15 Fla. L. Weekly Supp. 570a
Insurance — Personal injury protection — Application — Misrepresentations — Refund of premiums — Trial court erred in directing verdict in favor of medical provider where insured’s testimony as to whether he received refund check was inconsistent, and insurer presented copy of refund check and testimony that check was mailed in normal course of business — Further, court erred as matter of law in taking rescission issue away from jury based on belief that misrepresentation did not impose additional risk on insurer where uncontroverted testimony established that policy’s premium rate would have been 15% higher had there been no misrepresentation
CERT. DENIED at 34 Fla. L. Weekly 335c
AFFIRMATIVE INSURANCE COMPANY, Appellant, v. AMERICAN HEALTH & REHABILITATION CENTER a/a/o Verilus Toutoute, Appellee. Circuit Court, 11th Judicial Circuit (Appellate) in and for Miami-Dade County. Case Nos. 07-136 AP, 07-199 AP. L.C. Case No. 05-0666 SP (23). March 31, 2008. An appeal from the County Court for Miami-Dade County, C. Schwartz, J. Counsel: Jeffrey Rubinton, Rubinton & Laufer, LLC, for Appellant. Mark L. Rosen, Lubell & Rosen, LLC, for Appellee.
(Before ROSINEK, SOTO, and THORNTON, JJ.)
[Original Opinion at 15 Fla. L. Weekly Supp. 311a]
(THORNTON, Judge.) This court withdraws its January 22, 2008 opinion and submits this revised opinion.
This is an appeal from an order granting a directed verdict in favor of the Appellee, American Health & Rehabilitation Center (“American”), a/a/o Verilus Toutoute (“Toutoute”), and against Appellant, Affirmative Insurance Company (“Affirmative”). We reverse.
The insured, Toutoute, and his two sons were injured in a motor vehicle accident and sustained injuries which required medical treatment. Toutoute was the driver and his two sons were passengers in the vehicle. Upon seeking medical treatment, Toutoute and his two sons assigned to American their rights to receive payment for their medical bills. American submitted the medical bills for payment to Affirmative. Payment was denied.
Affirmative’s insurance underwriting guidelines and contract mandate that all household residents must be disclosed on the insurance application. After the accident, but before this lawsuit was instituted, Affirmative discovered that Toutoute, in his application, had failed to list his two sons as household residents. Affirmative’s refusal to pay American for medical services rendered to Toutoute and his two sons was based upon Toutoute’s alleged misrepresentation. Affirmative notified Toutoute by certified letter that it was voiding the policy from its inception. Affirmative stated that a refund check (for policy premiums) would be sent under separate cover. American thereafter filed suit against Affirmative for failure to pay Personal Injury Protection [“PIP”] benefits under §627.736(4)(b) Fla. Stat. (2005).
The case proceeded to trial by jury. Affirmative defended on the basis that Toutoute’s failure to list his two sons was a material misrepresentation, voiding the policy not only for the sons’ medical bills, but for Toutoute’s own medical bills as well. At the conclusion of the evidence, the trial court submitted to the jury American’s claim for the sons’ medical bills.1 As to the claim for Toutoute’s medical bills, American moved for a directed verdict, arguing that the misrepresentation did not impose upon Affirmative any additional risk with respect to Toutoute himself. American also argued that Affirmative failed to return Toutoute’s premium after the policy was voided. In response, Affirmative stated that the motion for directed verdict should be denied, arguing that Toutoute’s failure to list his two sons voided the entire policy from inception.2 Affirmative also argued that it had in fact timely mailed the refund check to Toutoute. The trial court entered a directed verdict in favor of American based in part on United Automobile Insurance Company v. Miami Chiropractic Associates, 14 Fla. L. Weekly Supp. 16a (Fla. 11th Cir. Ct. Nov. 17, 2006)3 and Martinez v. General Insurance Company, 483 So. 2d 892 (Fla. 3d DCA 1986). Affirmative appeals the trial court’s entry of a directed verdict in favor of American.4
A lower court’s directed verdict is reviewed de novo. Plotch v. Gregory, 463 So. 2d 432, 435 (Fla. 4th DCA 1985). The directed verdict should be affirmed if, viewing the evidence in the light most favorable to the non-moving party, it appears that no reasonable trier of fact could have reasonably differed as to the establishment of material facts. Id. Additionally, the trial judge must have also made the correct decision as a matter of law.5 Ligman v. Tardiff, 466 So. 2d 1125 (Fla. 3d DCA 1985); McDonald v. McGowan, 402 So. 2d 1197 (Fla. 5th DCA 1981).
