Gold Coast Property Management Inc. v. Certain Underwriters at Lloyd’s London, et al.

At a glance

Parties

Gold Coast Property Management Inc. v. Certain Underwriters at Lloyd's London, Indian Harbor Insurance Company, General Security Indemnity Company of Arizona, United Specialty Insurance Company, Lexington Insurance Company, Princeton Excess and Surplus Lines Insurance Company and International Insurance Company of Hannover SE

Case no.

No. 18-cv-23693-GAYLES

Court

U.S. District Court, Southern District of Florida (Judge Darrin P. Gayles)

Forum and rules

Motion to compel arbitration and motion to remand under the New York Convention and Chapter 2 of the Federal Arbitration Act (9 U.S.C. § 203)

Treaty

Arbitration clause in a property insurance policy (Commercial Compass Form Policy, Section VII(C)); New York Convention

Sector

Property insurance (Hurricane Irma claim)

Outcome

Remand denied; arbitration compelled; the action was stayed pending arbitration and closed for administrative purposes (14 June 2019).

The dispute

Gold Coast Property Management Inc. held a property insurance policy bound by the insurance administrator AmRisc, LLC on 24 February 2017. Eight insurers wrote the policy under separate policy numbers. Seven of them, led by Certain Underwriters at Lloyd's London, were the defendants. After Hurricane Irma, Gold Coast made a claim for property losses. It said the insurers delayed their coverage decision and sued them in Florida state court. Underwriters demanded arbitration under the policy's arbitration clause and removed the case to federal court under the New York Convention. Gold Coast sought remand. It argued that there was no signed written agreement to arbitrate, that it did not know of the arbitration clause, and that the policy's Service of Suit endorsement overrode the arbitration clause or made it ambiguous.

Key holdings

1. For jurisdiction, the Court asks only whether the removal notice and pleadings show a non-frivolous claim that the suit relates to an arbitration agreement falling under the Convention. Whether the agreement binds the parties is left to the motion to compel. Only the 'agreement in writing' requirement was in dispute. pp. 4–6
2. The signature requirement is met even though the policy itself is unsigned. Gold Coast's manager signed the insurance application. Under Florida law (Fla. Stat. § 627.419(1)), the application becomes part of the insurance contract, so the signature counts as a signature on a written agreement to arbitrate. The motion to remand was denied. p. 6
3. Gold Coast could not claim it was unaware of the arbitration clause. In the signed Surplus Lines Disclosure, it acknowledged that the policy forms might differ from those in the admitted market and that it should read the entire policy. The binder of 24 February 2017 also identified the policy form containing the arbitration clause. pp. 7–8
4. The Service of Suit Clause does not override the arbitration clause or make it ambiguous. The two clauses can be read together: the policy requires arbitration, and the Service of Suit Clause only gives the parties a way to go to court to compel arbitration or enforce an award. This reading is consistent with the Convention's strong presumption in favour of arbitration. pp. 8–9
5. All the requirements for compelling arbitration were met. The motion to compel was granted, and the action was stayed pending arbitration and closed for administrative purposes. The parties must file a status report within 14 days after the arbitration ends. p. 9

Procedural history

1. 24 February 2017AmRisc binds the Commercial Compass Form Policy, which contains the arbitration clause, on behalf of the insurers.
2. 26 July 2018Gold Coast files a Complaint for Damages and Petition for Declaratory Judgment in the Eleventh Judicial Circuit, Miami-Dade County, Florida.
3. 6 September 2018Underwriters sends Gold Coast a demand for arbitration under the policy.
4. 10 September 2018Underwriters removes the action to the U.S. District Court for the Southern District of Florida and moves to compel arbitration.
5. 17 October 2018The other defendants, once served, adopt the motion to compel.
6. 14 June 2019Order: remand denied, arbitration compelled, action stayed and administratively closed.

Tribunal, counsel and experts

Decided by

• Darrin P. Gayles Judge, U.S. District Court, Southern District of Florida

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Keywords

• New York Convention
• motion to compel arbitration
• motion to remand
• removal
• 9 U.S.C. § 203
• agreement in writing
• signature requirement
• insurance application
• service of suit clause
• Lloyd's
• surplus lines
• property insurance
• Hurricane Irma
• AmRisc
• Florida law
• stay pending arbitration

Summary generated with AI from the published documents — refer to the award for the authoritative text.