25 Fla. L. Weekly Supp. 903a
Online Reference: FLWSUPP 2510PEREInsurance — Personal injury protection — Attorney’s fees — Where insurer paid reduced amount on PIP claim in response to demand letter without paying statutory penalty and postage, forcing medical provider to file suit for penalty and postage, insurer’s post-suit payment of penalty and postage is confession of judgment entitling provider to award of attorney’s fees — Because provisions of PIP statute are incorporated into every PIP policy, any penalties and damages provided for in statute become part of policy, and recovery of those penalties and damages entitles insured to attorney’s fees under section 627.428
HANDS PROFESSIONAL CENTER, CORP., (a/a/o Yosvany Perez), Plaintiff, v. WINDHAVEN INSURANCE COMPANY, Defendant. County Court, 11th Judicial Circuit in and for Miami-Dade County. Case No. 16-2024 CC 26 (03). July 26, 2017. Gloria Gonzalez-Meyer, Judge. Counsel: Jose R. Iglesia, and Marlene S. Reiss, for Plaintiff. Bridgid Napier, for Defendant.
ORDER GRANTING PLAINTIFF’S MOTION TODETERMINE ENTITLEMENT TO ATTORNEY’S FEES
This cause, having come before the Court on July 25, 2017 on Plaintiff’s Motion to Determine Entitlement to attorney’s fees as the prevailing party in this case based on Windhaven’s confession of judgment, and the Court having heard argument of counsel, and having reviewed the parties’ submissions,
Accordingly, it is hereby
ORDERED AND ADJUDGED:
that the Plaintiff’s Motion for Entitlement to Attorney’s Fees is GRANTED.
The issue before the Court is the Plaintiff’s entitlement to attorney’s fees following Windhaven’s post-suit payment of postage and penalty sought in the Complaint and Amended Complaint filed by the Plaintiff, which constitutes a confession of judgment. See Wollard v. Lloyd’s and Companies of Lloyd’s, 439 So.2d 217 (Fla. 1983).
Windhaven concedes that it paid the statutory penalty and postage set forth in §627.736(10), Fla. Stat. (2013), but argues that, even though it confessed judgment, the Plaintiff is not entitled to attorney’s fees because the statutory penalty and postage are not insurance benefits.
The Court disagrees and follows USAA Gen. Indem. Co. v. Cohen Chiro. Group, P.A. (a/a/o Emy Fahie), 23 Fla. L. Weekly Supp. 522e (Fla. 17th Jud. Cir., Aug. 10, 2015)(affirming final in favor of medical provider for statutory Demand Letter penalty and postage provision and granting entitlement to attorney’s fees upon Cohen’s obtaining a final judgment for the postage and penalty); Central Magnetic Open MRI of Plantation, Ltd. (a/a/o Monica Quesada) v. GEICO Gen. Ins. Co., FLWSUPP 2503QUES (Broward Cty. Ct., Apr. 21, 2017) [25 Fla. L. Weekly Supp. 291c], DiPietro, J; Doctor Ralph Miniet Practice (a/a/o Roberto Moreira) v. GEICO Gen. Ins. Co., Case No. 15-4036 SP 26 (04)(Miami-Dade Cty. Ct., June 6, 2016) [25 Fla. L. Weekly Supp. 477a], King, J.; and MR Services I, Inc. (a/a/o Lawrence Cohen) v. State Farm Mut. Auto. Ins. Co., Case No. 12-23619 COCE (50) (Broward Cty. Ct., June 4, 2014) [21 Fla. L. Weekly Supp. 1069b], Skolnik, J.
These facts are not in dispute. In response to the Plaintiff’s statutory pre-suit Demand Letter. Windhaven paid a reduced amount of 200% of the Medicare Part B Fee Schedules, without paying any postage or penalty. The Plaintiff sued for benefits, postage and penalty. Windhaven did not advise the Plaintiff, until after the lawsuit was filed, by way of raising an “exhaustion” defense, that policy benefits had been exhausted on January 27, 2016. The Plaintiff pursued the statutory postage and penalty in its Amended Complaint and Windhaven’s Answer alleged that, even though it paid the penalty and postage after suit was filed, it owed no attorney’s fees.
