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T.H.E. Insurance Co. v. Dollar Rent-A-Car Systems4/22/2005
T.H.E. Insurance Company, ("T.H.E."), appeals a summary final judgment finding that its supplemental liability policy issued by its agent, Dollar Rent-A-Car, ("Dollar"), to Sean McGrath, provided liability coverage to McGrath, notwithstanding an exclusion from coverage for driving under the influence of alcohol.
McGrath rented a vehicle from Dollar and elected to purchase supplemental liability insurance, ("SLI"), provided by T.H.E. This SLI coverage is optional and beyond the Florida minimum statutorily mandated liability limits.
The terms of McGrath's rental agreement with Dollar provide in pertinent part that:
THE VEHICLE MAY NOT BE USED . . . WHILE THE DRIVER IS UNDER THE INFLUENCE OF ALCOHOL OR DRUGS . . . . ANY PROHIBITED USE OF THE VEHICLE VIOLATES THE AGREEMENT AND VOIDS OR DEPRIVES YOU OF BENEFITS, PROTECTION AND OPTIONAL COVERAGES, IF ANY, TO WHICH YOU WOULD HAVE OTHERWISE BEEN ENTITLED UNDER THIS AGREEMENT. . . .
(capitalization provided). According to the terms of the rental agreement, when McGrath signed the agreement, he is deemed to have "acknowledge and underst d SLI [would be] void if violate the terms of the [rental] agreement."
While McGrath operated the rented vehicle, he was involved in an accident that resulted in the death of his fiancée. The personal representative of the decedent initiated an action against McGrath and when McGrath sought coverage from T.H.E., the latter denied coverage alleging that McGrath was intoxicated at the time of the accident, thereby violating the terms of the rental agreement and voiding the SLI coverage.
T.H.E. sought declaratory relief, as did McGrath by counterclaim. The trial court granted summary judgment in which it found coverage for two reasons: (1) section 627.421, Florida Statutes (2004), required T.H.E. to deliver a copy of its SLI insurance policy to McGrath within sixty days after issuance, and T.H.E. failed to make the required delivery because the rental agreement did not constitute "terms of insurance;" and (2) the exclusion of coverage for driving while intoxicated violates public policy as established in P & H Vehicle Rental and Leasing Corp. v. Garner, 416 So. 2d 503 (Fla. 5th DCA 1982).
Section 627.421 (1) -- Delivery of Copy of Policy We disagree with the trial court that T.H.E.'s failure to deliver a copy of the SLI policy to McGrath invalidated the exclusion for intoxicated drivers. We view the statutory requirement as one calculated to give notice of exclusions to the person renting a motor vehicle and this was accomplished by placing the notice in large print, in plain language, in the rental agreement signed by McGrath. The rental agreement was calculated to provide notice of the intoxication exclusion before McGrath took delivery of the motor vehicle under a short-term rental agreement, rather than receiving notice of it within sixty days after renting the vehicle, and, in this instance, after the tragic accident occurred.
Notwithstanding the terms of the agreement, McGrath argues that exclusions in car rental agreements are insufficient, citing to ZC Insur. Co. v. Brooks, 847 So. 2d 547 (Fla. 4th DCA 2003). ZC Insur. Co. held that an exclusion in SLI coverage is not binding when a general statement in the car rental agreement provides that coverage "is subject to other specific exclusions which are summarized in the separate SLI brochure, which is available at the rental counter." That general statement with no description of a specific exclusion and directing a renter to a brochure located on a counter is not comparable to the statement in the instant case that provides notice of a specific exclusion in large print and i
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