25 Fla. L. Weekly Supp. 829a
Online Reference: FLWSUPP 2509ADAMInsurance — Med pay — Subrogation lien — Declaratory judgments — Amended complaint seeking declaration that any recovery of settlement proceeds by insurer under subrogation lien is required to be reduced by its pro rata share of attorney’s fees and costs incurred by insured in recovering from tortfeasor fails to present bona fide, actual, or present need for declaration where collateral source statute clearly provides for reduction of lien by pro rata share of fees and costs and statute is not in conflict with subrogation clause in policy or letters from insurer asserting claim of lien under statute and policy — Motion to dismiss is granted
ROBERT E. ADAMS, Plaintiff, vs. ALLSTATE FIRE AND CASUALTY INSURANCE COMPANY, Defendant. County Court, 15th Judicial Circuit in and for Palm Beach County. Case No. 502017CC005560XXXXMB. September 27, 2017. Sherri L. Collins, Judge. Counsel: James C. Spitz, West Palm Beach, for Plaintiff. Gladys Perez Villanueva, Shutts & Bowen LLP, Miami, for Defendant.
Order GRANTING DEFENDANT’S MOTION todismiss Plaintiff’s amended complaint for declaratoryrelief and dismissing complaint with prejudice
This matter came before the Court upon the Defendant, Allstate Fire and Casualty Insurance Company (“Allstate’s”), Motion to Dismiss Plaintiff’s Amended Complaint for Declaratory Relief. Plaintiff, Robert Adams, was represented by James Spitz, Esq., and Defendant, Allstate Fire and Casualty Insurance Company, was represented by Gladys Perez Villanueva of Shutts & Bowen. The Court, having heard argument of the parties on the 25th day of August, 2017, reviewed the entire court file and written submissions by both parties, and being otherwise duly advised in the matter, GRANTS Allstate’s Motion to Dismiss, and makes the following findings of fact and conclusions of law:Material Facts
Plaintiff, Robert E. Adams, was insured by Allstate at the time he was involved in a motor vehicle accident. Plaintiff’s policy afforded him Med Pay coverage. Allstate paid Plaintiff’s medical providers $3,104.27 in Med Pay benefits, for which it claimed a subrogation lien on any settlement proceeds. Plaintiff settled with the third-party tortfeasor, without reimbursing any amount of Allstate’s lien for Med Pay benefits.
Plaintiff filed a Complaint for Declaratory Relief, alleging that Allstate’s failure to respond to Plaintiff’s repeated efforts to obtain a copy of the policy, specifically the policy language, upon which Allstate relied in asserting that it maintained a subrogation claim for Med Pay, constituted a waiver of any subrogation claim under section 768.76(7), Florida Statutes. Plaintiff’s Complaint further alleged that if Allstate is entitled to recovery under its subrogation lien, section 768.76(4), Florida Statutes, applies and requires a reduction of the amount of the insurer’s reimbursement by its pro rata share of costs and attorney’s fees.
After Allstate filed its Motion to Dismiss Plaintiff’s Complaint, Plaintiff filed an Amended Complaint for Declaratory Relief. Plaintiff’s Amended Complaint includes the same prayer for relief as in the Complaint, i.e., that the Court declare that if Allstate is entitled to recovery under its subrogation lien, section 768.76(4), Florida Statutes, applies and requires a reduction of the amount of the insurer’s reimbursement by its pro rata share of costs and attorney’s fees. Essentially, Plaintiff’s Amended Complaint is the same as its original Complaint minus the claim that Allstate waived its subrogation rights. Allstate’s Motion to Dismiss, which is the subject of this order, tests the sufficiency of the amended complaint.Standard for Motion to Dismiss
The standard to be utilized in considering a motion to dismiss has been set forth by the Fourth District Court of Appeal in Hitt v. North Broward Hospital District, 387 So. 2d 482, 483 (Fla. 4th DCA 1980)(quoting Poulos v. Vordermeier, 327 So. 2d 245, 246 (Fla. 4th DCA 1976)):
The function of a motion to dismiss a complaint is to raise a question of law as to the sufficiency of the facts alleged to state a cause of action. The motion admits as true all well pleaded facts as well as all reasonable inferences arising from those facts. The allegations must be construed in the light most favorable to plaintiffs and the trial court must not speculate what the true facts may be or what will be proved ultimately in trial of the cause. Further, the trial court’s gaze is limited to the four corners of the complaint. Finally, the motion must be decided on questions of law, only, and matters not shown on the face of the complaint cannot properly be raised on a motion to dismiss.
