Additional Insured Coverage Limited to Vicarious Liability
On certified questions from the Eleventh Circuit, the Florida Supreme Court holds in Garcia v. Federal Ins. Co. (Oct. 25, 2007), that additional insured provisions in a homeowner’s policy extending coverage to “any other person or organization with respect to liability because of acts or omissions” of the named insured limits coverage to instances of vicarious liability, and does not extend to the additional insured’s own active negligence.
The claim arose when plaintiff’s foot slipped from a worn brake pedal, which caused the vehicle she was operating to strike and seriously injure a pedestrian. At the time of the accident, plaintiff was running errands for the insured, her employer. In the ensuing lawsuit, the complaint alleged that the insured and plaintiff were each independently negligent for allowing the brake pedal to wear down to bare metal.
The plaintiff sought coverage under the insured’s homeowner’s policy, which extended coverage to “any other person or organization with respect to liability because of acts or omissions” of the named insured. At issue was whether the additional insured coverage was limited to the additional insured’s vicarious liability.
Two phrases were relevant to the court’s narrow construction of the clause: “with respect to,” and “because of.” Relying on dictionary definitions of these terms, the court found that the phrase “with respect to,” means “concerning,” while “because of” means “by reason of.” Thus, in the court’s view, the clause must be read to mean that an additional insured “is only entitled to coverage concerning liability caused by or occurs by reason of acts or omissions of the named insured,” and that the policy does not extend to the additional insured’s liability for her own acts of negligence.
Though the court had not previously interpreted the clause at issue, the court noted its earlier decision, Container Corp. of Am. v. Maryland Cas. Co., 707 So.2d 733 (Fla. 1998), in which it had explained that a carrier wishing to limit additional insured coverage to vicarious liability could do so with appropriate language. In Container Corp., the court had referred to the language at issue in Consolidation Coal Co. v. Liberty Mut. Ins. Co., 406 F.Supp. 1292 (W.D.Pa. 1976), in which the phrase “but only with respect to acts or omissions of the named insured” had been construed to limit the coverage. The court rejected plaintiff’s efforts to distinguish this case based on the absence of the phrase “but only,” finding the two clauses substantially similar.
The court also rejected plaintiff’s argument that the clause should be equated with “arising out of,” a phrase previously construed very broadly by the court in Taurus Holdings, Inc. v. United States Fidelity & Guaranty Co., 913 So.2d 528 (Fla. 2005). “Arising out of,” the court had held in Taurus Holdings, “requires only some level of causation greater than coincidence” and is “broader in meaning than the term caused by.” Presence of the term “because of” required a narrower construction limiting coverage to the insured’s liability caused by the named insured’s negligence.
The court found in this case that, since the claimant sued plaintiff for plaintiff’s own negligence, and did not allege that plaintiff was vicariously liable for the conduct of the insured, plaintiff was not entitled to additional insured coverage under the policy.
