UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF FLORIDA

CASE NO. 20-21770-Civ-WILLIAMS/TORRES

WESTCHESTER SURPLUS LINES INSURANCE COMPANY, et al,

Plaintiffs,

v.

SUMMERS FIRE SPRINKLERS, INC., et al, 

Defendants.

_________________________________/

REPORT AND RECOMMENDATION ON DEFENDANTS’

MOTIONS TO DISMISS, OR ALTERNATIEVELY, MOTIONS TO STAY

This matter is before the Court on Defendant Summers Fire Sprinklers, Inc.’s

(“Summers”) motion to dismiss, or alternatively, motion to stay [D.E. 10] Westchester 

Surplus Lines Insurance Company’s and Illinois Union Insurance Company’s 

(collectively, “Plaintiffs”) complaint for declaratory relief [D.E. 1]. Defendant 

Latitude on the River Condominium Association, Inc. (the “Association,” and 

collectively with Summers, “Defendants”) has adopted and incorporated Summers’ 

motion in its own motion [D.E. 17]. Plaintiffs responded to Defendants’ motions on 

August 27, 2020 [D.E. 22] to which Defendants replied on September 10, 2020 [D.E.

27, 28]. The matter is now fully briefed and ripe for disposition.1 After careful 

 

1 The Honorable Judge Kathleen M. Williams referred the motions to the 

undersigned Magistrate Judge on August 25, 2020. [D.E. 19]. 

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consideration of the motions, response, replies, relevant authority, and for the 

reasons discussed below, Defendants’ motions should be DENIED. 

I. FACTUAL BACKGROUND

This action arises from property damage that occurred in 2011 at the 

Association’s luxury condominium building located in Miami, Florida. The cause of 

the damage was allegedly from water leaking from CPVC piping. In July 2016, the 

Association filed a construction defect lawsuit that is pending in the Circuit Court of 

the Eleventh Judicial Circuit against numerous parties involved in the construction 

of the building, including Summers (the “Underlying Action”). According to the 

Underlying Action, some of the defects resulted from Summers improperly providing 

and installing a fire protection system in the building. The Underlying Action thus 

contains counts against Summers for (1) breach of § 718.203(2), Florida Statutes, by 

constructing the condominium with ABF and CPVC products that are incompatible 

with one another, which caused the CPVC components to leak and fail, (2) negligence, 

and (3) failure to comply with local, state, and national building codes and 

regulations. Miami Riverfront Partners, LLC (“MRP”), the developer of the building, 

and Suffolk Construction Company, Inc. (“Suffolk”), the general contractor that hired 

Summers, have brought cross-claims against Summers for indemnity related to any 

liability that may be imposed on them for Summers’ actions. 

Plaintiffs have issued several primary commercial general liability policies to 

Summers and are currently defending Summers in the Underlying Action. But, 

Plaintiffs contend that there is no coverage under the policies because, among other 

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reasons, there is no coverage for “property damage” that occurs outside the policy 

periods, and Summers had prior knowledge of “property damage” before some of the 

policy periods. Plaintiffs therefore initiated this action that brings five causes of 

action. [D.E. 1]. In sum, the action seeks declaratory relief under 28 U.S.C. § 2201 

for a determination that there is no coverage under the commercial general liability 

policies. Id. Summers has moved to dismiss the action, or alternatively, moved to 

stay the Court’s determination on coverage. [D.E. 10]. The Association followed suit 

and filed its own motion that adopts and incorporates the same arguments as 

Summers’ motion. [D.E. 17]. 

II. LEGAL STANDARD

In ruling on a defendant’s motion to dismiss, a court takes the allegations in 

the complaint as true and construes the allegations “in the light most favorable to the 

plaintiff[ ].” Rivell v. Private Health Care Sys., Inc., 520 F.3d 1308, 1309 (11th Cir. 

2008) (citing Hoffman–Pugh v. Ramsey, 312 F.3d 1222, 1225 (11th Cir. 2002)). “When 

considering a motion to dismiss, all facts set forth in [a plaintiff’s] complaint ‘are to 

be accepted as true and the court limits its consideration to the pleadings and exhibits 

attached thereto.’” Grossman v. Nationsbank, N.A., 225 F.3d 1228, 1231 (11th Cir. 

