Opinion ID: 3055061
Heading Depth: 2
Heading Rank: 1

Heading: Insurance Applications and Contracts

Text: Joe Franco owns Ocean’s 11, which operates a restaurant and bar in Florida. In 2009, Franco applied for and obtained liability insurance for Ocean’s 11 from Indemnity. He repeated this process in 2010 and 2011. Each of the three insurance applications, incorporated into their respective insurance policies, contained a warranty stating, in relevant part, that the statements made in the insurance application were true, correct and complete to the best of Franco’s knowledge and belief: The undersigned represents and warrants, to the best of his/her knowledge and belief, based on reasonable inquiry, that the particulars and statements set forth on this application are true, correct and entirely complete, and there are no other risk factors that have not been disclosed herein. If any particulars or statements are materially misrepresented or material information has been omitted intentionally or accidentally, such misrepresentation or omission will void any issued coverages and the insurance company will have no duty to 2 Case: 12-16261 Date Filed: 06/26/2013 Page: 3 of 7 defend any claims, pay any damages, or pay sums or perform acts or services. In 2011, a patron sued Ocean’s 11 for damages for assault and battery sustained at its bar. After investigating, Indemnity advised Ocean’s 11 that it was rescinding the three insurance contracts and declaring the insurance policies void ab initio. Indemnity maintained that Franco had made various material misrepresentations in the three insurance applications as to such things as square footage, anticipated gross receipts, number of security personnel, employee background checks and Franco’s years of experience. Indemnity did not provide Ocean’s 11 with a defense to the bar patron’s pending suit or coverage for any potential losses.