Miami Shipping Law

In   Miele v. Certain Underwriters at Lloyd’s of London , Case No. 13-14166 (11 th Cir. Mar. 17, 2014), the Eleventh Circuit in another unpublished decision has found that exclusion for: " The cost of repairs or replacing any part of Your Boat by reason of wear and tear, gradual deterioration, osmosis, wet or dry rot, corrosion, weathering, marring, scratching, denting, vermin, pets or marine life, or electrolytic or galvanic action" is not ambiguous. In Miele , an insured’s 32-foot vessel sank while docked because water entered through what a surveyor concluded was a “degraded and rotten” air conditioning hose, which cause was not disputed.  Underwriters denied coverage under the insured’s yacht insurance policy based upon the exclusion. In the insured’s suit against the insurers, the United States District Court for the Southern District of Florida granted summary judgment to the insurers.   On appeal, the insured argued that the exclusion ...

Under Florida law, the duty to defend determination is made by looking only at the terms within the  insurance policy and the allegations within the complaint.  Generally, extrinsic evidence may not be considered.  However, in the case of Composite Structures, Inc. v. Continental Insurance Co ., Case No. 12-15866 (11th Cir. Mar. 20, 2014) (unpublished), the United States Court of Appeals for the Eleventh Circuit (applying Florida state law) recognized an important exception to this general rule. When an insurer’s coverage denial is based on factual issues that ordinarily would not be alleged in the complaint, the insurer may consider extrinsic evidence outside of the complaint. The underlying lawsuit was brought by two seamen who sustained carbon monoxide poisoning while aboard a boat.  The seamen sued the insured boat manufacturer for negligence and strict liability, and the insured tendered its defense to its insurer. The insurer disclaim...