IN THE DISTRICT COURT OF APPEAL
                                    FIRST DISTRICT, STATE OF FLORIDA

UNITED STATES FIDELITY              NOT FINAL UNTIL TIME EXPIRES TO
& GUARANTY COMPANY,                 FILE MOTION FOR REHEARING AND
                                    DISPOSITION THEREOF IF FILED
      Appellant,
                                    CASE NO. 1D15-0808
v.

ESSEX INSURANCE
COMPANY and FEDERAL
INSURANCE COMPANY,

      Appellees.

_____________________________/

Opinion filed March 21, 2016.

An appeal from the Circuit Court for Duval County.
James L. Harrison, Judge.

Mark D. Tinker of Banker, Lopez, Gassler, P.A., St. Petersburg, Scott W.
McMickle and Elenore Klingler of McMickle, Kurey & Branch, LLP, Alpharetta,
GA, for Appellant.

Meagan L. Logan of Marks Gray, P.A., Jacksonville, for Appellee Essex Insurance
Company.




PER CURIAM.

      Appellant, United States Fidelity & Guaranty Company (USF&G), appeals

the trial court’s grant of summary judgment, requiring USF&G to give $600,000 it
received from Federal Insurance (Federal) to Essex Insurance Company (Essex).

Because the record does not provide an adequate basis for equitable subrogation,

we reverse the order granting summary judgment.

      This case arose out of an agreement between USF&G, Essex, and Federal to

settle underlying litigation involving mutual insureds through a jointly-funded

settlement. The agreement provided that the insurers could litigate among

themselves if any of them wished to reallocate the settlement funds. USF&G and

Essex were substituted as plaintiffs for the insured in an action against Federal, but

USF&G and Essex maintained separate and independent claims against Federal.

Before trial, USF&G settled its claim with Federal for $600,000. Essex and Federal

proceeded to trial, where the trial court found in favor of Federal in the amount of

$2 million, Federal’s contribution to the settlement proceeds. Essex entered into a

post-judgment settlement with Federal, but has kept the terms of the settlement

confidential. Subsequently, Essex asserted a claim against USF&G to recover the

$600,000 settlement money USF&G received from Federal.

      USF&G and Essex filed cross motions for summary judgment. The trial

court granted summary judgment in favor of Essex, finding that Essex, as the

excess carrier, should receive the settlement funds.

      In order to support recovery under a theory of equitable subrogation, Essex

must establish: “(1) that it made the payment at issue to protect its own interests,

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(2) the payment was non-voluntary, (3) it was not primarily liable for the debt paid,

(4) it paid the entire debt, and (5) subrogation would not work any injustice to the

rights of a third party.” Nova Info. Sys., Inc. v. Greenwich Ins. Co., 

,

1005 (11th Cir. 2004) (quoting Dade Cty. Sch. Bd. v. Radio Station WQBA, 

, 646 (Fla. 1999)). Essex cannot establish the fourth element as it did not

pay the entire settlement in the underlying tort litigation.

      In light of the independent nature of their respective claims against Federal,

the trial court erred in determining Essex was entitled to the settlement money

USF&G received from Federal. Accordingly, we reverse the trial court’s order

granting summary judgment.

WETHERELL and WINOKUR, JJ., CONCUR; MAKAR, J., CONCURS WITH
OPINION.




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MAKAR, J., concurring with opinion.

      Three insurers collectively contributed $9 million to settle and pay claims

arising from a motor vehicle accident, voluntarily entering an agreement stating

that the insurers would be “subsequently litigating among themselves how the

settlement amount should be paid and allocated among the policies under Florida

law.” The subsequent litigation that resulted was done independently amongst the

insurers, each against the other, none cooperating or coordinating with the others.

Weighing the risks and costs of litigation, USF&G entered a settlement with and

received $600,000 from Federal. The dispute between Essex and Federal went to

trial, resulting in a $2 million judgment against Essex in Federal’s favor (later

settled for an undisclosed amount).

      In this appeal, the issue is what legal right does Essex now have to the

$600,000 of settlement funds that USF&G received from Federal, funds that

USF&G sought and successfully obtained at its own expense through its

independent litigation efforts against Federal? None, it appears. Contractual

subrogation doesn’t apply because no contractual relationship exists between the

parties (the trial court’s reference to the Essex policy notwithstanding); and neither

equitable subrogation nor equitable contribution was established on this record to

support Essex’s claimed entitlement to the settlement funds that USF&G procured

for itself. In essence, the parties’ three-page agreement says the three insurers may

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litigate “how the settlement amount” is to be allocated, but it leaves ambiguous by

what legal yardstick that is to be measured. The record does not indicate whether

this is a common or uncommon way for insurers to resolve disputes of this

magnitude, and no party has pointed us to any statute or case that specifies the

standards or manner by which such disputes are required to be resolved. Absent a

definitive guidepost, the parties would have us resolve their dispute by applying

general principles of equity. As such, I agree that the trial court should not have

awarded to Essex the funds that USF&G obtained through its own independent

efforts from Federal, such that the judgment against USF&G should be vacated and

judgment entered in its favor.




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