24 Fla. L. Weekly Supp. 156b
Online Reference: FLWSUPP 2402LADIInsurance — Personal injury protection — Affirmative defenses — Accord and satisfaction — Where “full and final” language on insurer’s checks to medical provider was not conspicuous and accompanying letters contained no language to indicate that checks were full and final payment and conflicted with language on checks, provider’s motion for partial summary judgment on accord and satisfaction defense is granted — Coverage — Motion for summary judgment on claim for declaratory relief regarding insurer’s right to avail itself of statutory fee schedule without having elected fee schedule in its policy is denied where relief requested has been determined by Florida Supreme Court
CARE PLUS MEDICAL CENTER OF WESTCHESTER, INC., (a/a/o Maria Del R. Ladines), Plaintiff, vs. UNITED AUTOMOBILE INSURANCE COMPANY, Defendant. County Court, 11th Judicial Circuit in and for Miami-Dade County. Case No. 12-3449 SP 25 (01). December 5, 2014. Gloria Gonzalez-Meyer, Judge. Counsel: Joseph M. Rodriguez and Marlene S. Reiss, Law Offices of Marlene s. Reiss, P.A., Miami, for Plaintiff. Pedro Ortiz, for Defendant.
ORDERGRANTING PLAINTIFF’S MOTION FOR PARTIALSUMMARY JUDGMENT ON ACCORD ANDSATISFACTION DEFENSEandDENYING DEFENDANT’S “MOTION FORSUMMARY JUDGMENT RE: AND REQUESTFOR §57.105 SANCTIONS”andDENYING PLAINTIFF’S MOTION FOR SUMMARYJUDGMENT ON DECLARATORY JUDGMENT COUNT
THIS CAUSE came before the Court on December 1, 2014, on Plaintiff’s Partial Motion for Summary Judgment on Defendant United Auto’s “Accord and Satisfaction” affirmative defense; Defendant’s “Motion for Summary Judgment Re: Accord and Satisfaction and Request for §57.105 Sanctions”; and, the Plaintiff’s Motion for Partial Summary Judgment on Declaratory Judgment claim, the Court having reviewed the motions, responses thereto, evidence in support of and opposing the motions, having reviewed all pertinent documents, and having heard argument of counsel, the Court GRANTS the Plaintiff’s Motion for Partial Summary Judgment; DENIES Defendant’s Motion for Summary Judgment and Request for §57.105 Sanctions; and, DENIES Plaintiff’s Motion for Summary Judgment on declaratory judgment count. Accordingly, it is hereby
ORDERED AND ADJUDGED:
that the Plaintiff’s Motion for Partial Summary Judgment on Accord and Satisfaction defense is hereby GRANTED;
that the Defendant’s “Motion for Summary Judgment Re; Accord and Satisfaction and Request for §57.105 Sanctions” is hereby DENIED; and,
that the Plaintiff’s Motion for Summary Judgment on declaratory judgment count is hereby DENIED.
This case involves Plaintiff Care Plus Medical’s claim for Personal Injury Protection (PIP) benefits, as the valid assignee of United’s insured, Maria Del R. Ladines.Accord and Satisfaction Defense
The parties filed cross-motions for summary judgment on Defendant United Auto’s Accord and Satisfaction defense, which were heard on August 20, 2014 and continued on December 1, 2014.1
The operative defense, contained in United Auto’s original Answer, states in pertinent part:
As for its First Affirmative Defense, Defendant states that it issued payment — which Plaintiff cashed in accord and satisfaction — pursuant to Florida Statute 627.736 and Defendant’s policy of insurance in the reduced, adjusted and reasonable amount of $2,461.54 for all reasonable expenses, necessary medical, surgical, x-ray, dental and rehabilitative services related to the subject accident for the alleged dates of service 5/26/11 through 7/5/11. In addition, checks were also issued in the total amount of $27.70 in appropriate interests [sic] for said dates of service. Furthermore, Defendant issued payment — which Plaintiff cashed — pursuant to Florida Statute 627.736 and Defendant’s policy of insurance in the reduced, adjusted and reasonable amount of $3,070.49 for all reasonable expenses, necessary medical, surgical, x-ray, dental and rehabilitative services related to the subject accident for the alleged dates of service 7/14/11 through 9/1/11. In addition, cheeks were also issued in the total amount of $64.86 in appropriate interests [sic] for said dates of service and a check in the amount of $256.00 in PIP penalty and postage costs. However, the Defendant is disputing that the remaining medical services and/or charges at issue are related to the Subject motor vehicle accident, medically necessary and/or reasonable as to the amount charged.
