Court Opinion

ID: 9946736
Source: CourtListenerOpinion
Date Created: 2024-03-01 13:02:38.758883+00
Date Added: 2024-06-11T14:22:19.777546
License: Public Domain

DISTRICT COURT OF APPEAL OF FLORIDA
                        SECOND DISTRICT

          UNIVERSAL PROPERTY AND CASUALTY INSURANCE
           COMPANY a/s/o VIRGILIO PEREZ Y. PEREZ and
                        SIRKKA PEREZ,

                               Appellant,

                                   v.

        LAGUNA RIVIERA CONDOMINIUM ASSOCIATION, INC.,

                                Appellee.

                              No. 2D23-34

                             March 1, 2024

Appeal from the Circuit Court for Manatee County; Edward Nicholas,
Judge.

Nancy Gregoire Stamper of Birnbaum, Lippman & Gregoire, PLLC, Fort
Lauderdale; Jourdan Weltman and Alyson Holob of Universal Property
and Casualty Insurance Company, Fort Lauderdale; for Appellant.

E. Taylor George and Shaun R. Koby of Lydecker LLP, Tampa, for
Appellee.

LABRIT, Judge.
     Universal Property and Casualty Insurance Company appeals an
adverse final judgment in a negligence action it brought—as subrogee of
its insureds, Virgilio and Sirkka Perez—against Laguna Riviera
Condominium Association. We affirm because the trial court properly
applied section 627.714(4), Florida Statutes (2022), in entering judgment
for the Association.
                                     I.
      In January 2021, Universal issued a property insurance policy to
the Perezes, owners of a unit within the Laguna Riviera Condominiums.
The policy was for a term ending in January 2022. The complete policy
is not in the record, but it undisputedly contains a provision that
subrogates Universal to the rights of the Perezes to the extent of any
payment made under the policy.
      After Universal issued the policy, the legislature amended the
insurance code and added the following language to section 627.714(4):
      If a condominium association's insurance policy does not
      provide rights for subrogation against the unit owners in the
      association, an insurance policy issued to an individual unit
      owner in the association may not provide rights of
      subrogation against the condominium association.
Ch. 2021-99, § 1, Laws of Fla. This amendment effectively precludes a
unit owner's insurer from suing an association in subrogation if the
association's insurer doesn't have a reciprocal right to sue unit owners.
And pertinent here, this amendment became effective on July 1, 2021.
Id. at § 27.
      On July 13, 2021, a main pipe within the Laguna Riviera
Condominiums failed and damaged the Perezes' unit. Universal paid
$125,000 to cover the loss. It then filed a negligence complaint against
the Association, as subrogee of the Perezes, alleging that the
Association's failure to inspect, maintain, test, or repair the main pipe
caused the loss. The Association answered the complaint and asserted
section 627.714(4) as an affirmative defense. The Association also
attached a copy of its insurance policy to its pleading, showing that the
Association's insurer had "waive[d] [its] rights to recover payment from
any unit-owner" through the policy it issued to the Association.

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     Based on this waiver and the language of section 627.714(4) as
amended, the Association moved for judgment on the pleadings. It
argued that the statute bars Universal's action because the Association's
policy does not provide for rights of subrogation against unit owners.
The trial court agreed. It granted the Association's motion for judgment
on the pleadings and entered final judgment for the Association.1 This is
Universal's appeal. We review the trial court's decision de novo.
Hilbrands v. Hilbrands, 320 So. 3d 938, 939 (Fla. 2d DCA 2021) (citing
U.S. Fire Ins. Co. v. ADT Sec. Servs., Inc., 134 So. 3d 477, 479 (Fla. 2d
DCA 2013)).
                                     II.
     Universal argues, as it did below, that its subrogation rights vested
in January 2021 when it issued its policy and that the July 2021
amendment to section 627.714(4) does not and cannot apply
retroactively to impair its vested contract rights. For its part, the
Association contends that Universal's subrogation rights didn't and
couldn't vest until the loss occurred on July 13, 2021—after the
amendment's effective date—and that the trial court properly applied the
statutory amendment prospectively. Thus, the dispositive question is
whether Universal had a vested subrogation right against the Association
when section 627.714(4) became effective on July 1, 2021.
     Our decision in R.A.M. of South Florida, Inc. v. WCI Communities,
Inc., 869 So. 2d 1210 (Fla. 2d DCA 2004), is instructive. There, we
considered whether a statutory amendment barred an unlicensed
contractor's claims, even though the claims would have been viable
under the version of the statute in effect when the contractor signed its