Windhaven argues that penalty and postage under the Demand Letter provision or the PIP Statute are not “insurance benefits,” and therefore that §627.428, Fla. Stat. does not entitle the Plaintiff to recover any attorney’s fees notwithstanding the confession of judgment. Windhaven relies on the Supreme Court’s decision in Petty v. FIGA, 80 So.3d 313 (Fla. 2012) [37 Fla. L. Weekly S34a].1
The Plaintiff argues that Petty, supra, is inapplicable and that §627.428, Fla. Stat. governs and requires that the Court find Plaintiff’s entitlement to attorney’s fees as the prevailing party, having obtained the equivalent of a judgment in its favor, i.e., Windhaven’s confession of judgment and in-suit payment of the Demand Letter provision’s postage and penalty.
The Court agrees with the Plaintiff and finds that the Plaintiff is entitled to its attorney’s fees pursuant to §627.428, Fla. Stat. and that Petty does not apply for the following reasons.2§627.736(10), Fla. Stat. (2008)
The Demand Letter provision of the PIP Statute provides, in pertinent part:
Each notice required by this subsection must be delivered to the insurer by United States certified or registered mail, return receipt requested. Such postal costs shall be reimbursed by the insurer if so requested by the claimant in the [notice of intent to initiate litigation], when the insurer pays the claim…
Fla. Stat. 627.736(10)(c) (2013) (emphasis added).
If, within 30 days after receipt of notice by the insurer, the overdue claim specified in the notice is paid by the insurer together with applicable interest and penalty of 10 percent of the overdue amount paid by the insurer, subject to a maximum penalty of $250, no action may be brought against the insurer…. To the extent the insurer determines not to pay any amount demanded, the penalty shall not be payable in any subsequent action.
Fla. Stat. § 627.736(10)(d) (2013) (emphasis added).
Here, when Windhaven responded to the Plaintiff’s Demand Letter by making a reduced payment, sections 627.736(10)(c) and 627.736(10)(d)’s entitlement to the penalty, postage and interest were triggered. For whatever reason, which remains unexplained, Windhaven failed to pay the statutory postage and penalty.3 It was only by virtue of the lawsuit that Windhaven ultimately paid the penalty and postage, thereby confessing judgment for the damages statutory damages sought by the Plaintiff. To allow an insurer to avoid §627.428 attorney’s fee liability would remove any incentive for an insurer to pay penalty and postage when they are due and would force insureds to file suit in every instance with no attorney’s fee liability on the part of the insurer; a result that is contrary to the purpose of §627.428.§627.428, Fla. Stat.
The Court finds that §627.428, Fla. Stat. is applicable and requires a finding of entitlement to the Plaintiff’s attorney’s fees.
Florida Statutes §627.428 entitles every insured who prevails against an insurer to recover his or her attorney’s fees. All that is required to trigger attorney’s fee liability in a first-party claim against an insurer is for the insured to obtain “a judgment or decree. . . .” A confession of judgment makes the Plaintiff a “prevailing” insured.4
Section 627.428 provides, in pertinent part:
Upon the rendition of a judgment or decree by any of the courts of this state against an insurer and in favor of any named or omnibus insured or the named beneficiary under a policy or contract executed by the insurer, the trial court . . . shall adjudge or decree against the insurer and in favor of the insured or beneficiary a reasonable sum as fees or compensation for the insured’s or beneficiary’s attorney prosecuting the suit in which recovery is had.
