11 Fla. L. Weekly Supp. 229a
Insurance — Automobile — Contracts — Class action by plaintiff involved in accident with defendant’s insured, alleging that defendant insurer breached insurance contract by using non-OEM parts in estimate to repair plaintiff’s vehicle — Florida’s nonjoinder statute applies to contract action, and plaintiff must satisfy condition precedent of obtaining settlement or verdict against insured prior to attaining third-party beneficiary status — Plaintiff has not satisfied condition precedent where, although insurer did make payments to plaintiff for damage to his vehicle, payments were not part of settlement or verdict against insured — Even if nonjoinder statute did not apply, plaintiff has suffered no damages and has no case against insurer where, although estimate called for non-OEM bumper and bumper cover, OEM bumper and cover were actually installed and insurer reimbursed plaintiff for difference in value of parts, and replacement of taillight with non-OEM part was unilateral decision of repair shop made at shop’s own expense — It was permissible for insurer to discover and correct billing errors prior to class certification — Attorney’s fees — There is no requirement that defendant making payments in attempt to correct billing errors stipulate to pay attorney’s fees — There is no basis for entitlement to fees where plaintiff did not plead any contractual right to fees, and only statutory basis for fees which could have been pled, claim under Florida Deceptive and Unfair Trade Practices Act, was voluntarily dismissed — Complaint dismissed with prejudice
JACQUES CASAS, on behalf of himself and others similarly situated, Plaintiff, vs. UNITED SERVICES AUTOMOBILE ASSOCIATION, Defendant. Circuit Court, 17th Judicial Circuit in and for Broward County. Case No. 99-15664 (09). January 6, 2004. Robert Lance Andrews, Judge.
ORDER
THIS CAUSE having come before the Court on Defendant’s Motion for Summary Judgment, and the Court having considered same, having heard argument of counsel and otherwise being duly advised in premises, finds and decides as follows:
The instant action arises from an automobile accident which occurred between Plaintiff and an insured of Defendant. Defendant inspected the damage to Plaintiff’s vehicle, prepared repair estimates, and based upon these estimates made payments to Plaintiff in the amount of $2,181.96. The repair estimates specified two non-OEM parts: a bumper and a bumper cover. The non-OEM parts which were specified in the estimates were not installed on Plaintiff’s vehicle, rather the repair shop installed an OEM bumper and bumper cover. Defendant subsequently discovered that the non-OEM parts had been specified, contrary to Defendant’s policy. On August 21, 2000, Defendant informed Plaintiff of its error and sent a check in the amount of $145.64, which represented the difference in the actual costs to repair Plaintiff’s vehicle with an OEM bumper and bumper cover, and the amount of Defendant’s repair estimate for the non-OEM bumper and bumper cover.
Plaintiff has filed a class action complaint against the Defendant, alleging breach of the terms of an insurance contract to which he asserts rights as a third-party beneficiary.1 The complaint alleges that USAA breached the terms of the insurance contract by using non-OEM parts in its estimate because non-OEM parts are inferior per se and were not of “like kind and quality” to the parts they replaced, as required. Defendant has now moved for summary judgment.
Summary judgment is appropriate “if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” Rule 1.510(c) Fla. R. Civ. Pro. The party moving for summary judgment has the burden of showing the absence of a genuine issue of fact. All inferences must be drawn from the proof in favor of the party opposing the motion. Liberty Mutual Insurance Co. v. Stuckey, 220 So.2d 421 (Fla. 4th DCA 1969). Unless the material facts are so crystallized that nothing remains except question of law, summary judgment should not be granted. Moore v. Morris, 475 So.2d 666 (Fla. 1985). If the evidence raises any issue of material fact, if it is conflicting, if it will permit different reasonable inferences, or if it tends to prove the issues, it should be submitted to the jury as a question of fact to be determined by it. Id.
