After eleven years of litigation, including four appeals in both the State and Federal court systems, Howard Pomerantz, a partner at Abramowitz, Pomerantz & Morehead, P.A. (www.FloridaInjuryLawyers.com) has collected $5 million dollars from an insurer for the City of Miami Beach in a post-trial settlement of a drowning case.
Well-known Jazz Guitarist/Composer Zachary Breaux was celebrating the successful release of his third CD, “Uptown Groove”, and took his wife and three young daughters from their home in New York to vacation at the Seville Hotel on Miami Beach. The beach behind the hotel was routinely quite crowded since it was equipped with public restrooms, showers, public telephones, public parking, and a beach concession shack from which concessionaires who appeared to be lifeguards rented beach lounges, umbrellas and water craft. The Breaux family believed that the beach was guarded. There were no warning signs to indicate that it was an unguarded beach.
The Breauxs rented a double beach lounge and Zachary was building a sand castle with his three young daughters at the water’s edge. They had no idea that there were dangerous rip currents that day, or that warning flags cautioning people to stay out of the water had been posted throughout the beach only in lifeguarded areas.
When Zachary heard a woman in the water screaming for help, he told his daughters to go get a lifeguard and then entered the water to try to help the woman. It turned out that the concessionaires were not lifeguards and Zachary’s wife and three daughters watched in horror as both Zachary and the woman he tried to save were caught in the rip current and drowned.
A wrongful death lawsuit was filed against the City of Miami Beach. Both the trial court and the Third District Court of Appeals ruled that the City did not owe a duty to the Breaux family. In a landmark decision, the Florida Supreme Court reversed in Breaux v. City of Miami Beach, 899 So.2d 1059 (Fla. 2005), holding that a municipality operating a public swimming area owes the same duty as a private landowner to warn of dangerous conditions of which it knew or should have known, such as the existence of dangerous rip currents and that the beach was unguarded.
Following the Supreme Court ruling, Miami Beach demanded a defense in the wrongful death lawsuit from the insurer for the beach concession company. Miami Beach had required that it be listed as an additional insured on the concessionaire’s $1 million dollar policy as a condition for granting a license to the concessionaire to operate on the beach. The policy provided coverage to the City for its liability arising out of the operations of the concessionaire. The insurance company denied a defense to the City, contending that it could not owe coverage to the City because there was no negligence on the part of its insured, the concessionaire. We argued to the contrary that it was the operation of the concessionaire on the beach, attracting people to use the beach at that location, that caused the Florida Supreme Court to rule that the 29th Street beach was a “public swimming area”, thereby creating the duty owed by the City to the Breaux family. Thus, the liability of the City “arose out of” the operations of the concessionaire, creating insurance coverage for the City.
After protracted negotiation we agreed to settle with Miami Beach for $5 million dollars with the City only obligated to make an actual payment of $160,000.00 (due to sovereign immunity limits). Additionally, Miami Beach assigned to our client its rights to sue the concessionaire’s insurer for the remaining $4,840,000.00 plus attorney’s fees.
A lawsuit was filed in Federal Court to determine whether the insurer owed coverage and a defense to the City of Miami Beach and, if so, whether it was responsible to pay the unpaid portion of the settlement amount. The Federal Court bifurcated the case such that two separate trials were held. We prevailed in both trials, winning rulings that the insurance company had wrongfully denied coverage and a defense to Miami Beach and, secondly, that it was required to pay the $4,840,000.00 balance of the payment plus interest and attorney’s fees. It was also required to reimburse the City for the $160,000.00 the City paid to our client, plus interest. We prevailed in having the Court rule that we were entitled to both pre-judgment and post-judgment interest which amounted to over $1 million dollars, bringing the total judgment amount against the insurance company to more than $6 million dollars. The Court had not yet determined the amount of our entitlement to attorney’s fees when the insurance company appealed to the Eleventh Circuit Court of Appeals in Atlanta. The insurance company agreed to settle our client’s claim for a lump sum of $5 million dollars while the appeal was pending.