23 Fla. L. Weekly Supp. 465b
Online Reference: FLWSUPP 2305MARTInsurance — Automobile — Windshield repair — Repair shop’s complaint alleging breach of contract for failure to pay reasonably priced bill must plead terms of policy insurer breached and how it breached them — There is no cause of action for failure to pay benefits within reasonable time — Insured or assignee who believes insurer is failing to pay claim pursuant to policy has option either to file breach of contract complaint or to file civil remedy notice pursuant to section 624.155 and, if insurer does not resolve claim within 60 days, file both breach of contract action and action for additional damages under section 624.155 — Complaint dismissed without prejudice
EPIC AUTO GLASS LLC., as assignee of/for JOSE DAVID MARTINEZ, Plaintiff, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant. County Court, 6th Judicial Circuit in and for Pinellas County. Case No. 15-1437-SC. September 1, 2015. Kathleen T. Hessinger, Judge. Counsel: Marc B. Nussbaum, St. Petersburg, for Plaintiff. Brendan James McKay, Banker Lopez Gassler, St. Petersburg, for Defendant.
ORDER DISMISSING PLAINTIFF’S COMPLAINTWITH LEAVE TO AMEND
This Cause came to be heard before this Court on Defendant’s Motion to Dismiss with the Parties present, through counsel, and this Court having heard argument, and reviewed the pleadings and law and being otherwise advised of the premises, it is hereby Ordered and Adjudged as follows,
1. This is a windshield loss case, wherein Plaintiff replaces windshields on automobiles. Plaintiff replaced the windshield on the Defendant’s insured’s automobile, took an assignment of benefits and made a claim against the insured’s auto insurance company. On December 17, 2014, Plaintiff replaced the windshield and, sometime thereafter, made its claim to Defendant. Plaintiff filed its complaint against Defendant, on February 11, 2015, in small claims court and the Parties agreed to invoke the civil rules, thereafter.
2. Plaintiff filed a one count complaint alleging, in pertinent part, that
. . .11. Plaintiff submitted a reasonably priced bill to Defendant and has not been paid. This is an action for Defendant’s failure to pay full value for the benefits described above within thirty (30) days or as required under the assignee’s policy of insurance.
12. This is an action for breach of contract with damages, exclusive of interest, costs and attorney’s fees.
13. Despite demand, Defendant has failed or refused to pay Plaintiff’s bill, in full.
. . .17. Defendant’s refusal to reimburse Plaintiff adequately for the services provided, and otherwise make Plaintiff whole, is a breach of contract.
3. Defendant filed a Motion to Dismiss arguing that Plaintiff failed to set forth actual factual allegations as to a material breach of the contract. Defendant argues that no cause of action exists for failure to pay the claim “within 30 days or as required under the policy of insurance.” Defendant further argues that Plaintiff failed to allege any provision under the policy of insurance for which Defendant breached as it relates to a “reasonably priced bill.”
4. This case is one of many “glass cases” wherein the Plaintiff takes an assignment of benefits from the insured, without obtaining a copy of the policy of insurance from the insured or the insurance company, and files a bare bones complaint alleging it has not been paid adequately within a specific time period; therefore, Defendant breached the contract. Plaintiff claims that it only needs to allege that Defendant breached the contract and incurred damages. Plaintiff further argues that it need not allege specific provisions of the policy if it is not in its possession. This Court finds Plaintiff’s argument without merit.
5. Rule 1.110(b), Fla. R. Civ. P. requires the complaint allege a short and plain statement of ultimate facts to show that the pleader is entitled to relief. (emphasis added) Plaintiff alleges it submitted a reasonably priced bill and, based on paragraphs 11 and 17 of the Complaint, it was not paid or it was not adequately reimbursed for the services. (Paragraph 11 reads that Plaintiff has not been reimbursed and paragraph 17 suggests Plaintiff was reimbursed, but not the amount for which it finds adequate.) If Plaintiff is alleging the terms and conditions of the policy require a “reasonably” priced bill be reimbursed then Plaintiff is required to plead the terms for which it claims Defendant breached. If the terms of the policy of insurance do not address payment of a “reasonably” priced bill, then Plaintiff must allege what terms and conditions of the policy Defendant breached and how Defendant breached them. This Court finds no merit in Plaintiff’s argument that it did not have a copy of the policy of insurance when Plaintiff has not alleged, or shown, any effort to obtain the policy of insurance to determine what provisions the insurance company breached prior to filing its complaint against Defendant. Within the 57 days from the windshield replacement to the filing of the complaint, Plaintiff could have requested a copy of the insurance policy to determine the terms for which it believes the insurer breached the policy.
