13 Fla. L. Weekly Supp. 1113a
Insurance — Personal injury protection — Application — Misrepresentations — Where insurer failed to effectively rescind and cancel policy by returning all pertinent premiums paid on policy within reasonable time, insurer waived right to assert material misrepresentation defense — Declaratory judgment — Insurer’s obligation to provide policy, declarations page and/or PIP log on presuit request from medical provider/assignee — Summary judgment entered against insurer that failed to provide policy information requested by provider prior to suit
SUNNY MEDICAL, PL, as assignee of Jacqueline DeLarosa, Plaintiff, vs. UNITED AUTOMOBILE INSURANCE COMPANY, Defendant. County Court, 18th Judicial Circuit in and for Seminole County. Case No. 03-SC-5078. March 31, 2006. John R. Sloop, Judge. Counsel: Richard Oliver Hale, IV, Orlando. Sean Amorginos, Luks, Santaniello, et al., The Citrus Center, Orlando.
ORDER ON PLAINTIFF’S and DEFENDANT’S MOTIONS FOR FINAL SUMMARY JUDGMENT AS TO COUNT I and PLAINTIFF’S MOTION FOR FINAL SUMMARY JUDGMENT AS TO COUNT II OF COMPLAINT
THIS MATTER having come before this Court on Plaintiff’s and Defendant’s Motions for Final Summary Judgment as to Count I and Plaintiff’s Motions for Final Summary Judgment as to Count II of its Complaint and this Court having heard arguments of counsel and being otherwise fully advised in the premises, finds as follows:
Facts
1. It remains undisputed that Jacqueline DeLarosa is a covered driver under a policy of insurance, issued by the Defendant, that was in full force and effect at the time of her motor vehicle accident on April 25, 2003.
2. Plaintiff accepted and Defendant acknowledged the Insured executed an assignment of benefits to Plaintiff under the insurance policy issued by Defendant to Plaintiff within the meaning of Florida Statute Section 627.736(5). Plaintiff gave notice of covered losses and made demand for PIP benefits and medical payments for reasonable, necessary and related medical, rehabilitative and remedial treatment.
3. Following the inception of treatment by the Plaintiff/Provider, the Defendant conducted an Independent Medical Examination and subsequently terminated the PIP benefits available to Jacqueline DeLarosa. The termination of said benefits sparked the filing of this lawsuit.
4. Whereupon, the Defendant filed a two-count Complaint, claiming breach of contract and seeking declaratory relief.
5. On or about June 13, 2005, this Honorable Court allowed the Defendant leave to amend its affirmative defenses. At the present time, only two affirmative defenses continue to exist.
6. The Defendant’s First Affirmative Defense is that the Plaintiff is not entitled to the documents sought in its claim for declaratory relief.
7. The Second Affirmative Defense is that Jacqueline DeLarosa committed a material misrepresentation which precludes coverage for the above-referenced motor vehicle accident.
8. The record evidence before this Court fails to establish that the Defendant properly rescinded the insurance policy of Jacqueline DeLarosa.
9. The record evidence before this Court supports that the Defendant failed to provide the documents requested by the Plaintiff prior to the filing of this lawsuit, including a copy of the patient’s policy, declarations page and/or PIP log.
10. Summary Judgment is appropriate where 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 a judgment as a matter of law.
Analysis
Defendant has asserted as an affirmative defense the proper denial of a claim, and has alleged Ms. DeLarosa mis-represented information in the original application for the subject insurance policy which, if known by the Defendant would have caused the Defendant to not issue said policy or, to issue it under different terms or at a different premium, to wit: that Ms. DeLarosa’s fifteen year old son, who was not involved in the subject accident and has made no claim for benefits, was not identified on the application for the subject insurance policy. Despite the foregoing, the Defendant has failed to return all or any part of unearned premiums paid by Ms. DeLarosa or anyone on her behalf for the period covering the automobile crash which caused her injuries, as required by Florida Statute §§ 627.7282(1)(c). The Defendant failed to effectively rescind and cancel said policy by returning all pertinent premiums paid on the policy within a reasonable time, a condition precedent under the “material misrepresentation” affirmative defense and, therefore, under Leonardo v. State Farm Fire and Casualty Company, 675 So.2d 176 (Fla. 4DCA 1996), and Bankers Insurance Company v.General No-Fault Insurance, Inc., 814 So.2d 1119 (Fla. 4DCA 2002), Defendant has waived the right to assert this defense.
