Morales v. Zenith Ins. Co.Annotate this Case
Santana Morales died while working for Lawns Nursery and Irrigation Designs, Inc. (Lawns). Thereafter, Lawns’ surviving spouse entered into a workers’ compensation settlement agreement with Lawns and Zenith Insurance Company (Zenith), Lawns’ workers’ compensation and employer liability insurance carrier. In a separate wrongful death lawsuit, Morales’ Estate obtained a default judgment against Lawns. Zenith refused to pay the tort judgment, and the Estate sued Zenith under Lawns’ employer liability policy. A federal district court entered summary judgment for Zenith, holding that the policy’s workers’ compensation exclusion barred the Estate’s suit. On appeal, the Eleventh Circuit certified three questions of law to the Supreme Court. The Court answered (1) the Estate had standing to bring direct action against Zenith to recover the judgment against Lawns; (2) the workers’ compensation exclusion barred coverage of the Estate’s tort judgment under the employer liability policy; and (3) a release in the workers’ compensation settlement agreement, through which Mrs. Morales elected the consideration described in the agreement as the sole remedy with respect to the insurance coverage that Zenith provided to Lawns, precluded the Estate from collecting the tort judgment from Zenith.