24 Fla. L. Weekly Supp. 305a
Online Reference: FLWSUPP 2404HERNInsurance — Personal injury protection — Coverage — Medical expenses — Exhaustion of policy limits — Where insurer acted in good faith in exhausting policy limits by allocating portion of global settlement reached with another of insured’s assignees to PIP benefits in amount equal to that assignee’s original demand, benefits are exhausted notwithstanding unilateral actions of counsel representing both plaintiff medical provider and other assignee that allocated lesser amount of settlement to PIP benefits so as to not exhaust policy limits
ZENITH MOBILE DIAGNOSTIC a/a/o Silvio Hernandez, Plaintiff, vs. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant. County Court, 11th Judicial Circuit in and for Miami-Dade County. Case No. 14 5182 SP 25 (04). May 9, 2016. Carlos Guzman, Judge. Counsel: Kevin W. Whitehead, Whitehead Law Group, P.A., Miami, for Plaintiff. Michael A. Rosenberg and Stephen G. Mellor, Roig Lawyers, Deerfield Beach, for Defendant.
ORDER GRANTING DEFENDANT’S AMENDEDMOTION FOR FINAL SUMMARYJUDGMENT AND FINAL JUDGMENT
THIS CAUSE having come before the Court on March 30, 2016 for hearing of Defendant’s Amended Motion for Final Summary Judgment Regarding Benefits Exhausted, and the Court having considered the Motion and Plaintiff’s Response, heard argument of counsel, reviewed the court file and relevant legal authorities, and being otherwise fully advised in the premises, the court finds as follows:
BACKGROUND
1. This case involves an alleged breach of contract brought against Defendant, State Farm Mutual Automobile Insurance Company (hereinafter “State Farm”) by Zenith Mobile Diagnostic as assignee of Silvio Hernandez (hereinafter “Assignor”), for injuries he allegedly sustained in a motor vehicle accident on July 15, 2012.
2. At the time of the alleged accident, the Assignor was covered under a policy of insurance issued by the State Farm which provided $10,000.00 in personal injury protection (“PIP”) benefits.
3. Prior to the filing of the instant lawsuit on behalf of Plaintiff, Plaintiff’s counsel filed a case on behalf of another of the Assignor’s medical providers, Corzo Medical Center, which allegedly treated the Assignor after the loss at issue in this case.
4. Both the Complaint and pre-suit demand letter on behalf of Corzo Medical Center sought payment for the remaining PIP benefits in the amount of $7,445.60.
5. Thereafter, State Farm entered settlement negotiations wherein Corzo Medical Center made an initial settlement demand in the amount of $7,445.60 to resolve the PIP benefits portion of the claim and $4,000.00 for attorney’s fees and costs. Defense counsel responded to the initial demand with an offer of $2,500.00 in PIP benefits and $3,000.00 in attorney’s fees and costs.
6. On or about 04/11/2014, the parties agreed to a global settlement in the amount of $9,750.00, which represented full and final settlement of all medical benefits, attorney’s fees and costs at issue in the case. The Defendant issued one check in the amount of $9,750.00 made payable to Kevin W. Whitehead, P.A. Trust Account.
7. Subsequent to the oral settlement where there is no written record, State Farm allocated $7,445.60 of the global settlement to Corzo Medical Center’s outstanding medical bills, and alleged in this lawsuit for the first time that this payment exhausted the statutory limit of ten thousand dollars ($10,000.00) in PIP benefits. State Farm never notified the Plaintiff’s counsel during the settlement discussions or in writing when it sent the settlement draft to Plaintiff’s counsel that it was exhausting PIP benefits.
8. Thereafter, on April 15, 2014, the Plaintiff’s counsel filed the instant suit on behalf of Plaintiff, Zenith Mobile Diagnostic as assignee of Silvio Hernandez, alleging breach of contract for non-payment of PIP benefits.
9. Upon being informed that benefits were exhausted in the instant case, Plaintiff’s counsel, Kevin Whitehead informed State Farm that he forwarded only $5,750.00 to Corzo Medical Center after the global settlement referenced above. Plaintiff’s counsel further alleged that PIP benefits under the Assignor’s policy were not exhausted.
10. On or about April 17th, 2014, after the Plaintiff initiated this lawsuit against the Defendant, the Defendant sent letters to Zenith Mobile Diagnostics, Corzo Medical Center, and Silvio Hernandez, advising that $10,000.00 in PIP benefits had been paid under the subject policy and that benefits were exhausted. This was the first indication made by the Defendant of its position that the global settlement in CORZO MEDICAL CENTER INC. a/a/o Silvio Hernandez v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Case Number: 14-000802 CC 25 (3) was intended to exhaust the policy benefits.
