14 Fla. L. Weekly Supp. 23a
Attorney’s fees — Insurance — Personal injury protection — Justiciable issues — Appeal of order vacating order that awarded section 57.105 fees to insurer upon finding that medical provider that filed suit two years after it had been notified that benefits were exhausted knew or should have known prior to filing suit that it did not have ripe, viable cause of action — Abuse of discretion for successor judge to vacate predecessor’s order awarding fees, based on desire for uniformity with alleged companion case, where provider demonstrated complete disregard for court’s controlling precedent regarding exhaustion of benefits, there was no merit to contention that insurer waived exhaustion of benefits defense by raising defense in motion for summary judgment without having filed answer, and predecessor judge’s finding that provider knew or should have known that claim was not supported by material facts or application of law was made in judgment that was not appealed and, therefore, is law of case
PROGRESSIVE EXPRESS INS. CO., Appellant, vs. PHYSICAL THERAPY WALK-IN CLINIC, (a/a/o Maria Altaf), Appellee. Circuit Court, 13th Judicial Circuit (Appellate) for Hillsborough County. Case No. 06-232, Division X. L.C. Case No. 02-19401-SC. September 26, 2006. An appeal of a decision of the County Court, Hillsborough County. The Hon. Daniel Gallagher presiding. Counsel: Valeria Hendricks, Davis & Harmon, P.A., Tampa, for Appellant. V. Rand Saltsgaver, Orlando; Timothy A. Patrick, Tampa, for Appellee.
[Editor’s note: Lower court order published at 13 Fla. L. Weekly Supp. 400a]
(JAMES D. ARNOLD, J.) Appellant Progressive Express Insurance Company appeals the decision of the trial court vacating its judgment awarding §57.105 fees in Progressive’s favor. Fees were originally awarded because Appellee Physical Therapy Walk-in Clinic (the provider) filed suit more than two years after Progressive notified it that benefits were exhausted. We agree that the decision of the trial court to vacate the award of §57.105 fees should be reversed. The somewhat involved factual history follows.
On July 24, 2000, Progressive notified provider Physical Therapy Walk-In Clinic that insurance benefits for its insured, Maria Altaf, had been exhausted. Without notifying Progressive that it disputed the payments made on Ms. Altaf’s behalf, more than two years later, on August 20, 2002, the provider sued Progressive. On April 7, 2003, Progressive moved for summary judgment, citing exhaustion of benefits. On October 27, 2003, the trial court held a hearing on the motion for summary judgment, and on January 23, 2004, Judge Huey entered an order granting the motion for final summary judgment in Progressive’s favor. The order stated that “the clinic knew or should have known prior to filing suit that it did not then and does not now have a ripe, viable cause of action.” The provider filed a motion for rehearing, which the trial court denied six months later on June 9, 2004.
On July 26, 2004, Judge Sisco, a successor judge, entered final judgment, which reserved jurisdiction to determine entitlement to §57.105 fees, in Progressive’s favor. The provider did not appeal the final judgment. On August 25, 2004, Progressive filed a motion for attorney’s fees pursuant to §57.105(1)(a), (b), Florida Statutes. In its response to the motion for attorney’s fees, the provider re-argued the merits of the summary judgment, and claimed that the trial court previously denied fees in a “companion” case, hereinafter referred to as the Burgos case. Burgos was not, in fact, a companion case.1
By the time the amount of fees could be litigated, a third judge was on the case. On November 4, 2004, Judge Gallagher entered an order granting entitlement to §57.105 fees, again finding that “the provider knew or should have known that its lawsuit was not supported by material facts necessary to establish the claim, nor was it supported by application of existing law to the facts,” and that the cases the provider relied upon were based upon “a different version of §57.105, which required a complete absence of justiciable issue of either law or fact.” [Editor’s note: see 12 Fla. L. Weekly supp. 158a] Not unexpectedly, the provider filed a motion for rehearing of the fees decision on November 15, 2004. On January 18, 2005, Progressive filed another motion seeking sanctions pursuant to §57.105, this time on the ground that the provider’s motion for rehearing lacked any legal or factual foundation; it was simply another attempt to re-argue matters raised — and rejected — in three prior hearings.
On February 15, 2005, Judge Gallagher denied the provider’s motion for rehearing and held a fee hearing to determine the amount of fees due for all the legal activity up to that time. At its conclusion the trial court announced an award §57.105 fees against the provider and its attorney for filing the claim after benefits had been exhausted, as well as additional fees for the rehearing. This order setting forth the amount of fees was never reduced to writing.