Fla. Stats. §627.428 (emphasis added); §627.736(8).5 See also Ivey v. Allstate, 774 So.2d 679, 682 (Fla. 2000) [25 Fla. L. Weekly S1103a] (“Florida law is clear that in ‘any dispute’ which leads to judgment against the insurer and in favor of the insured, attorney’s fees shall be awarded to the insured. . . . If a dispute arises between an insurer and an insured, and judgment is entered in favor of the insured, he or she is entitled to attorney’s fees.”); Sonora v. Star Cas. Ins. Co., 603 So.2d 661 (Fla. 3d DCA 1992); Old Republic Ins. Co. v. Monsees, 188 So.2d 893 (Fla. 4th DCA 1966)(attorney’s fee statute [previously §627.0127] “becomes in effect a part of every insurance policy issued in Florida.”)
Section 627.428 says nothing about the recovery of insurance benefits only as the basis for an attorney’s fee award.
In particular, in this case, the PIP Statute allows an insured to recover its postage and the limited “penalty” if the insurer pays claimed benefits or a portion thereof during the Demand Letter period. If those statutory damages are not recovered pre-suit and the insured is forced to file suit to recover them, attorney’s fees incurred as a result are recoverable pursuant to §627.428.
Old Republic Ins. Co. v. Monsees, 188 So.2d 893 (Fla. 4th DCA 1966), states in pertinent part, “[t]he application of the statute is not limited to suits for the recovery of money.” Therefore, all that is required for the Plaintiff to recover its attorney’s fees is for the Plaintiff to obtain a judgment, order, or decree (or the functional equivalent thereof, i.e., a confession of judgment). See also Peninsular Life Ins. Co. v. Howard, 72 So.2d 389 (Fla. 1954)(affirming award of attorney’s fees to beneficiary who prevailed on counter-claim for declaratory relief); Florida Rock and Tank Lines, Inc. v. Continental Ins. Co., 399 So.2d 122 (Fla. 1st DCA 1981)(reversing denial of attorney’s fees where insured prevailed in indemnity claim brought against it by insurer); Old Republic Ins. Co. v. Monsees, 188 So.2d 893 (Fla. 4th DCA 1966).
The provisions of the entire PIP Statute are incorporated into every PIP policy by virtue of Fla. Stat. §627.7407(2), and therefore any penalties or other damages provided for in the PIP Statute become part of the policy and recovery of any of those damages or penalties entitles the insured to its attorney’s fees.6 See §627.7407(2), supra; see also State Farm Mut. Auto. Ins. Co. v. Curran, 83 So.3d 793 (Fla. 5th DCA 2011) [36 Fla. L. Weekly D195b], approved 135 So.3d 1071 (Fla. 2014)(“PIP policies incorporate a PIP statute providing a penalty for failure to attend a CME.”)
In this case, the postage and penalties to which the Plaintiff was entitled, which it “recovered” by way of Windhaven’s confession of judgment satisfy the §627.428 requirement that the insured obtain “an order or decree” (or the functional equivalent thereof) in its favor in any suit in which “recovery is had.” Fla. Stat. §627.428.Petty v. FIGA is Inapplicable
Petty v. FIGA, 80 So.3d 313 (Fla. 2012) [36 Fla. L. Weekly D195b], on which Windhaven relies, has no application in PIP. PIP is statutory insurance and has nothing to with the FIGA Statute. See Custer Medical Center, Inc. (a/a/o Maximo Masis) v. United Auto. Ins. Co., 62 So.3d 1086, 1089 (Fla. 2010) [35 Fla. L. Weekly S640a] (recognizing the distinction between PIP, which is statutorily mandated, and other types of insurance; cases involving non-statutory insurance policies have “no application in the statutorily required coverage context”); Nunez v. GEICO Gen. Ins. Co., 117 So.3d 388 (Fla. 2013) [38 Fla. L. Weekly S440a] (same).
Petty involved a homeowner’s policy and dealt with the FIGA Act; specifically, whether FIGA was liable to pay the homeowner’s claim for attorney’s fees where the homeowner’s policy did not include an attorney’s fee provision. The claim for fees arose under Fla. Stats. §627.428 after the insurer paid an appraisal award, thus constituting a confession of judgment.
