Pruco Life Insurance Company v. Wells Fargo Bank, N.A. , 780 F.3d 1327 ( 2015 )

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[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 13-12135
________________________
D.C. Docket No. 9:10-cv-80804-JIC
PRUCO LIFE INSURANCE COMPANY,
Plaintiff-Counter Defendant-Appellee,
versus
WELLS FARGO BANK, N.A.,
as securities intermediary,
Defendant-Counter Claimant-Appellant.
________________________
No. 13-15859
________________________
D.C. Docket No. 1:12-cv-24441-FAM
PRUCO LIFE INSURANCE COMPANY,
Plaintiff-Appellant,
versus
U.S. BANK, N.A.,
as securities intermediary,
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Defendant-Appellee.
________________________
Appeals from the United States District Court
for the Southern District of Florida
________________________
(February 27, 2015)
Before TJOFLAT and JULIE CARNES, Circuit Judges, and DUBOSE, ∗ District
Judge.
JULIE CARNES, Circuit Judge:
CERTIFICATION FROM THE UNITED STATES COURT OF
APPEALS FOR THE ELEVENTH CIRCUIT TO THE SUPREME
COURT OF FLORIDA PURSUANT TO FLORIDA
CONSTITUTION ARTICLE V, § 3(B)(6).
TO THE SUPREME COURT OF FLORIDA AND ITS HONORABLE
JUSTICES:
These consolidated appeals require us to determine the validity of two
individuals’ Stranger-Originated Life Insurance (“STOLI”) policies that the issuing
insurance company sought to have invalidated several years after their issuance. In
support of the insurance company’s effort is a Florida statute that requires a person
who procures life insurance to have an insurable interest in the life of the insured at
∗
Honorable Kristi K. DuBose, United States District Judge for the Southern District of
Alabama, sitting by designation.
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the inception of the policy. 1 The insurance company contends that, as with most
STOLI policies, there was no such interest when these policies were issued, which
the company says entitles it to have the policies declared void. Undermining the
insurance company’s argument, however, is another Florida statute requiring all
insurance policies to include a clause providing that the policy is incontestable
after it has been “in force” for two years. 2 The policies at issue in this
consolidated appeal contained such a clause, and the insurance company clearly
failed to contest the policies within that two-year window.
Thus, the question before this Court is which statute controls. Stated another
way, when these two statutes collide, does Florida’s interest in prohibiting the
issuance of insurance policies purchased by an individual with no insurable interest
trump its interest in requiring insurance companies to determine, within a
designated period of time, whether a particular policy is subject to that or any other
challenge? 3 Florida law does not definitively answer these questions, and federal
district courts have disagreed when asked how to interpret the above Florida
1
Fla. Stat. § 627.404 (2008).
2
Fla. Stat. § 627.455 (1982).
3
If the answer to this question is that the Florida statute requiring an insurable interest in
the insured trumps the statute requiring an insurer to challenge a policy’s validity within two
years of issuance, a second question arises as to the Berger policy, discussed infra. That
question is whether § 627.404, the insurable interest statute, is violated when the individual who
procures the insurance has the required insurable interest at the time of issuance, but nonetheless
has procured the policy in bad faith.
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statutes. Accordingly, certification to the Florida Supreme Court is warranted
pursuant to Florida Constitution Article V, § 3(b)(6).
I. BACKGROUND
The two cases before us involve three STOLI policies. Wells Fargo, N.A.,
the present owner of a STOLI policy on the life of Arlene Berger, appeals a district
court’s final judgment, entered in favor of Pruco Life Insurance Company,
invalidating this policy. As to the second appeal before us, Pruco has appealed a
different district court’s order dismissing its claim seeking the invalidation of two
STOLI policies issued on the life of Rosalind Guild.
A. The Berger Policy
Throughout 2005 and 2006, Arlene and Richard Berger attended financial
planning seminars at which they were told that they could obtain “free life
insurance.” The Bergers talked with insurance salesman Stephen Brasner, who
arranged for them to participate in his STOLI scheme 4 by obtaining (1) financing
for the payment of premiums from a third-party lender and (2) a fraudulent
financial report listing Arlene Berger’s net worth as $15.9 million and her annual
income as $245,000. Brasner then applied to Pruco for a $10 million insurance
4
For a fuller explanation of the workings of STOLI transactions, see PHL Variable Ins.