6. Plaintiff also alleges that Defendant failed to pay the benefits within “thirty (30) days or as required under the assignee’s policy of insurance.” Plaintiff is alleging an independent cause of action for failure to pay within thirty (30) days, or as under the terms of the policy; however, such cause of action does not exist. To support its cause of action, Plaintiff cites to Fla. Std. Jury Instr. (Civ) 416.19 that states “if a contract does not state a specific time within which a party is to perform a requirement of the contract, then the party must perform the requirement within a reasonable time.” Plaintiff relies on the cases for which the jury instruction cites, as sources and authorities, for the basis of this independent cause of action; however, Plaintiff’s argument is misplaced. The jury instruction, nor its authoritative cases, suggests an independent cause of action for “breach of contract for failure to pay a claim within a reasonable time.” After waiting a reasonable time for the insurer to pay a claim (or a specific time as set forth by statute or the policy) and the insurer fails to pay the claim, then Plaintiff can file a cause of action for breach of contract under the policy terms or conditions for which the insurer failed to pay the claim. The lawsuit is not breach of contract for “failure to pay within a reasonable time,” the lawsuit is breach of a specific term of the contract. If the time in which to pay the claim becomes an element of or a defense to the action, and time was not specified, then the jury is instructed to determine performance based on a reasonable time. The authoritative cases cited to support the jury instruction are reflective of this reasoning and this court will address each case specifically.
7. In Patrick v. Kirkland, 43 So. 969 (Fla. 1907), the Florida Supreme Court held that where the time within which an agreement is to be performed is not stated, the law implies a reasonable time. The Patrick case, nor any of the other cases cited as authority for Fla. Std. Jury Instr. (Civ) 416.19, does not hold, or even suggest, that an independent cause of action exists for “failure to perform within a reasonable time.” In Patrick, the heirs of an estate sued Patrick for an accounting and a reconveyance of property. Patrick essentially received the property as collateral for paying a judgment against the estate. However, Patrick was required to reconvey the property to the heirs upon the repayment of the judgment amount with interest. Id. at 970. Patrick alleged, as part of his defense, that the agreement never stated when the land should be reconveyed. The Court ruled that where no time is agreed on for the redemption, a reasonable time is implied. Id. at 971.
8. In De Cespedes v. Bolanos, 711 So. 2d 216 (Fla. 3rd DCA 1998) [23 Fla. L. Weekly D1254a], the action was a judicial dissolution of a corporation. During the pendency of the suit, the parties entered into a settlement agreement. One of the parties filed an Emergency Motion to Enforce the Settlement Agreement and the Court had to decide if the agreement was binding. Id. at 217. One of three issues in dispute over the agreement was that the parties never agreed upon a definite duration of time within which they would be required to collect the receivables subject to the 50/50 split. Id. at 218. As to this issue, the Court held that the general Florida rule is that when a contract does not expressly fix the time for performance of its terms, the law will imply a reasonable time. Id. This case does not find that an independent cause of action exists for failure to pay or perform within a reasonable time. The performance time was an element or part of the issue, not the cause of action.
9. In Fleming v. Burbach Radio, Inc., 377 So. 2d 723 (Fla. 4th DCA), the Court addressed the repayment time of three loans with promissory notes and four loans without written promissory notes. The action was to recover on the loans, an issue was when they were payable. Id. at 723. (emphasis added) As to the oral agreements, the Court held that the Plaintiff did not prove when these loans were to be paid as Plaintiff failed to prove whether the oral undertakings included a promise to repay at or within a certain time. The Court suggested that a claim for declaratory relief as to the essential element of time for performance may have been the proper claim for the oral agreements. Id. at 723-724. However, as to the written promissory notes, when there is no provision of the contract specifying a time for performance, the party charged with the performance must act within a reasonable time. Id. at 724. As in the present case, if the policy of insurance does not specify a time for payment, then a reasonable time for payment is expected; however, “failure to pay within a reasonable time” is not the cause of action. If Plaintiff waits a reasonable time then files a breach of contract for failure to pay the claim pursuant to the specified policy provisions and Defendant claims that it was not provided sufficient time to adjust the claim, then the jury instruction becomes relevant to the jury’s determination as to whether the insurer breached the insurance policy.
