FIL ED U.S. COURT OF APPEAL S EL EVENTHCI RCUI T FEB 2, 2011 J OHN L EY CL ERK [DO N OT PUBLISH]
IN THE UN ITED STATES COURT OF APPEALS FOR THE ELE VENTH CIRCUIT

__ __ __ __ __ __ __ __ __ __ __ __ No. 0 9- 16 34 8

__ __ __ __ __ __ __ __ __ __ __ __ D. C. Dock etNo. 0 8- 61 61 8- CV-CM A ROLYN COMPANIES,INC., Pl ai nt iff -Co un te rDefen da nt -Ap pe ll an t,
ve rs us R & J SALES OF TEXA S, INC., d.b .a Prec is io n R es to rat io n andRo of in g, ADMIRAL INSURANC E COMPANY Defen da nt s- App el le es , CRUM & FORSTER SP ECIALTY INSURANCE COMPANY, Defen da nt -Co un te rCl ai m an t-Ap pe ll ee.

__ __ __ __ __ __ __ __ __ __ __ _ App eal fro m

th e Uni te d S ta te s Di st ric t Co urt fo r th e So uthe rnDis tri ctof F lo rid a

__ __ __ __ __ __ __ __ __ __ __ __ _ (Feb ru ary 2, 2 01 1)Befo re BARKETT, MARCUS Cir cu itJu dg es , andRESTANI, Ju dg e. * PER CURI AM: Thi s ca se in vo lv es anin su ran ce co ve rag e d is pu te ari si ng fro m cert ai n da m ag e to a res id en ti al bu il di ng cau se d b y he av y rai n. Fo ll owi ng a 20 05 hu rri can e, th e b ui ld in g a ss oc iati on , Sto ne br id ge Gard en s i n Lau de rh il l, Fl or id a, hi redPla in ti ff Ro lyn Co m pa ni es , Inc . (“ Ro lyn”), a g en eral co nt ract orsp eci al iz in g in di sa st er-r eco ve ry

co ns tru ct io n, t o re pa ir i ts bu il di ng s. Ro lyn ret ai ne d aroo fin g
subc on tra ct or , R & JSal es of Tex as , Inc . d/b/ a Pre ci si on Res to rat io n a ndRo of in g (“ Prec is io n” ), to rep ai r th e ro of s. Du e to Prec is io n’s al le ge d faul ty w orkm an sh ip , wate r in tru si on da m ag edth e in te rio r of Bu il di ng 28 00 du rin g ahe av y rai n. Ro lyn rep ai redth e in te rio rs of a ll un it s o f Bu il di ng 28 00 at aco stof o ve r $1 ,30 0,0 00
. Ro lyn fil edsu itag ai ns t Pr eci si on forbre ach of c on tra ct , andag ai ns t two in su ran ce co m

pa ni es , Defen da ntCru m

& Fo rs te r Sp eci al ty Ins ur an ce Co m pa ny (“ Cru m & Fo rs te r”) andDefen da ntAdm ira l In su ran ce Co m pa ny (“ Adm ira l” ),
se ek in g ade cl arat io n t ha t i ns ur an ce p ol ic ie s i ss ue d b y th e co m pa ni es requi red th em to de fen d a ndin de m

ni fy Ro lyn an d t o re im

bu rs e Ro lyn fo r an y

ex pe ns es or da m ag es in cu rred . The d is tri ctco urt g ran te d s umm ary jud gm en t t o t he in suran ce

Honora ble J ane A . Restani, J udg e of the United States Court of Interna tional Trade , * sitti ngby designation. 2de fen da nt s upo n d et erm in in g t ha t Ro lyn was n otco ve redun de r ei th er i ns ur an ce

po li cy . W e rev ie w th e d is tri ctco urt’s g ran t o f su m m ary jud gm en t d e n ov o, drawi ng al l fa ct s an d i nf

eren ces inth e li gh t m os t favo rab le to th e n on -m ov in g p arty . Dy er v. Lee , 48 8 F .3d87 6, 8 78 (11 th Cir . 20 07 ). Ro lyn rai se s fo uris su es onap pe al . Firs t, Ro lyn arg ue s tha t the di st ric t co urt
erre d i n fi nd in g t ha t the “ vo lu nt ary pa ym en ts ” ex cl us io n i n t he Cru m & Fo rs te r
co m m erci al ge ne ral li ab il it y

