Landmark American Insurance Company successfully moved to dismiss four of the insured's six counts. Landmark Am Ins. Co. v. Studio Imports, Ltd., Inc., Nos. 4D10-5001 and 4D10-5073 (Fla. Dist. Ct. App. Nov. 16, 2011). The trial court did not dismiss the breach of contract claim and the bad faith claim. Because both claims were to be tried simultaneously, Landmark appealed.
The back story included extensive damage to the insured's commercial property caused by Hurricane Wilma in 2005. The insured claimed Landmark took too long to reimburse for losses, which caused additional damages, such as loss of good will, a damaged reputation with customers, and ruined business relationships.
The appellate court agreed the breach of contract and bad faith claims could not be tried together under Florida law. Where causes of action for both the underlying damages and bad faith were brought in the same action, the appropriate method was to abate the bad faith action until coverage and damages were determined. Consequently, the trial court order was reversed so the underlying issue could be determined prior to the bad faith claim.