Co. v. Bank of Utah, Civ. No. 12-1256 ADM/JJK, 2013 WL 6190345, at *1 (D. Minn. Nov. 27,
2013) and Susan Lorde Martin, Betting on the Lives of Strangers: Life Settlements, STOLI, and
Securitization, 13 U. Pa. J. Bus. L. 173, 187–88 (Fall 2010).
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policy on the life of Arlene Berger, naming her husband Richard as beneficiary.
Pruco issued the policy on April 27, 2006.
Brasner subsequently established an irrevocable trust to hold the Berger
policy. The trust named Wilmington Trust Company as trustee and Richard Berger
as co-trustee and beneficial owner. In conjunction with the financing agreement
and the creation of the trust, Arlene Berger granted the third-party lender a power
of attorney and the authority to obtain her medical records.
Despite their signed authorizations, the Bergers claim not to have realized
the implications of these actions. Richard Berger was shocked when he discovered
that Arlene Berger had granted an irrevocable power of attorney pursuant to the
financing agreement. Moreover, according to the Bergers, they neither needed nor
wanted life insurance when they joined Brasner’s STOLI scheme, did not intend to
pay any of the premiums, never had any intention of controlling or keeping any
insurance procured through Brasner, and only accepted the policy because it was
free.
At some point, ownership of the Berger policy was transferred to the trust.
For their participation in this insurance policy transaction, the Bergers received a
payment of nearly $173,000 from Brasner in May of 2008. Then, in September of
2008, Arlene Berger instructed Wilmington Trust to relinquish all her interests and
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rights under the policy to the third-party lender in satisfaction of the financing
agreement. The policy was ultimately sold to a client of Wells Fargo.
On July 9, 2010, approximately four years after it had issued the Berger
policy, Pruco filed suit against Wells Fargo asserting that the policy was void ab
initio for lack of an insurable interest, as required by § 627.404. The district court
granted summary judgment to Pruco on its claim. Adopting its previous analysis
of this issue in an order denying Wells Fargo’s motion to dismiss, the court held
that there was no valid insurable interest in the life of the insured by the party
procuring the insurance, 5 meaning that the policy ran afoul of Florida Statute §
627.404’s requirement of such an interest at the time an insurance policy is issued.
See Pruco Life Ins. Co. v. Brasner, No. 10-80804-CIV, 2011 WL 134056, at *3–6
(S.D. Fla. Jan. 7, 2011) (Cohn, J.). From this conclusion, the court reasoned that
the policy was void ab initio and therefore the incontestability provision of §
627.455 did not bar Pruco’s claim, asserted more than two years after issuance of
the policy.
5
The question whether the individual procuring the insurance for Mrs. Berger had the
requisite “insurable interest” in her life was actually a bit more complicated than described
above, and the factual wrinkle creating that complication will be addressed in the second
question to the Florida Supreme Court. But the district court did ultimately hold that the
procurer of the insurance did not have the necessary interest, which therefore rendered the policy
void ab initio.
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B. The Guild Policy
In September of 2005, insurance broker Gary Richardson persuaded
octogenarian Rosalind Guild to participate in a $10 million STOLI scheme by
offering her free life insurance and monetary compensation. To implement the
scheme, Richardson established an irrevocable trust to hold the Guild policies.
Richardson then submitted two life insurance applications to Pruco, each seeking a
$5 million policy and listing Guild’s daughter as primary beneficiary and the trust
as contingent beneficiary. It was understood that Guild’s daughter would not
receive the death benefit from the policies and that any beneficial interest would
eventually be sold to an investor with no insurable interest in Ms. Guild’s life. In
support of the applications, Richardson submitted a fraudulent financial statement
portraying Guild’s net worth as $19.2 million and annual income as $345,000.
Pruco issued the Guild policies on October 21, 2005. A third party paid over
$2 million in premiums over the course of the next few years. Then, on February
13, 2008, Pruco received a request to change the ownership and beneficiary of the
policies from the Guild Trust to securities intermediary, U.S. Bank, N.A., in
connection with the sale of the beneficial interest in the policies to an investor.
Pruco made the requested change.
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On December 17, 2012, approximately seven years after it had issued the
Guild policies and almost five years after it had approved the change in beneficiary
and ownership to U.S. Bank, Pruco filed suit against U.S. Bank asserting that the
policies were void ab initio under § 627.404. U.S. Bank filed a motion to dismiss
Pruco’s complaint. Analyzing the interplay between the two Florida statutes
differently than did the district court in the Berger case, the district court in Guild
found that, because Pruco had run afoul of the two-year time limit provision to
contest the policy, Pruco’s claim was barred. Accordingly, the district court
granted U.S. Bank’s motion to dismiss Pruco’s claim. See Pruco Life Ins. Co. v.