2000) (quoting GSW, Inc. v. Long Cnty., 999 F.2d 1508, 1510 (11th Cir. 1993)). 

A motion to dismiss under Rule 12(b)(6) “is granted only when the movant 

demonstrates that the complaint has failed to include ‘enough facts to state a claim 

to relief that is plausible on its face.’” Dusek v. JPMorgan Chase & Co., 832 F.3d 

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1243, 1246 (11th Cir. 2016) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570

(2007)). 

“While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need 

detailed factual allegations, a plaintiff's obligation to provide the grounds of his 

entitle[ment] to relief requires more than labels and conclusions . . . .” Twombly, 550 

U.S. at 555 (internal citations and quotations omitted) (alteration in original). “To 

survive a motion to dismiss, a complaint must contain sufficient factual matter.” 

Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). A complaint does not suffice “if it tenders 

‘naked assertion[s]’ devoid of ‘further factual enhancement.’” Id. (quoting Twombly, 

550 U.S. at 557 (alteration in original). Factual content gives a claim facial 

plausibility. Id. “[A] court’s duty to liberally construe a plaintiff's complaint in the 

face of a motion to dismiss is not the equivalent of a duty to re-write it for [a

plaintiff].” Peterson v. Atlanta Hous. Auth., 998 F.2d 904, 912 (11th Cir. 1993).

III. ANALYSIS

Defendants first argue that Plaintiffs’ complaint should be dismissed because 

it references external evidence outside the complaint. Alternatively, if we allow the 

action to proceed, Defendants seek to join all necessary parties, specifically MRP, 

Suffolk, and unidentified insurers. Defendants originally made ripeness arguments 

regarding the duty to indemnify, but in their response and replies the parties 

narrowed the issue down to first determining if Plaintiffs have a duty to defend. The 

parties thus now agree that the Court could determine if Plaintiffs have a duty to 

defend before the Underlying Action is resolved. And if the Court finds that they 

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have no duty to defend, Plaintiffs shall obviously have no duty to indemnify. 

Alternatively, if the Court finds that they have a duty to defend, Plaintiffs can renew 

their motion seeking a declaration that they have no duty to indemnify. Defendants, 

however, raise a new argument in their reply – because the complaint references 

evidence outside its parameters, which would require fact discovery, Plaintiffs’ 

complaint must be dismissed. Before we consider the merits of this argument, we

consider the general principles governing the duty to defend and the duty to 

indemnify under Florida law. These principles are necessary, as they support the 

parties’ agreement that a determination on Plaintiffs’ duty to defend can be made 

before the Underlying Action is resolved and will inform the analysis on Defendants’ 

new argument.

A. The Duty to Defend

Under Florida law, an insurer’s duty to defend is triggered if the allegations of 

a complaint brought against the insured fall within the scope of the insurer’s duty. 

See Higgins v. State Farm Fire & Cas. Co., 894 So. 2d 5, 9-10 (Fla. 2004) (citations 

omitted). A court looks no further than to the terms of the insurance policy and the 

allegations of the underlying complaint brought against the insured to determine if 

the duty to defend is triggered. See id. “If the complaint alleges facts partially within 

and partially outside the scope of coverage, the insurer is obligated to defend the 

entire suit.” MJCM, Inc. v. Hartford Cas. Ins. Co., 2010 WL 1949585, at *4 (M.D. 

Fla. May 14, 2010) (citing Battisti v. Continental Cas. Co., 406 F.2d 1318, 1321 (5th 

Cir. 1969)); see also Grissom v. Commercial Union Ins. Co., 610 So. 2d 1299, 1307 

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(Fla. 1st DCA 1992) (“All doubts as to whether a duty to defend exists in a particular 

case must be resolved against the insurer and in favor of the insured. So long as the 

complaint alleges facts that create potential coverage under the policy, the insurer 

must defend the suit.”). To put it simply, the duty to defend “depends solely on the 

allegations in the complaint filed against the insured.” Trizec Props., Inc. v. Biltmore 

Const. Co., 767 F.2d 810, 811 (11th Cir. 1985) (citing Tropical Park, Inc. v. United 

States Fidelity and Guaranty Co., 357 So. 2d 253, 256 (Fla. 3d DCA 1978); Coblentz 

v. American Surety Co., 416 F.2d 1059, 1062 (5th Cir. 1969)).

