Peoples Gas System v. Posen Construction, Inc.
Opinion
*1338 CERTIFICATION FROM THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT TO THE SUPREME COURT OF FLORIDA, PURSUANT TO FLA. R. APP. P. 9.150(a). TO THE SUPREME COURT OF FLORIDA AND ITS HONORABLE JUSTICES:
This appeal requires us to determine whether a Florida law regulating underground utility infrastructure recognizes a standalone cause of action for reimbursement of damages paid to third parties and/or a statutory right of indemnification. The plaintiff, Peoples Gas System ("PGS"), sues the defendant construction company, Posen Construction, Inc. ("Posen"), for damages under the Florida Underground Facility Damage Prevention and Safety Act ("the Act").
I. BACKGROUND
PGS is a Florida natural gas distributor that maintains underground pipelines, and Posen is a road construction company. During one of Posen's road construction projects near Ft. Myers, Florida, Posen learned that it would need to have PGS remove a section of gas pipeline ahead of Posen's work. In October 2010, Posen submitted a request to obtain the location of PGS's pipeline. The Act mandates specific procedures and notifications when, in a situation like this, a construction company requires the assistance of an underground utility company.
PGS alleges the request was unlawful because Posen's request failed to describe the excavation area with the specificity the Act requires. In November 2010, Posen's superintendent, Greg Menuez ("Menuez"), directed his subordinate, Mark Santos ("Santos"), to dig and till the ground around the excavation area with heavy machinery. Importantly, PGS alleges that Menuez knew that a gas pipeline in the area was not properly marked. Santos ruptured the gas pipeline, caused a fire, and was severely injured. Unsurprisingly, years of litigation followed.
The litigation began in 2011 in Florida state court, when Santos sued PGS and Posen. At some point between the 2011 commencement of the litigation and 2017, Santos dismissed Posen and settled with PGS. Concurrent with the commencement *1339 of the Santos litigation, PGS also sued Posen in federal court, seeking damages for the repair costs under a negligence claim. Posen counterclaimed, and the parties ultimately settled. The present litigation commenced in January 2018, when PGS sued Posen under the Act, claiming either damages or an alternative claim for indemnity for the money it paid Santos in the earlier settlement.
The Act creates a rebuttable presumption of negligence against the excavator if an excavator "performs an excavation or demolition that damages an underground facility of a member operator."
II. DISCUSSION
A. Does the Act provide a cause of action to recover damages paid to a third party?
PGS first argues that the district court wrongfully dismissed the action because, in its two-count complaint, only the second count sought indemnity as an alternative claim, while the first count sought direct damages under the Act. Under PGS's theory, the first claim should have survived because the broad language of the Act provides that the negligent party, "if found liable, is liable for the total sum of the losses to all parties involved as those costs are normally computed."
The parties both agree that there is sparse case law addressing the issue, much less binding precedent from the Florida Supreme Court. When we lack guidance from the Florida Supreme Court, we must adhere to the decisions of Florida's intermediate appellate courts "absent some persuasive indication that the state's highest court would decide the issue otherwise."
Ernie Haire Ford, Inc. v. Ford Motor Co.
,
The district court, synthesizing applicable rules from sparse caselaw, found that none of the cases addressing the Act had permitted recovery for a cost as remote as this one, e.g., reimbursement for a settlement agreement between a utility and a third party arising from previous litigation. In the district court's view, even the most generous precedent seemed limited to recovering costs relating to equipment damage or personal injury, which dovetailed with the codified legislative intent that the statute's purpose was more preventative than remedial in nature.
Florida appellate courts and federal district courts have split on this question.
See, e.g.,
A & L Underground, Inc. v. City of Port Richey
,
Furthermore, the courts are not in uniform agreement as to whether the Act provides a standalone cause of action, or whether it simply clarifies the legal analysis in a negligence claim.