Although United Auto’s defense does not allege statutory Accord and Satisfaction, its Motion for Summary Judgment argues both common law and statutory Accord and Satisfaction under the UCC provision, §673.3111, both of which require a pre-existing bona fide dispute.
Each of the subject checks sent by United Auto denominates “CARE PLUS MEDICAL CENTER OF WESTCHESTER, INC F/A/O MARIA DEL R. LADINES” as the payee followed by a line below stating “for Full and Final PIP Benefits for Bill ID (number).” No Full and Final language appears on the endorsement side of the check.
On August 10, 2011, and on October 11, 2011, United accompanied the checks its sent with identical cover letters, each of which reads, in pertinent part:
United Auto Insurance Company (“UAIC”) has received the bill(s) submitted for PIP benefits on the referenced matter. Enclosed please find our draft(s) and itemized Explanations of Review (“EOR”) for the amount charged. Please be advised that our claims investigation, including our review for medical necessity and relatedness of services billed to the referenced loss, is ongoing. As such, we reiterate our request for your cooperation in providing any and all medical records and information relating to your patient that you may possess or can assess.
Having notified you of our ongoing claims investigation, the enclosed draft(s) are hereby tendered as advanced consideration for unverified treatments. Any payment for medical treatment that is excessive, unrelated, unreasonable, unnecessary or unlawful is an unintended overpayment and expressly disputed. Any such disputed overpayment is not intended to be gratuitous in nature and subject to reimbursement.
“UAIC” hereby advised that it does not, either by sending this letter or processing this payment advance at this time, waive any existing rights or defense, including rights or defenses discovered during future review, investigation or discovery. Any and all such rights and defenses are specifically reserved; including, but not limited to claims for reimbursement and any defenses listed below, including our enclosures.
Taking the above-stated issues under advisement, the bills have been applied to the deductible.
Charges are dictated by statute. The charges billed exceed the amount allowable pursuant to the Medicare Part B Fee Schedule.
No pre-suit statutory demand letter was sent until November 11, 2010.Applicable Law
The affirmative defense of accord and satisfaction requires proof of: (1) a preexisting dispute as to the nature and extent of an obligation between the parties, (2) their mutual intent to effect settlement of that dispute by a superseding agreement, and (3) the obligor’s subsequent tender and the obligee’s acceptance of performance of the new agreement in full satisfaction and discharge of the prior disputed obligation. See Rocka Fuerta Const. Inc. v. Southwick, Inc., 103 So.3d 1022 n. 2 (Fla. 5th DCA 2012) [38 Fla. L. Weekly D79a]; Martinez v. South Bayshore Tower, LLLP, 979 So.2d 1023 (Fla. 3d DCA 2008) [33 Fla. L. Weekly D655a].
Section 673.3111(2) states that a “claim is discharged if the person against whom the claim is asserted proves that the instrument or an accompanying written communication contained a conspicuous statement to the effect that the instrument was tendered as full satisfaction of the claim.” Fla. Stat. 673.3111(2)(emphasis added).
Whether a term is “conspicuous” is an issue of law for the trial court to decide. See Fla. Stats. §671.201(10).
“Conspicuous” is defined as:
(10) “Conspicuous,” with reference to a term, means so written, displayed, or presented that a reasonable person against which it is to operate ought to have noticed it. Whether a term is “conspicuous” is a decision for the court. Conspicuous terms include the following:
(a) A heading in capitals equal to or greater in size than the surrounding text, or in contrasting type, font, or color to the surrounding text of the same or lesser size; and
(b) Language in the body of a record or display in larger type than the surrounding text or set off from surrounding text of the same size by symbols or other marks that call attention to the language.
Fla. Stat. §671.201(10)(a)-(b) (emphasis added). See also Orange Motors of Coral Gables, Inc. v. Dade County Dairies, Inc., 258 So.2d 319 (Fla. 3d DCA 1972)(statute requiring conspicuous language excluding or modifying implied warranties of merchantability not satisfied where language on disclaimer in the same color, size, and type used for other provisions); Osborne v. Genevie, 289 So.2d 21 (Fla. 2d DCA 1974)(same); Gonzalez v. Associates Live Ins. Co., 641 So.2d 895 (Fla. 3d DCA 1994)(terms of medical insurance policy which were required to be conspicuous were unenforceable as text was printed in same color, style, and size of type as remainder of page); Hirsch v. Klosters Rederi, 521 So.2d 316 (Fla. 3d DCA 1988).Findings of Fact and Conclusions of Law
The Court does not make any finding with regard to whether there was a pre-existing dispute. However, as a matter of law, the Court finds that the “Full and Final” language on United’s checks is not conspicuous.