10. In L.P. Sims v. American Hardware Mut. Ins. Co., 429 So. 2d 21 (Fla. 2nd DCA 1982), Plaintiff sued his uninsured/underinsured motorist carrier for damages as a result of a motor vehicle accident. The insurance company claimed the accident was a “hit and run” and Plaintiff failed to file a “notice of claim” within 30 days of the “hit and run.” Id. at 22. The Court ruled the accident was not a “hit and run;” therefore, the 30 day provision was not applicable. In concluding its ruling, the Court stated, in dicta, in a typical uninsured/underinsured automobile case, as opposed to a “hit and run” case, the policy has a more liberal “as soon as practicable” notice provision. The Court noted that when the trial judge or the parties confront this notice provision, on remand, they should know that Florida courts held that determination of what is a reasonable time depends on the circumstances and is a question of fact for the jury or fact finder. Id. Again, the lawsuit was not an independent cause of action for failure to pay within a reasonable time. The lawsuit was an uninsured/underinsured personal injury claim wherein proper notice to the insurer was raised as a defense to the claim.
11. In Sound City, Inc. v. Kessler, 316 So. 2d 315 (Fla. 1st DCA 1975), Plaintiff sued Defendant for breach of a contract as a result of Defendant terminating a business relationship. Defendant claimed the contract was not enforceable as it lacked a provision stating the duration of the contract. Id. at 316. The Court ruled,
. . .in the absence of an express provision as to the duration in a contract, the intention of the parties with respect to duration and termination is to be determined from the surrounding circumstances and by application of a reasonable construction of the agreement as a whole and that if it appears that no termination was within the contemplation of the parties, or their intention cannot be ascertained, the contract will be terminable within a reasonable time depending upon the circumstances and that it may not be terminable by either party without giving reasonable notice. Id. at 318.
The cause of action was a breach of a provision of the contract, i.e. termination of the contract. Sound City was not an independent cause of action for failure to perform within a reasonable time.
12. Cocoa Properties, Inc. v. Commonwealth Land Title Ins. Co., 590 So. 2d 989 (Fla. 2nd DCA 1991), is an example of a cause of action based on a specific provision of a title insurance policy. The specific provision of the title insurance stated that the insurance company would clear a defect in the title “within a reasonable time after receipt of such notice.” The insured sued the title insurance company for breach of contract for failure to clear the title within a reasonable time which caused the insured to loose profit on a sale. Id. at 990-991. The Court held that “under paragraph 7(a) of the policy, Cocoa Properties has a claim if Commonwealth did not remove the title defect, by litigation or otherwise, within a reasonable length of time after receiving notice of the defect.” Id. at 991. (emphasis added) In the present case, Plaintiff has not alleged any specific provision of the policy that states the claim has to be paid within a specific period of time or within a “reasonable time.” Defendant may have breached a specific provision of the policy for failing to pay the claim or not paying the full claim, but Plaintiff has failed to allege any provision of the policy for which Defendant allegedly breached. Plaintiff generally alleges that Defendant failed to pay a reasonably priced bill within 30 days or as required under the policy without reflecting the provisions that require the Defendant to pay a “reasonably priced bill within 30 days” or any time period.
13. In Sharp v. Machry, 488 So. 2d 133 (Fla. 2nd DCA 1986), the Plaintiff brought suit to foreclose on a mortgage. The question was whether the note and mortgage were in default because the condition for payment, the construction financing, never occurred. The parties both agreed that the law required the note to be construed as one without a due date; thus, payable within a reasonable time. Id. at 134-135. The Court held that when an instrument is payable upon the happening of a certain event that is wholly or partially in the control of the promisor then it is reasonable to suppose that the parties expected reasonable effort to be made to make the event happen. Id. at 135. The Court further stated that “some courts declare broadly that where payment is to be made upon a condition under the control of the promisor, an action may be brought within a reasonable time.” Id. (emphasis added) In the present case, Plaintiff can bring the action after a reasonable time from making the claim, but the cause of action is not “failure to pay within a reasonable time.” If Defendant claims the action was premature as insufficient time elapsed to adjust the claim, then the fact finder determines whether the insurer breached the provisions of the policy or the action was premature. The Court would then be required to read Fla. Std. Jury Instr. (Civ) 416.19 to the jury to aid in its verdict. Again the cause of action is breach of contract for failure to pay pursuant to the applicable policy provision, not “failure to pay within a reasonable time.”
