Statements Made During an Application for Insurance are Important

Insurance applications are important. A Florida trial court recently held that an unsworn and unsigned telephonic statement made during an application for insurance does not qualify as former testimony or a business record under the Florida Rules of Evidence, thereby making it inadmissible as summary judgment evidence.¹

Francisco Gonzalez, the policyholder, filed a claim with his insurance company, Bristol West Insurance Company, after being injured in a motor vehicle accident. Bristol refused to pay out on the claim and Gonzalez was forced to file suit. Bristol asserted an affirmative defense indicating that Gonzalez’s claim was barred based on an alleged material misrepresentation during the insurance application process.

Bristol contended that when Gonzalez completed his insurance policy application, he was asked to identify the members of his household over the age of 15. Gonzalez listed his wife but failed to list his son. Bristol contended that Gonzalez’s failure to list his son during the application process was a material misrepresentation. In response, Bristol filed a Motion for Summary Judgment based on its claim of a material representation defense and attached the affidavits taken from Gonzalez over the phone which were unsworn and unsigned. Bristol argued that it was entitled to use the unsworn and unsigned telephonic statement to establish its material defense because the statement qualified as a business record under the business records exception to the hearsay rule, F.S. 90.803(6).

The court disagreed.

Business Record Exception

In order to qualify for the business record exception to the hearsay rule, a ‘business record’ must satisfy these criteria: (1) the record was made at or near the time of the event; (2) was made by or from information transmitted by a person with knowledge; (3) was kept in the ordinary course of a regularly conducted business activity; and (4) that it was a regular practice of that business to make such a record.² Bristol had several factual hurdles to jump over that they were not able to meet to prove that the proffered statement met the business record exception.

The statement obtained by Bristol was not made near or at the time of the event.

In fact, it was made almost nine (9) years later after the underlining statement was obtained. This was neither near nor at the time of the event.

The statement obtained by Bristol was not made by someone with personal knowledge.

The statement proffered by Bristol was not supplied by someone within Bristol’s business organization who had knowledge of the facts and data contained in the statement. In addition, the underlining statement was taken in Spanish and was only translated to English nine years later for the sole purpose of litigation.

The statement was not kept in the ordinary course of regularly conducted business activity.

The unsworn and unsigned telephonic statement was not created by Bristol, is not Bristol’s record, and therefore does not qualify as Bristol’s business record. A record is not a business record simply because it appears in the insured’s file. It must be generated by the business. The proffered statement in this case was not created by Bristol or by anyone within Bristol’s business organization.

Finally, the statement obtained by Bristol was not regular business.

According to Bristol’s corporate designee, the statement at issue was made for the purpose of preparing for litigation, and under Florida law, cannot be qualified as a regular conducted business activity.³

If you think about it, it makes sense why this statement would not be allowed to come in under the business record exception. Timing requirements for business records ensure that when a statement is made, it must be fresh in the mind of the participant. Florida courts have held that when the record is made at a more remote time, the reliability of the entry decreases.⁴ Additionally, whenever a record is made for the purpose of preparing for litigation, its trustworthiness is suspect and should be closely scrutinized. The fact that Bristol’s corporate designee testified stating the proffered statement was created solely for the purpose of litigation, makes it inherently untrustworthy.⁵ The court held that under the reasons stated above, the statement was inadmissible for the purpose of trial and summary judgment.

Former Testimony

The former testimony rule found in section 90.804(2)(a) only applies if (i) a former testimony was taken in the course of a judicial proceeding in a competent tribunal; (ii) the party against whom the evidence is offered, or his privy, was a party to the former trial; (iii) the issues are substantially the same in both cases; (iv) a substantial reason is shown why the original witness is not available; and (v) the witness who proposes to testify to the former evidence is able to state it with satisfactory correctness.⁶

In the instant case, Gonzalez’s statement was allegedly taken as apart of the requirement of an insurance policy, prior to this lawsuit being filed, and was not taken in connection with a judicial proceeding. Therefore, there was no opportunity to cross examine or object to Gonzalez’s statement. Additionally, Bristol’s proffered statement does not rise to the level of testimony because it is not sworn.

The court held that the statement proffered by Bristol was inadmissible hearsay not meeting either exceptions; and ordered the statement to be stricken from the record and prohibited from being used for any purpose in trial or summary judgment.

Policyholders making statements or providing answers to questions during the insurance application process, often do not realize how important these statements and answers can be. Wrong answers may lead to a denial of coverage. If you are faced with coverage problems caused by alleged misrepresentations in an insurance application, please consult competent and experienced legal counsel.

Thought For The Day

The search for truth takes you where the evidence leads you, even if, at first, you don’t want to go there.
― Bart D. Ehrman, Forged: Writing in the Name of God
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¹ Feijoo, a/a/o Gonzalez v. Bristol West Ins. Co., No. 2014-001360, 28 Fla. L. Weekly Supp. 76a (Fla. Miami-Dade Cty. Ct. Feb. 20, 2020).
² See Fla. Stat. § 90.803(6); see also, M.S. v. Dept. of Children and Families, 6 So. 3d 102 (Fla. 4th DCA 2009) citing Quinn v. State, 662 So.2d 947, 953 (Fla. 5th DCA 1995).
³ Fla. Stat. 90.803(6)(a)
⁴ See, Maslak v. Wells Fargo Bank, N.A., 190 So. 3d 656, 660 (Fla. 4th DCA 2016).
⁵ See, Coates v. State, 217 So. 3d 1048 (Fla. 4th DCA 2017).
⁶ See, Johns-Manville Sales Com. v. Janssens, 463 So.2d 242 (Fla. 1st DCA 1984).