23 Fla. L. Weekly Supp. 600a
Online Reference: FLWSUPP 2306GARCInsurance — Homeowners — Where insurer had notice of valid assignment to plaintiff water remediation company prior to issuance of payment to insured, insurer cannot rely on payment to insured to discharge debt owned to plaintiff — Insurer’s assertion that plaintiff agreed that sending check to insured would discharge debt owed to it is unsubstantiated — No merit to arguments that plaintiff was responsible for contacting insured to determine if payment had been issued to her and that plaintiff’s assignment is limited chose in action rather than general assignment
INDOOR ENVIRONMENTAL SERVICES, INC. a/a/o ROSANNE GARCIA, Plaintiff, vs. TOWER HILL PREFERRED INSURANCE CO., Defendant/Third-Party, Plaintiff/Counter-Defendant vs. ROSANNE GARCIA n/k/a ROSANNE LEAL, FRASER PROPERTY AND ADJUSTING, INC. And JP MORGAN CHASE & co, Third-Party Defendants. County Court, 11th Judicial Circuit in and for Miami-Dade County, Civil Division. Case No. 15-22035-CA-(01). October 13, 2015. Laura Anne Stuzin, Judge. Counsel: Mario Enriquez, Trujillo Vargas Ortiz Gonzalez, LLP, Coral Gables, for Plaintiff. Jorge Cruz Bustillo, Kelley Kronenberg, Miami, for Defendant.
ORDER GRANTING PLAINTIFF’S MOTION FORSUMMARY JUDGMENT AND DENYING DEFENDANT’SMOTION FOR SUMMARY JUDGMENT
THIS CAUSE came before this Court on August 31, 2015 upon Defendant’s, Tower Hill Preferred Insurance Company (hereinafter “TOWER HILL”), Motion for Summary Judgment and Plaintiff’s, Indoor Environmental Services (hereinafter “IES”), Motion for Summary Judgment. The Court having heard argument of counsel and reviewed the evidence and motions filed, and being otherwise duly advised on the premises, it is hereupon,
ORDERED AND ADJUDGED:
(1) TOWER HILL’s Motion for Summary Judgment is DENIED; and
(2) IES’s Motion for Summary Judgment is GRANTED.UNDISPUTED FACTS
This is a case regarding water remediation services IES performed on behalf of Rosanne Garcia in September 2012 at her property located at 13246 SW 45 Lane, Miami, FL 33175. TOWER HILL insures Rosanne Garcia’s property. The services were performed to remediate water damage considered in claim number 2800101967. IES obtained a valid assignment of Rosanne Garcia’s right to be paid by TOWER HILL for the services rendered. Both parties acknowledge the authenticity and validity of the assignment. TOWER HILL also admits receiving notice of the assignment. The services performed by IES are described in four invoices identified as follows:
INVOICE 886
The services described in this invoice include a water dry out, cleaning and remediation performed from September 12, 2012 to September 17, 2012. The balance due is $9,685.85. TOWER HILL offered to pay IES $7,748.00 instead of the total amount due and IES agreed. See Summary of Agreed Costs Disposition. Notably, this agreement was made between TOWER HILL and IES after the assignment and without consulting Rosanne Garcia. Id.
Nevertheless, this agreed amount was paid directly to Rosanne Garcia via Check No. 0900043793. TOWER HILL did not inform IES that a check had been issued to Rosanne Garcia. Although the check was made payable to Rosanne Garcia, IES, and Rosanne Garcia’s public adjuster, IES never received or endorsed the check. The check was cashed and IES never received the money it was owed from this check. Rosanna Garcia’s public adjuster has sent correspondence admitting that it retained the funds owed to IES from this check. See Notice of Filing, email from Rosanne Garcia’s public adjuster’s attorney.
INVOICE 888
The services described in this invoice include temporary roof mitigation and placing a tarp on the roof. These services were performed in September 2012. The balance due is $1,695.25. These services were paid to Rosanne Garcia after TOWER HILL received a notice of the assignment.
Nevertheless, the payment due to IES was combined with monies due and owing to Rosanne Garcia for payment unrelated to IES’s services. Payment in the amount of $10,733.26 was sent directly to Rosanne Garcia vis Check No. 0900043163. TOWER HILL did not inform IES that a check for its services was being sent to Rosanne Garcia.
