Michael A. Packer

In this interesting dispute, the Second District Court of Appeal took the unusual step of granting a motion for rehearing but maintained its prior decision that affirmed the trial court’s decision in favor of Laguna Riviera in a subrogation dispute. In doing so, the court certified conflict with the Fourth District Court of Appeal’s decision in Universal Property & Casualty Insurance Co. v. Grove Isle at Vero Beach Condominium Ass’n. 

This suit arises out of a water damage loss to Universal’s insured’s unit located within the Laguna Riviera Condominium Assn. After paying the claim, Universal, pursuant to its policy’s subrogation provision, brought a negligence action against the Association to recoup the monies paid to its insured. However, after the policy inception date, but before the date of loss, Florida statute § 627.714(4) went into effect. Florida statute § 627.714(4) states:

If a condominium association’s insurance policy does not provide rights for subrogation against the unit owners in the association, an insurance policy issued to an individual unit owner in the association may not provide rights of subrogation against the condominium association.

Laguna Riviera’s insurance policy did not provide rights of subrogation; therefore, they moved for judgment on the pleadings, which was granted. The Second District Court affirmed judgment in favor of Laguna Riviera and found the Universal’s rights to pursue a claim did not accrue until after the loss occurred, which was after the effective date of FS § 627.714(4). Interestingly, the appellate court stated: 

We acknowledge the body of law holding that “the statute in effect at the time an insurance contract is executed governs substantive issues arising in connection with that contract.” Menendez v. Progressive Express Ins. Co., 35 So. 3d 873, 876 (Fla. 2010) . . . Universal’s cause of action against the Association is neither contractual nor between the parties to the insurance contract; rather, it is based on the transfer of the right to sue in tort from one contracting party to the other. And that transfer was contingent on the occurrence of future events, without which Universal’s rights never would have vested. . . 

At bottom, neither Universal’s subrogation rights nor its right to sue in negligence vested before the legislature amended section 627.714(4). As we explained in R.A.M., “[a] statute does not operate ‘retrospectively’ merely because it is applied in a case arising from conduct antedating the statute’s enactment.” 869 So. 2d at 1216 (quoting, Metropolitan Dade County v. Chase Fed. Hous. Corp., 737 So. 2d 494, 499 (Fla. 1999)). “Rather, [we] must ask whether the new [statutory] provision attaches new legal consequences to events completed before its enactment.” Id. (second alteration in original) (quoting, Metropolitan Dade County, 737 So. 2d at 499). The only event completed before the enactment of the new statutory provision here was Universal’s issuance of the policy. While that event certainly vested contractual rights between the contracting parties, Universal’s subrogated right to sue the Association was not one of them. That right did not vest or become fixed until the completion of additional events, all of which occurred after the amendment to section 627.714(4).
 

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