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[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT ________________________
No. 19-12734 ________________________
D.C. Docket No. 0:18-cv-62093-UU
ALFREDO QUINTERO,
Plaintiff-Appellant,
versus
GEICO MARINE INSURANCE COMPANY,
Defendant-Appellee.
________________________
Appeal from the United States District Court for the Southern District of Florida ________________________
(December 22, 2020)
Before WILLIAM PRYOR, Chief Judge, HULL and MARCUS, Circuit Judges.
HULL, Circuit Judge:
This case involves a marine insurance policy insuring a boat owned by
Alfredo Quintero (“Quintero”) and the federal maritime doctrine of uberrimae USCA11 Case: 19-12734 Date Filed: 12/22/2020 Page: 2 of 17
fidei. After the boat was stolen, the insurer, Geico Marine Insurance Company
(“Geico”), denied coverage based on Quintero’s misrepresentation that he was in
possession of the boat. Quintero appeals the district court’s grant of summary
judgment in favor of Geico and denial of his motion for partial summary judgment.
The issue is whether Quintero’s misrepresentation voided his policy ab initio.
After careful review, and with the benefit of oral argument, we conclude it did and
affirm.
I. FACTS
A. Quintero’s Policy
Initially, Quintero’s 32-foot powerboat was covered by a Geico marine
insurance policy that ran from May 5, 2017, to May 5, 2018. On March 13, 2018,
Geico sent Quintero a policy renewal package identifying changes to the policy’s
terms and Quintero’s required payment.
Geico’s renewal package required a down payment of Quintero’s annual
premium, or $776 of the premium total of $2580. The package included this
urgent reminder: “Your coverage expires on 05/05/2018 at 12:01 AM Local Time.
Prevent a lapse in coverage by making your required payment promptly.” The
annual premium for the upcoming policy period had increased by 25 percent, and
Quintero’s next payment of $776 was scheduled to be paid through Geico’s
automatic-payment system. The renewal policy stated that Geico would provide
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coverage “during the policy period” on the condition that Quintero pay the
premium and comply with all policy terms.
On May 4, 2018, Geico charged Quintero’s credit card, but the charge was
declined. That same day, Quintero called Geico about the attempted charge and
increased premium. Quintero began the call by updating his address information.
A customer service representative then explained that (1) Geico ordinarily debited
renewal payments from the policyholder’s card on file, (2) Quintero’s card was
declined, (3) he was thus automatically disenrolled from the automatic-payment
system, and (4) he could either call in to make payments or put another card back
on file.
When the Geico representative explained that rates had increased for
everyone and why, Quintero complained that the 25 percent increase was
“ludicrous.” He stated that if Geico was making a change, he was “making a
change too,” and that “it’s not acceptable, that you’re going to increase me 25
percent. It’s just not acceptable.” The representative said she could not reduce his
premium, to which Quintero replied, “So you prefer losing a customer, okay. I
guess -- so you’re going to lose me as a customer, with all my vehicles, because
you want to increase me 25 percent.” Quintero asked to speak to a supervisor and
was transferred, but the call went to voicemail. Because Quintero had updated his
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address information, Geico sent him a new endorsement reflecting the address
change.
B. Non-Payment and Expiration
Quintero did not make the required renewal payment prior to the policy
expiring on May 5, 2018. On May 10, 2018, Geico sent Quintero a “Notice of
Policy Expiration.” The Notice stated his policy expired on May 5, 2018, at 12:01
a.m., and that “all liability thereunder terminated on its expiration date.”
C. Theft and Policy Reinstatement
On May 25, 2018, at 4:58 a.m.—as detailed in a later police report—a dark
pickup truck pulled up to the driveway of Quintero’s home, where the boat was
stored, and towed the boat away along with its trailer. A neighbor’s surveillance
camera, a block away, recorded the perpetrator’s truck towing the boat away, and
the Broward County Sheriff’s Office later obtained the footage.
That same morning, at 7:28 a.m., Quintero called Geico to “pay [his] boat
policy.” A customer service representative observed that “the policy was due the
5th of May,” and asked Quintero if he was trying to reinstate it. Quintero said yes
and acted as if he was unaware of the lapse:
[REPRESENTATIVE]: Okay, so it looks like the policy was due the 5th of May. Are you trying to reinstate it?
