Middle District of Florida Denies Insurer’s Motion to Dismiss Plaintiffs’ Claim for Declaratory Relief

by Zachary D. Sonenblum

In Barry v. QBE Specialty Ins. Co., the US District Court for the Middle District of Florida denied QBE’s Motion to Dismiss Plaintiffs’ Claim for Declaratory Relief and permitted the Plaintiffs to proceed with both of its claims against QBE – 1) breach of contract and 2) declaratory relief. 

In moving to dismiss the dec action, QBE primarily argued 1) that Plaintiffs failed to allege any actual controversy because Plaintiffs failed to cite any contractual provision requiring clarification as to whether the policy covers the Plaintiffs’ property damage and 2) that the dec count is duplicative of the breach of contract count.

The Middle District explicitly rejected each of QBE’s arguments. As to the first argument, the Court held that Plaintiffs have indeed pled an actual controversy because the parties dispute whether the Policy covers Plaintiffs’ property damage. 

As to the second argument, the Court reasoned that a court’s decision on whether to hear a declaratory judgment claim is discretionary; that a motion to dismiss tests plausibility as opposed to redundancy; and that both the federal Declaratory Judgment Act and Federal Rule of Civil Procedure 57 allow a party seek a declaratory judgment even if there is another adequate remedy. Furthermore, in rejecting the duplicity argument, the Court cited to prior Middle District opinions and held “[t]his argument is often raised in this context, and (for several reasons) it is consistently rejected by this Court.” E.g., 500La Peninsula Condo. Ass’n, Inc. v. Landmark Ins. Co., 2020 WL 6273699 at *1 (M.D. Fla. Oct. 26, 2020). The Middle District also concluded that whether the dec action is duplicative of and subsumed within the breach of contract claim can better be resolved at summary judgment. 

Notwithstanding the Barry decision, it is important to note that other Florida federal and state courts have reached the opposite decision and have dismissed dec counts for being duplicative. See Brodsky v. USAA General Indemnity Co., No. 19-62860, 2020 WL 231189, at *2 (S.D. Fla. Jan. 15, 2020) (“If the determination of the plaintiff’s breach of contract claim involves the same factual dispute as the declaratory judgment claim, then the Plaintiff will be able to secure full, adequate and complete relief through the breach of contract claim and consequently the declaratory action must be dismissed.”); McIntosh v. Harbour Club Villas Condominium Ass’n, 468 So. 2d 1075, 1081 (Fla. 3d DCA 1985) (“a trial court should not entertain an action for declaratory judgment on issues which are properly raised in other counts of the pleadings and already before the Court, through which the Plaintiff will be able to secure full, adequate and complete relief.”); Kies v. Florida Insurance Guaranty Ass’n, 435 So. 2d 410, 411 (Fla. 5th DCA 1983) (same).

Zachary Sonenblum focuses his practice on civil litigation defense, with an emphasis in the area of first party property disputes. He is also experienced at insurance defense litigation.