As with any other insurance policy, “[d]oubts as to whether a duty to defend 

exists are resolved in favor of the insured, and exclusionary clauses in insurance 

contracts are to be construed liberally in favor of the insured.” MJCM, 2010 WL 

1949585, at *5 (citing Trizec, 767 F.2d at 812). This means that “an insurer must 

defend a lawsuit against its insured if the underlying complaint, when fairly read, 

alleges facts which create potential coverage under [the] policy.” McCreary v. Fla. 

Res. Prop. & Cas. Joint Underwriting Ass’n, 758 So. 2d 692, 695 (Fla. 4th DCA 1999) 

(citing Fun Spree Vacations, Inc. v. Orion Ins. Co., 659 So. 2d 419, 421 (Fla. 3d DCA 

1995)); see also Essex Ins. Co. v. Big Top of Tampa, Inc., 53 So. 3d 1220, 1223 (Fla. 

2d DCA 2011) (“A liability insurer has no duty to defend a suit where the complaint 

on its face alleges facts which fail to bring the case within the coverage of the policy.” 

(citing Auto–Owners Ins. Co. v. Marvin Dev. Corp., 805 So. 2d 888, 891 (Fla. 2d DCA 

2001)). However, “[w]here the complaint’s allegations show either that a policy 

exclusion applies or that no coverage exists, no duty to defend arises.” Kenneth Cole 

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Prods., Inc. v. Mid-Continent Cas. Co., 763 F. Supp. 2d 1331, 1334 (S.D. Fla. 2010) 

(citing Federal Ins. v. Applestein, 377 So. 2d 229, 232 (Fla. 3d DCA 1979)).

B. The Duty to Indemnify

“An insurer’s duty to indemnify is narrower than its duty to defend and must 

be determined by analyzing the policy coverages in light of the actual facts in the 

underlying case.” Sinni v. Scottsdale Ins. Co., 676 F. Supp. 2d 1319, 1323 (M.D. Fla. 

2010) (citing State Farm Fire & Cas. Co. v. CTC Dev. Corp., 720 So. 2d 1072, 1077 n.3 

(Fla. 1998); Hagen v. Aetna Cas. & Sur. Co., 675 So. 2d 963, 965 (Fla. 5th DCA 1996)). 

That is, in contrast to the duty to defend, the duty to indemnify is dependent upon 

the entry of a final judgment, a settlement, or a final resolution of the underlying 

claims by some other means. See Northland Cas. Co. v. HBE Corp., 160 F. Supp. 2d 

1348, 1360 (M.D. Fla. 2001) (citing Travelers Ins. Co. v. Waltham Indus. Lab. Corp., 

883 F.2d 1092, 1099 (1st Cir. 1989); Beaudette, Inc. v. Sentry Ins., 94 F. Supp. 2d 77, 

100 (D. Mass. 1999)). Unless the insured can demonstrate that it suffered a covered 

loss under the policy, the insurer has no duty to indemnify. See Northland Cas. Co., 

160 F. Supp. 2d at 1360 (citing Matter of Celotex Corp., 152 B.R. 661, 666 (Bankr. 

M.D. Fla. 1993)). “[W]hereas the duty to defend is measured by the allegations of the 

underlying complaint, the duty to indemnify is measured by the facts as they unfold 

at trial or are inherent in the settlement agreement.” Northland Cas. Co., 160 F. 

Supp. 2d at 1360 (citation and quotation marks omitted).