Declaratory Relief
Chapter 86 of the Florida Statutes governs declaratory actions and requires Plaintiff to establish that:
there is a bona fide, actual, present practical need for the declaration; that the declaration should deal with a present, ascertained or ascertainable state of facts or present controversy as to a state of facts; that some immunity, power, privilege or right of the complaining party is dependent upon the facts or the law applicable to the facts; that there is some person or persons who have, or reasonably may have an actual, present, adverse and antagonistic interest in the subject matter, either in fact or law; that the antagonistic and adverse interest are all before the court by proper process or class representation and that the relief sought is not merely the giving of legal advice by the courts or the answer to questions propounded from curiosity. These elements are necessary in order to maintain the status of the proceeding as being judicial in nature and therefore within the constitutional powers of the courts.
Id. citing Martinez v. Scanlan, 582 So. 2d 1167, 1170 (Fla. 1991) (emphasis in original); City of Hollywood v. Petrosino, 864 So.2d 1175, 1177 (Fla. 4th DCA 2004) [29 Fla. L. Weekly D163a]; and May v. Holley, 59 So. 2d 636, 639 (Fla. 1952).
When considering a motion to dismiss a declaratory action, “[t]he test is not whether the complaint shows that the plaintiff is likely to succeed in getting a declaration of rights, but whether the plaintiff is entitled to a declaration of rights at all.” Graves v. City of Pompano Beach, 74 So. 3d 595, 597-98 (Fla. 4th DCA 2011) [36 Fla. L. Weekly D2572b]. Courts “have no power to entertain a declaratory judgment action which involves no justiciable controversy.” See El Faison Dorado, Inc. v. Hillsborough County, 483 So. 2d 518 (Fla. 2d DCA 1986). Courts routinely decline to exercise jurisdiction in cases that seek declaratory relief where there is a lack of justiciable controversy. See Apthorp v. Detzner, 162 So. 3d 236 (Fla. 1st DCA 2015) [40 Fla. L. Weekly D490a] and cases cited therein.Analysis
Plaintiff, in his amended complaint, claims to be in doubt as to his rights under section 768.76(4), arguing that any recovery to which Allstate is entitled under a Med Pay subrogation lien is restricted to the subrogation language contained within section 768.76(4), which requires a reduction of the amount of the insurer’s reimbursement by the pro rata share of costs and attorney’s fees. Plaintiff further argues that Allstate’s subrogation clause (i.e., policy language addressing subrogation rights) and Allstate’s demand letter somehow conflict with section 768.76(4). This Court disagrees.
Subsection (4), of section 768.76, Florida Statutes, states:
(4) A provider of collateral sources that has a right of subrogation or reimbursement that has complied with this section shall have a right of reimbursement from a claimant to whom it has provided collateral sources if such claimant has recovered all or part of such collateral sources from a tortfeasor. Such provider’s right of reimbursement shall be limited to the actual amount of collateral sources recovered by the claimant from a tortfeasor, minus its pro rata share of costs and attorney’s fees incurred by the claimant in recovering such collateral sources from the tortfeasor. In determining the provider’s pro rata share of those costs and attorney’s fees, the provider shall have deducted from its recovery a percentage amount equal to the percentage of the judgment or settlement which is for costs and attorney’s fees.
Allstate’s Policy contains the following subrogation clause:
Subrogation Rights
When we pay, an insured person’s rights of recovery from anyone else becomes ours up to the amount we have paid. The insured person must protect these rights and help us enforce them.
Initially, this Court notes that Plaintiff is attempting to obtain a declaration of the explicit statutory language in section 768.76(4). There is no dispute as to the explicit text of section 768.76(4) or that any reimbursement of a collateral source, in this case Med Pay subrogation, is to be reduced in accordance with Florida’s Collateral Source Statute.
Allstate’s policy language quoted above is also a statement of law because, under Florida law, subrogation is not available to an extent greater than the amount paid by the insurer. See McCabe v. Florida Power and Light Co., 68 So. 3d 995, 997 (Fla. 4th DCA 2011) [36 Fla. L. Weekly D1966b]; see also Allstate Ins. Co. v. Rudnick, 761 So. 2d 289, 293 (Fla. 2000) [25 Fla. L. Weekly S329d] (holding collateral source statute includes only those benefits that have already been paid or that are presently due and owing).