MR. QUINTERO: Yeah. Well, I didn’t know it was -- oh, it says here that . . . okay, yeah, I guess I’m -- they told me that I have to pay $700 or something like that, 700 and something dollars.
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[REPRESENTATIVE]: The first payment is $776, that’s right.
MR. QUINTERO: Yeah. What are we . . .
[REPRESENTATIVE]: What are we, I’m sorry?
MR. QUINTERO: That I don’t know why you guys -- it’s only eight months, instead of like the cars are . . . okay. It is what it is. We have to have insurance, so . . . Something -- something happens out there, you know, you want to be insured, so . . .
The representative then asked these questions:
[REPRESENTATIVE]: I have to ask you some questions, then we can make a payment and reinstate the policy, okay?
MR. QUINTERO: Sure.
[REPRESENTATIVE]: First off, is the boat -- does the boat have any damage or is it -- has it been damaged?
MR. QUINTERO: No. It’s beautiful.
[REPRESENTATIVE]: Okay. And is it sound and seaworthy?
MR. QUINTERO: Sound and seaworthy. What it means? It’s in good condition?
[REPRESENTATIVE]: Mm-hmm.
MR. QUINTERO: Yeah, yeah, yeah.
[REPRESENTATIVE]: Okay. And when was the last time you physically saw your boat?
MR. QUINTERO: Every day. It’s in my house.
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The representative then took Quintero’s credit card information and reenrolled him
in the automatic-payment system. At one point, Quintero noted the declarations
page he had received from Geico showed that his policy expired on May 5. At the
end of the call, Quintero asked, “So the policy will be active right away, right? I
just want to make sure that I’m not without insurance.” The representative
confirmed that with the payment, the policy was now reinstated as of May 5, 2018.
That same afternoon, at 2:43 p.m., Quintero reported his boat and trailer
stolen to local police. At 6:28 p.m., he called Geico again, this time to make a
claim for the stolen boat and trailer. During his call to the claims department,
Quintero stated that he stored the boat at his home, “right in front of [his]
driveway,” and that he had last seen the boat around 11:30 p.m. to 12 a.m. the
night before. He told Geico he discovered the boat was missing when his wife
came home from work just after noon that day and asked him where the boat was.
He had “assumed” the boat was still there when he went to work that morning,
having to run to his truck due to heavy rain.
Geico investigated and took statements from Quintero and his wife. In July
2018, Geico informed Quintero it needed further information and was awaiting the
final police report. Geico demanded that Quintero submit to an examination under
oath. Quintero refused.
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II. PROCEDURAL HISTORY
On July 31, 2018, Quintero filed this action in Florida state court, seeking a
declaration that Geico breached the policy by failing to cover his boat loss. Geico
removed the case to federal court.
Geico then obtained a final report from the Broward County Sheriff’s Office
describing the video surveillance obtained from a neighboring residence a block
away. According to the report, the surveillance footage captured the boat being
towed away just before 5 a.m. on May 25, 2018. It showed two vehicles drive into
the community where Quintero resided, and one—a dark pickup truck—tow away
the boat minutes later.
Then, in a January 30, 2019 letter, Geico informed Quintero that: (1) it had
completed its investigation; (2) it had denied coverage and rescinded the policy ab
initio because Quintero was not in possession of the boat when he called to
reinstate his expired marine insurance policy; and (3) Quintero’s
misrepresentations that the boat was in his possession and in good condition were
material to its agreement to insure the vessel after the policy had previously
expired and been non-renewed at his request.
Ultimately, the district court granted Geico’s motion for summary judgment
and denied Quintero’s motion for partial summary judgment. The court concluded
that Quintero’s misrepresentations concerning the status of the boat on May 25,
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2018, voided the policy ab initio under the doctrine of uberrimae fidei because they
were material to Geico’s calculation of the risk of insuring the vessel. In
addressing Quintero’s contention that the policy was never cancelled or non-
renewed, the court noted that “the Policy, the Notice of Policy Expiration, and the
recorded telephone transcripts indicate that the previous policy’s term expired on
May 5, 2018.” The court concluded that the policy was void ab initio under the
uberrimae fidei doctrine “regardless of whether [it] was renewed, cancelled, or
expired.”
Later on, the district court denied Quintero’s motion for relief under Federal
Rules of Civil Procedure 59(e) and 60(b). This appeal followed.