(“ CGL”) p ol ic y

ap pl ie d, thu s p recl ud in g c ov erag e
un de r th atpo li cy . Seco nd , Rol yn a rg ue s tha t the di st ric t co urt erredby con cl ud in g th atex cl us io ns rel at edto asb es to s an d m ol d a ls o p recl ud edco ve rag e und er the Cru m & Fo rs te r po li cy . Thir d, Ro lyn arg ue s tha t the di st ric t co urt erredin de te rm in in g t ha t Ro lyn is no t an “ ad di ti on al in su red ” und er the Adm ira l p ol ic y , th us pre cl ud in g c ov erag e und er tha t p ol ic y . Fou rth , Rol yn a rg ue s tha t the di st ric t
co urt erredinde te rm in in g t ha t co ve rag e und er the Adm ira l p ol ic y was a ls o pr ecl ud edby pol ic y

ex cl us io ns rel at edto roo fin g o pe rat io ns . Upo n re vi ew of th e pa rti es ’ br ie fs an d t he reco rdon ap pe al , we agr ee wi th th e d is tri ctco urt tha t
su m m ary jud gm en t was pro pe r as to each Defen dant . W e n ow ad dr es s ea chpo li cy in tu rn . I. CRUM & FORSTER POLICY
3Bec au se th is is a di ve rs it y cas e, Fl or id a la w go ve rn s the sco pe of t he Cru m & Fo rs te r CGL po li cy . Davi s v . Nat’l Med . Ent ers ., Inc ., 25 3 F .3d13 14 , 13 19 n.6 (1 1t h C ir. 2 00 1) . The Fl or id a Supr em e Co urt h as st at ed : “ Ourin te rp ret at io n o f in su ran ce co nt ract s, s uc h a s the CGL po li ci es inth is cas e, is go ve rn edby ge ne ral ly accep te d ru le s o f co ns tru ct io n. In su ran ce co nt ract s ar e co ns tru ed
acco rd in g t o t he ir p la in m ean in g, wi th an y am bi gu it ie s co ns tru edag ai ns t the in su rer andinfav or

of c ov erag e.” U.S. Fir e In s. Co . v. J .S.U.B., Inc ., 97 9 S o. 2 d 87 1, 8 77 (Fl a. 20 07 ). The Cru m

& Fo rs te r po li cy

co nt ai ns a vo lu nt ary-paym en t p ro vi si on , whi ch st at es : 2. Du ti es In Th e Eve ntOf Occurren ce, Offe ns e, Cl ai m Or Sui t

. . . . d. No in su redwil l, ex cep t atth atin su red ’s ownco st , vo lu nt ari ly mak e a p aym en t, as su m e an y

ob li ga ti on , or i nc ur

an y ex pe ns e, ot he r th an fo r fi rs t ai d, wi th ou t o urco ns en t. Ro lyn Co s. v . R & J Sa le s o f Tex ., Inc ., 67 1 F . Sup p. 2 d 1 31 4, 1 32 6– 27 (S.D. Fla
. 20 09 ). The d is tri ctco urt h el d t ha t thi s p ro vi si onpre cl ud edRo lyn fro m reco ve rin g
co st s i t i nc urredwhen itrep ai redBu il di ng 28 00 be cau se Ro lyn di d n otsee k C ru m & Fo rs te r’s co ns en t b efo re v ol un ta ril y in cu rri ng th os e co st s. Ro lyn Co s., 6 71 F. Supp . 2dat 1 33 0. We agre e. As o ne Flo rid a co urt h as sai d re ga rd in g v ol un ta ry -p aym en t p ro vi si on s s uc h
4as th e o ne at i ss ue he re:

Whi le anin su redis free to en te r in to a reas on ab le set tl em en t wh enit s in su rer h as wron gf

ul ly refus edto pro vi de itwith ade fen se to a su it , we fi ndth atth e in su redis no t s im il arl y free to in de pe nd en tl y

en ga ge in su chset tl em en ts wher e, as he re, the in su rer h adno t d ecl in eda de fen se to su it . Con se qu en tl y , . . . th e in su red ’s fai lure t o c om pl y with th e rel ev an t p ol ic y

pro vi si on s re li ev edth e in su rer o f it s o bl ig at io ns un de r th e p ol ic y . . . . Am . Rel ia nc e In s. Co . v. Per ez, 7 12 So . 2d12 11 , 12 12 –1 3 (F la . Dis t. Ct . App
. 19 98 ) (b rack et s o m it te d) . Thu s, a v ol un tary -p aym en t p ro vi si on , su chas t he on e at is su e h ere, “ requi res th e in su redto ob ta in th e in surer’s co ns en t b efo re s et tl in g.” Id

