15 Fla. L. Weekly Supp. 316a
Attorney’s fees — Insurance — Personal injury protection — Confession of judgment — Error to find that insurer confessed judgment by paying claims for dates of service not included in demand letter or in complaint
PROGRESSIVE EXPRESS INSURANCE COMPANY, Appellant, v. ASCLEPIUS MEDICAL INC. a/a/o TANIA SOTO, Appellee. Circuit Court, 11th Judicial Circuit (Appellate) in and for Miami-Dade County. Case No. 06-574 AP. L.C. Case No. 05-62 SP 26. Amended Opinion filed February 11, 2008. An Appeal from the County Court for Miami-Dade County, George A. Sarduy, Judge. Counsel: Marie E. Corredore and Maury L. Udell, for Appellant. Douglas H. Stein, for Appellee.
(Before GROSS, FREEMAN, AND KARLAN, JJ.)
(KARLAN, J.) This is an appeal from a Final Judgment granting a Motion to Tax Attorney’s Fees and Costs with Interest in favor of, Appellee/Asclepius Medical, Inc. a/a/o Tania Soto (“Provider”) against Appellant/Progressive Express Insurance Company (“Progressive”) in the amount of $374.11 plus interest. The final judgment is based on the trial court’s finding that Progressive confessed judgment in the case, when it remitted payment for medical services rendered from October 25, 2004 to December 17, 2004.
Medical services were provided to Ms. Soto between September 2, 2004 and October 21, 2004 for injuries suffered in an automobile accident. The Provider alleges that it submitted proper and timely bills to Progressive. Progressive paid a portion of the benefits after reducing what they believed to be allowable charges. The Provider also submitted bills to Progressive for services rendered to Ms. Soto for the period of October 25, 2004 through December 17, 2004. Progressive paid these bills on January 21, 2005 with the same type of reductions that were made in the payments on the earlier submitted bills.
The Provider sent Progressive a presuit demand letter on December 4, 2004 seeking payment for medical services rendered totaling $4,530.00. The letter seeks payment of medical services provided for “dates of service September 9, 2004”, and attached to the letter are two patient account ledgers for services rendered from September 9 to September 14, 2004 and October 4 to October 21, 2004. On January 5, 2005, the Provider filed its Complaint against Progressive, as the demanded amount remained unpaid.
Progressive filed an answer denying all relevant allegations and filed a first Motion for Summary Judgment regarding the lack of adequate notice as to the amount in dispute and a Second Motion for Summary Judgment on December 2, 2005, which argued additional technical violations of the notice statute. There is no record of a hearing or order on these Motions for Summary Judgment.
On February 22, 2006, the Provider filed a Motion to Tax Attorney’s Fees and Costs with Interest arguing that Progressive had confessed judgment, over a year earlier, on January 21, 2005, by paying the Provider $1807.05 on the invoices for services that were rendered from October 25, 2004 to December 17, 2004. The Provider made this argument despite the fact that Progressive had paid the same reduced amount in January, that it had paid for the first set of invoices, and for which the Provider had filed its lawsuit!
The trial court conducted a hearing on the Provider’s Motion to Tax Fees on May 16, 2006, and granted the Motion to Tax Fees on July 14, 2006. The trial court found, as a matter of law, that the Provider was entitled to attorney’s fees and costs as a result of Progressive’s confession of judgment. The trial court entered a Final Judgment in favor of the Provider for the sum of $374.11 plus interest on October 23, 2006.
The only issue raised on appeal is whether the trial court erred in finding that Progressive confessed judgment by paying bills submitted by the Provider for dates of service not included in the original complaint nor in the presuit demand letter. The issue before this Court is a question of law and thus, the standard of review is de novo. Volusia County v. Aberdeen at Ormond Beach, L.P., etc., 760 So. 2d 126, 131 (Fla. 2000).
Progressive argues that a confession of judgment only occurs where the insurer makes a payment on a disputed claim, after suit has been filed. Consequently, the payment of later submitted medical bills for dates of service other than those contained in the initial demand letter and complaint cannot be used to find the insurer has confessed judgment, since these later submitted bills are not in dispute.