We first discuss whether the trier of fact could have reasonably differed as to the establishment of material facts. When a policy is rescinded, coverage may be barred as to the insured as well as to the precluded household residents. Penaranda v. Progressive American Insurance, 747 So. 2d 953 (Fla. 2d DCA 1999); Progressive American Ins. Co. v. Papasodero, 587 So. 2d 500 (Fla. 2d DCA 1991). However, as American correctly argues, even if a material misrepresentation exists, an insurance company is required to refund the entire premium to the insured as a prerequisite to deeming the policy void. Florida caselaw is clear that where an insurance company seeks to rescind a voidable policy, it must give notice of rescission and it must return or tender all premiums paid within a reasonable time after discovery of the grounds for voiding the policy. Gonzalez v. Eagle Insurance Company, 948 So. 2d 1, 3 (Fla. 3d DCA 2006).
It is not disputed that Affirmative gave timely certified notice of rescission. Whether Affirmative returned or tendered the premium to Toutoute within a reasonable time, however, is a material fact which is in dispute. On direct examination, Toutoute testified that he did not recall receipt of a check from Affirmative. Upon cross-examination, he was asked if he recalled receiving money from the insurance company and he responded, “The money came through my lawyer, I received money that my lawyer gave me.” When asked again whether he recalled receipt of money from the insurance company, he stated, “I don’t remember what they showed me, I don’t remember.”
Affirmative then presented the insured with his deposition testimony where he stated that he had received money from Affirmative. In response thereto he stated, “I said I didn’t remember that check. That is what I said.”
The Vice President of Affirmative testified that the company’s policy is to mail a refund check to the insured when it cancels a policy. However, she did not have personal knowledge that the refund check in this case was mailed to the insured. Affirmative did not present any evidence that the insured received the refund check (i.e., a copy of the canceled check or a signed acknowledgement of receipt of the check), but did enter a copy of the alleged refund check into evidence.
A trier of fact could reasonably differ as to whether the refund of the insurance premium was tendered by Affirmative or received by Toutoute. The trial court was presented with the insured’s inconsistent testimony about whether he received a refund check versus Affirmative’s testimony that the check was mailed in the normal course, coupled with its presentation of their copy of a refund check.6 Despite these disputed facts, the trial court entered a directed verdict in favor of American, which presupposes a finding that Affirmative did not tender the refund check within a reasonable time.
Under Florida law, “when the evidence is conflicting, or will admit of different reasonable inferences, it should be submitted to the jury as a question of fact and not taken from them and passed on by the judge as a question of law.” Weygant v. Fort Meyers, 609 So. 2d 714 (Fla. 2d DCA 1992). Based on the disputed testimony surrounding the tendering of the refund check, we believe the trial court should have submitted this issue of material fact to the jury, as a reasonable trier of fact could have differed as to its establishment.
Concerning whether the trial court made the correct decision as a matter of law, we note that the trial court entered a directed verdict in favor of American because it believed that the misrepresentation did not impose any additional risk on Affirmative. A review of the trial transcript indicates that Affirmative’s Vice-President testified that the policy’s premium rate would have increased by fifteen percent had there been no misrepresentation (i.e., had the two sons been listed on the policy application). This testimony was uncontroverted. The misrepresentation was material. Therefore, the Court below erred as a matter of law in taking the rescission issue away from the jury when, under Section 627.409(1)(b), Florida Statutes, the policy would not have been issued at the same premium rate.
FOR THESE REASONS, the order granting a directed verdict in favor of the Appellee is REVERSED. Consequently, we also reverse the lower court’s order awarding American’s attorney’s fees and costs. This cause is REMANDED to the trial court for further proceedings consistent with this opinion. (ROSINEK AND SOTO, JJ., concur.)
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1The jury found in favor of Affirmative on American’s claim for the two sons’ medical bills, finding that Toutoute’s failure to include their names in the insurance application was a material misrepresentation.
2According to trial testimony from Affirmative’s Vice-President, the inclusion of the two sons in the policy would have increased the policy premium by fifteen percent (15%).
3Two months after the trial court granted a directed verdict in the instant case, the above-cited opinion was withdrawn, and a substituted opinion was filed. See United Automobile Insurance Company v. Miami Chiropractic Associates, 14 Fla. L. Weekly Supp. 360b (Fla. 11th Cir. Ct. Feb. 17, 2007).
4American has not cross-appealed the jury’s verdict barring their recovery for the sons’ medical bills.
5See also Philip J. Padovano, Florida Appellate Practice, Vol. 2, §9.4, p. 164 (2006 ed., West 2005).
6It is interesting to note, though not dispositive, that, as to the two sons, the jury specifically found that Affirmative “tendered the premiums to Toutoute within a reasonable amount of time.”