An insurer’s duty to indemnify is therefore dependent on the outcome of a case, 

meaning any declaration as to the duty to indemnify is premature unless there has 

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been a resolution of the underlying claim. “The only exception to this general rule is 

if the court can determine that the allegations in the complaint could under no 

circumstances lead to a result which would trigger the duty to indemnify.” Id. (citing 

Sphere Drake, P.L.C. v. 101 Variety, Inc., 35 F. Supp. 2d 421, 430-31 (E.D. Pa. 1999)). 

“In such a situation, the court could adequately assess the duty to indemnify prior to 

a conclusion on the merits of the underlying litigation.” Id. 

Given that the duty to defend is broader than the duty to indemnify, Tropical 

Park, Inc., 357 So. 2d at 256, an insurer has no duty to indemnify if there is no duty 

to defend. See Clarendon Nat’l Ins. Co. v. Vickers, 2006 WL 8434796, at *3 (S.D. Fla. 

May 25, 2006) (collecting cases). Stated differently, “‘a court’s determination that the 

insurer has no duty to defend requires a finding that there is no duty to indemnify.’” 

Mt. Hawley Ins. Co. v. Miami River Pt. Terminal, LLC, 228 F. Supp. 3d 1313, 1326 

(S.D. Fla. 2017) (emphasis in original) (quoting Trailer Bridge, Inc. v. Ill. Nat'l Ins. 

Co., 657 F.3d 1135, 1146 (11th Cir. 2011)). With these principles in mind, we turn to 

the merits.

Here, Defendants argue that the complaint must be dismissed because the 

Court would have to make factual findings outside the four corners of the complaint, 

which is improper while the Underlying Action is pending. This is because Plaintiffs 

make a reference to “other evidence” in the complaint, so the Court would need to 

conduct its own fact finding to determine if Plaintiffs’ have a duty to defend. 

Defendants cite to no law to support this argument. 

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It is true that the duty to defend “depends solely on the allegations in the 

complaint filed against the insured.” Trizec, 767 F.2d at 811. The complaint, 

however, only needs to allege facts that create potential coverage under the policies. 

See McCreary, 758 So. 2d at 695. Critically, Defendants do not argue that the facts 

alleged in the four corners of the complaint fail to establish that there may be a duty 

to defend. The Court can thus simply limit its review to the facts alleged in the 

complaint to make its determination and ignore any extrinsic facts. There is no 

reason to dismiss a complaint solely because it may contain too many allegations. See 

Grissom, 610 So. 2d at 1307 (“So long as the complaint alleges facts that create 

potential coverage under the policy, the insurer must defend the suit.”). We next

address Defendants’ argument that Plaintiffs must join all necessary parties. 

C. Rule 19(a) Parties

Rule 12(b)(7) provides that a complaint should be dismissed upon a plaintiff's 

“failure to join a party under Rule 19.” Rule 19 sets forth a two-step analysis in 

deciding whether to dismiss an action for failure to join an absent party. See Molinos 

Valle del Cibao v. Lama, 633 F.3d 1330, 1344 (11th Cir. 2011). First, a court must 

determine whether an absent party is required in the case under Rule 19(a). See id.

A party is required if “in [the] person’s absence, the court cannot accord complete 

relief among existing parties.” Fed. R. Civ. P. 19(a)(1)(A); see also Combe v. Flocar 

Inv. Group Corp., 977 F. Supp. 2d 1301, 1305 (S.D. Fla. 2013) (finding that additional 

parties that may have some liability in the action are not required to be joined if the 

court can still provide complete relief). A party is also required if the party has an 

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interest in the action and resolution of the action may either “as a practical matter 

impair or impede the person’s ability to protect the interest” or “leave an existing

party subject to a substantial risk of incurring double, multiple, or otherwise 

inconsistent obligations.” Fed. R. Civ. P. 19(a)(1)(B). This question has been 

commonly analyzed as whether the non-joined party is “necessary.” Second, for all 

such necessary parties, a court determines whether the Rule 19(b) factors permit the 

litigation to continue if the party cannot be joined, or instead whether they are 

indispensable. Focus on the Family v. Pinellas Suncoast Transit Case, 344 F.3d 1263, 

1280 (11th Cir. 2003). The burden is on the moving party to establish that an absent 

party is required to be joined to an action. See West Peninsular Title Co. v. Palm 

Beach Cnty., 41 F.3d 1490, 1492 (11th Cir. 1995).