. at 1 21 3. Here, Ro lyn di d n otob ta in Cru m & Fo rs te r’s co ns en t b efo re i nc urrin g c os ts with re ga rdto Bu il di ng 28 00 . Alth ou gh Ro lyn arg ue s tha t i t was leg al ly obl ig at ed to ad dr es s the da m ag e cau se d b y it s s ub co nt ract or , Preci si on , we agr ee wi th th e di st ric t co urt tha t the co st s i nc urredby Rol yn t o re pa ir t he da m ag e were n ot in cu rred“ ‘inv ol un ta ril y

be cau se of c irc um st an ces be y on d [R ol yn’s] con tro l,’ su ch
as ‘ a si tu at io n re qu iri ng im m ed ia te res po ns e to pro te ctit s l eg al in te res ts .’ ” Ro lyn Co s., 6 71 F. Sup p. 2 d a t 1 32 7 (quo ti ng Jamesto wn Bu il de rs , Inc . v. Gen . Star In de m . Co., 9 1 C al . Rpt r. 2d51 4, 5 18 (Cal . Ct. Ap p. 1 99 9) ). Ther e is no in di cat io n i n t he reco rdth atRo lyn was r equi redto res po ndimm ed ia te ly to fi x t he da m ag e, an d, i n fa ct , inth e ti m e b etweenth e d am ag e an d the rep ai rs , Rol yn 5worke d wi th Prec is io n fo r se ve ral m on th s t o t ry to ge t Pr eci si on to rep ai r th e da m ag e. Accep ti ng Ro lyn’s bro adde fin it io n o f “ le ga ll y ob li ga te d” wou ld effe ct iv el y

de le te th e v ol un ta ry -p aym en t p ro vi si on fro m th e p ol ic y . See Mo or e v . St at e Farm

Mu t. Au to . Ins . Co., 9 16 So . 2d87 1, 8 77 (Fl a. Dis t. Ct . App . 20 05 ) (“ W e wil l n otin te rp reta co nt ractinsu cha way as t o re nd er p ro vi si on s
m ean in gl es s wh enth ere i s a r eas on ab le in te rp ret at io n tha t d oe s n otdo so .”). The act io n o f Ro lyn he re fa ll s i nt o t he cat eg ory of f ai li ng to co op erat e wit h th e in su rer. Su cha “ fai lu re wh ic h c on st itut es a m at eri al bre ach an d s ub st an ti al ly pr ejud ic es th e ri gh ts of t he in su rer i n d efen se of t he cau se wil l re le as e th e in su rer of it s o bl ig at io n t o p ay .” Mi d- Co nt in en t Ca s. Co . v. Am . Prid e Bl dg . Co., LLC, 60 1 F .3d11 43 , 11 50 (11 th Cir . 20 10 ) (i nt ern al qu ot at io n m ark s o m it te d) (qu ot in g Ram os v. Nw. Mu t. In s. Co ., 33 6 S o. 2 d 7 1, 7 5 (F la . 19 76 )). Itap pe ars ob vi ou s th atco m pl et in g t he rep ai r witho utco ns en t wo ul d h av e a m at eri al effe cton po te nt ia l l it ig at io n, i nc lu di ng set tl em en t the reo f. In a ny case , th e d is tri ctco urt was
no t ca ll edup onto res ol ve an y is su e o f pr ejud ic e to th e in su rer, b ecau se su chis su e
was no t ra is ed , as app el la nt ’s cou ns el st at edat o ral arg um en t. 1 Mo reo ve r, Ro lyn was a ls o n otex cu se d fr om see ki ng Cru m

& Fo rs te r’s

Counsel also stated that there is no claim of an implied conse nt by Crum & F orster to 1 the re pairs. 6co ns en t due to “ th e in su rer’s re fu sa l t o d efen d i n alaws ui t t o e st ab li sh li ab il it y .”