III. STANDARD OF REVIEW
“We review de novo a district court’s grant of summary judgment, viewing
all facts and reasonable inferences in the light most favorable to the nonmoving
party.” Jurich v. Compass Marine, Inc., 764 F.3d 1302, 1304 (11th Cir. 2014).
Summary judgment is appropriate where “there is no genuine dispute as to any
material fact and the movant is entitled to judgment as a matter of law.” Fed. R.
Civ. P. 56(a). “A genuine issue of material fact does not exist unless there is
sufficient evidence favoring the nonmoving party for a reasonable jury to return a
verdict in its favor.” Haves v. City of Miami, 52 F.3d 918, 921 (11th Cir. 1995).
8 USCA11 Case: 19-12734 Date Filed: 12/22/2020 Page: 9 of 17
IV. DISCUSSION
Quintero argues the district court erred in applying the doctrine of uberrimae
fidei because (1) his policy was not cancelled, non-renewed, or expired when he
spoke to Geico the morning of May 25, 2018, (2) his coverage continued in full
force without a lapse, and (3) his May 25 statements were not material to Geico’s
decision to insure his boat because Geico reinstated and backdated his policy and
did not require a new underwriting process.
A. Expiration of the Policy
First, based on the record, we conclude that Quintero’s initial policy, by its
terms, expired on May 5, 2018, because Quintero did not pay the required
premium for the new policy period. In fact, Quintero’s phone call on May 4 with
Geico makes clear that Quintero understood that if he did not pay his new
premium, Geico would not renew his policy for the May 5, 2018, to May 5, 2019
period.
Notably too, during the May 4 call, Quintero complained that the 25 percent
premium increase was “ludicrous” and “not acceptable.” After this exchange,
Quintero did not pay the installment amount due on May 5, 2018. Accordingly, on
May 10, 2018, Geico sent Quintero a Notice of Policy Expiration informing him
that the policy had expired as of May 5, 2018, and “all liability thereunder
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terminated on its expiration date.” Therefore, Quintero’s initial policy did not
cover his boat loss that occurred on May 25, 2018.
Quintero argues that the initial policy was not cancelled or non-renewed, but
that is irrelevant. His coverage already expired on May 5, 2018, so he did not have
coverage when he called Geico on the morning of May 25, 2018.
Quintero also argues Geico’s Jeffrey O’Keefe, an adjuster, inconsistently
testified as to whether the policy was ever cancelled or expired. But the district
court did not rely on O’Keefe’s statements for the proposition that the policy
expired. Rather, the district court noted that “the Policy, the Notice of Policy
Expiration, and the recorded telephone transcripts indicate that the previous
policy’s term expired on May 5, 2018 and that Quintero called to reinstate his
Policy on May 25, 2018 after the Vessel had been stolen.”
Furthermore, O’Keefe clarified any confusion about cancellation and
expiration. In his deposition, he repeatedly stated that the policy was not cancelled
in May 2018; it expired. And in his supplemental affidavit, he stated that on May
5, 2018, “the subject policy expired and a Notice of Policy Expiration was mailed
to Alfredo Quintero on May 10, 2018.”
In any event, any initial imprecise statements by O’Keefe do not change the
fact that the terms of Geico’s policy conditioned renewal of coverage on payment
of the premium, Quintero did not pay the premium, and the policy period expired
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on May 5, 2018. Indeed, the renewal package informed Quintero that coverage
would expire on this date at 12:01 a.m. and included an urgent reminder to
“[p]revent a lapse in coverage by making [the] required payment promptly.” As a
result, when Quintero failed to pay his renewal premium, he received a Notice of
Policy Expiration stating his policy had expired on May 5, 2018, at 12:01 a.m., and
that “all liability thereunder terminated on its expiration date,” making clear that
coverage expired along with the policy. Quintero’s boat was thus uninsured
between May 5, 2018, and when he first called Geico on May 25, 2018. In other
words, there was a lapse in coverage, and no policy was in force when Quintero
called Geico on May 25.
B. Doctrine of Uberrimae Fidei
Even so, Quintero claims that he still had coverage on May 25 because
Geico renewed and backdated the policy to run from May 5, 2018, Geico did not
treat it as if it was issuing new coverage, and his statements were not material to
the issuance of coverage. In response, Geico contends that the renewal policy was
void ab initio because Quintero made material misrepresentations in his May 25
call before Geico reinstated the policy. Geico relies on the doctrine of uberrimae
fidei, to which we turn.