Compare
A& L Underground, Inc.
at 481, (permitting a claim under the Act to proceed) and
Southland Construction
at 1037, ("[the Act] could be the source of a statutorily-created duty owed by [defendant to plaintiff] to correctly mark the location of its underground facilities and it could be the basis for Southland to recover its own damages if the facilities are not correctly marked.")
with
James D. Hinson
at 1328, ("[the Act] does not provide BellSouth with any additional remedies or damages other than those available at Florida common law.").
See also
MCI Worldcom Network Servs., Inc. v. Mastec, Inc.
,
In our view, Florida case law does not conclusively establish the purpose of the Act, including whether it creates a cause of action to recover damages paid to third parties or simply clarifies a common law negligence claim, and whether it authorizes damages incurred under circumstances as remote as these. Under this circuit's precedents, we should certify questions to the state supreme court when we have "substantial doubt" regarding the status of state law.
Fla. VirtualSchool [sic] v. K12, Inc.
,
B. Does the Act permit statutory indemnity?
PGS's second argument on appeal is that the district court erroneously dismissed its second count because Florida *1341 law does not require a specific statutory right to indemnification when the law otherwise allocates the losses to a tortfeasor. We seek clarification from the Florida Supreme Court because the caselaw is not conclusive and the statute is subject to multiple plausible interpretations, including the one PGS embraces, which caselaw still does not foreclose.
As an example of this implied right of statutory indemnification, PGS points to a different part of the Florida code that allocates liability for sheriffs' deputies and a federal district court case finding that the statutory language is broad enough to provide an indemnification obligation even when the statute does not use that word.
Martinez v. Miami-Dade Cty.
,
Likewise, PGS argues that the Act uses equally broad language to allocate liability to negligent excavators, even without using the word "indemnify" verbatim. The district court summarily dismissed this argument, finding that the statute at issue in Martinez created an indirect right to statutory indemnification that the Act did not. The Martinez court was seemingly bothered by the fact that the statutory language - "shall be responsible for the acts or omissions" - was not susceptible to any alternative meaning. The distinction between the instant case and Martinez should be obvious: The language of the Act is clearly ambiguous with multiple reasonable interpretations. "Losses" may or may not include relatively remote indemnity payments to third parties in separate litigation proceedings.
PGS's next argument is that it is entitled to statutory indemnity regardless of whether common law indemnity is available. PGS's primary case, this time coming from the Florida Supreme Court, addressed a corporate dispute between a corporation and its directors.
Wendt v. La Costa Beach Resort Condo. Ass'n, Inc.
,
PGS next looks to two similar statutes in Arizona, dealing with underground and overhead utility lines, for the prospect of courts recognizing indemnification even absent the word "indemnification" in the statute. This, too, is unpersuasive because the statutes cited impose broad liability on the violator, including "expenses and damages to third parties incurred by the owner of the facility as a result of the [violator's] contact."
However, PGS ultimately appeals to the plain language of the statute. Although Posen, and several court cases, have heavily relied on the fact that the statute does not explicitly give rise to an indemnity action, PGS again notes the relevant language of the statute - "[the negligent party] is liable for the
total sum of the losses to all parties
involved as those costs are normally computed."
III. CERTIFIED QUESTION
We therefore certify the following question to the Supreme Court of Florida:
Whether a member-operator has a cause of action underFla. Stat. § 566.106 (2)(a)-(c) to recover damages (or obtain indemnification) from an excavator for payments to a third party for personal injuries related to the excavator's alleged violation of the statute?
In certifying this question, we do not intend to restrict the issues considered by the Supreme Court of Florida.
See
Miller v. Scottsdale Ins. Co.
,
QUESTION CERTIFIED.
Reference
- Full Case Name
- PEOPLES GAS SYSTEM, a Division of Tampa Electric Company, a Florida Corporation, Plaintiff - Appellant, v. POSEN CONSTRUCTION, INC., a Michigan Corporation, Defendant - Appellee.
- Cited By
- 18 cases
- Status
- Published