Five months later on August 2, 2005, Judge Gallagher held a hearing on the provider’s objection to Progressive’s proposed order from the February 15th hearing. The objection was not filed in the record, but on August 9, 2005, the trial court entered an order directing the provider to file a proposed order within 20 days. The provider never did so.
On November 9, 2005, Judge Gallagher sent to the parties a letter indicating that he was receding from his previous decision to grant sanctions. He stated he misunderstood Judge Sisco’s ruling in the Burgos case as having been based upon a previous version of §57.105. He also stated that the law was ambiguous, but did not give specifics. On November 10, 2005, he entered an order granting motion for rehearing for “uniformity purposes,” among other unstated reasons.2
On November 22, 2005, Progressive filed a motion for reconsideration, arguing that Judge Gallagher, as a successor judge, ignored Judge Huey’s factual finding in his January 23, 2004 order that the provider knew or should have known it had no claim prior to filing suit. Also, the trial court erred in reviewing the alleged “companion” case, which was not in the record before the court. Finally, Progressive argued that it was error to consider the provider’s motions for rehearing because they merely reargued issues that the court had already rejected. This failed, and on December 20, 2005, Judge Gallagher vacated his November 4, 2004 order granting entitlement to fees.
Generally, orders determining attorney’s fees pursuant to §57.105, Florida Statutes (2002) are reviewed for abuse of discretion. See Peyton v. Horner, 920 So.2d 180 (Fla. 2d DCA 2006). However, where the trial court committed errors of law in reaching its decision not to award attorney’s fees, those errors are reviewed de novo. See, e.g., Gaston v. Department of Revenue, 742 So.2d 517 (Fla. 1st DCA 1999) (reversing trial court’s refusal to award statutory attorney’s fees that was based on erroneous conclusion of law).
Progressive contends that the trial court abused its discretion in vacating the finding of entitlement to fees, and erred as a matter of law in considering the record in the Burgos case when deciding whether to do so. Because the trial court’s order vacating its award of attorney’s fees was based solely upon its desire for “uniformity” and not because the facts and law supported the provider’s claim when filed, Progressive contends that there is no competent substantial evidence to support vacating the order. Progressive asks this Court to reverse the December 20, 2005 order vacating the fees award, require the trial court to reinstate its November 4, 2004 orders, and require the trial court to reduce to writing its oral determinations as to the amount of the original award the additional sanctions for the provider’s frivolous motion for rehearing.3
The provider argues that the trial court did not abuse its discretion when it denied §57.105 fees to Progressive, claiming that even if this Court disagrees with the reasoning or ruling below, this does not justify reversal, citing Castlewood v. Lafleur, 322 So.2d 520 (Fla. 1975), which is inapplicable to the instant case. The provider’s argument that, as an assignee, it had priority over other claims, and that Progressive should have reserved the remaining balance of the claim even though the provider failed to notify Progressive that it disputed the payment is similarly without merit. Not only does this argument ascribe the powers of ‘mind reading’ upon Progressive, but the Fourth District Court of Appeal squarely rejected this argument last year in Simon v. Progressive Express Ins. Co., 904 So.2d 449 (Fla. 4th DCA 2005). This Court has also rejected this notion. Francisco Gomez, M.D. (a/a/o Noemia Brunet) v. Progressive Express Ins. Co., 12 Fla. L. Weekly Supp. 121b (Fla. 13th Jud. Cir. Oct. 20, 2004).
The provider also claims that case lawsupports its claims for statutory interest and penalties on the reduced payments; however, it did not raise this issue below, and the issue is not preserved for appeal. Nor did it argue any basis to modify existing law in this circuit. Instead, the record is clear that the provider and its trial counsel raised a claim that this Court had squarely rejected long before the provider filed this suit. See MTM Diagnostic, Inc. v. State Farm Mutual Automobile Insurance Co., 9 Fla. L. Weekly Supp. 581e (Fla. 13th Jud. Cir. Nov. 20, 2000).
Furthermore, we are not persuaded by the provider’s contention that Progressive waived the exhaustion of benefits defense because it failed to raise it in a responsive pleading. Progressive raised the issue in a motion for summary judgment without having filed an answer. This is permissible. Florida Rule of Civil Procedure 1.510(b) states that a defendant may file a motion for summary judgment at any time and judicial authority recognizes that a defendant may seek summary judgment prior to filing an answer. See Coral Ridge Properties, Inc. v. Playa Del Mar Ass’n, Inc., 505 So. 2d 414 (Fla. 1987).
