CopyCited 41 times | Published | Supreme Court of Florida | 36 Fla. L. Weekly Supp. 373, 2011 Fla. LEXIS 1574, 2011 WL 2659854
...Const. This appeal arises from a motion for class certification filed in the trial court by Sosa. That motion emanated from a cause of action initiated by Sosa in which Sosa claimed that Safeway Premium Insurance Company ("Safeway") violated sections
627.840(3)(b) and
627.835, Florida Statutes (2003), by knowingly overcharging him an additional service charge of $20 twice in a twelve-month period in two premium finance agreements which he entered into with Safeway....
...onthly installments. See id. A "service charge," which is usually in the form of interest on the amount financed, is added to the principal amount billed to the insured by the premium finance company "for financing the premiums under the agreement." § 627.840(2), Fla. Stat. (2010). An "additional service charge" is a statutorily limited service charge that may be imposed in addition to a service charge. See id. § 627.840(3)(a). For example, under section 627.840(3)(b), a premium finance company may assess to an insured a service charge that does not exceed "a maximum of $12 per $100 per year." In addition to this service charge, a premium finance company may make an "additional [service] char...
...ayment. If Safeway canceled the previous premium finance agreement for nonpayment, the application and new agreement were returned to the stack for processing with the additional service charge of $20, as that additional charge was permissible under section 627.840(3)(b) due to the insured's nonpayment....
...Sosa based his complaint on the overcharges resulting from his first and second premium finance agreements with Safeway. He did not include in his complaint his third premium finance agreement with Safeway. He alleged that Safeway's imposition of an additional service charge twice in a twelve-month period violated section
627.840(3)(b), Florida Statutes (2003), and that, due to this violation, he and the putative class members were entitled to the return of the premium finance charges assessed against them by Safeway plus "twice the entire amount of the premium finance charge so paid." §
627.835, Fla....
...According to the Third District, to prove the overcharges, the trial court would need to preliminarily and individually address each individual member's claims, as Safeway could have a different explanation and defense to an alleged knowing violation of section 627.840 for each individual class member....
...Therefore, Sosa, to meet rule 1.220(a)'s requirements, was required to allege facts that implicated Safeway's specific intent to overcharge not only Sosa, but each class member on an individual basis. See id. Sosa and the individual class members failed to establish a knowing violation of sections
627.840 and
627.835, and, therefore, the Third District concluded that the trial court erred in granting class certification and reversed the trial court's order....
...methodology to be employed by an appellate court when it reviews a trial court's order on class certification. Third District's Misapplication of Section
627.835's "Knowingly" Requirement Section
627.835 penalizes a party if it "knowingly" violates section
627.840(3)(b). See §
627.835. The purpose of section
627.840(3)(b) is to regulate the service charges that a premium finance company may allocate. Section
627.840(3)(b) provides: (b) The service charge shall be a maximum of $12 per $100 per year plus an additional charge not exceeding $20, which additional charge need not be refunded upon prepayment....
...(emphasis added.) In 1995, Florida's Department of Financial Services, which succeeded Florida's Department of Insurance (the agency that audited and regulated Safeway), adopted a rule interpreting this section. That rule states: 69O-196.038 Limit on Additional $20 Service Charge. (1) The additional $20 charge referred to in Section 627.840(3)(b), F.S., may be charged only once in a 12-month period for any one customer regardless of the number of premium finance agreements entered into during the 12-month period or the number of policies financed in each finance agreement....
...da Statutes. The Third District in Sosa erred when it held that the trial court improperly granted Sosa's motion for class certification on the basis that Sosa failed to demonstrate that Safeway knowingly overcharged him in contravention of sections
627.840 and
627.835....
...ality requirement because their claims arose from the same course of conduct and routine billing practice by Safeway and were based on the same legal theory, i.e., Safeway knowingly overcharged Sosa and the class members in contravention of sections
627.840 and
627.835....
...In this case, Sosa and the putative members filed the action against Safeway predicated on a routine course of conduct and common billing practice that Safeway knowingly charged them an additional premium service charge twice in a twelve-month period in contravention of sections
627.840 and
627.835....
...The complaint sets forth allegations that Safeway engaged in the common course of conduct and business practice of "assessing and accepting for payment from Mr. Sosa and the Class members an additional charge in excess of twenty dollars ($20) in a 12-month period," which violated sections 637.835 and 627.840....
...rs. Therefore, commonality was clearly satisfied if true because *111 the common course of conduct and routine business practice by Safeway and the same legal theoryi.e., Safeway overcharging Sosa and the putative class members in contravention of section
627.840 and
627.835served as the basis for all claims....
...because the common class questions for Sosa and the putative class members require generalized proof and not individual inquiries or mini-trials. To resolve whether Safeway overcharged Sosa and the putative class members in contravention of sections
627.840 and
627.835, the trial court need only determine whether Safeway was aware of, and understood that, its common course of conduct and routine business billing practice would result in an overcharge to the class members....
