23 Fla. L. Weekly Supp. 479a
Online Reference: FLWSUPP 2305MARDInsurance — Personal injury protection — Where there was no reasonable or credible explanation for insurer’s failure to advise medical provider and court of exhaustion of benefits until 17 months after exhaustion, and insurer contumaciously ignored provider’s continuous requests for updated PIP log and ignored court order to provide log, insurer is ordered to pay attorney’s fees and costs incurred by provider due to insurer’s inaction
SUMMIT RADIOLOGY, LLC a/a/o CHARLOTTE MARDO, Plaintiff, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant. County Court, 17th Judicial Circuit in and for Broward County. Case No. 12-011187 COCE 50. September 2, 2015. Honorable Peter B. Skolnik, Judge. Counsel: Andrew B. Davis-Henrichs, South Florida Trial Lawyers, LLC, Davie; and Emilio Roland Stillo, for Plaintiff. Valieri Beretta-Melley, for Defendant.
ORDER GRANTING PLAINTIFF’SMOTION FOR SANCTIONS
THIS CAUSE having come before the Court on August 17, 2015 on Plaintiff’s Motion for Sanctions, and the Court having reviewed the Plaintiff’s Motion, the Court file, having heard argument from counsel, and having been otherwise fully advised in the premises, it hereby ORDERED AND ADJUDGED as follows:
Background
1. The Plaintiff, an MRI provider, filed suit on June 4, 2012 for outstanding bills and alleged that Defendant failed to pay 80% of the reasonable amount for an MRI scan performed on the Defendant’s insured.
2. On January 23, 2013, the Defendant filed its Answer and Affirmative Defenses.
3. On July 23, 2013, in response to Plaintiff’s First Request for Admissions, the Defendant admitted that “the benefits being exhausted is not a defense to this claim.”
4. On or about August 23, 2013, unbeknownst to the Plaintiff, the Defendant exhausted the personal injury protection benefits under the insured’s policy of insurance.
5. On June 10, 2014, the Plaintiff filed its Supplemental Request to Produce Re: Updated PIP Log, requesting a copy of the most updated PIP payout or bill ledger to show whether benefits had been recently exhausted.
6. The Defendant did not respond timely to Plaintiff’s supplemental discovery request as required by the Florida Rules of Civil Procedure. The Plaintiff filed an Ex Parte Motion to Compel responses and, subsequently, this Court entered an Order on July 30, 2014 requiring the Defendant to file responses within 10 days. The Defendant filed its response to Plaintiff’s Supplemental Request to Produce, however; stated, “[a]n updated PIP payout log has been requested and will be provided to Plaintiff upon receipt.” On September 29, 2014, the Plaintiff sent Defendant’s Counsel a letter requesting a copy of the PIP payout log. This letter went unanswered.
7. Defendant then served Plaintiff with a proposal for settlement on November 21, 2014. In response, Plaintiff filed a motion to strike Defendant’s proposal for settlement based, in part, on Defendant’s failure to comply with all of Plaintiff’s outstanding discovery requests and, thus; the proposal had not been filed in good faith.
8. On February 9, 2015, Plaintiff’s Counsel took the deposition of the Defendant’s adjuster whereupon the adjuster first informed Plaintiff that PIP benefits were exhausted.
9. After the deposition, on February 12, 2015, the Defendant filed its Motion for Leave to Amend Affirmative Defenses to add exhaustion of benefits as an affirmative defense. The Defendant’s Motion was heard on July 8, 2015, but was deferred and the case stayed pending hearing on Plaintiff’s Motion for Attorneys Fees.
10.The Plaintiff sought sanctions and attorneys fees against the Defendant for failing to raise exhaustion as a defense and providing a PIP Log in a timely fashion.
11. In response to Plaintiff’s Motion, the Defendant filed a response in opposition to Plaintiff’s Motion, along with the affidavit of claims representative Catherine Troung. Ms. Troung avers that benefits exhausted on August 23, 2013, and claims that due to oversight and mistake the adjuster did not realize benefits had exhausted until on or about February 9, 2015, while reviewing the file in preparation for the deposition. Ms. Troung was not the adjuster who worked on the file for any periods of time relevant to the hearing but appears to have been assigned the file after the deposition of the adjuster Jovanny Valdes in February 2015. Ms. Troung provided no facts as to how she concluded there was an “oversight or mistake”. Further, the affidavit does not address any of the relevant chronology or the violation of the Court’s July 29, 2014 Order. Further, the Defendant did not provide an affidavit of Jovanny Valdes.
