Florida’s Statutory Sovereign Immunity Language Inserted Into Any Government Liability Policy Takes Precedence Over the Policy’s Definition of “Occurrence”
November 6, 2018
| Agents of America
In Florida, as in most jurisdictions, government agencies may be subject to liability for tortious acts, with the recovery limit capped by law. A recent decision, State of Florida v. Barnett, explores the recent conflict regarding the limit of recovery against a state agency for an “occurrence” involving multiple claimants.
Section 768.28(5), Florida Statutes (2010), states in relevant part as follows:
Neither the state nor its agencies or subdivisions shall be liable to pay a claim or a judgment by any one person which exceeds the sum of $100,000 or any claim or judgment, or portions thereof, which, when totaled with all other claims or judgments paid by the state or its agencies or subdivisions arising out of the same incident or occurrence, exceeds the sum of $200,000.
Stated simply, where a state agency may be liable for negligence, the maximum recovery is limited to $100,000 per person, or $200,000 in the aggregate (for instance, where there are multiple claimants involved in the same incident or occurrence); notably, Section 768.28(5) does not define the term “occurrence.” In government liability policies where typical “per occurrence” policy limits may be $1 million or more, insurers have incorporated this sovereign immunity language as a policy endorsement, which in effect lowers the recovery limit “to the maximum amount permitted by law.”
Barnett involved a domestic dispute between husband and wife, who together had seven children (two children from their marriage, and five children from previous relationships). Florida’s Department of Children and Families (“DCF”) conducted an investigation into the tempestuous household; based in part on interviews of the children, who stated they did not fear for their safety, DCF closed the file and took no further action. Nine months later, the then-estranged husband shot and killed four of the children and wounded a fifth child before killing his wife and then himself.
Litigation by the children’s biological parents ensued, and the claimants argued that each child was entitled to a separate $100,000 recovery limit under 768.28(5). Florida’s Department of Financial Services intervened and filed a declaratory judgment action to determine the claimants’ rights. The trial court determined that each child was entitled to a separate $100,000 recovery, reasoning that each gunshot constituted a separate “incident or occurrence.”
The appellate court reversed. As an initial matter, the court noted that the statute did not define “occurrence.” Further, the court acknowledged longstanding legal precedent that Florida’s sovereign immunity statute must be strictly construed, with all reasonable inferences against waiver of that immunity. The court then cited several previous decisions holding that where one negligent accident caused injury to multiple claimants, recovery for all claimants was limited to the aggregate $200,000 statutory limit. Since the children’s deaths arose allegedly from DCF’s one-time decision to close its investigation, the court reasoned, only one “occurrence” transpired for purposes of determining maximum recovery under Florida’s sovereign immunity statute.
Barnett resolves a long-standing debate on the interpretation of sovereign immunity law for claims involving multiple claimants, and has significant implications on the availability and depletion of liability limits. Had Barnett affirmed the trial court, exposures for claims with identical facts would multiply given the frequency of government liability claims involving multiple claimants. When incorporating sovereign immunity language, or any other statutory language, into their policies, insurers should take caution not to add language to the endorsement that does not otherwise exist in the statute as such could increase recovery limits.