Gallon v. GEICO General Insurance Company , 2014 Fla. App. LEXIS 14234 ( 2014 )

NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING
MOTION AND, IF FILED, DETERMINED
IN THE DISTRICT COURT OF APPEAL
OF FLORIDA
SECOND DISTRICT
EDDIE GALLON, )
)
Appellant, )
)
v. ) Case No. 2D13-2853
)
GEICO GENERAL INSURANCE )
COMPANY; and JOHN OR JANE DOE, )
Agent Individually, )
)
Appellees. )
)
Opinion filed September 12, 2014.
Appeal from the Circuit Court for Polk
County; Steven L. Selph, Judge.
Sanga Turnbull of Smith & Stallworth, P.A.,
Lakeland, for Appellant.
Jennings L. Hurt III and Meredith M.
Stephens of Rissman, Barrett, Hurt,
Donahue & McLane, P.A., Orlando, for
Appellees.
VILLANTI, Judge.
Eddie Gallon seeks review of the order that dismissed his fourth amended
multi-count complaint against GEICO General Insurance Company with prejudice. We
affirm the dismissal of Gallon's counts for promissory estoppel and negligent
procurement without further comment. However, we reverse the dismissal of Gallon's
count for negligent misrepresentation and remand for further proceedings.
Gallon was the back seat passenger in his mother's car when she was
involved in a single-car accident. Gallon was ejected from the vehicle and severely
injured. Gallon's mother, Natalie Gallon, carried automobile insurance on the car with
GEICO, including uninsured motorist (UM) coverage, and Gallon made a claim for UM
benefits. However, a dispute arose as to the amount of UM benefits available to Gallon.
GEICO contended that Gallon was limited to $50,000 in UM benefits, even though there
were two vehicles on the policy and the policy indicated that UM coverage was
"stacked," because Mrs. Gallon had purchased UM coverage on only one vehicle.
Gallon contended that because the policy provided stacked UM coverage and because
there were two vehicles covered by the policy, he should be entitled to $100,000 in UM
benefits. When GEICO refused to agree to this amount of coverage, Gallon sued.
In his fourth amended complaint, Gallon asserted a claim for negligent
misrepresentation. To state a claim for negligent misrepresentation, the plaintiff must
allege—and ultimately be able to prove—that "(1) there was a misrepresentation of
material fact; (2) the representer either knew of the misrepresentation, made the
misrepresentation without knowledge of its truth or falsity, or should have known the
representation was false; (3) the representer intended to induce another to act on the
misrepresentation; and (4) injury resulted to a party acting in justifiable reliance upon
the misrepresentation." Baggett v. Electricians Local 915 Credit Union, 620 So. 2d 784,
786 (Fla. 2d DCA 1993) (citing Atl. Nat'l Bank of Fla. v. Vest, 480 So. 2d 1328, 1331
(Fla. 2d DCA 1985)). At the motion to dismiss stage, the court is limited to determining
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whether the complaint on its face contains allegations that are legally sufficient to state
a cause of action. See, e.g., Maynard v. Taco Bell of Am., Inc., 117 So. 3d 1159, 1160-
61 (Fla. 2d DCA 2013) (quoting Reyes ex rel. Barcenas v. Roush, 99 So. 3d 586, 589
(Fla. 2d DCA 2012)). Notably, the court may consider only the legal sufficiency of the
allegations and may not determine questions of fact or consider issues of proof or
credibility. See Reyes ex rel. Barcenas, 99 So. 3d at 589 (noting that the trial court may
not determine the veracity of a plaintiff's allegations when considering a motion to
dismiss).
In his count for negligent misrepresentation, Gallon alleged that there was
a time when Mrs. Gallon's coverage with GEICO had lapsed. When GEICO reissued
the policy, the premium was significantly higher. Mrs. Gallon's review of the
declarations page showed that GEICO had reissued the policy with stacked UM
coverage. Unsure of what that coverage was, Mrs. Gallon claimed she called GEICO
and spoke to one of GEICO's agents. Gallon alleged in his complaint that the purpose
of the call was so that Mrs. Gallon "could make a decision on whether to continue
paying for the coverage or decline it." GEICO's agent told Mrs. Gallon that paying for
the stacked UM coverage would mean that "in the event either of her sons were
injured . . . GEICO would pay double the stated amount of $50,000/$100,000 on the
policy because she had two vehicles insured on the policy." Gallon alleged that based
on this explanation of the coverage, Mrs. Gallon "kept the stacked uninsured motorist
coverage and continued paying the listed premium for it." However, despite this
reliance and Mrs. Gallon's payment of the premiums, GEICO denied him the benefits of
the stacked UM coverage for which his mother had paid.
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A comparison of Gallon's allegations to the elements of a negligent
misrepresentation claim shows that Gallon's allegations were legally sufficient. He
sufficiently alleged that GEICO's agent made a false statement about the extent of Mrs.