U.S. Bank, No. 12-24441-CIV, 2013 WL 4496506, at *2, *5 (S.D. Fla. Aug. 20,
2013) (Moreno, J.).
II. DISCUSSION
A. Whether Pruco’s Delay Bars Its Claim to Have the Insurance
Policies Here Declared Void
Pruco argues that the Berger and Guild life insurance policies should be
declared void because the purchasers of these policies lacked an insurable interest
in the persons insured. Pruco relies on Florida Statute § 627.404 (the “insurable
interest statute”), which bars the purchase of a life insurance policy on another
individual unless the benefits of the insurance contract are payable to the insured
individual, his or her personal representative, or a person having an insurable
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interest in the insured individual. 6 Section 627.404 defines “insurable interest” to
include “the life, body, and health of another person to whom the individual is
closely related by blood or by law and in whom the individual has a substantial
interest engendered by love and affection.” Fla. Stat. § 627.404(2)(b)(2). Because
the purchasers of the policies here did not have an insurable interest, as defined by
statute, Pruco says the policies must be invalidated.
The present owners of the Berger and Guild policies (Wells Fargo and U.S.
Bank) respond that, even if Pruco has a winning argument as to the lack of an
“insurable interest,” Pruco waited too long to make that argument and therefore its
request to invalidate the policies should be denied. Like Pruco, Wells Fargo and
U.S. Bank have also found a law that supports their position: Florida Statute §
627.455 (“the incontestability statute”). Section 627.455 states that “[e]very
insurance contract shall provide that the policy shall be incontestable after it has
been in force during the lifetime of the insured for a period of 2 years from its date
6
Section 627.404 provides:
Any individual of legal capacity may procure or effect an insurance contract on
his or her own life or body for the benefit of any person, but no person shall
procure or cause to be procured or effected an insurance contract on the life or
body of another individual unless the benefits under such contract are payable to
the individual insured or his or her personal representatives, or to any person
having, at the time such contract was made, an insurable interest in the individual
insured. The insurable interest need not exist after the inception date of coverage
under the contract.
Fla. Stat. § 627.404(1).
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of issue[.]” Fla. Stat. § 627.455.7 Here, Pruco waited more than four years and
seven years to challenge the Berger and Guild policies, respectively, based on the
absence of an insurable interest at the time of the policies’ issuance: periods of
time that put them well outside the two-year contestability period. That being so,
the present owners of the policies argue that Pruco’s tardiness dooms its efforts to
undo these insurance contracts, on which it had been readily accepting large
premium payments without complaint for several years.
The question before this Court, then, is which of the above two statutes
controls these disputes. That the two district courts in the consolidated appeal
before us reached different conclusions on the same question suggests that the
answer is not clear cut, and this has proven to be the case. The district court that
ruled on the validity of the Berger policy (hereinafter, “the Berger court”) held that
the STOLI policy at issue was void ab initio because it violated § 627.404, the
insured-interest statute. A contract that is void ab initio is a contract that never
existed. The district court thus reasoned that the two-year incontestability
provision required by § 627.455 never took effect because the incontestability
period applies only to an insurance policy that has been “in force,” and, with no
party having a valid insurable interest, the Berger insurance policy was never “in
7
Notably, § 627.455 does not itself impose an incontestability period, but rather
mandates that every policy include a clause to that effect. The Berger and Guild policies all
contain such a clause, in conformity with the statute.
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force.” For that reason, the court concluded that the two-year contestability period
was not an obstacle to Pruco’s effort to invalidate the insurance policies. Brasner,
2011 WL 134056, at *4–6.
The district court that adjudicated the validity of the Guild policy (“the
Guild court”) took a different view of the interplay between the two relevant
statutes, concluding that Pruco’s tardy insurable-interest claim under § 627.404
was barred by the incontestability provision called for by § 627.455. See U.S.
Bank, 2013 WL 4496506, at *2, *5. The Guild court likened § 627.455 to a statute
of limitations that applies regardless of the basis of any challenge to the validity of
the policy. Id. at *3.
As to the relative merits of the two courts’ analyses, there are arguments to
be made on both sides of the issue. Were we adding up the number of courts that
favor one or the other position, the Berger court would find itself aligned with the
majority view on this issue: that a statute requiring an insurable interest at a
policy’s issuance will take precedence over a statute rendering a policy immune
from any challenges by the insurer after a designated period of time. See W.
