Opinion
No. 2D19-422
06-02-2021
TANK TECH, INC., a Foreign Corporation, Appellant, v. VALLEY TANK TESTING, L.L.C., a Foreign Limited Liability Company, Appellee.
Mary K. Simpson and Robert D. Fingar of Guilday Law, P.A., Tallahassee, for Appellant. Andrew J. Mayts of Shumaker, Loop & Kendrick, LLP, Tampa, for Appellee.
Mary K. Simpson and Robert D. Fingar of Guilday Law, P.A., Tallahassee, for Appellant.
Andrew J. Mayts of Shumaker, Loop & Kendrick, LLP, Tampa, for Appellee.
KELLY, J.
Tank Tech, Inc., appeals from the final summary judgment entered in favor of Valley Tank Testing, L.L.C., on a claim of equitable subrogation. This is the second time the viability of this claim has been before this court. In Tank Tech, Inc. v. Valley Tank Testing, L.L.C., 244 So. 3d 383 (Fla. 2d DCA 2018) ( Tank Tech I ), this court reversed a final summary judgment in favor of Valley Tank after finding that Tank Tech had a viable claim for equitable subrogation. Id. at 392. In Tank Tech I , we summarized the parties' dispute, as follows:
The complaint was the product of a dispute between Tank Tech and Valley Tank regarding which of the two entities caused damage to underground petroleum storage tanks (USTs) at various Circle K stores. Tank Tech had been hired to modify the USTs by adding a second interior wall inside of them while Valley Tank had been hired to test the interstitial space between the original UST walls and the newly added walls. As a result of the damage, Tank Tech was required to repair the damaged USTs. Tank Tech then sued Valley Tank to recover the repair costs and other losses.
Id. at 386-87. Tank Tech's contract with Circle K required it to repair any damage to the containment systems installed on Circle K's USTs regardless of whether the damage was caused by an action or omission of Tank Tech or a third party. Id. at 388.
In reversing the summary judgment on Tank Tech's claim for equitable subrogation, we stated that Tank Tech's contract with Circle K legally obligated it to repair the damages; thus, it was not a "volunteer," and it was not precluded from making a claim for equitable subrogation. Id. at 392. We also concluded that Tank Tech had established a genuine issue of material fact regarding whether Tank Tech or Valley Tech was primarily liable for the damage to the USTs and that "[i]f Tank Tech is ultimately successful in proving that Valley Tank caused the damage ... then it would be entitled to seek any damages it incurred as a result of having to repair the damaged USTs." Id.
On remand from this court Valley Tank filed what it styled as a "second renewed motion for summary judgment" on Tank Tech's claim for equitable subrogation. In this motion it argued that Tank Tech could not state a claim for equitable subrogation for the same reasons it set forth in its previous motion for summary judgment; however, it focused on two elements it had not developed in its previous arguments either in the trial court or this court. First, it argued that Tank Tech had not offered any evidence that it had paid off or discharged Valley Tank's debt to Circle K; and second, it argued that Tank Tech had not obtained a release for Valley Tank for any potential liability for those claims.
A trial court's ruling on a motion for summary judgment presents a question of law we review de novo. Clay Elec. Coop., Inc. v. Johnson, 873 So. 2d 1182, 1185 (Fla. 2003). "The party moving for summary judgment has the burden of establishing irrefutably that the nonmoving party cannot prevail." Hervey v. Alfonso, 650 So. 2d 644, 645-46 (Fla. 2d DCA 1995). Only after the moving party has met this burden must the nonmoving party show the existence of genuine issues of material fact. Id. at 646.
After the trial court rendered final summary judgment in this case, the Florida Supreme Court amended Florida Rule of Civil Procedure 1.510(c) to adopt a new summary judgment standard. See In re Amendments to Fla. R. Civ. P. 1.510 , 309 So. 3d 192, 194-95 (Fla. 2020) (adopting the federal summary judgment standard). The amendment, which became effective on May 1, 2021, does not apply here as the final judgment predates the amendment. See Wilsonart, LLC v. Lopez, 308 So. 3d 961, 964 (Fla. 2020) (stating that the amendment to rule 1.510(c) applies prospectively).
After reviewing the record in this case, we have no trouble concluding that Valley Tank did not meet its burden and therefore was not entitled to summary judgment. In Tank Tech I , we explained that
Equitable subrogation is generally appropriate where: (1) the subrogee made
the payment to protect [its] own interest, (2) the subrogee did not act as a volunteer, (3) the subrogee was not primarily liable for the debt, (4) the subrogee paid off the entire debt, and (5) subrogation would not work any injustice to the rights of a third party.
244 So. 3d at 389 (quoting Dade Cnty. Sch. Bd. v. Radio Station WQBA, 731 So. 2d 638, 646 (Fla. 1999) ). Tank Tech I held the summary judgment was erroneous because a fact question remained regarding whether Valley Tech was primarily liable for the damage to the tanks. Nothing that transpired on remand has altered our conclusion that this is a disputed issue of fact. On remand, Valley Tech attempted to work around this obstacle by arguing that "Tank Tech failed to offer any evidence that Tank Tech paid off or discharged Valley Tank's debt to Circle K in full." While the trial court found this argument persuasive, we do not.
