You have to put the <div> outside the <p>, so you have to close the <p> and the <span> before the <div>, and open them again after the </div> (and get rid of the <br/>'s):
Code:
<span class="body" style="font-size:0.86em;"> my text</span></p>
<p class="body"><span class="body" style="font-size:0.86em;"></span></p>
<div class="group1">
<img src="images/E7-10_fmt.jpeg" alt="alt text" />
</div>
<p class="body"><span class="body" style="font-size:0.86em;">my text</span></p>
This doesn't make the code any prettier or more logical, but it will validate.