Civil Remedy Filing

Civil Remedy Notice of Insurer Violations

Filing Number: 792096

Filing Accepted: 11/13/2024

Print Filing

Complainant

Last/Business Name *

CALATLANTIC GROUP, LLC

First Name

Street Address *

5505 WATERFORD DISTRICT DRIVE

City, State Zip *

MIAMI, FL 33126

Email Address *

LKERR@COGBURNLEGAL.COM

Complainant Type: *

Insured

Last/Business Name*		ODC CONSTRUCTION, LLC		First Name
Policy # *		IRE 2001343 04		Claim #*		020231489620

Attorney

Attorney is Applicable

Last Name*	KERR First Name * LAUREN Initial D
Street Address*		777 S. HARBOUR ISLAND BLVD., SUITE 245
City, State Zip*		TAMPA , FL 33602
Email Address *		LKERR@COGBURNLEGAL.COM

Violation

Insurer Type *		Authorized Insurer Unauthorized Insurer

Insurer Name
Insurer Name*		SWISS RE CORPORATE SOLUTIONS CAPACITY INSURANCE CORPORATION
Insurer Name*
Street Address*
City, State Zip*		,
NAIC Company Code 34916

Name of individual responsible for violation (if any):* DAVID GARDNER AND/OR DIANNE HOLDER
Type of Insurance * Commercial Property & Casualty

Reason for Notice *

	Claim Delay
	Claim Denial
	Unfair Trade Practice

* Statutory provision(s) which the insurer allegedly violated.

	624.155(1)(b)(1)		Not attempting in good faith to settle claims when, under all the circumstances, it could and should have done so, had it acted fairly and honestly toward its insured and with due regard for her or his interests.
	626.9541(1)(i)(3)(a)		Failing to adopt and implement standards for the proper investigation of claims.
	626.9541(1)(i)(3)(b)		Misrepresenting pertinent facts or insurance policy provisions relating to coverages at issue.
	626.9541(1)(i)(3)(c)		Failing to acknowledge and act promptly upon communications with respect to claims.
	626.9541(1)(i)(3)(d)		Denying claims without conducting reasonable investigations based upon available information.

* Specific policy language that is relevant to the violation.
Enter all words or phrases (one at a time) that should be used to filter.

ODC Construction, LLC (“ODC”) purchased at least one commercial general liability (“CGL”) policy from First Specialty Insurance Corporation n/k/a Swiss Re Corporate Solutions Capacity Insurance Corporation ("FSIC") providing ongoing and products-completed operations coverage for liability because of property damage resulting from ODC’s work, specifically Policy Number IRE 2001343 04 (the "Policy"). The insuring agreement of the Policy states: We will pay those sums that the insured becomes legally obligated to pay as damages because of … “property damage” to which this insurance applies. We will have the right and duty to defend the insured against any “suit” seeking those damages … The Policy defines “property damage” to include: a. Physical injury to tangible property, including all resulting loss of use of that property … or b. Loss of use of tangible property that is not physically injured … For coverage to be afforded, “property damage” must have been caused by an “occurrence,” which is defined under the Policy as “an accident, including continuous or repeated exposure to substantially the same general harmful conditions.” Not only does the Policy provide coverage to the named insured, ODC, it also provides coverage to CalAtlantic Group, LLC (“CalAtlantic”) as an additional insured. The Policy contains the following endorsement in relevant part: ADDITIONAL INSURED – OWNERS, LESSEES OR CONTRACTORS – AUTOMATIC STATUS WHEN REQUIRED IN CONSTRUCTION AGREEMENT WITH YOU This endorsement modifies insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE PART A. Section II – Who Is An Insured is amended to include as an additional insured any person or organization for whom you are performing operations when you and such person or organization have agreed in writing in a contract or agreement that such person or organization be added as an additional insured on your policy … The Policy also contains a similar endorsement extending coverage to ODC’s completed operations. On January 10, 2017, ODC entered into a subcontract agreement with Standard Pacific of Florida GP, Inc to perform ongoing concrete and framing work, including the project at issue in the below-described lawsuit. The contract required ODC to name Standard Pacific of Florida GP, Inc and its affiliated entities as an additional insured on its policies of insurance. CalAtlantic Group, LLC (f/k/a CalAtlantic Group, Inc.) is an affiliated entity and the sole member of Standard Pacific of Florida GP, Inc. Therefore, CalAtlantic is an additional insured under the Policy.