The “Full and Final” language is in a font smaller than other writing on the check. The language was included as part of “two other lines of similar font.” The language was not in a contrasting color. And the language was not set off by any “symbols or marks that call attention to the language.” See Fla. Stat. 671.201(10)(a) & (b).
Furthermore,§ 671.201(10)(a) requires a heading. United’s “Full and Final” language is not demarcated by a heading. To the contrary, the language is tucked away under the words “CARE PLUS MEDICAL CENTER OF WESTCHESTER, INC. F/A/O MARIA DEL R. LADINES,” which gives no indication that any of the language below it pertains to an accord and satisfaction. Therefore, in relation to the entire instrument, United’s “Full and Final” language is not “conspicuous” as a matter of law because it does not comply with any of the statute’s requirements.
This Court finds the recent order issued by Judge Zeller in Broward County in Dr. Alan R. Freedman (a/a/o Janette Westley) v. UAIC, Case No. 11-3383 COCE (55) (Cty. Ct., August 6, 2014) [22 Fla. L. Weekly Supp. 397a] to be persuasive and well reasoned, stating:
After a careful review of the checks mailed to Plaintiff by the Defendant, the court finds that the FOR FULL AND FINAL PAYMENT language fails to meet the statutory definition of conspicuous. Although the language is in capitals and is equal to the surrounding text, the language is not contained in a heading, but rather is within the body of the “Pay to the Order” line of the checks. Since the language is not a heading and is not otherwise contained within the body of a record in larger type than the surrounding text or set off in a manner that calls attention to the language, the court finds that the Defendant is not entitled to summary judgment on its affirmative defense of statutory accord and satisfaction.
Similarly, Judge Lee in Broward County, was very recently affirmed by the Seventeenth Judicial Circuit Court in UAIC v. Complete Rehab & Med. Centers (a/a/o Miyerlandy Martinez), Case No. 11-25577CACE, (Fla. 17th Jud. Cir. October 27, 2014) [22 Fla. L. Weekly Supp. 531a], Judge Lee determined that United Auto’s “Full & Final” checks did not constitute an accord and satisfaction), stating:
The insurance company forwarded the Plaintiff a check, which Plaintiff accepted and cashed. The check provided on its face that the payment was “as full and final payment of PIP benefits.” The Defendant urges this language is “conspicuous,” as required for effective application of statutory accord and satisfaction under Florida Statute §673.3111(2). The Florida Uniform Commercial Code defines “conspicuous” in Florida Statute §671.201(10). The language at issue in the instant case, while in all capital letters, was in a font smaller than other writing on the check, was included as part of two other lines of similar font, was not in a contrasting color, and was not set off by any “symbols or marks that call attention to the language.” See id. §671.201(10)(a)&(b). The question of conspicuousness is a matter of law to be decided by the court. Id. §671.201(10). The Court concludes that the language, taken not in an isolated sense but in relation to the whole of the instrument, is not conspicuous.
Complete Rehab & Med. Centers (a/a/o Miyerlandy Martinez) v. UAIC, Case No. 09-7320 COCE(53)(Broward Cty. Ct., October 12, 2009) [16 Fla. L. Weekly Supp. 1171a].
This Court notes that, even unlike the language in Martinez, United’s “Full and Final” language was not in all capital letters.
The Court finds that, as a matter of law, United Auto’s checks do not contain conspicuous language that would otherwise satisfy Fla. Stats. §673.3111(2).
If the instrument itself does not contain conspicuous language, §673.3111(2) provides that an accompanying written communication may serve to effectuate an accord and satisfaction if it contains conspicuous language.
The Court finds that United’s accompanying letter contains no language to indicate that the enclosed checks are for full and final payment of any disputed amounts. In fact, the letter says that United’s investigation is ongoing and effectively states that the monies paid may have to be reimbursed if United’s ongoing investigation concludes that the medical treatment is not medically necessary or related to the subject accident.
The letter actually conflicts with the “Full and Final” language on the checks. No reasonable person, when faced with United’s checks and the accompanying letters, would believe that cashing those checks would result in an accord and satisfaction of a disputed claim. Indeed, this Court finds that the checks and letters together are confusing.
