The Britos sued Heritage and the mold testing company filed a separate small claims suit (in its own name) against Heritage to collect the $2,495 invoice.

The mold testing company's case went to trial while the Britos' case against Heritage was still in pretrial proceedings. The Britos were not parties to the mold testing company's small claims suit, but they did testify as witnesses.

A jury rendered a verdict in favor of Heritage and against the mold testing company on the assigned invoice claim. The verdict form asked the jury to answer whether the Britos had suffered a loss to their property after September 22, 2015 (two days before the date of the leak and resulting damage claimed by the Britos). The jury answered that question, “No,” and final judgment then was entered against the mold testing company on its $2,495 assigned claim.

Heritage filed a motion for summary judgment against the Britos in the Britos' case, contending that their claim was barred by collateral estoppel and res judicata, based on the jury's verdict in the separate mold testing company small claims case.

The Britos opposed the motion, relying on the fact that they were not parties to the small claims case (even though they testified), and citing legal authority for the inapplicability of the affirmative defenses of collateral estoppel and res judicata.

The trial court granted Heritage's motion for summary judgment, and the Britos appealed.

The Appellate Court's Decision

The appellate court reversed, finding that a lack of privity meant that the Britos were not bound by the small claims court decision.

In its decision, the appellate court explained that the Britos filed an affidavit of the attorney for the mold testing company in opposition to Heritage's motion for summary judgment in their case that established that the mold testing company and its counsel did not represent the Britos; the Britos were not notified regarding the mold testing company's small claims action before it was filed; the Britos had no hand in the mold testing company's litigation strategy or preparation of the verdict form; and the Britos were not present for the entire trial.

The appellate court added that the coverage claims under the Heritage insurance policy also were different in that the mold testing company's claim was subject to an “Additional Coverages” provision, which had a $10,000 limit, while the Britos' claim exceeding $80,000 for the entire amount of their alleged loss (other than the assigned mold testing claim) was part of “Coverage A—Dwelling,” with a $364,000 ceiling. Therefore, the appellate court concluded, the mold testing company and the Britos were not “privies” for purposes of the res judicata “identity of parties” requirement.

The case is Brito v. Heritage Property and Casualty Ins. Co., No. 3D18-1448 (Fla. Ct. App. July 24, 2019). Attorneys involved include: Barnard Law Offices and Garrett William Haakon Clifford, for appellants. Greenberg Traurig and Brigid F. Cech Samole and Katherine M. Clemente, for appellee.