* Facts and circumstances giving rise to the violation.
Enter all words or phrases (one at a time) that should be used to filter.

This civil remedy notice is being filed because First Specialty Insurance Corporation n/k/a Swiss Re Corporate Solutions Capacity Insurance Corporation ("FSIC") has failed to address CalAtlantic Group, LLC’s (“CalAtlantic”) tenders of defense in good faith. The FSIC policy implicated is Policy Number IRE 2001343 04 (the "Policy"). CalAtlantic has been named as a defendant in a lawsuit styled as Bridgehaven at Citrus Park Homeowners Association, Inc. v. Lennar Homes, LLC, et al, Case No. 22-CA-009092, Hillsborough County, Florida (now pending before the American Arbitration Association) (the “Lawsuit”). The Lawsuit alleges property damage resulting from work performed at the Bridgehaven community (the “Project”), including the concrete and framing work performed by CalAtlantic’s subcontractor, ODC Construction, LLC (“ODC”). During original construction, ODC performed work at the Project pursuant to a subcontract agreement with Standard Pacific of Florida GP, Inc (“StanPac”). Included in the subcontract between StanPac and ODC was a requirement that ODC would secure commercial general liability ("CGL") insurance and name StanPac and its affiliated entities as an additional insured on its policies of insurance. CalAtlantic Group, LLC (f/k/a CalAtlantic Group, Inc.) is an affiliated entity and the sole member of StanPac. ODC purchased at least one CGL policy, the Policy, from FSIC, which provides ongoing and products-completed operations coverage for liability because of property damage resulting from ODC’s work. This coverage extends to both the named insured, ODC, and the additional insured, CalAtlantic. As described supra, the Policy extends coverage to additional insureds where required by contract. Because the written subcontract between StanPac and ODC required ODC to name StanPac and its affiliates as an additional insured, and CalAtlantic is an affiliate of StanPac, CalAtlantic is an additional insured under the Policy. CalAtlantic tendered its defense to FSIC on March 30, 2023. On July 12, 2023, FSIC denied the claim. On December 5, 2023, CalAtlantic again tendered its defense to FSIC and notified FSIC of the Lawsuit. Since that time, FSIC has refused to update its coverage determination as to CalAtlantic’s tender of defense, nor has FSIC provided CalAtlantic with a defense in the Lawsuit. CalAtlantic wrote to FSIC again on October 21, 2024 to refute the denial, but FSIC has not issued any update. FSIC’s refusal to provide a defense to CalAtlantic is knowingly wrongful because the Lawsuit, as pled, implicates coverage under the Policy and does not clearly implicate any exclusions under the Policy. "Under Florida law, an insurer's duty to defend its insured against legal action is quite broad, and 'is determined by comparing the allegations contained within the four corners of the underlying complaint with the language of the policy.'" Zurich Am. Ins. Co. v. Southern- Owners Ins. Co., 314 F. Supp. 3d 1284, 1299 (M.D. Fla. 2018) (Howard, J.) citing Addison Ins. Co. v. 4000 Island Blvd. Condo. Ass'n, Inc., 263 F. Supp. 3d 1266, 1269 (S.D. Fla. 2016) (quoting Jones v. Fla. Ins. Guar. Ass'n Inc., 908 So. 2d 435, 443 (Fla. 2005)). That is, an insurer's duty to defend is determined solely by the allegations in the underlying complaint. Zurich, 314 F. Supp. 3d at 1299 citing Category 5 Mgmt. Grp., LLC v. Companion Prop. & Cas. Ins. Co., 76 So. 3d 20, 23 (Fla. 1st DCA 2011); Lawyers Title Ins. Corp. v. JDC (Am.) Corp., 52 F. 3d 1575, 1580 (11th Cir. 1995). "The duty arises when the relevant pleadings allege facts that 'fairly and potentially bring the suit within policy coverage.'" Id. citing Lawyers Title Ins. Corp., 52 F. 3d at 1580 (quoting Lime Tree Vill. Cmty. Club Ass'n, Inc. v. State Farm Gen. Ins. Co., 980 F. 2d 1402, 1405 (11th Cir. 1993)). The actual facts of the situation are not relevant, such that "the insurer must defend even if