FILED

U.S. COURT OF APPEALS

ELEVENTH CIRCUIT

JAN 9, 2012

JOHN LEY

CLERK

[DO NOT PUBLISH]

 IN THE UNITED STATES COURT OF APPEALS

 FOR THE ELEVENTH CIRCUIT

 ________________________

 No. 10-12825 

 ________________________

 D.C. Docket No. 1:07-cv-23044-AJ; 1:07-cv-23358-AJ

1:07-cv-23044

ESPERANZA GARCIA,

as Personal Representative of the Estate of Paola Penafiel,

lllllllllllllllllllll Plaintiff - Appellant,

 versus

GEICO GENERAL INSURANCE COMPANY,

llllllllllllllllllll Defendant - Appellee,

____________________________________________________________

1:07-cv-23358

GEICO GENERAL INSURANCE COMPANY,

a foreign insurance company,

llllllllllllllllllll Plaintiff - Appellee,

EDGAR BAENA,

MIGUEL BAENA,

ESTATE OF PAOLA PENAFIEL,

ERICA MANSON,
lllllllllllllllllllll Defendants - Appellants,

ALEXANDRA MONTOYA, et al.,

lllllllllllllllllllll Defendants.

________________________

 Appeal from the United States District Court

 for the Southern District of Florida

 ________________________

(January 9, 2012)

Before BARKETT, WILSON, and ARNOLD, Circuit Judges.

*

PER CURIAM:

This is a consolidated appeal involving the interpretation of an automobile

insurance policy’s “non-owned auto” provision. Esperanza Garcia, Edgar Baena,

and Miguel Baena appeal a series of district court orders in favor of Geico General

Insurance Company (“Geico”). For the following reasons, we reverse and remand. 

In December 2006, Miguel flew to South Florida for vacation. At the Fort

Lauderdale airport, he rented a car from Enterprise Rent-A-Car (“Enterprise”). 

When an Enterprise representative asked him whether there would be any other

drivers, Miguel responded in the negative. The rental agreement therefore stated,

Honorable Morris S. Arnold, United States Senior Circuit Judge for the Eighth Circuit, *

sitting by designation.

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“no other drivers permitted.” Miguel did not have his own automobile insurance,

and he did not purchase liability insurance from Enterprise. 

Miguel later met his brother Edgar, who was not privy to the terms of the

rental agreement with Enterprise. The brothers attended a Miami Heat game

together, and on the way home from the game, Miguel asked Edgar to drive. 

Edgar agreed, and during the course of operating the vehicle, Edgar crashed into

Paola Penafiel’s car. Penafiel was killed in the collision. 

Although Miguel was uninsured, Edgar had an automobile insurance policy

with Geico. Geico conceded that its policy with Edgar stated that Geico was 1

liable for damages arising out of Edgar’s use of a “non-owned auto”—here, the

Enterprise rental car. However, under the policy, Geico’s liability was contingent

on the condition that, “[s]uch use [of the non-owned auto] must be with the

permission, or reasonably believed to be with the permission, of the owner and

within the scope of that permission.” (emphases added). Because Geico believed

that Enterprise did not grant such permission, Geico denied coverage for the

accident. 

Garcia, the representative of Penafiel’s estate, subsequently reached a

 Edgar’s policy was the only possible source of insurance coverage for Penafiel's claims 1

because the Graves Amendment prohibited Garcia from bringing suit against Enterprise or

Enterprise’s insurer to recover for Penafiel’s death. See 49 U.S.C. § 30106.

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Coblentz agreement with Edgar, in which Edgar agreed to the entry of a consent

judgment in the amount of $5 million in resolution of the estate’s wrongful death

action against him. See Coblentz v. Am. Sur. Co. of N.Y., 416 F.2d 1059, 1062–63

(5th Cir. 1969). Garcia is now proceeding against Geico on a theory of bad faith 2

under Florida law to recover the $5 million judgment. 

There were three trials in this case, and neither jury in the first two trials

was able to reach a verdict. After the first trial, the district court granted a directed

verdict for Geico on the issue of whether Enterprise consented to Edgar’s use of

the rental vehicle. In doing so, the district court rejected the argument that

Enterprise had given implied permission to Edgar, and found as a matter of law

that Enterprise did not consent to Edgar’s use. Therefore, the second and third

trials addressed only whether Edgar reasonably believed he had the owner’s

permission to drive the rental car. In the third trial, the jury rendered a verdict in

favor of Geico, finding that although Edgar had Miguel’s express permission to

drive the rental car, Edgar did not reasonably believe he had the permission of

Enterprise, the owner. Garcia, Edgar, and Miguel now appeal. 

We focus first on the main issue of the appeal: Appellants’ contention that

 In Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir. 1981) (en banc), we

2

adopted as binding precedent all of the decisions of the Fifth Circuit handed down prior to

October 1, 1981.

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the court erred by refusing to apply Florida’s dangerous instrumentality doctrine in

this case and interpreting “permission . . . from the owner” as express permission.

We review construction of an insurance policy de novo. James River Ins. Co. v.

Ground Down Eng’g, Inc., 540 F.3d 1270, 1273–74 (11th Cir. 2008). “Because

federal jurisdiction over this matter is based on diversity, Florida law governs the

determination of the issues on this appeal.” State Farm Fire & Cas. Co. v.