The trial judge’s letter to the parties, in which he indicates his intent to vacate the order awarding fees, does, as Progressive asserts, suggest frustration with this case. While we are sympathetic to the trial judge’s desire to dispose of the case, §57.105, Florida Statutes, provides that a court shall award feeswhen it finds that the losing party or attorney know or should have known that a claim or defense when initially presented to the court or at anytime before trial was a) not supported by the material facts necessary to establish the claim; or b) would not be supported by the application of then-existing law to those material facts. These findings were made on January 20, 2004, and in the final judgment entered July 26, 2004. The judgment wasnot appealed; therefore, it is the law of the case.
Thus, the trial court abused its discretion when it vacated the order awarding fees. See In re Forfeiture of 1997 Jeep Cherokee, 898 So.2d 223 (Fla. 2d DCA 2005) ([m]otorist was entitled to an award of attorney fees following city’s dismissal of forfeiture action against her; if city had simply reviewed the traffic records before filing its complaint, it would have known that its claim against motorist was unsupported by the material facts); Gahn v. Holiday Property Bond, Ltd., 826 So.2d 423 (Fla. 2d DCA 2002) (where Appellees’ objection to personal jurisdiction was supported neither by material facts nor by the application of existing law, the court abused its discretion in denying Appellants’ motion for fees and costs).
Progressive asserts that the provider demonstrated complete disregard for this Court’s controlling authority and lack of candor to the trial court. That is evident. This circuit’s November, 2000 decision in MTM Diagnostic, Inc. v. State Farm Mutual Automobile Insurance Co., 9 Fla. L. Weekly Supp. 581e (Fla. 13th Jud. Cir. Nov. 20, 2000), relating to exhaustion of benefits, was well-established prior to the provider’s filing suit in August 2002. The provider’s trial counsel was appellate counsel in at least two cases which are precedent to the instant case. Physical Medicine Center v. Progressive Express Ins. Co., 12 Fla. L. Weekly Supp. 210c (Fla. 13th Jud. Cir. Nov. 14, 2004); Francisco Gomez, M.D., P.A. v. Progressive Express Ins. Co., 12 Fla. L. Weekly Supp. 121b (Fla. 13th Jud. Cir. Oct. 20, 2004). These cases demonstrate that this Court has been faithful to its controlling precedent in MTM Diagnostic, which held that a PIP insurer has no further obligation to the assignee of an insured once PIP benefits are exhausted. See also Dicarlo & Assoc. v. American Home Assurance Co., 11 Fla. L. Weekly Supp. 305 (Fla. 13th Jud. Cir. Jan. 20, 2004). Accord Simon v. Progressive Express Ins. Co., 904 So. 2d 449 (Fla. 4th DCA 2005) (holding insurer has no duty to “reserve” or “hold” benefits for reduced or denied claim, absent contention made that denial or reduction of claim was in bad faith, or that insurer had manipulated, or acted improperly, in reducing claim). Here, the provider has made no showing of any misconduct on the part of the insurer. Case law the provider relies upon, exemplified by Bennett v. State Farm, 580 So. 2d217 (Fla. 2d DCA 1991), is factually distinguishable on that basis and is consistent with Simon v. Progressive, cited above.
Considering the facts before us, we can think of few cases more deserving of an award of §57.105 fees than this one. It is therefore
ORDERED that the decision of the trial court vacating its order granting §57.105 fees be REVERSED and the cause REMANDED for further proceedings. At those proceedings, the trial court is directed to re-instate its order granting §57.105 fees for the underlying action and rehearing and reduce the order to writing. It is further ORDERED that the court conduct further proceedings with respect to additional fees,if any, that may be due.
Additionally, Progressive’s motion for appellate attorney’s fees pursuant to §57.105 is GRANTED. The amount of those fees shall be determined by the trial court. (PENDINO and HOLDER, JJ., Concur.)
__________________
1The parties were the same; this can be said for a number of cases. However the assignors and incidents were unrelated.
2There was no motion for rehearing before the court. Instead, there was an objection to the proposed order asto the amount of fees. It was this objection that brought the matter back before the court.
3Recall that this order was never reduced to writing because the clinic objected to Progressive’s proposed order, and the clinic failed to submit an order to the court when asked to do so. It was at this point, that the case unraveled.