14. In concluding this analysis, this Court summarily notes that the additional cases provided by Plaintiff do not support its argument for an independent cause of action for “failure to pay within a reasonable time.” They merely cite the general Florida rule that when a contract does not expressly fix the time for performance of its terms, the law will imply a reasonable time. See Hammond v. DSY Developers, Inc., 951 So. 2d 985 (Fla. 3rd DCA 2007) [32 Fla. L. Weekly D708a] (action for specific performance of contract to purchase property); Doolittle v. Fruehauf Corp., 332 So. 2d 107 (Fla. 1st DCA 1976) (action for performance of an option to purchase in a lease); Tyner v. Woodruff, 206 So. 2d 684 (Fla. 4th DCA 1968) (action for failure to perform a fruit picking contract); and Denson v. Stack, 997 F.2d 1356 (11th Cir. 1993) (action for breach of contract for failure to return escrowed deposit).
15. Thus, under Florida law, if the insured believes the insurance company is failing to pay its claim pursuant to the policy, the insured, or in this case, the assignees of the insured, has two options. The first option is for the insured, or its assignee, to file a breach of contract complaint for failing to pay, pursuant to the specific provisions of the policy of insurance as has been thoroughly discussed in this order. The second option is for the insured, or its assignee, to file a civil remedy notice pursuant to §624.155(1)(b)1, Fla. Stat. Under §624.155, Fla. Stat., the insured, or in this case the assignee, can potentially resolve this matter within 60 days of giving the civil remedy notice without the need for protracted litigation. However, under Florida law, the insured, or its assignee, does not have an option to file a breach of contract complaint for “failure to pay within a reasonable time” as such is not a cause of action.
16. During oral argument, Plaintiff, through its counsel, had a difficult time understanding the viability of the second option. As such, this Court will briefly address it. Section 624.155(1)(b)1, Fla. Stat. states any person may bring a civil action against an insurer when such person is damaged by the insurer not attempting in good faith to settle claims when, under all circumstances, it could and should have done so, had it acted fairly and honestly toward its insured (in this case the assignee of the insured) and with due regard for his or her interests. §624.155(1)(b)1, Fla. Stat. (2015) Under this provision, the insurer has 60 days, after filing of the civil remedy notice, to pay the claim or explain why it is not paying the claim. If the insured pays the claim within the 60 days, the matter is resolved. §624.155(1)(b), Fla. Stat. (2015) If the insurer does not pay the claim, the insured, or its assignee, not only has a breach of contract action, it has an action under §624.155, Fla. Stat. to recover any additional damages. See Talat Enterprises, Inc. v. Aetna Cas. and Surety Co., 753 So. 2d 1278 (Fla. 2000) [25 Fla. L. Weekly S172a]. In Talat, the Florida Supreme Court thoroughly addressed the applicability of first party claims under §624.155, Fla. Stat. Thus, if the real concern is that the insurance company is not paying the claim within a reasonable time, then a civil remedy notice pursuant to §624.155, Fla. Stat., is an avenue to a potentially quick resolution for payment. Otherwise, Plaintiff has the first option to file a breach of contract action setting forth the provisions of the policy for which it claims Defendant breached.
17. In conclusion, Plaintiff’s allegations that it submitted a reasonably priced bill that has not been paid within 30 days or as set forth by the policy is not a cause of action as it relates to this windshield action. This Court notes that the parties stipulated to the civil rules of procedure, although this case was filed in small claims court; however, this Court’s ruling would be the same as to the allegations of a “claim” in small claims court as Plaintiff is required to state what provisions of the contract the insurer breached and how the insurer breached the contract.
It is therefore Ordered and Adjudged that the Complaint is DISMISSED without prejudice and Plaintiff has 20 days to amend its Complaint in accordance with this Court’s order.