Reserve Life Assur. Co. of Ohio v. ADM Assocs., LLC, 737 F.3d 135, 143 (1st Cir.
2013); Susan Lorde Martin, Life Settlements: The Death Wish Industry, 64
Syracuse L. Rev. 91, 104 (2014). Answering a certified question from a federal
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district court, the Delaware Supreme Court identified ten other states whose courts
had held that a life insurance policy lacking an insurable interest was a void and
illegal contract that could not be resurrected by an insurer’s failure to challenge the
policy within the statutory contestability period. PHL Variable Ins. Co. v. Price
Dawe 2006 Ins. Trust ex rel. Christiana Bank & Trust Co., 28 A.3d 1059, 1067
n.18 (Del. 2011) (collecting cases). The court interpreted Delaware law as being
aligned with this majority view. Id. at 1068–76.
The Guild court, however, followed the minority position on this issue,
which holds that the lack of an insurable interest renders an insurance policy
merely voidable, not void ab initio. As this thinking goes, because the policy
holder of a voidable insurance contract can, through an applicable defense,
successfully resist an insurer’s effort to invalidate the policy, a policy lacking a
purchaser with an insurable interest similarly cannot be invalidated if the insurer
has failed to make its challenge within the time period set out in an incontestability
clause. W. Reserve Life Assur. Co. of Ohio, 737 F.3d at 143. At least two states
follow this minority position: New York and Michigan. See New England Mut.
Life Ins. Co. v. Caruso, 535 N.E.2d 270, 273–75 (N.Y. 1989); Bogacki v. Great-
West Life Assur. Co., 234 N.W. 865, 865–67 (Mich. 1931); cf. Equitable Life
Assur. Soc. of U.S. v. Poe, 143 F.3d 1013, 1019–20 (6th Cir. 2013)
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(acknowledging that Michigan strictly construes incontestability clauses). Stated
simply, the minority view holds that an incontestability clause applies, no matter
the basis for an insurer’s challenge to the validity of the policy.
As Pruco acknowledges, there are no cases decided by Florida courts that
specifically address whether an incontestable provision bars a tardy challenge to
the validity of a policy considered to be void ab initio because it lacked an
insurable interest at its inception.8 Breaking down the analysis of each district
court decision before us to determine what support under Florida law each might
have, the Berger court noted that Florida law embraces both the public policy that
prohibits an insurance company from contesting a policy after the contestability
period expires as well as the public policy that an insurable interest is necessary for
an insurance policy to be valid. Brasner, 2011 WL 134056, at *6. The court also
8
Other than the two district court cases now on review, the parties identify three other
federal district court cases that touch on this precise question of Florida law. See PHL Variable
Ins. Co. v. Hudson Valley, EPL, LLC, Civ. Action No. 13-1562-SLR-SRF, 2014 WL 4635454, at
*4–5 (D. Del. Sept. 16, 2014) (Fallon, Mag. J.) (interpreting Florida law to require invalidation
of a policy, based on its lack of an insurable interest and notwithstanding the insurer’s failure to
comply with the time limits for challenge found in an incontestability clause) adopted Civ. No.
13-1562-SLR-SRF, 2014 WL 5088854 (D. Del. Oct. 8, 2014) (Robinson, J.); The John Hancock
Life Ins. Co. v. Rubenstein, Case No. 09-21741-Civ-Ungaro, at 5 (S.D. Fla. Aug. 31, 2009)
(Ungaro, J.) (same); Sciaretta v. Lincoln Nat’l Life Ins. Co., 899 F. Supp. 2d 1318, 1328 (S.D.
Fla. 2012) (Middlebrooks, J.) (dictum to the same effect).
While theses decision support the majority (and Pruco’s) position, they offer no
additional analysis other than that offered by the Berger court: because a policy purchased
without an insurable interest violates public policy and is therefore void ab initio, the policy
never existed and hence an incontestability provision cannot apply to bar the insurer’s request
that the policy be invalidated.
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recognized that neither party before it had cited any binding caselaw requiring the
court “to reconcile one policy over the other.” Id. Finally, the court acknowledged
the reasoning behind the minority position, which holds that an incontestability
clause trumps a requirement of an insurable interest. That is, the minority position
encourages “insurers to timely investigate suspicious circumstances, protects
policyholders, and prevent[s] insures from receiving a windfall years down the
road.” Id. (alteration in original). Yet, the Berger court also noted that, under the
minority view, “if bad actors can disguise their fraud for two years, their hands are
washed clean . . . and they are free to collect on their ill-gotten gains.” Id. (citing
Settlement Funding, LLC v. AXA Equitable Life Ins. Co., 06 CV 5743(HB), 2010
WL 3825735, at *5 (S.D.N.Y. Sept. 30, 2010)).