Defendant argues that there are no genuine issues of material fact in this case and they are entitled to summary judgment as a matter of law. Defendants argues that under Florida’s nonjoinder statute, §627.4136 Fla. Stat., Plaintiff is not a third-party beneficiary of Defendant’s contract with its insured because Plaintiff has neither obtained a settlement with or judgment against Defendant’s insured. Plaintiff, in turn, argues that Florida’s nonjoinder statutes only applies to tort claims and therefore does not apply to the instant breach of contract claim.
As a general rule, in the absence of a contractual or statutory provision in such respect, there is no privity between an injured person and an insurer, and the injured party has no right of action at law against the insurer. Florida has enacted a statutory provision affording an injured party the right to bring a direct action against an insurer, once the injured party satisfies specific conditions precedent. §627.4136, Fla. Stat. Section 627.4136, Fla. Stat., provides in pertinent part:
(1) It shall be a condition precedent to the accrual or maintenance of a cause of action against a liability insurer by a person not an insured under the terms of the liability insurance contract that such person shall first obtain a settlement or verdict against a person who is an insured under the terms of such policy for a cause of action which is covered by such policy.
(2) . . . No person who is not an insured under the terms of a liability insurance policy shall have any interest in such policy, either as a third-party beneficiary or otherwise, prior to first obtaining a settlement or verdict against a person who is an insured under the terms of such policy for a cause of action which is covered by such policy.
Plaintiff argues that the breach of contract claim is not barred by §627.4136, Fla. Stat., because that statute only applies to tort actions. Plaintiff’s argument must fail. A review of the statute reveals that it does not specify that only tort actions are controlled by its provision, it only refers to a “cause of action which are covered by such policy.” See e.g. Lucente v. State Farm Mutual Automobile Insurance Co., 591 So.2d 1126 (Fla. 4th DCA 1992) (holding that an injured motorist could sue tort-feasor’s liability insurer for alleged unfair claim settlement practices only after motorist first obtained judgment against tort-feasor). Since undoubtedly a breach of contract claim could be considered a cause of action which would be covered under a liability insurance policy, it is entirely conceivable that the statute does indeed apply to such a cause of action. Moreover, because the only direct cause of action available to an injured party is provided for by contract or by statute, absent the statutory provision in §627.4136, Fla. Stat., Plaintiff has no right of action against the insurer because there is no privity between Plaintiff and Defendant; nor does the policy contain a specific provision designating Plaintiff as a third-party beneficiary. As such, this Court finds that §627.4136 Fla. Stat., does apply to this cause of action and Plaintiff must satisfy the conditions precedent prior to attaining third-party beneficiary status.
Plaintiff further argues that even if the nonjoinder statute applied, there has been a settlement of Plaintiff’s claim. Again, Plaintiff’s argument must fail. Section 627.4136, Fla. Stat., specifically provides that any person who is not an insured will not have any interest in the policy prior to first obtaining a settlement or verdict against a person who is an insured under the terms of the policy. Plaintiff has never initiated any action against the insured in this matter. While USAA did make payments Plaintiff for the damage to his car, these payments were not a result of a settlement or a verdict against the insured. Therefore, because Plaintiff has not satisfied the conditions precedent of §627.4136, Fla. Stat., Plaintiff cannot maintain a direct action against Defendant.
This Court must note that even if it could somehow find that the nonjoinder statute did not apply to this cause of action, it would nevertheless have to agree with Defendant’s additional argument that Plaintiff has suffered no damages. Although the repair estimate originally called for a non-OEM bumper and bumper cover to be installed, an OEM bumper and bumper cover were actually installed. When Defendant learned of its error, it reimbursed Plaintiff the difference in value between the OEM and non-OEM parts. However, Plaintiff argues that he has damages because a non-OEM tail light was installed on his car. The undisputed facts reveal that the estimate prepared by Defendant did not specify that a non-OEM tail light be installed on Plaintiff’s car. In fact, there was no suggestion by Defendant’s independent appraiser that the tail light needed to be replaced. Furthermore, neither Plaintiff nor the repair shop ever requested Defendant to pay for an OEM tail light. No claim whatsoever has been made by Plaintiff for the Defendant to replace the non-OEM tail light with an OEM part. It was the repair shop which made a unilateral decision to install the non-OEM tail light, at no cost to Plaintiff, and without informing Plaintiff that such non-OEM part had been installed. In actuality, Plaintiff has no idea what parts were installed on his vehicle and whether they were OEM or non-OEM parts. The only knowledge of what work was done on his car and the alleged refusal to pay for OEM parts comes from the representative of the repair shop.2 As such, Plaintiff cannot show that he has suffered any damages with regard to the tail light.