The law provides a relatively simply means by which an insurer can effect an accord and satisfaction — by issuing a draft with conspicuous language indicating that the payment is made as a full and final payment on a disputed claim and/or accompanying such a draft with a clear and unambiguous letter that states as much. United has done neither.
Even though the Court’s ruling is made as a matter of law, the Court has reviewed pertinent portions of the affidavit and deposition of Roberto Diaz, Care Plus’s owner, and finds that the testimony does not support United Auto’s position.2 Mr. Diaz’s testimony does not create any fact questions to preclude summary judgment. Nowhere in his testimony does Mr. Diaz state that he accepted United Auto’s checks as full and final payment of a disputed amount.
Therefore, the Court denies United Auto’s Motion for Summary Judgment and grants the Plaintiff’s Motion for Partial Summary Judgment on the defense.
Further, the Court denies United Auto’s motion for §57.105 sanctions which it incorporated within its Motion for Summary Judgment.Plaintiff’s Declaratory Judgment Claim
On April 10, 2013, the Plaintiff amended its Complaint by agreement between the parties to add a claim for declaratory relief.3
The claim for declaratory relief asks the Court to declare that United Auto cannot avail itself of the provisions of Fla. Stats. §627.736(5)(a)2. because United’s policy obligates it to pay 80% of reasonable medical expenses.
The Court notes that the declaratory judgment claim was filed prior to the Supreme Court’s decision in GEICO v. Virtual Imaging Svcs., Inc., 141 So.3d 147 (Fla. 2013) [38 Fla. L. Weekly S517a], which answers the question of whether an insurer may avail itself of the permissive reimbursement methodology in Fla. Stats. §627.736(5)(a)2., Fla. Stats. (2008) without having elected to do so in its policy and, thus, there is no longer any question with regard to the Plaintiff’s doubts about which methodology United is bound to use, i.e., Fla. Stats. §627.736(5)(a)1., Fla. Stats. (2008).
The Plaintiff’s Motion for Summary Judgment, filed after the Supreme Court’s decision in Virtual, asks the Court to determine as a matter of law that United Auto is precluded from utilizing the Medicare Part B Fee Schedules as one of the factors identified in Fla. Stats. §627.736(5)(a)1.
United argues that the claim for declaratory relief does not comport with the relief requested in the Plaintiff’s Motion for Summary Judgment.
The Court is not inclined to grant summary judgment beyond the relief requested in the claim for declaratory relief, but will entertain the Plaintiff’s argument in a Motion for Summary Judgment on the reasonableness of the bills or by way of a motion in limine if the Plaintiff seeks to preclude United Auto from relying on evidence of Medicare Part B Fee Schedules at trial.
Therefore, the Court denies the Plaintiff’s Motion for Summary Judgment at this time on the basis that the relief requested was determined by the Florida Supreme Court in Virtual and the Plaintiff is no longer in doubt as to the question of whether United Auto could utilize Fla. Stats. §627.736(5)(a)2. without having elected that provision in its policy.4
Accordingly, it is hereby
ORDERED AND ADJUDGED:
that the Plaintiff’s Motion for Partial Summary Judgment on Accord and Satisfaction defense is hereby GRANTED;
that the Defendant’s Motion for Summary Judgment on Accord and Satisfaction defense is hereby DENIED; and,
that the Plaintiff’s Motion for Summary Judgment on declaratory judgment count is hereby DENIED.
__________________
1Incorporated within United Auto’s Motion for Summary Judgment is a “Request for §57.105 Sanctions.”
2The deposition of Mr. Diaz was filed on the Wednesday before the Monday hearing on the summary judgment motions. Plaintiff Care Plus has moved to strike the deposition, arguing that it was untimely filed and served only one business day before the hearing. See Ferguson v. V.S.L. Corp., 528 So.2d 32 (Fla. 3d DCA 1988)(authorizing court to consider deposition filed the day of summary judgment hearing since it was taken pursuant to notice and was physically in existence “before the court,” satisfying the requirements of Rule 1.510). The Court denies the motion and has considered Mr. Diaz’s deposition testimony.
3At the hearing, United Auto conceded that it has yet to file and Answer to the Amended Complaint. However, the Plaintiff agreed to proceed at the hearing notwithstanding that no answer has been filed at this point.
4The Court has not determined that United Auto may use the Medicare Part B Fee Schedules for any purpose at this time. The Court’s ruling is limited to the question raised in the claim for declaratory relief, which is whether United Auto may avail itself of the permissive methodology in §627.736(5)(a)2. without having elected that methodology in its policy.