     1 In doing so, the trial court expressed an "eager[ness] for appellate

guidance with regard to section 627.714," which we now provide.

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contract. See id. at 1214. The contractor—much like Universal in this
case—argued that we could not apply the amendment retroactively and
deprive it of a vested contract right. Id. at 1215. But we disagreed,
concluding that the unlicensed contractor did not have a vested right to
enforce the contract before the statutory amendment took effect. Id. at
1221.
     In so holding, we explained the critical difference between vested
and fixed rights on the one hand, and expectant or contingent ones on
the other. Id. at 1218. "A vested right has been defined as 'an
immediate, fixed right of present or future enjoyment' and also as 'an
immediate right of present enjoyment, or a present, fixed right of future
enjoyment.' " Id. (quoting City of Sanford v. McClelland, 163 So. 513,
514–15 (Fla. 1935)). In other words, rights "are vested when the right to
enjoyment, present or prospective, has become the property of some
particular person or persons, as a present interest." Id. (quoting Pearsall
v. Great N. Ry. Co., 161 U.S. 646, 673 (1896)). Conversely, rights "are
expectant when they depend upon the continued existence of the present
condition of things until the happening of some future event." Id.
(quoting Pearsall, 161 U.S. at 673). And "[t]hey are contingent when they
are only to come into existence on an event or condition which may not
happen or be performed until some other event may prevent their
vesting." Id. (quoting Pearsall, 161 U.S. at 673).
     Here, Universal's subrogation rights were not immediate or fixed in
January 2021 when it issued the Perezes' policy. That is, Universal was
not immediately subrogated to the rights of the Perezes because "no right
of subrogation arises until the claim has been paid." See 16 Couch on
Insurance § 223:3 (3d ed. 2023); see also Nat'l Sur. Corp. v. Bimonte, 143
So. 2d 709, 710 (Fla. 3d DCA 1962) (stating that a claimant's "right to

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subrogation was not perfected until it paid the claim of its indemnitee in
full" (first citing Fowler v. Lee, 143 So. 613, 614 (Fla. 1932); and then
citing Whyel v. Smith, 134 So. 552, 554 (Fla. 1931))); accord Dadeland
Dodge Inc. v. Am. Vehicle Ins. Co., 698 So. 2d 929, 931 (Fla. 3d DCA
1997). Instead, when the policy incepted, Universal's subrogation rights
were contingent on a future event—namely Universal's payment of a
covered loss—and its rights were expectant because they depended on
the law not changing during Universal's policy period. It is of course
beyond dispute that the legislature had the authority to amend section
627.714(4). And when it did so, Universal's subrogation rights were not
vested.
      It is likewise "well established that the right to sue on an inchoate
cause of action—one that has not yet accrued—is not a vested right
because no one has a vested right in the common law, which the
[l]egislature may substantively change prospectively." Raphael v.
Shecter, 18 So. 3d 1152, 1157 (Fla. 4th DCA 2009) (quoting Williams v.
Am. Optical Corp., 985 So. 2d 23, 30 (Fla. 4th DCA 2008)); cf. R.A.M., 869
So. 2d at 1220 ("[O]nce a cause of action has accrued, the right to pursue
that cause of action is generally considered a vested right."). The cause
of action Universal pursued here did not accrue until the pipe failed and
damaged the Perezes' unit. See Peat, Marwick, Mitchell & Co. v. Lane,
565 So. 2d 1323, 1325 (Fla. 1990). Thus, Universal, standing in the
Perezes' shoes, did not have a vested right to sue the Association until
July 13, 2021—after the amendment to section 627.714(4) became
effective. See Cas. Indem. Exch. v. Penrod Bros., 632 So. 2d 1046, 1047
(Fla. 3d DCA 1993) ("In subrogation actions, the subrogee stands in the
shoes of the subrogor and has only those rights which the subrogor
had.").