Ja m es to wn Bu il de rs , 91 Cal . Rpt r. 2dat 5 17 . Cru m & Fo rs te r ne ve r wro ng fu ll y refu se d t o p ro vi de Ro lyn with ade fen se to an y su it , and , infact , Cru m

& Fo rs te r de fen de d R ol yn i n asu itby the own er o f on e o f Bu il di ng 28 00 ’s un it s. Thus , Ro lyn ha d t im e to ob ta in Cru m & Fo rs te r’s co ns en t b efo re i nc urrin g t he se co st s,
an d n ot hi ng inth e rec or d p ro vi de s an ex cu se forit s fa il ur e to ob ta in su chco ns en t. Bec au se Ro lyn fai le d t o o bt ai n C ru m & Fo rs te r’s co ns en t b efo re i nc urrin g c os ts to rep ai r Bu il di ng 28 00 , we agr ee wi thth e d is tri ctco urt tha t the vo lu nt ary-paym en t pr ov is io n o f th e Cru m

& Fo rs te r po li cy

ba rs reco ve ry . 2 II. ADMIRAL POLICY Und er Fl or id a la w, “ th e la ws o f th e juri sd ic ti on wher e th e co nt ractwas
ex ecu te d g ov ernin te rp ret at io n o f subs ta nt iv e is su es reg ard in g t he co nt ract .” Lum be rm en s M ut . Cas . Co. v . Aug us t, 5 30 So . 2d29 3, 2 95 (Fl a. 19 88 ). The refo re, b ecau se Prec is io n’s Adm ira l i ns ur an ce p ol ic y was e xe cu te d i n Tex as , Tex as law g ov ern s wh ethe r Ro lyn is en ti tl edto reco ve r un de r th atpo li cy as a n ad di ti on al -in suredan d wh ethe r ex cl us io ns ap pl y . The p art ie s d o n otass ertan y

Be cause we a gree that the CGLpolicy ’s voluntary-pay ment provision prec ludes 2 rec overy of any of the c osts incurred by

Roly n to repa ir damag es to the building at issue, we nee d not rea ch Roly

n’s objection to the district cour t’s deter mination that damag es we re a lso barre d by exclusions i n the policy

related to asbestos and mold.

7si gn ifi can t d iff eren ce b etweenFlo rid a an d Tex as law. W e co nc lu de th atth e d is tri ctco urt p ro pe rly deci de d t ha t the Ro of in g Ope rat io ns Excl us io n i n t he Adm ira l p ol ic y pre cl ud edco ve rag e b y

Adm ira l. It read s as fol lo ws: ROOFING OPERATIONS – LIMITATION OF COVERAGE

. . . . Thi s i ns ur an ce d oe s n otap pl y to “pr op erty

da m ag e” t o a ny bu il di ng , st ru ctur e o r th e co nt en ts th ereo f, cau se d b y y ou r fai lu re o r th e fai lu re of an y subc on tra ct orwork in g o n your be ha lf: 1. To pro pe rly cov er an y un fin is he d ro of

or s ect io n o f ro of

du rin g th e co ur se of r oo fin g o pe rat io ns ag ai ns t the in flu x o f win d, ra in , sl eet , ha il , sn ow o r an y

othe r subs ta nc e. Ro lyn Co s., 6 71 F. Sup p. 2 d a t 1 33 6– 37
. Ro lyn do es no t d is pu te th atat t he ti m e o f th e rai n e ve ntat i ss ue , th e ro of
was y etto be co m

pl et edwith “ tape redroo f in su la ti on , at l eas t o ne m or e la y er o f fel t t o b e ‘mop pe d i n,’ a term in at io n b ar an d c ou nt er-f la sh in gs .” App . Rep ly Br. 25 (qu ot in g Ad m ira l An s. Br . 15 ). Rathe r, th e arg um en t i s tha t Pr eci si on wou ld
no t b e ex pe ct edto pl ace atar p o ve r th e ro of

at t hi s “ dr ie d i n” st ag e. Thu s, the re i s
no ge nu in e is su e o f fac t tha t the roo f was “un fin is he d” when a he av y rai n c au se d th e d am ag e. Whi le th e ro of m ay ha ve be en“ dr ie d i n,” itwas n ot“pr op erl y
co ve red ” so as t o p rev en t ra in in cu rs io n. Th eref or e, su m m ary jud gm en t i n fa vo r

8of

Adm ira l was pro pe rty gran te d. 3 Fo r th e fo reg oi ng reas on s, we af firm th e jud gm en t o f th e d is tri ctco urt. AFFIRMED.

Be causeAdmiral is entitled to judgment a s a matter of law on the Roofing

Oper ations 3 Ex clusion in the Admiral policy , we ne ed not addr ess the additional-insure d issue. 9