Under Florida law, the elements of waiver are: (1) the existence of a right, privilege or benefit that may be waived, (2) the actual or constructive knowledge of the right, and (3) the intention to relinquish the right. The failure to return the premiums to the insured in a timely manner is a relinquishment of the right to assert the defense of material misrepresentation. See Leonardo, Bankers Insurance Company. In Bankers, the summary judgment in favor of insured was upheld where carrier did not return the premium for the period “the insurance was ostensibly in effect as a result of the alleged misrepresentation,” but only for the subsequent policy periods, and returned premium to the premium finance company instead of directly to the insured. Bankers at 1119. In Leonardo, where the material misrepresentation was discovered in May and the premium was not returned until November of the same year, the appellate court ruled the six month delay was clearly unreasonable. In the case at bar, the Defendant failed to return any portion of the insured’s premium in its entirety and had no basis for rescission in the first instance in that there was no misrepresentation on the application for the subject insurance policy as a matter of law. Plaintiff is entitled to Summary Judgment and the Defendant is estopped from using its ‘material misrepresentation’ affirmative defense for having waived said affirmative defense by its failure to properly rescind the policy by the timely return of all applicable premiums.
The court is well aware of the multitude of complex issues involving PIP. Exhaustion of benefits and priority of payments continue to be a source of much confusion. A plaintiff must be vigilant in ascertaining whether a deductible truly applies; whether it has been correctly applied to the bills in the order in which they were received; where its claims rest in relation to other claims submitted; whether benefits remain, and, if so, what bills have been submitted that are entitled to payment.
The nature of litigation in this area is such that a Plaintiff may well end up spinning its wheels needlessly if benefits have in fact been paid out properly and in full. In short, the only method of obtaining a verifiable objective answer to these issues is to obtain what claims have been made, when these claims were received, the payment (amount) or denial of each claim, the amount of deductible and the claims applied thereto, the declarations page and a copy of the policy in effect. By requesting this information pre-suit, the Plaintiff is attempting to assess whether the filing of a lawsuit is warranted.
In this case, the Plaintiff waited for policy information before resorting to filing suit. The Defendant clearly had the ability to provide this information and simply chose not to do it. Sometimes, unfortunately, information relayed by adjusters pre-suit has turned out to be incorrect once suit has been filed. This can be determined pre-suit if Plaintiff can determine whether the bills were in fact subject to a deductible; whether benefits have in fact been exhausted; and the policy is needed to review the actual language that determines, with respect to out of state coverages, whether the policy contains language that would afford coverage in the state of Florida.
Recently, the 18th Judicial Circuit sitting in its Appellate capacity, reversed the trial court’s order dismissing a Plaintiff’s claim for declaratory relief. Louis Curren, Sr. vs. Progressive Express Insurance Company, 11 Fla. L. Weekly Supp 1053a, 8th Judicial Circuit (Appellate), 2004. Clearly, the cause of action exists and the Defendant’s failure to comply with pre-suit requests exposes it to judgment and fees if litigation is initiated. More importantly, the Circuit Court recently found that a claim for declaratory relief is proper. New Hampshire Indemnity Insurance Company v. Rural Metro Ambulance a/a/o William Zaniboni, 04-72-AP (En banc, November 18, 2005). Further, the Defendant’s failure to provide the requested documents pre-suit, necessitated the filing of this lawsuit and subjects the Defendant to attorney’s fees and costs for failing to satisfy its obligation.
Whereby it is ORDERED AND ADJUDGED that:
1. Plaintiff’s Motion for Final Summary Judgment as to Count I of its Complaint is HEREBY GRANTED.
2. Plaintiff’s Motion for Final Summary Judgment as to Count II of its Complaint is HEREBY GRANTED.
3. Defendant’s Motion for Summary Judgment as to Count I of the Complaint is HEREBY DENIED.
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