An insurance company will be required to pay a $2.3 million verdict in favor of a man who suffered catastrophic injuries in a motor vehicle accident caused by the firm’s insured, as well as $135,000 in taxes and costs.gavel2-300x225

Defendant insurer in New Hampshire Indemnity Company v. Gray had appealed to Florida’s 1st District Court of Appeal following the verdict, arguing it was improperly joined because the injured man failed to comply with F.S. 627.4136(4), which pertains to nonjoinder of insurers in civil litigation. Defense further asserted court did not articulate any basis for adding it to the judgment or making findings that its policy with at-fault driver covered the injured man’s costs, and finally insisting its policy does not provide such coverage and the judgment was improper.

Justices with the 1st DCA rejected all of these arguments and affirmed trial court’s verdict.

According to court records, the company’s insured was involved in a motor vehicle collision with plaintiff. We know from these records his injuries were catastrophic, but they aren’t detailed in the appellate record. When injured plaintiff filed a lawsuit against the at-fault driver, the at-fault driver’s insurance company provided him a defense as per the terms of his policy. At trial, jurors decided the case in injured man’s favor for $2.3 million.

Trial court entered a final judgment against at-fault driver, reserving the issue of jurisdiction to award costs. Trial court granted a plaintiff motion to award $127,000 in taxes and costs to the award. A week later, plaintiff requested the court join the insurance company to the judgment.

This is fairly standard. Insurance companies are not named as defendants typically in personal injury cases because of the potential prejudice that may arise if jurors know the defendant is covered by insurance. That doesn’t mean insurance companies aren’t liable to pay. If coverage is available under the policy, the court will join the insurer to the action later.

In this case, plaintiff served the joinder motion not on the insurance company directly, but rather on the attorneys who had been hired to provide the insured’s defense. Insurance company then argued plaintiff failed to comply with Florida law by failing to notify the insurance company of the joinder motion via certified mail. The company also argued it wasn’t responsible to pay the additional costs under the policy’s terms.

Plaintiff attorney corrected the procedural defect and did serve the insurance company directly with the motion prior to hearing. Insurer later argued that didn’t happen soon enough prior to the hearing, but the trial court found no error.

Court ultimately entered a judgment adjudicating insurer jointly and severally liable to pay not just the $2.3 million verdict, but $135,000 in costs.

Insurer appealed. As to the argument that the insurer was improperly joined to the action, appeals court found the issue unpreserved because the insurer didn’t file a motion for rehearing or alert the court to the alleged defect. The court further determined that payment of taxes and costs were covered under the terms of the policy under a provision that covers “litigation expenses.”

If you have been a victim of a traffic accident, call Chalik & Chalik at (954) 476-1000 or 1 (800) 873-9040.

Additional Resources:

New Hampshire Indemnity Company v. Gray , Oct. 8, 2015, Florida’s First District Court of Appeal