...., damages might vary from that of the other class members, this did not serve as a bar to a finding of typicality. See id. In this case, the claims of Sosa and the putative class members are based on the same legal theorya violation of sections
627.840 and
627.835that arose from the same course of conduct that caused a similar injurySafeway overcharging Sosa and the putative class members an additional service charge of $20 twice in a twelve-month period....
...His interests were not antagonistic to those of the rest of the class. On the contrary, they paralleled the interests of the class members, as he and the class members sought redress from Safeway based on alleged violations of sections
627.835 and
627.840....
...Rather, Sosa's economic injury for which he may pursue redress is in the form of a damage recovery of the entire premium finance charge plus twice the amount of the premium finance charge assessed by Safewaywhich is the damage award provided under section
627.835. More specifically, section
627.840 permits a premium finance company to charge an individual a maximum additional service charge of $20 in a twelve month period....
...In a twelve month period, Safeway charged Sosa an additional service charge of $20 twice, i.e., it assessed the $20 additional service charge to Sosa in each of his first two premium finance agreements whose individual duration was for six months. It is alleged that by doing so, Safeway violated section 627.840....
...emantics. As found by the trial court, the result of the reallocation of funds is the same regardless of what it is labeled, i.e., Sosa was credited $20 on his balance for his third premium finance agreement with Safeway because, in contravention of section 627.840, Safeway impermissibly charged him an additional service charge of $20 twice in a twelve month period by assessing that charge on Sosa's first and second premium finance agreements....
CopyCited 2 times | Published | Florida 3rd District Court of Appeal | 2009 Fla. App. LEXIS 2876, 2009 WL 928434
...Alvarez, Miami, for appellees. Before GERSTEN, C.J., and SHEPHERD and SUAREZ, JJ. SUAREZ, J. Safeway Premium Finance Company appeals the trial court's order certifying a class action. Lazaro E. Sosa's Motion for Certification alleges that Safeway violated section 627.840(3)(b), Florida Statutes (2002), by overcharging Sosa and other Safeway customers....
...action. We reverse the granting of the Motion for Certification. On November 26, 2002, Sosa entered into a six-month premium finance agreement *10 with Safeway for which he was charged an additional service charge of twenty dollars, provided for in section 627.840(3)(b), Florida Statutes (2002)....
...Sosa renewed his six-month automobile policy two more times, and, each time, obtained a new, six-month premium finance contract with Safeway wherein with each new contract he was charged the additional service charge of twenty dollars. He claims that section 627.840(3)(b) does not allow for more than one twenty-dollar additional charge in a twelve-month period and that the two additional service charges constituted a violation by Safeway of section 627.840(3)(b). He alleges that Safeway has made the same unauthorized charges to other customers. Safeway admits the overcharge, but states that the violation was an error and denies any knowing violation. Section 627.840(3)(b), Florida Statutes (2002) allows a premium finance company to charge a twenty-dollar additional charge once every twelve months. The twenty-dollar additional charge may be charged more than once every twelve months only if the customer's policy was cancelled due to nonpayment within the preceding twelve-month period. Section 627.840(3)(b) states: The service charge shall be a maximum of $12 per $100 per year plus an additional charge not exceeding $20, which additional charge need not be refunded upon prepayment. Such additional charge may be charged only once in a 12-month period for any one customer unless the customer's policy has been canceled due to nonpayment within the immediately preceding 12-month period. § 627.840(3)(b), Fla....
...Sosa claims that he and other Safeway customers are entitled to certain specific damages provided for in section
627.835 because Safeway billed them and accepted more than one twenty-dollar additional charge within a twelve-month period in violation of section
627.840(3)(b)....
...pany, or legal entity twice the entire amount of the premium finance charge so paid. §
627.835, Fla. Stat. (2002) (emphasis added). In order for Sosa to state an individual cause of action and one which qualifies for class certification pursuant to section
627.840(3)(b), based on damages specified in section
627.835, the premium finance company must have knowingly charged or accepted the additional twenty-dollar premium finance charge unauthorized by statute....
...y, in the processing of an application. Sosa personally has not alleged any individual facts showing intentional actions by Safeway or on behalf of potential members of the class sufficient to demonstrate a cause of action for damages under sections
627.840(3)(b) and
627.835, Florida Statutes (2002), for knowingly collecting an excess finance charge sufficient to meet the commonality requirement of a class action....
...The policy was for a six-month term. Safeway charged Sosa an additional service charge of $20 when he financed the six-month premium. When Sosa renewed his policy for another six-month term, Safeway again assessed him the $20 additional service charge. Section 627.840(3)(b), Florida Statutes (2002), allows a premium finance company to charge a maximum of $20 per year as an additional service charge....
...10, 1999. Given the geographical and chronological span of the class, numerosity was clearly established. Turning to commonality, the trial court concluded that the whole class shared this liability question: Whether the Defendant knowingly violated 627.840, Florida Statutes, by assessing and accepting for payment from Plaintiff and the Class members an additional charge in excess of twenty dollars ($20) in a 12-month period....