Although the check was made payable to Rosanne Garcia, IES, Rosanne Garcia’s Public Adjuster, and Pacific Union Financial LLC, Pacific Union Financial LLC did not endorse the check. IES disputes that it endorsed the check. Ultimately, IES never received the money it was owed from this check.INVOICE 981
The services described in this invoice are temporary roof mitigation done on November 9, 2012. The services include re-adjusting the tarp for an insurance inspection. The balance due is $350.00. The full amount of these services was sent to IES directly with IES as the sole payee via Check No. 0900044972 on January 31, 2013. This check paid for Invoice 984 as well. IES received payment as a result of this check being sent directly to IES and the debt for these services has been discharged.INVOICE 984
The services described in this invoice are temporary roof mitigation done on October 26, 2012. The services include repairing and disposing damaged tarp on the roof. The balance due is $960.74. The full amount of these services was sent to IES directly with IES as the sole payee via Check No. 0900044972 on January 31, 2013. This check paid for Invoice 981 as well. IES received payment as a result of this check being sent directly to IES and the debt for these services has been discharged.PRE-SUIT DEMAND LETTER
On January 30, 2013, well before filing suit, IES sent TOWER HILL a letter informing TOWER HILL that IES had not been paid for covered services rendered. The letter specifically states that IES was owed $12,691.84. That number is the total of the balance due on all four invoices issued by IES. As such, TOWER HILL was put on notice that IES had not received any payment for any invoice sent to TOWER HILL. TOWER HILL responded by issuing payment for Invoice 981 and Invoice 984.
TOWER HILL, however, failed to inform IES that some of the money owed to IES was instead paid to Rosanne Garcia. In fact, TOWER HILL failed to respond in any way to IES’s letter informing TOWER HILL that IES had not been paid for Invoice 886 or Invoice 888. As a result of TOWER HILL’s failure to address this demand letter, IES was forced to file suit to recover insurance proceeds due and payable for services described in Invoice 886 and Invoice 888.
FINDINGS OF FACTS AND ANALYSIS
In analyzing the various issues presented by IES and TOWER HILL, this Court finds that the following legal issues can be determined as a matter of law based on controlling precedent:
i. After an insurer receives notice of an assignment, does the insurer’s payment of insurance proceeds to its named insured and the assignor act as a defense to the assignee’s claim of breach of contract?
ii. Has TOWER HILL presented any competent evidence in support of its allegation that IES agreed to discharge debts owed by TOWER HILL upon the mailing of a check to Rosanne Garcia.?
iii. Did IES have a duty to call Rosanne Garcia and her Public Adjuster to determine whether TOWER HILL made payment to them instead of IES?
iv. Does IES have a full and valid assignment of the right to receive payment for insurance benefits at issue in this case?
v. Has TOWER HILL provided any competent evidence to create a triable issue as to any affirmative defense pled in its answer and affirmative defenses?AFTER AN INSURER RECEIVES NOTICE OFAN ASSIGNMENT OF BENEFITS, THE INSURER MUSTPAY THE ASSIGNED BENEFITS TO THE ASSIGNEE
This Court finds that the 11th Judicial Circuit, acting in its appellate capacity has issued a binding opinion that compels the Court to rule in IES’s favor in this case. In Graham’s Carpet Cleaning & Restoration a/a/o Neilda Childers v. Royal Palm Ins. Co., the 11th judicial circuit’s appellate division considered an insurer’s argument that its obligation to a water remediation company, as assignee of the named insured, was satisfied upon payment to the named insured for covered damages. Id. at 12-091 AP (11th Jud. Cir. 2013) [20 Fla. L. Weekly Supp. 865a]. The water remediation company filed a cross motion for summary judgment arguing that the insurer’s election to pay the named insured after notice of the assignment constituted a gratuitous payment and did not discharge the debt owed to the water remediation company. Id. The trial court, despite acknowledging the validity of the assignment and the insurer’s receipt of the same, granted summary judgment in favor of the insurer. Id.
On appeal, the Appellate Division of the 11th Judicial Circuit ruled that since the assignment was valid and the insurer admitted notice of the assignment, the insurer is obligated to make payment directly to the water mitigation company. Id. The insurer’s argument that it paid the named insured does not discharge liability to the water mitigation company when the insurer was provided notice of the assignment. Id. The appellate court ordered the insurer to satisfy its obligation to the water remediation company pursuant to the terms of the assignment. Id (citing Gisela Investment, N.V. v. Liberty Mut. Ins. Co., 452 So. 2d 1056, 1056 (Fla. 3d DCA 1984)).
