RPPTL New Items: Altman Contr. v. Crum & Forster (Chp. 558 and Duty to Defend)
January 22, 2018

Catching up on holiday reading, the Supreme Court of Florida’s decision on Altman Contractors, Inc. v. Crum & Forster Specialty Insurance Company, Case No. SC16-1420, 42 Florida Law Weekly S 960 (Fla. December 14, 2017), may seem to focus on narrow issues but is jam packed with tidbits for the office practitioner and the litigator whether your practice is limited to community association law, or a broader civil practice. Drawing our attention are the four opinions issued.

The opinion of a majority, four responded to the request from United States Court of Appeals for the Eleventh Circuit. The Supreme Court rephrased the certified question as follows:

Is the notice and repair process set forth in chapter 558, Florida Statutes, a “suit” within the meaning of the commercial general liability policy issued by C&F to Altman?

Altman Contractors, Inc. v. Crum & Forster Specialty Ins. Co., 832 F.3d 1318, 1326 (11th Cir. 2016). The court answered yes:

… because the chapter 558 presuit process is an “alternative dispute resolution proceeding” as included in the policy’s definition of “suit.”

The facts may appear pedestrian. Sapphire Condominium provided Altman numerous Chapter 558 notices of claim from April 2012 through November 2012 claiming over 800 defects. In January 2013 Altman provided its insurer Crum & Forster (“C&F”) notice of the claims and a demand for coverage. C&F declined to defend asserting that the notices did not constitute a “suit” under the policy.

Altman retained its own counsel. In August 2013 C&F provided a reservation of rights letter and C&F retained counsel to defend Altman. Altman objected to new counsel and demanded that Altman’s original counsel continue and that C&F reimburse for the expense of its counsel. Ultimately, Altman settled all of the claims, the Association not filing a lawsuit.

Altman filed a declaratory judgement action against C&F resulting in the District Court finding no policy ambiguity on the issue of coverage, denying Altman’s motion for partial summary judgment and granting C&F’s motion for partial summary judgment. Altman Contractors, Inc. v. Crum & Forster Specialty Ins. Co.,124 F. Supp. 3d 1272, 1275 (S.D. Fla. 2015).

Construing Chapter 558 Fla. Stat. (2012), in context of the policy, the court then quoted from the policy which defines a “suit” as not just a complaint filed in court:

“Suit” means a civil proceeding in which damages because of “bodily injury,” “property damage” or “personal and advertising injury” to which this insurance applies are alleged. “Suit” includes:

a. An arbitration proceeding in which such damages are claimed and to which the insured must submit or does submit with our consent; or

b. Any other alternative dispute resolution proceeding in which such damages are claimed and to which the insured submits with our consent.

Ultimately focusing on the “other alternative dispute resolution proceedings” language, and relying in part on Black’s Law Dictionary’s definition as “[a] procedure for settling a dispute by means other than litigation” the court held that the Chapter 558 proceedings fall under the policy’s definition of a “suit.”

On the path to this conclusion, the Court engaged in a number of interesting discussions. Harkening back to the Court’s decision in Raymond James Financial Services, Inc. v. Phillips, 126 So. 3d 186 (Fla. 2013) the Court revisited what constitutes a “civil proceeding.” Referring to only the statutory text, a “chapter 558 notice and repair process cannot be considered a “civil proceeding” because the process is voluntary, does not involved in adjudicatory body, or produce legally binding results.

The Court noted that §558.001 Fla. Stat. was amended to add that the benefits of the Act were extended to …. “the insurer of the contractor, sub-contractor, supplier, or design professional with the opportunity to resolve the claim through confidential settlement negotiations without resort to further legal process….” (Ch. 2015-165, § 1, Laws of Fla.). The Court did not comment that while insurers were provided an “opportunity” to participate, the statute does not expressly require the insurer to participate. The opinion does not comment as to why the legislature may have amended the law.

The Court was somewhat fractured. Four opinions were provided. A clear majority joined the courts opinion. Justice Lewis provided a concurrence and Justice Pariente separately provided concurring and descending opinions, as did Justice Lawson. These minority opinions considered whether the underlying policy provided coverage for the claim an issue that the majority opinion sidestepped when focusing only on the duty to defend.

How will this decision affect the community association, and likely other practitioners? This will focus on whether initiation of alternate dispute resolution processes such as, for example, mandatory pre-suit mediation provided by §718.311 Fla. Stat. trigger a duty to defend? This issue will send practitioners to review client’s policies.

What else? Of course, consider that the decision will provide insurers an impetus for insurers re-write their policies definition of a “suit.” Until then, consider what other ADR processes may trigger a duty to defend, of course depending upon your client’s policy provisions.

Thank you to Scott Pence, Chair of the RPPTL Insurance and Surety Committee for providing a heads up concerning the decision. For those that address insurance issues, you should consider joining the Insurance Committee. Check it out at

Be certain to sign up for the Real Property and the Condominium certification review seminars scheduled in Orlando for February 9th and 10th.

Belated good wishes to all for a successful, healthy and positive new year.

Michael J. Gelfand
Past Chair
Real Property, Probate and Trust Law Section of The Florida Bar
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Note: This article is not legal advice. Statements and comments made are not those of The Florida Bar or the RPPTL Section
© 2018 Michael J. Gelfand

Michael J. Gelfand
Florida Bar Board Certified Real Estate Attorney
Florida Supreme Court Certified Mediator:
Civil Circuit Court & Civil County Court
Fellow, American College of Real Estate Attorneys


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