Plaintiff further alleges that Defendant’s argument that Plaintiff’s claim has been paid in full and therefore he lacks standing to represent a class is the result of Defendant’s attempt to “pick off” the class plaintiff. Plaintiff argues that he has not been made whole because of the non-OEM part which was installed on his car. Again, this argument must be rejected as Defendant never required a non-OEM part to be installed; Plaintiff has never submitted a claim for this part so it cannot be said that Defendant has refused to pay for an OEM part; nor did Plaintiff incur any cost for this part.3 Since Plaintiff has not made a claim for payment or for a replacement of the tail light with an OEM part, because Defendant reimbursed the difference between the non-OEM parts that were listed in the estimate and the OEM parts which were installed on Plaintiff’s car, Plaintiff has no damages and therefore has no case or controversy with Defendant.
Plaintiff further argues that Defendant did not make its payment in the ordinary course of business the investigation of Plaintiff’s claim was handled by a senior USAA manager; Defendant consulted legal counsel prior to making the payment to Plaintiff; and approximately eleven months went by from the time that the complaint was filed until the time that Defendant made its payments. It is well settled that where a defendant, prior to class certification, recognizes billing errors and desires to correct them, it may do so. This is what happened in this case. No class had yet been certified when Defendant discovered its errors and made the payments to Plaintiff. Defendant did not seek any releases or otherwise interfere with the potential class action, but rather paid the difference in value between the non-OEM parts and the OEM parts.
Additionally, Plaintiff argues that Defendant has not stipulated to pay his attorney’s fees and an essential aspect of the cases in which class action defendants attempted to pay plaintiff’s claims after a suit was filed was the stipulation to pay attorney’s fees. This Court knows of no requirement that Defendant must stipulate to pay attorney’s fees when it make payments in an attempt to correct billing errors. Furthermore, Plaintiff did not plead any entitlement to attorney’s fees in the amended complaint. Stockman v. Downs, 573 So.2d 835 (Fla. 1991) (It is well settled that a claim for attorney’s fees whether based on contract or statute, must be plead and failure to do so waives the claim). Moreover, as Plaintiff did not plead any contractual right to attorney’s fees, and the only statutory basis for attorney’s fees which could have been pled, and which was pled in this action, was the claim under the Florida Deceptive and Unfair Trade Practices Act (FDUTPA), §501.2105, Fla. Stat., which was voluntarily dismissed, it does not appear that any basis for an entitlement to attorney’s fees exists.
Based on the foregoing, this Court finds that Defendant is entitled to summary judgment as a matter of law on Plaintiff’s complaint.
Accordingly, it is hereby
ORDERED AND ADJUDGED that Defendant’s Motion for Summary Judgment is GRANTED and Plaintiff’s Complaint is DISMISSED WITH PREJUDICE.
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1On October 17, 2000, this Court denied the Plaintiff’s Motion to serve as the representative of a nationwide class. To date, Plaintiff has not filed a motion to certify a statewide class.
2The Court must note that Plaintiff did not take his car to one of the repair shops recommended by Defendant, but rather to the repair shop that contacted Plaintiff and offered to fix his car. The representative of the repair shop was the one who told Plaintiff that Defendant was unwilling to pay for OEM parts, a statement which was never verified by Plaintiff with the Defendant. Additionally, the representative of the repair shop was the one who referred Plaintiff to an attorney for purposes of filing a lawsuit against Defendant. Prior to the initiation of this lawsuit, Plaintiff had not met the attorneys representing him in person, nor had he seen or approved the complaint filed.
3The Court must again note that aftermarket crash parts are specifically permitted under Florida statute, so long as there is adequate disclosure. §501.30, et seq., Fla. Stat.
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