Steinberg, 393 F.3d 1226, 1230 (11th Cir. 2004). We will “follow the decisions of

the state’s highest court when that court has addressed the relevant issue,” 

Technical Coating Applicators, Inc. v. U.S. Fid. & Guar. Co., 157 F.3d 843, 844

(11th Cir. 1998), and “apply the state law as it exists at the time of the appeal and

not at the time of the district court judgment,” id. at 845 (citing Kramer v. Piper

Aircraft Corp., 868 F.2d 1538, 1541 (11th Cir. 1989) (per curiam)). In light of the

Florida Supreme Court’s recent ruling in Chandler v. Geico Indem. Co., —So.

3d—, 2011 WL 5864808 (Fla. Nov. 23, 2011), we agree with Appellants and

reverse and remand. 

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The Geico policy dictated that Geico would provide coverage if Edgar had

been using a borrowed vehicle with the “permission . . . of the owner.” Appellants

 Given that in Chandler the Florida Supreme Court addressed the same issue raised in 3

Appellants’ Motion for Expedited Certification to the Florida Supreme Court, we find

certification to be unnecessary, and thus Appellants’ motion is DENIED. 

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argue that such permission is established—even in the absence of an express

statement granting permission—where the owner has given its consent to the use

or operation of the automobile beyond its immediate control, unless it can be

demonstrated that there has been “a breach of custody amounting to a species of

conversion or theft.” Roth v. Old Republic Ins. Co., 269 So. 2d 3, 5 (Fla. 1972)

(quoting Susco Car Rental Sys. of Fla. v. Leonard, 112 So. 2d 832, 835–36 (Fla.

1959)). Appellants assert that “permission” is present in the rental car context

when the driver receives permission to drive the car from someone lawfully in

possession of the vehicle. Because the jury determined that Edgar received

express permission from Miguel (the authorized renter), Appellants argue that

Edgar therefore had permission as a matter of law from Enterprise. 

The Florida Supreme Court’s decision in Chandler supports Appellants’

interpretation of “permission.” In Chandler, Kutasha Shazier was insured by

Geico under a policy that provided coverage for Shazier’s vehicle and any

“temporary substitute auto.” 2011 WL 5864808, at *2. A “temporary substitute

auto” was defined as a vehicle not owned by the policy holder that was

temporarily used “with the permission of the owner.” Id. When Shazier’s vehicle

broke down, she obtained a rental car from Avis Rent-A-Car (“Avis”). The rental

agreement between Shazier and Avis, much like the agreement in this case, stated

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that no additional operators of the vehicle were authorized and that allowing an

unauthorized driver to operate the car would automatically terminate the rental

agreement. Id. at *1. Shazier subsequently permitted an unauthorized driver to

operate the car, who in turn lent the car to another unauthorized driver who

crashed the vehicle. Id. 

Geico denied coverage for the accident in Chandler, arguing that use of the

rental car by the unauthorized driver terminated the rental agreement between Avis

and Shazier and thus revoked the “permission of the owner.” Id. Because Geico

determined that Shazier lacked permission, the car was not within Geico’s

“temporary substitute auto” coverage. Id. The trial court disagreed, finding that

Geico would be liable for any damages owed by Shazier, but the First District

Court of Appeals reversed, holding that Avis had the right to define the scope of

its permission and that unauthorized use of the car effectively revoked that

permission. Id. at *2. The Florida Supreme Court then quashed the district

court’s decision. Id. at *10. 

 The Florida Supreme Court explained that under Florida’s dangerous

instrumentality doctrine, the type of consent given by a car owner “is simply

consent to the use or operation of such an instrumentality beyond [the owner’s]

immediate control,” id. at *5 (quoting Susco, 112 So. 2d at 837), and that consent

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is not revoked in the absence of “a breach of custody amounting to a species of

conversion or theft,” id. at *4 (quoting Susco, 112 So. 2d at 835–36). Because

Florida law holds that a contract between a rental company and a renter that

restricts use by unauthorized drivers cannot “change the fact that the automobile

was being used with the owner’s consent,” see Susco, 112 So. 2d at 835, the

Florida Supreme Court found that Shazier had Avis’s permission to use the car at

the time of collision, Chandler, 2011 WL 5864808, at *9.

Edgar Baena’s Geico policy covered his use of a non-owned auto, provided

that such use was “with the permission, or reasonably believed to be with the

permission” of the owner. Chandler instructs that the broad definition of

“permission” developed in Florida’s dangerous instrumentality cases is applicable

to contractual insurance disputes, such as the one at hand. See Chandler, 2011

WL 5864808, at *9. Therefore, if Enterprise gave its consent to Miguel to rent the

car, that consent—in the absence of a breach of custody amounting to a species of

conversion or theft—extended to any person that Miguel allowed to use the car. 

The district court did not apply this proper definition of permission. Instead, it

incorrectly found as a matter of law that because Enterprise did not give express

permission to Edgar, Enterprise did not consent to Edgar’s use of the car. This

finding of law, as well as the district court’s grant of partial summary judgment in

8
favor of Geico regarding this issue, was in error. We therefore reverse and remand

for proceedings that apply the law of Chandler.

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REVERSED AND REMANDED. 

 Because we find that reversal and remand are warranted on the grounds above, we need 4

not reach Appellants’ other arguments. 

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