Maxum Indemnity Co. v. Florida Construction Services, Inc.

Citations: 59 F. Supp. 3d 1382; 2014 U.S. Dist. LEXIS 184010; 2014 WL 6467197Docket: Case No. 8:13-cv-2990-T-36AEP

Court: District Court, M.D. Florida; November 17, 2014; Federal District Court

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The Court grants Plaintiff Maxum Indemnity Company's Motion for Judgment on the Pleadings due to Defendants' failure to respond. The background involves the Estate of Rebecca Hawk, who died from carbon monoxide poisoning resulting from a neighbor's car left running in a garage adjacent to her apartment. Hawk's complaint alleges violations of Florida's Building Code and negligence against Thomason-Stevens, the general contractor responsible for the apartment's construction, claiming deficiencies in the HVAC system and tenant separation wall design.

In response, Thomason-Stevens filed a third-party complaint against Florida Construction Services, asserting that if Hawk proves defects in the materials supplied by Florida Construction Services, it would constitute negligence and breach of contract. Thomason-Stevens seeks contractual and common law indemnity as well as contribution for the damages claimed by Hawk.

Maxum, which insured Florida Construction Services, initiated this action for a declaratory judgment indicating it has no duty to defend or indemnify Florida Construction Services based on exclusions in the Commercial General Liability policy, specifically citing the Total Pollution Exclusion, New Residential Construction Exclusion, and Breach of Contract Exclusion. Maxum contends that the Total Pollution Exclusion precludes any indemnity claims, thereby relieving it of any defense obligations in the underlying suit.

Federal Rule of Civil Procedure No. 12(c) allows a party to move for judgment on the pleadings, where the court accepts the complaint's facts as true and favors the nonmoving party. Judgment is appropriate when no material facts are in dispute and the moving party is entitled to judgment as a matter of law. Maxum asserts it has no duty to defend Florida Construction Services in an underlying action, and the court concurs. An insurer’s duty to defend is determined solely by the allegations in the complaint; there is no obligation if a policy exclusion clearly applies. Maxum's Commercial General Liability policy for Florida Construction, effective from April 25, 2011, to April 25, 2012, includes a Total Pollution Exclusion applicable to claims involving pollutants, which encompasses carbon monoxide. The court finds that the exclusion is clear, as established by Florida law, and that the underlying complaint alleges death caused by carbon monoxide, classifying it as a pollutant. Consequently, since the allegations indicate any potential liability arises from a pollutant discharge, and the policy excludes such coverage, Maxum is not obligated to defend Florida Construction Services. Thus, Maxum is entitled to judgment on the pleadings, affirming it has no duty to provide defense in the action.

Florida law establishes that if an insurer has no duty to defend, then it also has no duty to indemnify. In this case, Maxum has determined that it has no duty to defend Florida Construction Services, and thus, it similarly has no duty to indemnify them in the underlying action. The underlying liability for Florida Construction Services relates solely to the death of Hawk due to carbon monoxide poisoning, which falls under the Total Pollution Exclusion clause. As a result, Maxum is not obligated to defend or indemnify Florida Construction Services. The court has granted Maxum's Motion for Judgment on the Pleadings and will issue a Declaratory Judgment in favor of Maxum Indemnity Company. Additionally, the court notes that the facts presented by Maxum are considered undisputed since the defendants did not respond to the motion despite being notified.