Marine insurance contracts are governed by federal maritime law. Geico
Marine Ins. Co. v. Shackleford, 945 F.3d 1135, 1139 (11th Cir. 2019). In the
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absence of an established federal admiralty rule, we rely on state law. Id. 1 Here,
there is controlling federal maritime law. Specifically, “[i]t is well-settled that the
marine insurance doctrine of uberrimae fidei is the controlling law of this circuit,”
HIH Marine Servs., Inc. v. Fraser, 211 F.3d 1359, 1362 (11th Cir. 2000), and is
“the controlling federal rule even in the face of contrary state authority,” Steelmet,
Inc. v. Caribe Towing Corp., 747 F.2d 689, 695 (11th Cir. 1984), vacated in part
on other grounds, 779 F.2d 1485 (11th Cir. 1986). We first review the scope of the
doctrine and then why it applies here.
As to scope, the uberrimae fidei doctrine requires an insured to “fully and
voluntarily disclose to the insurer all facts material to a calculation of the insurance
risk,” and “[t]he duty to disclose extends to those material facts not directly
inquired into by the insurer.” HIH Marine, 211 F.3d at 1362. This disclosure
includes all material facts that are “within or ought to be within, the knowledge of
one party, and of which the other party has no actual or presumptive knowledge.”
Steelmet, 747 F.2d at 695 (quoting Gulfstream Cargo, Ltd. v. Reliance Ins. Co.,
409 F.2d 974, 980 (5th Cir. 1969)); see also HIH Marine, 211 F.3d at 1363 (“[T]he
1 Consistent with this rule, the choice-of-law provision in both Quintero’s initial policy and renewal policy states that (1) the “policy is to be construed under United States federal admiralty law,” and (2) “[i]n the absence of controlling United States federal admiralty law,” the policy is to be “construed under the laws of the state” of the insured person, here Florida.
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law has placed the burden of good faith disclosure with the person in the best
position to know all the facts: the insured.”).
This doctrine, which embodies the “highest degree of good faith,” applies to
marine insurance contracts because the insurance underwriter often cannot ensure
the accuracy or sufficiency of the facts supplied by an insured “before the risk is
accepted and the premium and conditions set.” Steelmet, 747 F.2d at 695
(quotation marks omitted). Thus, the doctrine’s central principle “is that the
insured bears the burden of full and voluntary disclosure of facts material to the
decision to insure.” HIH Marine, 211 F.3d at 1263.
Further, under uberrimae fidei, an insured’s material misrepresentation to an
insurer renders a marine insurance policy void ab initio. See AIG Centennial Ins.
Co. v. O’Neill, 782 F.3d 1296, 1303 (11th Cir. 2015). The policy is void even if
the insured’s misrepresentation was the result of “mistake, accident, or
forgetfulness,” or the insurer did not inquire about the particular material fact the
insured failed to disclose. HIH Marine, 211 F.3d at 1362-63 (quotation marks
omitted). We examine materiality from a reasonable insurer’s perspective, asking
whether a particular fact “could possibly influence the mind of a prudent and
intelligent insurer in determining whether he would accept the risk.” Kilpatrick
Marine Piling v. Fireman’s Fund Ins. Co., 795 F.2d 940, 942-43 (11th Cir. 1986);
see also AIG Centennial, 782 F.3d at 1304 (employing definition from Kilpatrick).
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Here, Quintero is correct that the doctrine of uberrimae fidei applies only
when an insurer issues a policy, not when a policy is already in full force. See HIH
Marine, 211 F.3d at 1362-63 (requiring the disclosure of “all facts material to a
calculation of the insurance risk” and stating that doctrine’s central principle is
“disclosure of facts material to the decision to insure”); Kilpatrick, 795 F.2d at
942-43 (describing material fact as one that could influence insurer “in determining
whether he would accept the risk”); Steelmet, 747 F.2d at 695 (noting “highest
degree of good faith” is required because insurer cannot otherwise ensure the
accuracy of facts “before the risk is accepted” (quotation marks omitted)).
