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Harborside Refrigerated Services, Inc., F/k/a Uiterwyk Cold Storage Company, Inc., a Florida Corporation v. Iarw Insurance Company, Ltd., a Foreign Insurance Company
Citations: 759 F.2d 829; 1985 U.S. App. LEXIS 29390Docket: 84-3856
Court: Court of Appeals for the Eleventh Circuit; May 6, 1985; Federal Appellate Court
The appeal involves Harborside Refrigerated Services, Inc. (plaintiff-appellee) seeking recovery from IARW Insurance Company, Ltd. (defendant-appellant) following a judgment against Harborside for damages related to misdescribed chicken parts stored in its warehouse. The district court had granted Harborside's motion for summary judgment, which the appellate court partially reversed and affirmed. The court determined that the insurance policy did not cover liability for damages stemming from incorrect descriptions in warehouse receipts but required IARW to defend Harborside against such claims. The court interpreted the insurance policy in its entirety, concluding that its plain language indicates coverage is limited to damage or loss of goods in the warehouseman's possession, not including misdescribed receipts. Harborside's argument citing an exclusionary clause concerning forged receipts was rejected, as it conflicted with the overall intent of the contract. Lastly, the court remanded the case to the district court for reevaluation of the attorney's fees awarded to Harborside and referenced differing case law regarding apportionment of defense costs. Appellee argues that costs should not be apportioned based on established Florida case law, particularly the precedent set in Employers Commercial Union Insurance Co. of America v. Kottmeier, which asserts that an insurer has a duty to defend an entire lawsuit when parts of the complaint fall within the insurance policy’s coverage, even if other parts do not. The current case differs in that the original plaintiff, Travagricola, pursued two distinct theories of liability against Harborside, each requiring different factual proofs: negligence leading to damage and misrepresentation of already damaged goods. Despite these distinctions, the underlying principle from Kottmeier remains that apportioning defense costs between covered and uncovered claims is impractical, making the insurer responsible for the entire defense until the covered claim is resolved. The court also references Porter, which recognized that apportionment can be feasible in certain scenarios, but emphasizes that it is not applicable here due to the intertwined nature of the claims involved, which would be addressed collectively during discovery and trial. Consequently, the insurer must cover the full defense costs until the covered claim is dismissed. Regarding attorney's fees, the previous award is reversed due to the reversal of the primary judgment for the insured. However, the district court is permitted to reassess whether a reduced fee award is appropriate based on appellee's limited success on appeal. The court's final decision includes a partial reversal, partial affirmation, and remand for further consideration.