Choosing between the two competing positions on this question, as it was
required to do, the Berger court decided to follow the majority view: that because
a policy without an insurable interest was void ab initio, the incontestability clause
never took effect, and therefore it never expired. Brasner, 2011 WL 134056, at *6.
In lining up with the minority view, however, the Guild court noted that an
incontestability clause works to the mutual advantage of the insurer and the insured
by giving the insured a guaranty against expensive litigation and giving the
insurance company a reasonable period of time to ascertain whether the insurance
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contract is subject to any valid challenges. U.S. Bank, 2013 WL 4496506, at *3
(citing Allstate Life Ins. Co. v. Miller, 424 F.3d 1113, 1115–16 (11th Cir. 2005)
(because Florida courts have “uniformly held” that § 627.455 bars an insurer from
belatedly contesting a policy based on alleged fraudulent misrepresentations in the
insurance application, an insured’s use of an imposter to undergo the required
medical examination constituted fraud that rendered the policy voidable, not void
ab initio, thereby subjecting the insurance company to the two-year contestability
period)).
Characterizing the incontestability clause as a de facto statute of limitations,
the Guild court cited several Florida appellate decisions so applying the clause’s
time limitation to bar an insurer’s challenge based on claims of fraud from
misrepresenting the identity of the insured, the fact of death, and the absence of
pre-existing conditions. Id. The Guild court could find little distinction between
the fraud that underlay the misrepresentations in the case before it
(misrepresentations as to the identity of the insurable interest and the financial
resources of the named insured) and the fraud at issue in the above-cited Florida
cases. Id. at *5. In other words, “[i]n a STOLI context, a lack of insurable interest
may not be divided from the fraud that created it.” Id. For these reasons, the Guild
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court concluded that the Guild life insurance policies could not be invalidated
because Pruco had waited too long to make its challenge.
Because there is no controlling Florida precedent on whether the
incontestability clause can bar a challenge to the validity of an insurance policy
lacking the necessary insurable interest at the time of issuance, we find it necessary
to certify this question to the Florida Supreme Court, as set out below.
B. Whether An Insurable Interest in the Life of Mrs. Berger
Existed at the Inception of Her Life Insurance Policy
If the Florida Supreme Court determines that Pruco’s challenge to the
validity of the Berger and Guild policies is barred by the incontestability clause
mandated by § 627.455, then we pose no additional question for their decision. If,
however, the Florida Supreme Court decides that, notwithstanding Pruco’s failure
to contest the policies within two years of their issuance, Pruco may still seek to
invalidate those policies as being non-compliant with § 627.404, then we must ask
the court one more question regarding the validity of the Berger policy. 9
Specifically, as set out above, Florida Statute § 627.404(1) permits a third
party to procure an insurance policy on the life of another so long as the benefits
under that policy are payable either to the named insured, her personal
9
There has been no briefing on whether the Guild policy potentially satisfied the
“insurable interest” requirement at the time of issuance. Further, at oral argument, counsel for
Wells Fargo and U.S. Bank noted that the appeal concerning the Guild policy concerned only the
issue of incontestability.
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representative, or a person who, at the time the insurance contract is made, has an
“insurable interest” in the insured individual. Further, an insurable interest is not
required to exist after the “inception date of coverage.” Fla. Stat. § 627.404(1).
One can be said to have an “insurable interest” in the life of another individual to
whom one is closely related by blood or by law and in whom one has a substantial
interest engendered by love and affection. Fla. Stat. § 627.404(2)(b).
Although the Berger policy was eventually assigned to Wells Fargo, Mrs.
Berger was listed as the owner and Mr. Berger was named as the beneficiary at its
inception. Clearly, both of those individuals had an insurable interest in Mrs.
Berger’s life. Thus, Wells Fargo argued before the Berger court that the insurance
contract complied with § 627.404’s requirement that there be an insurable interest
at the inception of the policy.
The Berger court rejected that argument. The court acknowledged that
Florida law permits a life insurance policy to be assigned to an entity with no
insurable interest in the life of the insured. Yet, citing authority from other federal
Southern District of Florida cases interpreting Florida law, the court held that such
assignments must be made in good faith, and not as sham assignments seeking to
circumvent Florida’s law prohibiting a wagering contract on the life of another, as
embodied in § 627.404. If the insurance policy were procured with the intent of
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making such sham assignments, the policy would be deemed to have been obtained
in bad faith.