But as set forth above, Quintero’s policy was not in full force on May 25
because it had expired on May 5, 2018. Although Quintero was not required to go
through a new underwriting process, he was required to answer questions about the
condition and possession of the boat in order for Geico to issue coverage by
renewing the expired policy. Further, Quintero’s misrepresentations concerning
his possession of the boat during the May 25 phone call were material to Geico’s
calculation of the insurance risk in reinstating his policy, rendering the renewed
policy void ab initio.
Moreover, when Geico renewed the policy, it issued an amended, new
policy, even if it backdated coverage to the original policy’s expiration date.
Specifically, the cover page of the renewal package sent on March 13, 2018, states,
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“GEICO Marine Insurance Company is pleased to announce a new Marine
Insurance Policy which will replace your previous policy with this renewal. A
copy of the new policy in its entirety is enclosed, along with a Notice of Change in
Policy Terms, which details the differences between the new and previous policy.”
The renewal policy included endorsements that amended the terms of the original
policy. To be sure, O’Keefe stated that Geico did not require Quintero to go
through the entire underwriting process again when renewing his policy, because
“that would be a disservice to Mr. Quintero.” However, the facts remain that on
May 25, Quintero’s policy had expired, his policy was not in full force, and Geico
had to decide whether to issue and renew coverage for Quintero’s boat. Thus, the
doctrine of uberrimae fidei applies here.
To avoid the doctrine, Quintero reprises his argument that because his initial
policy never expired and Geico renewed and backdated it, his statements on May
25 were thus not material to Geico’s decision to issue coverage for his boat. This
argument fails for two reasons. First, Quintero’s policy did expire on May 5, as
explained above.
Second, Quintero’s statements were material to Geico’s issuance of
coverage on May 25, even if by renewal and backdating. Viewed from the
perspective of a reasonable insurer, Quintero’s misrepresentation that the boat was
in his home and possession was material, as no “prudent and intelligent insurer”
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would accept the risk of insuring stolen property that is no longer in the insured’s
possession. See Kilpatrick, 795 F.2d at 942-43. When Quintero made the call at
7:28 a.m. on May 25, the boat had already been missing for two and a half hours,
and Quintero had a duty to disclose that fact even if Geico did not directly ask him.
The call was made several hours after the theft of the boat and after weeks of
Quintero not paying his renewal premium.
Even if we assume, dubiously, that Quintero did not know for sure the boat
was already gone at the time of his misrepresentation, that has no impact on our
analysis. See HIH Marine, 211 F.3d at 1363. That the boat was missing from his
own home at the time of the 7:28 a.m. reinstatement call is a fact that ought to have
been within his knowledge, and one he was obligated to disclose even if Geico had
not asked. See id. at 1362-63; Steelmet, 747 F.2d at 695 (stating that uberrimae
fidei imposes the burden to disclose material facts that are “within or ought to be
within, the knowledge of one party, and of which the other party has no actual or
presumptive knowledge” (quotation marks omitted)).
Quintero also argues that O’Keefe’s first affidavit should be disregarded as
to materiality, but we need not rely on O’Keefe’s affidavit to assess materiality.
See Woods v. Indep. Fire Ins. Co., 749 F.2d 1493, 1496 (11th Cir. 1985) (noting
that materiality “can be decided as a matter of law if reasonable minds could not
differ on the question.”). An insured’s possession of the subject property is clearly
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material to the insurer’s risk in insuring it, and we agree with the district court’s
commonsense observation that “insuring a stolen Vessel is akin to insuring a loss.”
Accordingly, the district court properly applied the doctrine of uberrimae fidei and
correctly held Quintero’s renewal policy was void ab initio.2
V. CONCLUSION
For the reasons above, the district court did not err in granting Geico’s
motion for summary judgment and denying Quintero’s motion for partial summary
judgment.3 Accordingly, we affirm.
AFFIRMED.
2 The renewal policy also included a fraud and concealment provision, which stated: “There is no coverage from the beginning of this policy if an ‘insured’ has omitted, concealed, misrepresented, sworn falsely, or committed fraud in reference to any material matter relating to this insurance before or after any loss.” Because Quintero’s renewal policy was void ab initio under the doctrine of uberrimae fidei, we need not address this provision. 3 Quintero’s notice of appeal also refers to the district court’s denial of his Rule 59(e) and 60(b) motion. To the extent Quintero challenges any aspect of that ruling on appeal, his arguments lack merit.