The Court held that FIGA had no liability because the claim for attorney’s fees was not a “covered claim” under the FIGA Act. FIGA’s statutory liability is limited to “covered claims,” which are defined by the Act, once it takes over an insolvent insurer. See §631.51(1)(“The purposes of this part are to: (1) Provide a mechanism for the payment of covered claims under certain insurance policies to avoid excessive delay in payment and to avoid financial loss to claimants or policy holders because of the insolvency of an insurer.” Fla. Stats. §631.51(1)(emphasis added).) FIGA’s “covered claim” liability is not at issue in this case.
In this case, Windhaven’s liability is governed by the PIP Statute — not the FIGA Statute.
Moreover, Fla. Stat. §627.428 does not automatically apply to claims made against FIGA or an insolvent insurer because the FIGA Act has its own attorney’s fee provision. See Fla. Stat. §631.70. Therefore, attorney’s fees liability on the part of FIGA is governed by that provision and not §627.428.
Unlike the FIGA Act, the PIP Statute has its own coverage provisions, and it also includes an attorney’s fee provision, i.e., Fla. Stats. §627.736(8), which specifically is incorporated into every PIP policy and which specifically does make Fla. Stats. §627.428 applicable in PIP cases. Also unlike the FIGA Act, the PIP Statute also has statutory damages and penalties that are incorporated into every PIP policy. See Fla. Stat. §627.736(10).
For the reasons stated herein and those adopted in the cases on which the Court relies, this Court GRANTS Plaintiff’s Motion for Entitlement to Attorney’s Fees pursuant to §627.428, based upon Windhaven’s confession of judgment for statutory damages.
__________________
1Windhaven also cites an opinion issued by the 17th Judicial Circuit which applied Petty, supra. See UAIC v. ISO Diag. Testing, Inc. (a/a/o Yvonne Quevedo), Case No. COCE12-24010 (Fla. 17th Jud. Cir., Mar. 18, 2016) [23 Fla. L. Weekly Supp. 1000c].
2Because the Fourth District relied on Petty, supra, the Court finds that the Fourth District reached the wrong result.
3At the hearing, Windhaven provided no reason for not having paid the statutory penalty and postage when they were due before suit was filed.
4See e.g., Wollard v. Lloyd’s and Companies of Lloyd’s, 439 So.2d 217 (Fla. 1983)(settling disputed case is equivalent of a confession of judgment); Ajmechet v. United Auto. Ins. Co., 790 So.2d 575 (Fla. 3d DCA 2001) [26 Fla. L. Weekly D1816d](reversing denial of attorney’s fees to insured where United Auto paid loss during suit “[b]ecause the payment was obviously effected by the law suit, . . . .”); Barreto v. USSA, 82 So.3d 159 (Fla. 4th DCA 2012) [37 Fla. L. Weekly D571a] (insured who had to resort to judicial process to enforce appraisal process and obtain total amount of loss benefits entitled to attorney’s fees); United Auto. Ins. Co. v. Zulma, 661 So.2d 947 (Fla. 4th DCA 1996) [20 Fla. L. Weekly D2373i] (payment of insurance claim during suit was confession of judgment entitling insured to award of attorney’s fees).
5Section 627.736(8) provides, in pertinent part:
APPLICABILITY OF PROVISION REGULATING
ATTORNEY’S FEES – With respect to any dispute under the provisions of ss. 627.730-627.7405 between the insured and the insurer, or between an assignee of an insured’s rights and the insurer, the provisions of s. 627.428 shall apply, except as provided in subsections (10) and (15).
§627.736(8), Fla. Stats. (2008).
6Section 627.7407(2) of the No-Fault Law provides, in pertinent part:
(2) Any personal injury protection policy in effect on or after January 1, 2008, shall be deemed to incorporate that provisions of the Florida Motor Vehicle No-Fault Law, as revived and amended by this act.
§627.7407(2), Fla. Stats. (2008).