Importantly, section 768.76(4) limits Allstate’s “right of reimbursement”; Allstate’s subrogation clause grants Allstate its insured’s “right of recovery” from a third party. Contrary to Plaintiff’s argument, nothing in Allstate’s subrogation clause grants it a specific amount of reimbursement; it is simply a standard subrogation clause.
This Court further finds as follows with regard to the attachments to the Plaintiff’s Complaint:
1. Attachment A — Letter from Allstate to Plaintiff’s Counsel, dated January 31, 2015, which provides:
Allstate Insurance Company has received notice of a claim for Automobile Medical Payments Coverage under the subject policy resulting from the above-referenced date of loss. Allstate hereby places you on notice that with respect to any Automobile Medical Payments Coverage benefits paid to our insured as a result of the above-referenced incident, Allstate asserts its right of subrogation against claims made by our insured against other party for damages.
This notice asserting Allstate’s right of subrogation with regard to its payment of Automobile Medical Payments Coverage benefits relating to the above-referenced claim is being made pursuant to the subject policy of insurance and, to the extent applicable, pursuant to §768.76(7), Florida Statutes.
This court finds that Allstate’s letter of January 15, 2015 specifically indicates that the claim is being made subject to the appropriate statute regarding collateral sources.
2. Attachment B — Letter from Allstate to Plaintiff’s Counsel, “Notice of Intent to Assert Our Subrogation Claim,” dated April 25, 2016.
This Court finds that this letter asserts Allstate’s subrogation claim in the amount of $3,104.27.
3. Attachment C — Letter from Allstate’s Counsel to Plaintiff’s Counsel, dated March 8, 2017.
The March 8th letter is the one focused on by the parties’ at the hearing. The letter provides:
Our law firm has been retained by Allstate Insurance Co. to collect on lien for medical payments made to your client in connection with the loss on the above mentioned date.
Demand is hereby made for the reimbursement of the lien in favor of Allstate for medical payments advanced pursuant to their letter of protection in the amount of $3,104.27.
This letter demands payment of Allstate’s lien and establishes the lien amount. There is no contradiction or conflict between Allstate’s subrogation policy language, this letter — which establishes a lien amount — and Florida’s Collateral Source Statute.
This Court finds that the attachments to Plaintiff’s Amended Complaint demonstrate that Allstate properly asserted its subrogation rights under Florida’s Collateral Source Statute and properly asserted a claim of lien for the amount of Med Pay benefits it provided to Plaintiff, which should have been resolved during the settlement with the third-party tortfeasor, in accordance with the subrogation and cooperation clauses of the parties’ policy.Conclusion of Law
The Court finds that considering the language of section 768.76(4), Florida’s Collateral Source Statute, which provides that when recovering amounts paid under Med Pay subrogation, right of reimbursement shall be limited to the actual amount of the collateral source recovered by the claimant from the tortfeasor minus its pro rata share of costs and attorney’s fees incurred by the Plaintiff, and the subrogation clause in Allstate’s policy, which provides that when Allstate has paid, the insured’s right of recovery from anyone else becomes Allstate’s up to the amount Allstate paid, are not in conflict; there is no contradiction among the policy and statute.Conclusion
Plaintiff’s Amended Complaint for Declaratory Relief, requesting a declaration of the explicit statutory language in section 768.76(4) and Allstate’s policy language regarding subrogation rights — which is clearly a statement of the applicable law itself, does not comport with the jurisdictional requirement of Chapter 86. Plaintiff fails to present a “bona fide, actual, or present” need for a declaration as required by Chapter 86 of the Florida Statutes. Because Plaintiff’s complaint and amended complaint rely upon the statutory and policy language, as well as the letters attached to the amended complaint, the Court’s interpretation of the language of these documents and its finding that there is no contradiction between the policy and the letters sent to the Plaintiff, this Court finds that any further amendment to the Complaint would be futile. Accordingly,
IT IS HEREBY ORDERED AND ADJUDGED that Defendant’s Motion to Dismiss Plaintiff’s Amended Complaint for Declaratory Relief is hereby GRANTED;
IT IS FURTHER ORDERED AND ADJUDGED that Plaintiff’s Amended Complaint for Declaratory Relief is hereby DISMISSED WITH PREJUDICE.
