Michael G. Rothfeld | Carlton Fields Jorden Burt | April 6, 2015
FLORIDA STATE CASES
Fraud; Statute of Repose – The fraud statute of repose does not bar fraud claims when the jury finds no evidence of the plaintiff’s reliance during the repose period, because it is the defendant’s last action or omission that triggers the fraud repose period under § 95.031(2), Fla. Stat. Surviving spouse of decedent-smoker sued tobacco company, alleging fraudulent concealment, negligence, and conspiracy to commit fraud based on the defendant’s alleged concealment, omission, or misrepresentation of material information regarding the health effects and addictiveness of smoking. The complaint alleged that decedent’s detrimental reliance on misleading or false facts stated by cigarette executives from the 1950s through the 1990s proximately caused his death. The jury found for the plaintiff, and the defendant appealed, arguing that decedent’s reliance occurred before 1982 and that, as a result, the defendant did not defraud the decedent during the 12 year repose period from 1982 until 1994, when the original Engle complaint was filed. The trial court denied the motion, but the Fourth District Court of Appeals reversed, finding that under the Engle line of cases, all elements of fraud must be proven to exist during the repose period. On appeal, the Florida Supreme Court noted that repose periods run from the date of a discrete act by the defendant, regardless of when the cause of action accrues. As such, the plaintiff’s reliance during the repose period is irrelevant; the last action of the defendant is what controls and defines “the date of the commission of the alleged fraud” under the 12 year repose period for fraud actions contained in section 95.031(2). Accordingly, the Florida Supreme Court quashed the Fourth District’s decision, concluding that the smoker need not rely on the fraudulent information during the 12 year repose period. Evidence of the defendant’s wrongful conduct during the repose period prevents the statute of repose from barring plaintiff’s claims. Because such evidence existed, it was error to disturb the jury’s findings on appeal. Hess v. Philip Morris USA, Inc., No. SC12-2153, 40 Fla. L. Weekly S188a (Fla. Apr. 2, 2015).
Insurance; Hurricane Damage; Appraisal – It is error for a trial court to order appraisal where the insureds have not complied with all post-loss obligations. Insurer appealed from a trial court order requiring appraisal of an insured’s supplemental claim for coverage of hurricane damage. When the trial court issued its order, it did not have the benefit of the Third District Court of Appeal’s recent decision in State Farm Ins. Co. v. Cardelles, 40 Fla. L. Weekly D504 (Fla. 3d DCA Feb. 25, 2015), which clarified that an insured must fully comply with all post-loss obligations before a trial court can compel appraisal. Here, the insureds failed to produce required documentation and to protect the property from further damage pursuant to the policy’s terms. Accordingly, the Third District Court of Appeal reversed the trial court’s order compelling appraisal. State Farm Ins. Co. v. Xirinachs, et al., No. 3D14-1212, 40 Fla. L. Weekly D791b (Fla. 3d DCA Apr. 1, 2015).
Slavin Doctrine; Designer Liability; Road Construction – The Slavin doctrine cuts off a contractor’s liability for injuries to third persons caused by the contractor’s negligent construction where a patent defect exists and the owner has accepted the work. A fatal car accident occurred as a result of confusing traffic signals, designed by an FDOT subcontractor design company, located at an intersection under construction. On appeal from plaintiff’s denied motion for new trial following a jury verdict finding that the FDOT had accepted the design company’s patently defective work under the Slavin doctrine, the Court framed the issue as whether the acceptance of the design company’s work fell to FDOT, which controlled the project, or Broward County, which would ultimately control and maintain the intersection. As for Slavin’s “patent” prong, an FDOT employee discovered a potential design defect long before the accident, and FDOT was therefore aware of the defect because the test for patency is whether the dangerousness of a condition is obvious had the owner used reasonable care. As for Slavin’s “acceptance” prong, the design company owed its duty to FDOT because FDOT controlled “acceptance” of the work. In turn, Broward County then controlled the acceptance of FDOT’s work. The court disagreed with plaintiff’s argument that acceptance had not occurred because a ninety-day “burn-in” period, during which the contractor could correct errors, had not ended. Instead, the point of acceptance is when a contractor or designer completes its work and the controlling entity intervenes and accepts the work, thereby cutting off the contractor’s ability to correct any defects. FDOT had accepted the design company’s work when it accepted the plans and put the construction contract out for bid. Accordingly, the Second District Court of Appeal agreed with the trial court’s refusal to disturb the jury’s findings, and affirmed same. McIntosh v. Progressive Design and Engineering, Inc., No. 4D12-2335, 2015 WL 1422590 (Fla. 4th DCA Mar. 25, 2015) (This opinion has not been released for publication in the permanent law reports. Until released, it is subject to revision or withdrawal). Note: This opinion withdraws and replaces the prior decision decided on January 7th, 2015 and published in the CFJB construction law case update for the week of January 19th, 2015.
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