Gulf Insurance Co. v. Dolan, Fertig & Curtis

The law firm Dolan, Fertig & Curtis (Dolan) (plaintiff) had a claims-made insurance policy with Gulf Insurance Company (Gulf) (defendant). The policy covered legal-malpractice claims from November 20, 1978, to November 20, 1979, if the claim arose and was known to or made against Dolan during the period and Dolan notified Gulf during the period. Dolan then had a claims-made policy with Lawyers Professional Liability Insurance Company (LPLIC) starting November 20, 1979. The LPLIC policy covered retroactive claims unless Dolan knew about the claim prior to the start of the policy. On November 19, 1979, Dolan received a letter from a client advising Dolan to place its malpractice carrier on notice due to its negligent performance. On December 6, 1979, Dolan notified LPLIC of the claim. LPLIC responded on January 16, 1980, that the claim was excluded because Dolan knew of it before the policy was issued. Dolan wrote to Gulf about the claim on February 12, 1980. Gulf denied coverage because it was notified outside of the policy period. The Gulf policy contained a provision, if exercised within 30 days of the policy’s termination date, to add an endorsement providing an extended claims-discovery period. Dolan did not purchase the endorsement. The client sued Dolan and won $50,000. Dolan sought a declaratory judgment as to which insurer was liable. The trial court denied LPLIC’s motion for summary judgment and granted Gulf’s. Dolan appealed the granting of Gulf’s motion. The appellate court reversed, holding that there should be a reasonable claims-reporting time after the policy period expired to make the contract fair. In response to a petition for rehearing, the appellate court certified a question to the Florida Supreme Court.