facts alleged are actually untrue or legal theories unsound." Id. As a result, "an insurer's duty to defend is distinct from, and broader than, the duty to indemnify," Id. citing Sinni v. Scottsdale Ins. Co., 676 F. Supp. 2d 1319, 1323 (M.D. Fla. 2009), which "must be determined by analyzing the policy coverage in light of the facts in the underlying case," J.B.D. Constr., Inc. v. Mid-Continent Cas. Co., 571 F. App'x 918, 927 (11th Cir. 2014) (emphasis added). In addition, where an injured party "alleges facts partially within and partially outside the coverage of the policy, the insurer is obligated to defend the entire suit." Category 5 Mgmt. Grp., LLC, 76 So. 3d at 23. FSIC’s failure to defend CalAtlantic has prejudiced and damaged CalAtlantic. Due to FSIC’s unreasonable claims handling practices, CalAtlantic has been and will be forced to incur significant defense costs in the Lawsuit, for which FSIC is responsible. The Lawsuit includes allegations of losses covered under the Policy. Under Florida law, FSIC’s duty to defend CalAtlantic was triggered by the Plaintiff’s allegations, whether they are proven to be true or not. The attorneys' fees and costs that CalAtlantic has incurred have unjustly burdened CalAtlantic. Moreover, by refusing to defend CalAtlantic, FSIC has greatly exposed its named insured, ODC, to a much larger claim for CalAtlantic’s defense costs in this matter pursuant to the contractual indemnification provisions in the subcontract. FSIC must exercise its duty of good faith to CalAtlantic and must employ “the same degree of care and diligence as a person of ordinary care and prudence should exercise in the management of his own business.” Farinas v. Florida Farm Bureau Gen. Ins. Co., 850 So. 2d 555 (Fla. 4th DCA 2003) (internal citations omitted). Under Farinas, FSIC is obligated to (1) fully investigate all claims at hand to determine how to best limit its insured’s liability; (2) seek to settle as many claims as possible within the policy limits; (3) minimize the magnitude of possible excess judgments against its insureds by reasoned claim settlement; and (4) keep the insureds informed of the claim resolution process. FSIC’s obligations extend to all the insureds under the Policy and are not limited to the named insured. Thus, FSIC’s obligations extend to additional insureds, like CalAtlantic. To date, CalAtlantic is unaware of FSIC’s investigation, if any, of the claims against CalAtlantic, or its efforts, if any, to seek to settle the claim within the policy limits. Likewise, FSIC has never advised CalAtlantic how, or if, it intends to minimize the magnitude of a possible excess judgment against CalAtlantic. Given the facts outlined above, FSIC has failed or attempted to meet the standard for good faith in this matter. CalAtlantic will be filing suit against FSIC but is also filing this notice in an effort to provide FSIC with a last opportunity to deal with CalAtlantic in good faith as well as to perfect its right to pursue the remedies provided under Section 624.155, Florida Statutes. FSIC can cure by acknowledging its duty to defend CalAtlantic, reimbursing CalAtlantic for its reasonable defense costs, and working together with CalAtlantic to resolve this claim, including without limitation participating at the mediation scheduled for December 10, 2024.

Comments

User Id		Date Added		Comment
kcorcoran@balljanik.com		09-03-2025		Bridgehaven at Citrus Park Homeowners Association, Inc., as assignee of CalAtlantic Group, LLC, withdraws Civil Remedy Notice 792096 as to SWISS RE CORPORATE SOLUTIONS CAPACITY INSURANCE CORPORATION.

Acknowledgement
*	The submitter hereby states that this notice is given in order to perfect the rights of the person(s) damaged to pursue civil remedies authorized by Section 624.155, Florida Statutes. Before submitting a Notice using this system, please verify that all text has been entered correctly and completely. Once the Notice has been submitted, the text cannot be changed or deleted.

DFS-10-363
Rev. 10/14/2008