In the instant case, the facts are identical. TOWER HILL, when asked by the Court, conceded that the assignment at issue in this case was valid. TOWER HILL also concedes that it had notice of Rosanne Garcia’s assignment to IES before issuing payment. See TOWER HILL’s Answer and Motion for Summary Judgment. Based on the record, the validity and TOWER HILL’s notice of the assignment are undisputed. Therefore, this Court must follow Graham and grant IES’s summary judgment. After notice of the assignment, TOWER HILL, as the debtor, cannot rely on payments made to its named insured and the assignor, Rosanne Garcia, to discharge a debt owed to the assignee, IES. As such, IES’s motion for summary judgment must be granted and TOWER HILL’s motion for summary judgment must be denied.
Further, this Court rejects TOWER HILL’s argument that the Florida law obligating a debtor to pay the assignee after notice of the assignment only applies to secured transactions. Clearly, Graham, discussed at length above, holds that in the specific context of an assignment from a named insured to a water remediation company, payment to the named insured instead of the assignee water mitigation company does not discharge a debt owed to the water mitigation company. See Supra, pages 6-7. As such, the holding in Graham, shows that a duty to pay the assignee applies outside the context of secured transactions and in the specific context at issue in this case.
The Third District Court of Appeal has also issued binding precedent establishing that general principles of contractual construction mandate that a debtor who receives notice of an assignment must issue payment to the assignee. Aldana v. Colonial Palms Plaza LTD, 591 So. 2d 953 (Fla. 3d DCA 1992). In Aldana, a debtor/landlord made the same argument put forth by TOWER HILL. Id. In that case, a landlord issued a construction allowance to a tenant. The tenant assigned the construction allowance to a contractor. Id. The contractor provided the landlord with notice of the assignment and performed work based on tenant’s assignment of the construction allowance. Id. When the contractor completed the work, the landlord ignored the assignment and paid the tenant money due and owing to the contractor. Id.
The contractor sued the landlord for breach of contract. Id. The trial court ruled that the landlord’s agreement with the tenant had an anti-assignment clause and granted summary judgment for the landlord against the contractor. Id. On appeal, the contractor argued that the anti-assignment provision of Fla. Stat. Chap. 679 germane to secured transactions prohibited the anti-assignment clause in the lease. Id.
The Third District Court of Appeal ruled that although Fla. Stat. Chap. 679 did not apply to the lease, general rules of contractual construction, outside of Fla. Stat. Chap. 679, dictated that anti-assignment provisions only prevent the assignment of contractual duties and did not prevent the assignment of the right to receive payments due. Id. The Third District held that once the landlord was given notice of the assignment to the contractor, the landlord/debtor was obligated to pay the contractor/assignee and not the tenant/assignor despite the terms of his contract. Id.
In this case, IES has been assigned the right to receive payments due for the services it rendered at Rosanne Garcia’s property. Based on the clear dictates of Florida law, no provision in TOWER HILL’s policy can be construed to prevent that assignment. Since IES’s assignment is valid, payment to Rosanne Garcia, as stated clearly by controlling precedent, will not discharge the obligation owed to IES. Since TOWER HILL conceded the validity and receipt of the assignment before payment was issued, the only party TOWER HILL could pay to discharge the debt owed to IES was IES. Since TOWER HILL failed to pay IES, IES’s motion for summary judgment must be granted.
IES NEVER AGREED THAT SENDING ACHECK TO ROSANNE GARCIA WOULDDISCHARGE DEBT OWED TO IES
This Court also finds that TOWER HILL’s bare allegation that IES agreed to discharge debt upon the mailing of a check to Rosanne Garcia through its course of dealing is in dispute by IES. The record reflects that IES never discharged the debt pertaining to the first check paid and that TOWER HILL’s assertion of an approved course of dealing is unsubstantiated.
IES IS NOT RESPONSIBLE FOR CALLINGROSANNE GARCIA AND HER PUBLICADJUSTER TO DETERMINE WHETHERTOWER HILL MISTAKENLY PAID THEM
This Court finds TOWER HILL’s argument that IES could have called Rosanne Garcia’s Public Adjuster to retrieve the money owed to IES without filing a lawsuit to be entirely unpersuasive. Despite acknowledging receipt of the pre-suit demand letter, TOWER HILL failed to inform IES that TOWER HILL had paid funds owed to IES to Rosanne Garcia.