Gallon's UM coverage, that GEICO's agent knew or should have known that the
statement was false, that the statement was made to induce Mrs. Gallon to keep the
coverage and pay the higher premium, and that she was now injured due to her reliance
on that misrepresentation. Thus, because these allegations are facially and legally
sufficient to state a cause of action, the trial court erred in granting GEICO's motion to
dismiss this count.
In this appeal, as it did in the trial court, GEICO argues that this count was
properly dismissed because Mrs. Gallon was not entitled to rely on the representations
of GEICO's agent as to the scope of her coverage when those representations
conflicted with the plain language of the insurance policy. However, "[t]he terms of an
insurance policy do not preclude an action against the insurer or its agent where the
agent misrepresents the coverage of the insurance contract and the insured reasonably
relies on the misrepresentation to his detriment." Martin v. Principal Mut. Life Ins. Co.,
557 So. 2d 128, 129 (Fla. 3d DCA 1990); see also Warren v. Dairyland Ins. Co., 662
So. 2d 1387, 1388 (Fla. 4th DCA 1995) (noting that if Dairyland's agent "had improperly
explained uninsured motorist coverage to plaintiffs, Dairyland could be liable for
uninsured motorist coverage equal to the liability limits"). Moreover, whether an
insured's reliance on an agent's representations is reasonable is generally a question of
fact. See, e.g., Romo v. Amedex Ins. Co., 930 So. 2d 643, 652 (Fla. 3d DCA 2006).
Hence, the question of whether Mrs. Gallon's reliance on GEICO's agent's explanation
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of her stacked UM coverage was reasonable was not one that could be decided at the
motion to dismiss stage of these proceeding and so cannot serve as a basis to support
an affirmance.
In sum, because the allegations of Gallon's complaint were facially
sufficient to state a cause of action for negligent misrepresentation, the trial court erred
by dismissing this count of the complaint. Accordingly, we must reverse and remand for
further proceedings. The dismissal of the remaining counts is affirmed.
Affirmed in part, reversed in part, and remanded for further proceedings.
NORTHCUTT, J., Concurs.
ALTENBERND, J., Concurs with opinion.
ALTENBERND, Judge, Concurring.
I fully concur in this opinion. I am inclined to believe that claims of
negligent misrepresentation in this context should be rare. I write briefly to explain the
unusual circumstances that appear to have led to this claim.
Ms. Gallon's policy of insurance with GEICO, which was issued in 2008,
covers two automobiles. On one automobile—a 1999 Chrysler that apparently is the
family car—Ms. Gallon purchased standard personal injury protection coverage. She
also purchased $50,000/$100,000 in bodily injury liability coverage and an equal
amount of UM coverage on that automobile. That automobile also has $50,000 in
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coverage for property damage liability, collision coverage, and comprehensive
coverage.
On the second automobile—a 1990 Toyota that apparently is a teenager's
car—she has only the minimum requirements under the Florida Motor Vehicle No-Fault
Law. See § 627.730-.7405, Fla. Stat. (2008). Thus, this automobile is not insured for
liability coverage or UM. There is no indication in our limited record that GEICO
obtained a written rejection of UM coverage for this automobile. Because the policy
was issued with no liability coverage for this automobile, GEICO may not have required
its agent to obtain a rejection form.
When GEICO created the written policy for these two automobiles, the
standard language for stacked UM coverage was used on the declaration page—even
though no premium was charged for UM on the Toyota. The standard contractual forms
accompanying the declaration page appear to be the forms that normally would be used
when the policy covered two automobiles, both of which had UM coverage.
It may be that GEICO has some standard underwriting procedure by
which it "stacks" the $50,000/$100,000 UM on the first automobile with $0 on the
second, so that each car has $50,000/$100,000 in UM for the premium charged on only
the one automobile. If so, that is simply a very odd form of stacked coverage. 1
The claim in this case is that Ms. Gallon was told by a GEICO agent that
her stacked policy would have twice the limits of UM. In the context of this particular
policy, it is entirely possible that an agent would have interpreted the stacked coverage
1Whether such a combination coverage is authorized with or without a
rejection form in Florida is not an issue in this case.
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to provide twice the amount of UM coverage because that is the situation under the
usual policy where both cars have the same limit of UM coverage for both vehicles.
Ms. Gallon, of course, was contacting GEICO because she thought her
premium was too high. The alleged misinformation from the agent caused her to leave
her policy as it was. Apparently, if she had received correct information, in order to
actually receive typical stacked coverage, she would have been required to pay an even
higher premium. Thus, on remand, she may have a difficult time establishing all of the
elements that she has alleged in her complaint. See Fla. Std. Jury Instr. (Civ.) 409.8.
But at this stage in the proceedings the case was not resolvable on a motion to dismiss.
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