In identifying the applicable standard for determining whether a policy has
been procured in bad faith, the Berger court held that bad faith is established if the
policy was obtained with the intent that it would later be assigned to an entity or
person with no insurable interest in the life of the insured. Such an intent could be
proven by evidence of: (1) a preexisting agreement or understanding that the policy
would be assigned to one without an insurable interest; (2) the payment of
premiums by someone other than the insured, and particularly by the assignee; and
(3) the lack of a risk of actual future loss. The Berger court’s authority for this test
was derived from other federal district court decisions.
Ultimately, the Berger court concluded that the circumstances surrounding
the acquisition of the insurance policy on Mrs. Berger’s life supported a conclusion
that the policy was not obtained in good faith. The court noted that the Bergers
never intended to keep the policy and always knew that ownership would
eventually be transferred to a third party who would receive the benefits should
Mrs. Berger die after her two-year “free insurance period.” In addition, the
Bergers never paid, nor intended to pay, any premium for the policy, and Brasner,
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the insurance salesman, had created an “elaborate scheme” to make it look as if
Mrs. Berger was paying the premiums.
Wells Fargo argues that Florida law does not support the importation of a
good faith requirement into the insurable interest statute. It notes that § 627.404
only requires an insurable interest “at the moment of the policy’s inception.” Fla.
Stat. § 627.404(1). Further, Florida’s assignability statute generally permits the
assignment of an insurance policy to a third party with no insurable interest. Fla.
Stat. § 627.422 (1982). In support of this argument, Wells Fargo cites decisions
from courts in other states that have refused to graft a good faith requirement onto
similar statutory language.
Finally, even if § 627.404 contains an implied good faith requirement
subject to the standards articulated by the Berger court, there is one potential
factual wrinkle in this case. That is, assuming the accuracy of the Berger court’s
assumption--that, had Mrs. Berger died within that initial two-year period, her
husband, the beneficiary of the policy, would have received the $10 million--does
this fact undermine an argument that an insurable interest was lacking at the
inception of the policy?
In short, the parties cite no controlling Florida legal authority concerning
whether § 627.404 contains an implied good faith requirement and whether under
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the facts of the cases before us, such a requirement would have been satisfied.
Accordingly, we find ourselves in need of guidance on this point from the Florida
Supreme Court.
III. QUESTIONS TO BE CERTIFIED TO THE FLORIDA SUPREME
COURT
“When substantial doubt exists about the answer to a material state law
question upon which the case turns,” our caselaw indicates that it is appropriate to
certify the particular question to the state supreme court in order “to avoid making
unnecessary state law guesses and to offer the state court the opportunity to
explicate state law.” Forgione v. Dennis Pirtie Agency, Inc., 93 F.3d 758, 761
(11th Cir. 1996). Accord Union Planters Bank, N.A. v. New York, 436 F.3d 1305,
1306 (11th Cir. 2006) (certification of a dispositive question that is unanswered by
the pertinent state law enables the federal appellate court “to avoid making
unnecessary Erie guesses and to offer the state court the opportunity to interpret or
change existing law”) (internal quotation marks omitted). Such doubt exists here
on questions that are likely to recur and that are dispositive of the appeals before
us. Further, the Florida Constitution permits this Court to certify a question to the
Florida Supreme Court if it “is determinative of the cause and for which there is no
controlling precedent of the supreme court of Florida.” Fla. Const. art. V, §
3(b)(6).
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As there is no controlling precedent from the Supreme Court of Florida, we
respectfully certify the following questions for a determination of state law:
1. Can a party challenge an insurance policy as being void ab initio
for lack of the insurable interest required by Fla. Stat. § 627.404 if
that challenge is made after expiration of the two-year
contestability period mandated by Fla. Stat. § 627.455?
2. Assuming that a party can do so, does Fla. Stat. § 627.404 require
that an individual with the required insurable interest also procure
the insurance policy in good faith?
The phrasing of the above questions should not restrict the Florida Supreme
Court’s consideration of the issues presented in these appeals. In order to assist in
its consideration of the issues, the entire records, along with the briefs of the
parties, shall be transmitted to the Florida Supreme Court. Intervest Const. of Jax,
Inc. v. Gen. Fid. Ins. Co., 662 F.3d 1328, 1333 (11th Cir. 2011).
QUESTIONS CERTIFIED.
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