IES HAS A VALID AND FULL ASSIGNMENTOF BENEFITS FOR THE INSURANCEPROCEEDS AT ISSUE IN THIS CASE
This Court finds TOWER HILL’s argument that IES does not have a general assignment, but rather a limited chose in action to be meritless. See TOWER HILL’s response to IES’s summary judgment citing One Call Property Services, Inc. a/a/o William Hughes v. Security First Ins. Co., 165 So. 3d 749 (Fla. 4th DCA 2015) [40 Fla. L. Weekly D1196a]. The Court finds that nowhere in the opinion does the Fourth District Court of Appeal state that a chose in action constitutes a limited assignment. Id. In fact, the Fourth District Court of Appeal never uses the word limited in connection with the term “chose in action.” Id.
TOWER HILL’s representation that a chose in action is a limited assignment of rights that does not divest the insured of standing is clearly contradicted by the terms of One Call. Id. In One Call, the court specifically states that a chose in action is assignable. Id. The court also states that “once an assignment has been made ‘the assignor no longer has a right to enforce the interest because the assignee has obtained all rights to the thing assigned.’ ” citing Continental Cas. Co v. Ryan Inc., 974 So. 2d 368, 376 (Fla. 2008) [33 Fla. L. Weekly S59a]. If a claim is assignable, an assignment, by its very definition, will divest the assignor of standing of whatever is assigned. See Continental Cas. Co v. Ryan Inc., 974 So. 2d 368, 376 (Fla. 2008) [33 Fla. L. Weekly S59a]; One Call Property Services, Inc. a/a/o William Hughes v. Security First Ins. Co., 165 So. 3d 749 (Fla. 4th DCA 2015) [40 Fla. L. Weekly D1196a]. If, as in this claim, a claim for insurance proceeds is assigned to a water mitigation company, the insured is divested of standing to sue for benefits owed to the water mitigation company. This Court holds that IES has a valid assignment (as conceded by TOWER HILL) and, therefore, is the only party with standing to pursue the debts owed as a result of IES’s services rendered.
TOWER HILL HAS NOT PRESENTED ANY EVIDENCEIN SUPPORT OF ITS AFFIRMATIVE DEFENSES
This Court also finds that TOWER HILL’s has not presented any evidence in support of its affirmative defenses. As such, TOWER HILL cannot rely on issues beyond the scope of its affirmative defenses to defeat IES’s motion for summary judgment. See Accurate Metal Finishing Corp. v. Carmel, 254 So. 2d 556 (Fla. 3d DCA 1971). TOWER HILL’s first three affirmative defenses pertain to TOWER HILL’s alleged payment of the debt owed to IES. For reasons discussed above, TOWER HILL did not make payment to IES. See Supra pages 6-7. The payment made to Rosanne Garcia does not discharge the debt or obligation owed to IES after notice of the assignment. Id. Therefore, TOWER HILL’s first, second and third affirmative defenses that rely on TOWER HILL’s prior payments cannot provide a defense to IES’s breach of contract as a matter of law. TOWER HILL’s fourth and final affirmative defense cannot provide a defense to IES’s breach of contract as TOWER HILL concedes that the damages at issue in this case are covered. See TOWER HILL’s motion for summary judgment, page 2, paragraph no. 6 and Affidavit of Sam Townsend paragraph no. 12. Insofar as TOWER HILL made arguments outside the framework of the pleadings drafted in its motion for summary judgment, IES is entitled to summary judgment.
CONCLUSION
Based on the evidence presented, this Court finds that IES performed services covered by TOWER HILL at Rosanne Garcia’s property. IES obtained a full and valid assignment of benefits for the insurance proceeds owed for the services rendered. TOWER HILL received notice of the assignment before issuing any payments in this case. Upon receiving notice of the assignment, TOWER HILL was obligated under controlling Florida law to pay IES directly. Contrary to requirements of Florida law, TOWER HILL instead paid some payments directly to Rosanne Garcia instead of IES. IES demanded payment of the insurance proceeds due to it directly from TOWER HILL prior to filing suit. After TOWER HILL’s demand, TOWER HILL refused to make the payments owed to IES and failed to inform IES that the money it was seeking was paid to the wrong party.
TOWER HILL’s failure to pay covered damages to IES is a breach of the obligations owed under the insurance policy. As a result of the breach, IES has not been paid $7,748.00 that TOWER HILL agreed to pay IES as a result of services in Invoice 886. As a result of the breach, IES has not been paid $1,695.25 due and owing for services described in Invoice 888.
Thus, TOWER HILL’s Motion for Summary Judgment is DENIED; and IES’s Motion for Summary Judgment is GRANTED and IES shall submit to the Court a proposed Final Judgment under separate cover.
IT IS SO ORDERED