Jacqueline García-Navarro sued Universal Insurance Company after her mother, Carlina Navarro-Ayala, died from heart failure at Hogar La Bella Unión assisted living facility in March 2016. The lawsuit alleged that a licensed practical nurse incorrectly told doctors that Navarro-Ayala was a Jehovah's Witness, leading them to withhold blood transfusions despite her chronic anemia. García-Navarro sought $950,000 in damages and claimed Universal wrongfully denied coverage to the facility under its general liability policy.
The First Circuit upheld U.S. District Judge John A. Woodcock Jr.'s ruling that Universal had no duty to defend or indemnify the facility because the alleged negligent acts constituted 'professional services' excluded from coverage. As Chief Judge Barron explained, 'Under Rivera-Matos, whether an act or omission is a professional service turns, as discussed, on the intricate part doctrine.' The court found that the facility's failure to keep proper records and miscommunication with treating physicians 'were an intricate part of the rendering of medical services.'
The panel rejected García-Navarro's core argument with pointed language about procedural requirements. 'As we have repeatedly warned, arguments that were not raised below are forfeited and will only lead to reversal upon a showing of plain error,' Chief Judge Barron wrote. The court noted that García-Navarro 'does not, at any point in her briefing to us, explain how the application of Rivera-Matos was plain error' and therefore 'waived any argument on appeal that such an error occurred.'
The case had a complex procedural history spanning multiple judges and rulings. Initially, Judge William G. Young granted partial summary judgment to Universal in 2018 but allowed claims to proceed on record-keeping and miscommunication failures, reasoning Universal was 'stretching [the Viruet precedent] too far.' After the case was reassigned to Judge Woodcock, García-Navarro settled with the facility for $950,000 while pursuing coverage claims against Universal. The Puerto Rico Supreme Court's 2020 Rivera-Matos decision then prompted Universal to seek reconsideration based on the new 'intricate part doctrine.'
García-Navarro argued that Rivera-Matos should not apply retroactively to insurance contracts predating the decision, but the First Circuit found she never properly raised this argument below. Instead, she had only contended that 'Rivera-Matos did not control because the insurance contract at issue should be governed by the Puerto Rico Insurance Code and the Puerto Rico Civil Code.' Judge Woodcock had rejected that argument, ruling that as a federal court sitting in diversity, its job was to 'adhere[] to the legal principles outlined by the Supreme Court of Puerto Rico.'
The appellate court found no merit in applying retroactivity restrictions to Rivera-Matos, noting that the Puerto Rico Supreme Court decision 'favorably cited to Viruet' and merely clarified rather than overruled existing precedent. 'It is hardly evident that Rivera-Matos did anything more than clarify its prior precedent,' Chief Judge Barron observed. The court distinguished cases where new legal rules might trigger retroactivity analysis, finding Rivera-Matos simply 'applies or clarifies' existing professional services exclusion doctrine.
The ruling significantly expands potential coverage exclusions for assisted living and nursing home facilities in Puerto Rico, as the 'intricate part doctrine' sweeps in administrative and communication failures that facilitate medical care. The decision reinforces that federal courts must follow Puerto Rico Supreme Court interpretations of local insurance law, even when those interpretations broaden exclusions after litigation begins.