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      We acknowledge the body of law holding that "the statute in effect
at the time an insurance contract is executed governs substantive issues
arising in connection with that contract." Menendez v. Progressive
Express Ins. Co., 35 So. 3d 873, 876 (Fla. 2010) (quoting Hassen v. State
Farm Mut. Auto. Ins., 674 So. 2d 106, 108 (Fla. 1996)). But that body of
law applies to contractual claims between contracting parties, "which are
logically, and constitutionally, governed by the law in effect at the time of
the contract." Fla. Ins. Guar. Ass'n v. Bernard, 140 So. 3d 1023, 1033
(Fla. 1st DCA 2014); see also Hausler v. State Farm Mut. Auto. Ins. Co.,
374 So. 2d 1037, 1038 (Fla. 2d DCA 1979) ("When Hausler and State
Farm negotiated for and entered into the subject contract of insurance,
its terms were set in accordance with the law in effect at that time . . . .").
Universal's cause of action against the Association is neither contractual
nor between the parties to the insurance contract; rather, it is based on
the transfer of the right to sue in tort from one contracting party to the
other. And that transfer was contingent on the occurrence of future
events, without which Universal's rights never would have vested. See
16 Couch on Insurance § 223:3 n.8 ("While insurer may have future
interest in rights that its insured has against third party, insurer's right
of subrogation comes into existence only when insurer pays claim of
insured.").
      At bottom, neither Universal's subrogation rights nor its right to
sue in negligence vested before the legislature amended section
627.714(4).2 As we explained in R.A.M., "[a] statute does not operate

      2 Further, Universal's cause of action did not accrue, and the

statute of limitations did not begin to run, until the date the Perezes
suffered the loss at issue. See Allstate Ins. Co. v. Metropolitan Dade
County, 436 So. 2d 976, 980 (Fla. 3d DCA 1983). And Universal
presumably had no obligation to make any payment under the policy

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'retrospectively' merely because it is applied in a case arising from
conduct antedating the statute's enactment." 869 So. 2d at 1216
(quoting Metropolitan Dade County v. Chase Fed. Hous. Corp., 737 So. 2d
494, 499 (Fla. 1999)). "Rather, [we] must ask whether the new
[statutory] provision attaches new legal consequences to events
completed before its enactment." Id. (second alteration in original)
(quoting Metropolitan Dade County, 737 So. 2d at 499). The only event
completed before the enactment of the new statutory provision here was
Universal's issuance of the policy. While that event certainly vested
contractual rights between the contracting parties, Universal's
subrogated right to sue the Association was not one of them. That right
did not vest or become fixed until the completion of additional events, all
of which occurred after the amendment to section 627.714(4). Thus, the
trial court properly applied the amendment prospectively in entering
judgment for the Association.3
     Affirmed.

SLEET, C.J., and ROTHSTEIN-YOUAKIM, J., Concur.

Opinion subject to revision prior to official publication.

before that date. It therefore would be inconsistent to conclude that
Universal had a vested right to subrogation on the date it issued its
policy, where neither the statute of limitations nor Universal's coverage
obligations were triggered until the loss occurred. The conclusion we
reach avoids this inconsistency.
     3 Because we conclude that Universal's subrogation rights did not

vest before the statutory amendment, we need not consider either prong
of the two-prong test for retroactivity explained in Menendez: "whether
the [l]egislature intended for the statute to apply retroactively" and
"whether retroactive application would violate any constitutional
principles." See 35 So. 3d at 877.

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