In a 10-page order dated July 14, 2022, United States District Judge K. Michael Moore granted summary judgment on the eve of trial in the case of Kinsale Insurance Company vs. Pride of St. Lucie Lodge 1189, Inc. (“Kinsale”).
The case arose from a fatal shooting in the parking lot of an event space in Fort Pierce, Florida. The Lodge operated a clubhouse for a fraternal organization, which hosted events on weekend nights. The Lodge’s policy of insurance had a $50,000 sub-limit for claims arising out of assault and battery.
At some point during a “Grown and Sexy” event, a fight broke out between two groups of patrons. The patrons were ejected from the Lodge and the fight continued in the parking lot. Tanya Oliver was shot in the head while seated in the passenger seat of a vehicle in the Lodge’s parking lot.
Kinsale tendered its $50,000 sub-limit at the time suit was filed by the Haggard Law Firm, which was approximately nine months after Kinsale received notice of the claim. The Haggard Law Firm never made a policy limits demand and rejected the tender. The case was defended by Hamilton, Miller, went to trial and the jury returned a verdict of $4.78 million dollars, assigning 70% fault against the Lodge. Plaintiff then filed a bad faith case alleging a failure to timely tender the $50,000 sub-limit.
The crux of the summary judgment argument centered directly on the application of the Powell Doctrine. (Powell vs. Prudential Property & Cas. Ins. Co., 584 So.2d 12 (Fla. Dist. Ct. App. 1991)). In Powell, the court imposed an affirmative duty upon the insurer to initiate settlement negotiations where liability is clear, and injuries so serious that a judgment in excess of the policy limits is likely. Id. at 14. In a case where a clearly liable insured faces massive exposure, any delay in making an offer even where there is no assurance that the claim could be settled could be viewed as evidence of bad faith. Harvey vs. Geico, 259 So.3d 1 (Fla. 2018).
Daniel Santaniello acted as an expert on behalf of Kinsale on the critical question – did Kinsale have a duty to tender on a negligent security wrongful death shooting absent a demand for policy limits? Kinsale’ s counsel, Aaron Warren of Clyde & Co., laid out Mr. Santaniello’s expert opinions:
“Negligent security or inadequate security cases are unlike any other premises liability cases. These types of cases very rarely, if ever, are cases of clear liability. Liability becomes even more tenuous when the crime occurs between persons that know each other and have an underlying motive that culminates from heat of passion, a domestic dispute or personal hatred. Most security experts will agree these targeted crimes are not foreseeable, preventable or deterrable because the events can escalate quickly and unpredictably, as in this case."
"At the time of the offer on August 18, 2016, there was no evidence or theory presented by plaintiff’s counsel despite repeated requests to provide this information. There was no evidence or theory developed by the investigator that would suggest the Lodge’s liability was clear. There was no evidence or theory suggested by the Lodge or its employees/agents/members that the shooting was foreseeable, preventable or deterrable. The shooter’s group had left the property and only returned to retrieve an I.D. left behind. The last encounter between the shooter’s group and victim’s group escalated rapidly while everyone remained in their cars. This last encounter was happenstance; if the I.D. had not been left behind or if the victim’s group had left a moment sooner, then maybe the shooting would have been averted all together or to another day, or another street or block. This last encounter was unpredictable, unforeseeable, undeterrable and unpreventable."
"The motive of the shooter was clearly hatred for a person she knew, not a botched attempt to rob someone in the parking lot. Prior crimes had little to do with the shooter’s motives. Liability theories changed throughout the litigation, long after Kinsale offered its limits. Prior to that time, no theory of liability whatsoever had been offered, identified or developed. This fact is indisputable."
"Even in a traditional inadequate or negligent security investigation involving a crime against or between unknown persons, foreseeability and duty and reasonableness of security measures is always debatable. This is the case as a matter of law because the law developed on these types of claims leaves it to the jury to determine foreseeability, reasonableness of security measures and legal causation. Indeed, the security measures in place prevented the gun used to kill Ms. Oliver from entering the premises. The gun used in this crime never left the possession or car of the shooter, who had a lawful permit to carry it."
Santaniello’s opinion further stated:
"Having found nothing in the investigation to suggest the Lodge was liable for this event, the Plaintiff’s counsel should not have ignored repeated attempts of Kinsale to obtain their theories of the liability or facts, or information regarding injuries and damages. These were intentional omissions. As early as December 2015 it is believed that attorney Landy had contacted the Haggard Law Firm to handle the suit. The Haggard Law Firm routinely files demands on their cases and routinely outlines the theories of liability. Why didn’t they do so in on this matter? Why didn’t anyone return a single phone call or answer any questions regarding the loss or damages? The answer is more clear than the liability question – they had no interest in settling this matter for a $50,000 sub-limit which attorney Marlowe himself called “measly.” Liability was unequivocally not clear leading up to August 18, 2016. Kinsale’s claim representative responded to the Haggard Law Firm within minutes of receiving the complaint on August 12, 2016, which was the first time anyone representing the plaintiff had made a claim or presented a theory of liability."
The court granted summary judgment, stating “As Powell imposes a duty to initiate settlement negotiations only where liability is clear, no reasonable jury could conclude that Kinsale acted in bad faith in handling the Lodge’s claim. Accordingly, Kinsale is entitled to summary judgement.”
The decision will have a resounding effect and impact on “tender rejection” cases that are working their way through Florida Courts. Dan Santaniello regularly provides expert analysis on negligent security and bad faith opinions. For more information, contact Daniel J. Santaniello at DJS@InsuranceDefense.net.
