Opinion ID: 1800337
Heading Depth: 1
Heading Rank: 2

Heading: DETERRENT vs. COMPENSATION

Text: The second step in determining whether a particular type of liability insurance violates public policy is to examine the purpose that is served by the imposition of liability. If the primary purpose is to compensate victims, indemnification may be suitable. If, on the other hand, the primary purpose is to deter wrongdoers, then indemnification should not be the paramount consideration. We conclude that the primary purpose served by the imposition of liability for intentional acts of wrongful discrimination is to deter wrongful discrimination. Because of the unique nature of intentional discrimination, however, the two policies (compensation and deterrence) are not incompatible. Florida has a long-standing policy of opposing religious discrimination. Article I, section 2 of the Florida Constitution provides: Basic rights.  All natural persons are equal before the law and have inalienable rights, among which are the right to enjoy and defend life and liberty, to pursue happiness, to be rewarded for industry, and to acquire, possess and protect property; except that the ownership, inheritance, disposition and possession of real property by aliens ineligible for citizenship may be regulated or prohibited by law. No person shall be deprived of any right because of race, religion or physical handicap. (Emphasis added.) Pursuant to this provision, the legislature has passed numerous laws banning religious discrimination in various practices. [5] Intentional discrimination claims tried in Florida generally arise under the state's numerous antidiscrimination statutes, particularly under the Human Rights Act of 1977, sections 760.01-760.10, Florida Statutes (1987) (employment discrimination), and the Fair Housing Act, sections 760.20-760.37, Florida Statutes (1987). [6] The primary purpose for imposing liability under these acts is undeniably to deter discrimination. The Human Rights Act clearly states: 760.01 Purposes; construction; title.  ... . (2) The general purposes of ss. 760.01-760.10 are to secure for all individuals within the state freedom from discrimination because of race, color, religion, sex, national origin, age, handicap, or marital status and thereby to protect their interest in personal dignity, to make available to the state their full productive capacities, to secure the state against domestic strife and unrest, to preserve the public safety, health, and general welfare, and to promote the interests, rights, and privileges of individuals within the state. (Emphasis added.) And the Fair Housing Act provides: 760.21 State policy on fair housing.  It is the policy of this state to provide, within constitutional limitations, for fair housing throughout the state. Whatever victim compensation takes place under these acts is secondary to deterring discrimination. Florida's Human Rights Act appears to be patterned after Title VII of the federal Civil Rights Act of 1964, and no doubt has ever existed as to the main purpose of the federal act: This record, and its subsequent interpretation by the courts, leaves no doubt that the primary purpose of Title VII is to eliminate discrimination in employment and that its secondary purpose is to compensate victims of discrimination. Comment, supra, at 197 (footnotes omitted). The Club implies that if intentional discrimination were not to be held insurable many victims of discrimination would be unable to collect on their damage awards. We disagree. The bulk of discrimination cases are brought against commercial enterprises that have discriminated in the marketplace or workplace. These businesses generally have far greater resources than do individuals and to hold the acts of such parties uninsurable would result in relatively few instances where the injury would go uncompensated. Such was the case in the present claim. As to the Club's claim that intentional discrimination is adequately deterred by the threat of punitive damages, we point out that to deter effectively, punishment must be reasonably certain. Punitive damages would appear to be awarded with insufficient frequency in statutory discrimination cases to make punishment certain by any means. In fact, punitive damages are not even mentioned under the state's premier antidiscrimination statute, the Human Rights Act. See §§ 760.01-760.10, Fla. Stat. (1987). Cf. Comment, supra, at 199 n. 46 (punitive damages are generally unavailable under Title VII). In private actions arising under Florida's Fair Housing Act, punitive damages are statutorily limited to no more than $1,000, a token wrist slap to a large corporate offender. § 760.35, Fla. Stat. (1987). Based on the foregoing, we answer the certified question in the affirmative and quash the decision of the district court. In so doing, we hold that the public policy of Florida prohibits an insured from being indemnified for a loss resulting from an intentional act of religious discrimination. We remand for further proceedings consistent with this opinion. It is so ordered. OVERTON, BARKETT, GRIMES and KOGAN, JJ., concur. EHRLICH, C.J., dissents with an opinion. McDONALD, J., dissents.