12. Counsel for the Defendant presented no affidavits or any evidence as the firm’s involvement in not advising of the exhaustion.Conclusions of Law
13.This Court expressly finds that the Defendant acted in bad faith as there was no reasonable or credible explanation for the Defendant and its Counsel’s failure to advise the Plaintiff and the Court of the exhaustion in a timely manner. For over 17 months, the Defendant and its Counsel chose to contumaciously ignore the Plaintiff’s continuous requests for an updated PIP Log, violated the Florida Rules of Civil Procedure, and ignored this Court’s July 29, 2014 Order to provide the most current PIP log. The Defendant’s failure to inform the Plaintiff and the Court of the exhaustion in a timely fashion caused the Plaintiff to unnecessarily incur fees and costs. Barnes v. Pro Imaging, Inc, 15 Fla. L. Weekly Supp. 981b (Fla. 17th Cir. Appellate 2008).
14. No evidence was provided by counsel for the Defendant as to counsel for the Defendant’s involvement in the failure to advise of the exhaustion.
15. The Court finds the affidavit of Catherine Truong legally insufficient to establish what Defendant contends was “mistake or oversight” in that it is both conclusory and relies entirely on hearsay. Ms. Truong had no involvement in the failure to advise of the exhaustion. No facts are given to support Ms. Truong’s conclusion that there was an “mistake or oversight” on the part of adjuster Jovanny Valdes. Further, the Defendant did not provide the Court with an affidavit or testimony from Valdes herself as to what transpired as it relates to the exhaustion in this case nor did the affidavit address why the Defendant would not have been aware of the exhaustion in July 2014 after the Court ordered the Defendant produce the most current PIP log and the Defendant advised Plaintiff’s counsel and the Court that same had been “requested”.
16. This Court is aware of its inherent authority to impose sanctions, even in the absence of statutory authority, and this imposition should be done sparingly and cautiously. See Moakley v. Smallwood, 826 So.2d 221 (Fla. 2002) [27 Fla. L. Weekly S175b]; See also Koch v. Koch, 47 So.3d 320 (Fla. 2d DCA 2010) [35 Fla. L. Weekly D2091a]. The Defendant and Defendant’s Counsel caused an unnecessary waste of time to the Plaintiff and this Court. The Defendant knew or should have known about the exhaustion in August 2013 or sometime soon after. There was no reasonable argument provided by Defendant’s Counsel or Defendant’s claims adjuster to excuse the Defendant from timely advising the Plaintiff of the exhaustion. This Court cannot overlook the conduct of the Defendant and Defendant’s Counsel in failing to act reasonably in defending the suit. Each party is obligated to litigate in good faith. As such, the Plaintiff’s Motion is hereby GRANTED. The Court compels the Defendant to pay the reasonable fees and costs incurred by the Plaintiff due to the Defendant’s inaction. See Injury Treatment Cntr of Coral Springs, Inc. v. State Farm Mut. Auto. Ins. Co., 21 Fla. L. Weekly Supp. 700c (Fla. Broward County, Cnty. Ct. 2014)(Dishowitz, J.); A-1 Open MRI, Inc. v. United Auto. Ins. Co., 20 Fla. L. Weekly Supp. 288b (Fla. Broward County, Cnty. Ct. 2012)(Schiff, J.); Madrid LLC v. State Farm Fire and Cas. Co., Case No.: 11-11432 COCE 56, Order on Case Management Conference (Fla. Broward County, Cnty. Ct. March 7th 2014)(Pratt, J.)(unpublished order); Rivera-Morales M.D. v. State Farm Mut. Ins. Co., 22 Fla. L. Weekly Supp. 271a (Fla. Miami-Dade County, Cnty. Ct. 2013)(Gonzalez-Paulson, J.).
17. The Plaintiff shall schedule an evidentiary fee hearing at a later date where the amount of the sanction will be determined by the Court. The parties will schedule a fee hearing at a mutually convenient time in the near future.