Defendants in this case first argue that both MRP and Suffolk are 

indispensable parties because, if they are not included as parties in this action, 

Plaintiffs potential judgment against Defendants would not be binding on them. 

Thus, according to Defendants, Plaintiffs’ failure to name MRP and Suffolk leaves 

open any claims they may possess as to the issue of coverage. We disagree. This 

action centers around a determination if Plaintiffs must defend and indemnify 

Summers for its actions. Regardless of this determination, Summers’ potential 

liability to MRP or Suffolk would remain unchanged. See Mt. Hawley Ins. Co. v. 

Sandy Lake Properties, Inc., 425 F.3d 1308, 1311 (11th Cir. 2005) (denying 

intervention under similar circumstances because the claimant only had an economic 

interest and that “a legally protectable interest ‘is something more than an economic 

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interest.’”); see also Raimbeault v. Accurate Machine & Tool, LLC, 302 F.R.D. 675, 

684 (S.D. Fla. 2014) (“[W]hen the subject litigation involves a contract under which 

an absent party has no rights or obligations, even though the absent party may be 

impacted by the pending action due to a separate contract to which it is a party but 

that is not at issue, joinder of that absent party will not be required to determine 

obligations under the disputed contract.”). In other words, we can afford “complete 

relief” between Plaintiffs and Summers. See Combe, 977 F. Supp. 2d at 1305. As a 

result, MRP and Suffolk are not necessary under Rule 19(a)(A). 

Defendants also argue that “Summers has other insurers that potentially 

provide coverage for the claims asserted against Summers by the Association.” [D.E. 

10]. Defendants fail to identify these mystery insurers nor reference or provide copies 

of the policies. Given that the burden is on Defendants to establish that an absent 

party is required to be joined to an action, we find no compelling reason why these 

unnamed insurers are necessary for this action. See West Peninsular, 41 F.3d at 1492. 

Moreover, Defendants cite to one non-binding decision to support their argument, 

which holds that a primary insurer is a necessary party in a suit against an excess 

insurer. See City of Littleton, Colo. v. Com. Union Assur. Cos., 133 F.R.D. 159, 166 

(D. Colo. 1990). This principal is not applicable here as the primary insurer is already 

a party. Accordingly, Defendants have failed to establish the other insurers are 

necessary. See, e.g., King Cole Condo. Ass’n, Inc. v. QBE Ins. Corp., 2009 WL 

10668628, at *3 (S.D. Fla. July 1, 2009) (holding that an insurer was not an 

indispensable party because “any declaration as to Plaintiff’s rights or a finding on 

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the breach of contract claims does not impact the interest of [the second insurer] as a 

separate or additional insurer”). Therefore, Defendants’ motions should be DENIED.

IV. CONCLUSION

For the foregoing reasons, we RECOMMEND that Defendants’ motions [D.E. 

10, 17] should be DENIED. 

Pursuant to Local Magistrate Rule 4(b) and Fed. R. Civ. P. 73, the parties 

have fourteen (14) days from service of this Report and Recommendation within 

which to file written objections, if any, with the Honorable Judge Kathleen 

M. Williams. Failure to timely file objections shall bar the parties from de 

novo determination by the District Judge of any factual or legal issue covered in the 

Report and shall bar the parties from challenging on appeal the District Judge’s 

Order based on any unobjected-to factual or legal conclusions included in the 

Report. 28 U.S.C. § 636(b)(1); 11th Cir. Rule 3-1; see, e.g., Patton v. Rowell, 2017 WL 

443634 (11th Cir. Feb. 2, 2017); Cooley v. Comm’r of Social Security, 2016 WL 

7321208 (11th Cir. Dec. 16, 2016).

DONE AND SUBMITTED in Chambers at Miami, Florida, this 5th day 

of October, 2020.

/s/ Edwin G. Torres 

EDWIN G. TORRES

United States Magistrate Judge

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