the trial court’s finding, that there was a mutual mistake requiring reformation of the insurance contract, had sufficient support from the evidence in the record.
We next consider laches as a bar to the relief claimed by the plaintiff. Four elements are necessary to establish laches as a bar to relief. These elements are set out by the Florida Supreme Court in Van Meter v. Kelsey, 1956, 91 So. 2d 327, and by this court in Winston v. Dura-Tred Corporation, Fla.App.1972, 268 So. 2d 426, as follows: (1) conduct on the part of the defendant or one under whom he claims, giving rise to the situation of which complaint is made; (2) the plaintiff, having had knowledge or notice of the defendant’s conduct, and having been afforded the opportunity to institute suit, is guilty of delay in asserting his rights by suit; (3) lack of knowledge on the part of the defendant that plaintiff will assert the right on which he bases his suit; and (4) injury or prejudice to the defendnat in the event relief is accorded to the plaintiff, or in the event the suit is not held to be barred. As to this fourth element, also see State ex rel. Clendinen v. Dekle, Fla.1965, 173 So. 2d 452 at 456, and Brown v. Semple, Fla.App.1967, 204 So. 2d 229, at 233. Since laches is an affirmative defense, the burden of proving it is on those who assert it, and it must be proved by very clear and positive evidence. Van Meter v. Kelsey, supra. The record in this cause shows neither undue delay, in that Allied did not learn of the facts giving rise to a cause of action against Niagara until 1973, nor injury or prejudice to Niagara by reason of the delay. Therefore, we find that the essential elements of laches have not been proved.
For the reasons stated and upon the authorities cited, the judgment herein appealed is affirmed.
Affirmed.
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THE Florida BAR v. McCAIN, 361 So. 2d 700 (Fla. 1978)…establish [*706] laches as a bar to relief. 21 Pla.Jur. Limitation of Actions, Section 94. The Courts of Florida have, in a long line of cases, held these elements necessary to constitute laches. Niagara Fire Insurance Co. v. Allied Electrical Co., 319 So. 2d 594 (Fla. 3rd DCA 1975); Winston v. Dura-Tred Corp., 268 So. 2d 426 (Fla. 3rd DCA 1972); Blumin v. Ellis, 186 So. 2d 286 (Fla. 2nd DCA 1966); and Van Meter v. Kelsey, 91 So. 2d 327 (Fla.1956). The Florida Bar has been diligent in its efforts and does no…
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Alexander v. Kirkham, 365 So. 2d 1038 (Fla. 3d DCA 1978)…as to the legal meaning and operation of the terms or language employed in the writing.” [emphasis supplied] Accord: Heisler v. Florida Mortgage Title & Bonding Co., 105 Fla. 657, 142 So. 242 (1932); Niagara Fire Ins. Co. v. Allied Electrical Co., 319 So. 2d 594 (Fla. 3rd DCA 1975); 13 S. Williston, Law of Contracts, § 1585 (3rd ed. 1970); 3 A. Corbin on Contracts, § 619 (1960 rev.). We think this rule is directly applicable to the case before us. Nor is our conclusion contrary to the cases which hold that…
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Corona Props. OF Fla., Inc. v. Monroe Cnty., 485 So. 2d 1314 (Fla. 3d DCA 1986)…mit. Laches is an [*1318] affirmative defense. Van Meter v. Kelsey, 91 So. 2d 327 (Fla.1956); Smith v. Town of Bithlo, 344 So. 2d 1288 (Fla. 4th DCA 1977), cert. denied, 355 So. 2d 517 (Fla.1978); Niagara Fire Insurance Co. v. Allied Electrical Co., 319 So. 2d 594 (Fla. 3d DCA), cert. dismissed, 322 So. 2d 925 (Fla.1975); Tower v. Moskowitz, 262 So. 2d 276 (Fla. 3d DCA), cert. denied, 268 So. 2d 906 (Fla.1972). Laches bars relief claimed by plaintiff where there is conduct on the part of the defendant, or one…
Previewing 3 of 10 citing cases — full citator treatment, depth of discussion, and citing context are member features.
Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- VAN Meter v. Edward L. Kelsey and his wife, 91 So. 2d 327 (Fla. 1956)
- Allstate Ins. Co. v. Vanater, 297 So. 2d 293 (Fla. 1974)
- Cont'l Cas. Co. v. City of Ocala, 99 Fla. 851 (Fla. 1930)
- OLD Colony Ins. Co. v. Trapani, 118 So. 2d 850 (Fla. 2d DCA 1960)
- The State of Fla. on the relation of James A. Clendinen v. Dekle, 173 So. 2d 452 (Fla. 1965)
- Bryant v. State, 168 So. 2d 195 (Fla. 3d DCA 1964)
- Meyer Sobel v. Lobel, 168 So. 2d 195 (Fla. 3d DCA 1964)
- Gaiel Elsworth Hurrell v. Utter, 204 So. 2d 229 (Fla. 3d DCA 1967)
- Charles J. Livingston & Allstate Ins. Co. v. McREYNOLDS, 268 So. 2d 426 (Fla. 1st DCA 1972)
- Winston v. Dura-Tred Corp., 268 So. 2d 426 (Fla. 3d DCA 1972)