21 Fla. L. Weekly Supp. 115a
Online Reference: FLWSUPP 2102GLOBInsurance — Personal injury protection — Coverage — Medical expenses — Reasonable, related and necessary treatment — Trial court did not err in declining to exclude adjuster’s deposition testimony as to amount insurer calculated for possible negotiation of bills as evidence of offer to compromise claim — Trial court erred, however, in deeming insurer’s establishment of reasonable settlement sum to be admission of amount of reasonable benefits owed
STATE FARM FIRE & CASUALTY COMPANY, Appellant, v. GLOBAL MEDICAL REHAB CENTER, Appellee. Circuit Court, 11th Judicial Circuit (Appellate) in and for Miami-Dade County. Case Nos. 10-328 AP, 10-329 AP, 10-330 AP. L.T. Case Nos. 06-654 SP 26, 06-655 SP 26, 06-656 SP 26. October 21, 2013. A Consolidated Appeal from Separate Final Summary Judgments by the County Court in and for Miami-Dade County. Counsel: Douglas Stein, Seipp & Flick LLP, for Appellant. Stuart B. Yanofsky, Stuart B. Yanofsky, P.A., for Appellee.
(Before KARLAN, CUETO, and MARIN, JJ.)
(PER CURIAM.) Global Medical Rehab Center provided medical services to Jazmin Johnston, her husband Dean Johnston and their daughter Kathryn Johnston. The need for medical services arose out of a July 8, 2005, auto accident. At the time of the accident, the Johnstons were covered by PIP insurance issued by State Farm. Global Medical, as the Johnstons’ assignee, submitted medical bills to State Farms for payment.
Subsequent to receipt of Global Medical’s bills, State Farm obtained peer reviews stating that some of the services and bills were not reasonable or related to the July 8, 2005, auto accident. State Farm refused to pay and Global Medical filed lawsuits as to each assignee. The three actions were treated as companion cases but not formally consolidated.1
In the course of discovery, Global Medical took the deposition of Ondina Pol, State Farm’s Claim Representative, on February 16, 2009. During the deposition, Pol stated that a State Farm adjuster had prepared “some numbers for a possible negotiation of the bills.” The State Farm adjuster further acknowledged that no settlement offer was ever communicated to Global Medical.
At trial, Global Medical established through Pol’s deposition testimony that a monetary figure had been determined and that the figure included only amounts and bills that State Farm considered reasonable, related and necessary. For reasons not relevant to this appeal, the trial ended in a mistrial. Subsequently, Global Medical filed a motion to deem the amount determined to be reasonable, related and necessary by State Farm ‘admissible evidence’ of the benefits owed. State Farm opposed the admissibility of such evidence on the grounds that “[e]vidence of an offer to compromise a claim. . . as well any relevant conduct or statements made in negotiations concerning a compromise is inadmissible.” § 90.408, Fla. Stat. The Court granted the motion stating:
[State Farm] determined and calculated an amount that it deemed to be reasonable, related and necessary, after having utilized its investigative tools in reaching a claims’ decision, and as such [State Farm] both under its policy of insurance and F.S. 627.735 is responsible of [sic] the payment of said amount to Plaintiff.
(R. 635.) Final Judgment was granted the same day and State Farm appeals all three claims.2 3
We Reverse.
Restating section 90.408, “[e]vidence of an offer to compromise a claim . . . as well any relevant conduct or statements made in negotiations concerning a compromise is inadmissible.” As a preliminary matter, this Court agrees with the trial court’s conclusion that the deposition evidence was not an offer to compromise a claim nor was it made in settlement negotiations.
Facially the trial court’s ruling concerned evidence and conclusions derived in the normal course of discovery.4 The deposition testimony of evidence of Ondina Pol was not revealed in “an offer to compromise a claim” because no offer to settle was made until after Pol’s deposition. Likewise, the admitted evidence was not alluded to or established “in negotiations concerning a compromise.” We simply cannot find support in the record for State Farm’s contention that the disputed evidence came through negotiations or an offer of settlement.
Whether or not the disputed evidence constituted part of a settlement was central to the arguments before the trial court. State Farm repeatedly argued to the trial court that “[t]his was a settlement discussion.” Because the argument was central below, the transcript unsurprisingly shows that the trial court faced this factual assertion directly and addressed it without equivocation:
The Court: “[The State Farm Adjuster] said, we come up with a number that is reasonable under the statute and the policy. She doesn’t say, I come up with the number I think the provider will take.
State Farm: No. She talked about settlement —
The Court: That’s not what she said.
(Emphasis Added).
However, while we agree that the trial court properly declined to exclude the testimony pursuant to section 90.408, we do not agree that such evidence is sufficient to establish the reasonableness, relatedness and necessity of treatment.5 Specifically, we find that trial court failed to recognize a real distinction between that which constitutes a “reasonable” settlement offer and that which represents a figure which is “reasonable, related and necessary” pursuant to PIP law.
[A]n insurer is not liable for any medical expense to the extent that it is not a reasonable charge for a particular service or if the service is not necessary. Derius v. Allstate Indem. Co., 723 So. 2d 271, 272 (Fla. 4th DCA 1998) [23 Fla. L. Weekly D1383a]. Any insurance payout or litigation involves multiple factors beyond the ‘reasonableness’ of any given medical expense. It is axiomatic that expected costs of litigation change with each new found fact. A ‘reasonable’ figure on which to begin negotiations might begin with an initial determination of the cost of reasonable, related and necessary medical expenses; it does not end there. As Odina Pol’s deposition states, the amounts established by State Farm “did not determine that it was owed, but simply that [the adjuster] suggested a figure that she could use to attempt to negotiate a full and final settlement.” Such, settlement offers consider (among other factors) the expected time and expense of litigation as well as the inability of any person to guarantee an argument will carry the day. A ‘reasonable’ settlement sum both incorporates and is broader than the ‘reasonable, related and necessary’ medical expenses of section 627.736. Therefore, we find that the trial court erred when it deemed the ‘reasonable’ settlement sum to be an admission of reasonableness pursuant to PIP law.
Separately, this Court finds that State Farm, having prevailed on appeal, is entitled to an award of appellate attorney’s fees contingent upon prevailing in the proceedings below. §768.79(3), Fla. Stat.; See also, United Auto v. Miami Neurology Rehab., 19 Fla. L. Weekly Supp. 799a (Fla. 11th Cir. Ct., June 19, 2012) (“Due to the posture of this case where this court is remanding this matter for further proceedings, Miami Neurology is not entitled to an award of appellate attorney’s fees. However, in the event Miami Neurology prevails on the merits of the proceeding on remand at the trial court level, this court grants a conditional appellate fee award, and directs the trial court to assess the appropriate amount contingent upon Miami Neurology ultimately prevailing.”)
Based upon the foregoing, we REVERSE and REMAND for proceedings consistent herewith.
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1Singular references to procedural and factual issues should be presumed to apply to the claims made on behalf of all three Johnstons.
2The Johnstons’ claims are consolidated for this appeal.
3After State Farm filed its initial brief, Global Medical sought and received multiple extensions of time. Thereafter, the Court ordered Global Medical to comply with the Appellate Rules or be sanctioned. When Global Medical failed to file an Answer brief, the Court granted State Farm’s motion to preclude Global Medical from filing an Answer brief and from participating in oral argument.
4Where a party admits to reasonableness outside and independent of settlement negotiations, we see no statutory basis for requiring opposing parties or the court to ignore such admissions.
5Regardless of how ‘reasonableness’ might come to be admitted, it does nothing to settle issues of necessity of treatment, whether treatment was related to a covered injury or whether claims were timely and properly filed.
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