11. In the instant lawsuit, Defendant subsequently filed its Amended Motion for Final Summary Judgment alleging that benefits were fully and properly exhausted prior to the filing of the instant suit.
FINDINGS OF FACT AND LAW
The issue before this Honorable Court is whether the Plaintiff is entitled to recover PIP benefits from the Defendant in this action, where the Defendant has unilaterally made payments that, in total, are equal to the contractual and statutory limit of ten thousand dollars ($10,000.00) and the insurer asserts for the first time after it makes the payment that PIP benefits for the Assignor are now exhausted
The Court finds that State Farm was entitled to exhaust benefits by unilaterally making its allocation without informing the Plaintiff’s counsel during settlement discussions or upon submission of the subject payment that benefits were being exhausted. Thus, at that point, there is no further cause of action in this case where insurance benefits have been paid to the contractual and statutory limit of $10,000.00 and where State Farm has fulfilled its contractual obligation and complied with the requirements of Florida law. See Sheldon v. United Services Auto Ass’n, 55 So. 3d 593, 595 (Fla. 1st DCA 2010) [36 Fla. L. Weekly D23a]; see also Progressive American Ins. v. Stand-Up MRI of Orlando, 990 So. 2d 3, 6-7 (Fla. 5th DCA 2008)[33 Fla. L. Weekly D1746a].
The Third District Court of Appeals recently stated in GEICO v. Gables Ins. Recovery, Inc. a/a/o Rita Lauzan:
[T]he PIP statute does not, on its face, require an insurer to pay in excess of the $10,000 limit in PIP coverage. Nor does it require an insurer to “set aside” funds in anticipation of litigation over the unpaid claim in order to avoid being at risk of paying more than its coverage limits. . .
[T]he Appellate Division incorrectly applied this Court’s decision in [Coral Imaging Services v. Geico Indemnity Insurance Co., 955 So.2d 11 (Fla. 3d DCA 2006)[31 Fla. L. Weekly D2478a]]. We find that Coral Imaging is not controlling. Coral Imaging only applies where the PIP insurer exhausts benefits by improperly paying untimely claims. Coral Imaging, 955 So.2d at 12. Here, in contrast, benefits were not improperly exhausted. Rather, every medical provider GEICO paid on behalf of Lauzan was entitled to payment and all the claims paid were timely.
159 So. 3d 151, 154-155 (Fla. 3d DCA 2014) [39 Fla. L. Weekly D2561a].
In the case at bar, the Court finds that the Plaintiff was aware that State Farm was going to apportion $7,445.60 in PIP benefits as part of the $9,750.00 global settlement which would have exhausted PIP benefits up to its statutory and contractual limits, even though State Farm never informed the Plaintiff’s counsel of same. The Court finds persuasive that this amount was alleged by Plaintiff as being due and owing in its pre-suit demand letter and subsequent Complaint and from e-mail correspondences between Plaintiff’s counsel and Defendant’s counsel during the settlement negotiations. Further, it appears to the Court that the agreement to only apportion $5,750.00 in PIP benefits towards Corzo Medical Center’s outstanding bills, instead of $7,445.60, was an agreement made between the Plaintiff and its counsel to which State Farm was not privy.
Despite the County Court Orders cited by the Plaintiff, and the record evidence provided by Plaintiff’s counsel, this Court finds that State Farm fulfilled its statutory and contractual obligations by paying bills in the order they were received from the Assignor’s various medical providers. State Farm should not be required to pay more than 100% of the contractual benefits merely because Plaintiff’s counsel unilaterally chose to reserve funds from prior settlement to avoid an exhaustion defense in the instant case. State Farm is not responsible for the unilateral actions of Plaintiff’s counsel in allocating prior settlement funds when State Farm has acted in good faith to exhaust benefits.
For the reasons set forth above, summary judgment is hereby entered in favor of State Farm Mutual Automobile Insurance Company.
ORDERED AND ADJUDGED that Defendant’s Motion for Final Summary Judgment against the Plaintiff is GRANTED. The Plaintiff, Zenith Mobile Diagnostic as assignee of Silvio Hernandez, shall take nothing by this action and the Defendant, State Farm Mutual Automobile Insurance Company, shall go hence without a day.