First, on summary judgment it was Valley Tank's burden to establish that Tank Tech had not fully satisfied Valley Tank's debt to Circle K. It did not discharge that burden. The record before the trial court contained evidence demonstrating Tank Tech had repaired the tanks allegedly damaged by Valley Tank's improper testing, and it had paid or reimbursed Circle K for the expenses incurred with respect to those specific tanks. Valley Tank argued this was not enough because Tank Tech failed to show it was not contractually obligated to repair additional tanks for Circle K beyond those at issue in the litigation. Valley Tank offered nothing to demonstrate that any of the other tanks Tank Tech might be contractually obligated to repair were tanks for which Valley Tank would be primarily liable. Finally, as we explained in Tank Tech I , the extent to which Valley Tank was primarily liable for the repair of any tank remained a disputed issue of fact. 244 So. 3d at 392. Without knowing the extent to which Valley Tank was primarily liable, it remains to be seen whether Tank Tech discharged that liability in full.
Citing WQBA , Valley Tank also argued that as a prerequisite to bringing a claim for equitable subrogation, Tank Tech had to obtain a release from Circle K in favor of Valley Tank. We reject this argument as well because we believe it reads too much into WQBA . As explained in Kala Investments, Inc. v. Sklar, 538 So. 2d 909, 917 (Fla. 3d DCA 1989),
"Equitable" subrogation is a creature of equity which was developed to afford relief "when one person has satisfied the obligations of another and equity compels that the person discharging the debt stand in the shoes of the person whose claim has been discharged, thereby succeeding to the rights and priorities of the original creditor." Eastern National Bank v. Glendale Federal Savings and Loan Association, 508 So. 2d 1323, 1324 (Fla. 3d DCA 1987). The policy behind the doctrine is to prevent unjust enrichment by assuring that the person who in equity and good conscience is responsible for the debt is ultimately answerable for its discharge. Id. See United States Fidelity & Guaranty Co. v. Bennett, 96 Fla. 828, 119 So. 394 (1928). The doctrine is then a part of the universe usually spoken of as being inhabited by only indemnity or contribution.
Because the application of equitable subrogation depends upon the facts and circumstances of each case, United States Fidelity & Guaranty Co. v. Bennett, 96 Fla. 828, 119 So. 394, "having for its basis the doing of complete and perfect justice between the parties without regard to form," Dantzler Lumber & Export Co. v. Columbia Casualty Co., 115 Fla. 541, 551, 156 So. 116, 119 (1934), there is no general rule or test for its invocation.
WQBA must be read through this prism. That is, the propriety of a claim for equitable subrogation "depends on the facts and circumstances in each case" and there is "no general rule or test for its invocation." Id. We do not read WQBA as establishing a general rule applicable in all cases where a party seeks equitable subrogation. In fact, the court couched its discussion as one involving the limits of a claim for equitable subrogation "in a tort context." WQBA, 731 So. 2d at 646.
WQBA was a "prototypical tort case" where "one of several defendants pays the plaintiff's entire claim that, in equity, should have been paid by one of the other defendants." Welch v. Complete Care Corp., 818 So. 2d 645, 648 (Fla. 2d DCA 2002). More specifically, WQBA addressed the applicability of equitable subrogation as a substitute for contribution when a settling defendant's contribution claim failed. 731 So. 2d at 646-47. In concluding equitable subrogation could be substituted for a failed contribution claim, the court relied on West American Insurance Co. v. Yellow Cab Co. of Orlando, 495 So. 2d 204 (Fla. 5th DCA 1986), stating it was an example of the kind of case "to which application of equitable subrogation in a tort context should be limited." WQBA, 731 So. 2d at 646.
WQBA explained the facts of West American stating:
West American's insured was involved in an automobile accident with a cab owned by the Yellow Cab Company. The insured sued both West American and Yellow Cab. West American was successful in negotiating a settlement with its insured and secured a release of all claims against itself and Yellow Cab. West American then filed a contribution claim against Yellow Cab to recover the settlement monies paid to its insured. Because a jury determined Yellow Cab to be one hundred percent at fault, the district court concluded that West American was not a joint tortfeasor and therefore it could not sue Yellow Cab [for contribution] under section 768.31, Florida Statutes (1985).
Id. The release was necessary for a proper contribution claim. See West American, 495 So. 2d at 206 (stating that under section 768.31 "a tortfeasor who enters into a settlement with a claimant is not entitled to recover contribution from another tortfeasor whose liability for the injury or wrongful death is not extinguished by the settlement"). When the contribution claim failed because it was later determined the settling defendant was not a tortfeasor, the court in West American found that under these circumstances, "[t]o deny recovery, however, because West American was unable to prove its own liability produces a most unfair and inequitable result" which the court concluded could be addressed by permitting West American to recover under principles of equitable subrogation. Id. at 206-07. Here, Tank Tech, Circle K, and Valley Tank are not embroiled in a tort case, and Tank Tech's payments to Circle K were not made to settle litigation between Valley Tank, Circle K and Tank Tech, nor has Tank Tech pursued equitable subrogation as a substitute for a failed claim of contribution. Rather, Tank Tech repaired the damaged tanks at its expense to fulfill its contractual obligation to Circle K. Thus, we find WQBA inapposite.
Accordingly, we reverse the final summary judgment in favor of Valley Tank and remand for further proceedings consistent with this opinion.
Reversed and remanded.
CASANUEVA and BLACK, JJ., Concur.