The Provider argues that once the complaint is filed for overdue bills, payment of other overdue bills for the same type of treatment or services is a confession of judgment entitling the insured to reasonable attorney’s fees and costs. As noted by the Appellee in its brief, the presuit demand letter gives an insurer its last “safe harbor” before a suit is initiated for payment of overdue bills and avoid any possible exposure to attorney’s fees and costs. The initial question for this Court is whether a presuit demand letter regarding reduced payments and a Complaint for unpaid medical bills for those same dates is sufficient to put the Defendant/Appellant on notice of additional claims not included in the complaint. We say the answer is no.
In the case sub judice, it is undisputed that Progressive reduced the amount paid on the medical bills for dates of service, September 9, 2004 to October 29, 2004. In response to this reduction, the Provider, pursuant to § 627.736(11), Fla. Stat. (2003), sent Progressive a presuit demand letter. Section 627.736(11)(a) requires, as a condition precedent to the filing of a lawsuit for overdue benefits, that an insured provide the insurer with a demand letter stating the name of the insured, the claim number or policy number, and “an itemized statement specifying each exact amount, the date of treatment, service, or accommodation, and the type of benefit claimed due.” §627.736(11), Fla. Stat. (2003). If the insurer pays the amount due with interest and the 10 percent penalty within seven (7) days of receipt of notice, the insured may not bring an action for nonpayment or late payment. The section further provides that a demand letter may not be sent until the claim is overdue.
The Appellee’s argument rests upon this Court accepting its argument that once a demand letter has been sent and the insurer fails to respond and a complaint is filed, any subsequent overdue bills automatically become a part of the complaint without the need for amendment of the complaint to include these subsequent overdue bills. If this Court accepts the Appellee’s argument, the trial court’s grant of a confession of judgment for Progressive’s partial payment of the bills remitted for services rendered from October 25, 2004 through December 21, 2004 would require an affirmance of the lower court’s ruling.
The Provider’s argument that any payment made by an insurer, after the provider files a lawsuit — even when treatment is not completed and/or some of the charges are not overdue — should automatically be seen as a confession of judgment entitling it to attorney fees, pursuant to § 627.428, would infringe upon the purpose of the statute, since an insurer would no longer make payment for these later charges until the lawsuit was finally decided, out of fear that a timely payment would result in a confession of judgment. We reject this argument by the Provider.
In Wollard v. Lloyd’s and Companies of Lloyd’s, 439 So. 2d 217, 218 (Fla. 1983), the Florida Supreme Court held that an insurance company that settles a disputed case “has, in effect, declined to defend its position in the pending suit. Thus, the payment of the claim is, indeed, the functional equivalent of a confession of judgment or a verdict in favor of the insured.”
This Court finds that the failure of the Provider to amend its complaint to include the dates of service from October 25, 2004 to December 17, 2004 prevented the trial court from even considering a confession of judgment as these invoices were not properly before the trial court. The Provider had well over a year to amend its complaint, and instead, chose to prolong the litigation and wait over a year to seek a confession of judgment based upon its belief that the January 21, 2005 payment was a confession of judgment.
It is the facts alleged in the pleadings and the proof in an action that are used to determine the nature of the relief to be granted. Chasin v. Richey, 91 So. 2d 811, 812 (Fla. 1957). Thus, where a defendant is placed on proper notice by the allegations in the body of the complaint concerning the amount claimed, he cannot later complain of an excessive award. Id. However, relief should not be granted beyond the scope of the allegations and prayer for relief contained in the complaint. Id.
In this case, the Provider chose to bring an action based upon a statutorily required presuit demand letter for only the dates of service, September 9, 2004 to October 21, 2004. Progressive was only on notice for the September 9, 2004 to October 21, 2004 reduction, and consequently the trial court committed reversible error when it found that Progressive had confessed judgment by its payment for medical services rendered from October 25, 2004 to December 17, 2004.
Reversed and remanded. (GROSS and FREEMAN, JJ., Concur.)
