27 Fla. L. Weekly Supp. 425a

Online Reference: FLWSUPP 2704CLUCInsurance — Personal injury protection — Affirmative defenses — Accord and satisfaction — Insurer’s check for reduced payment of bills with notation that it was “full and final” did not effect accord and satisfaction where there was nothing in record indicating existence of preexisting dispute between parties — Further, “full and final” language on check in same size as surrounding text and not distinguished by contrasting type, font, or color does not amount to conspicuous statement — Provider’s motion for final summary judgment on defense is granted

QUALITY MEDICAL, GROUP, INC., (a/a/o Carlos Lucin), Plaintiff, v. UNITED AUTOMOBILE INSURANCE COMPANY, Defendant. County Court, 11th Judicial Circuit in and for Miami-Dade County. Case No. 14-9825 SP 25 (04). May 30, 2017. Carlos Guzman, Judge. Counsel: Armando Brana (Trial Counsel) and Marlene S. Reiss (Appellate Counsel), for Plaintiff/Appellee. Catherine Massard Ribetti (Trial Counsel) and Michael Neimand (Appellate Counsel), for Defendant/Appellant.

ORDER DENYING DEFENDANT’S MOTION FORSUMMARY JUDGMENT AND FOR 57.105SANCTIONS AND GRANTING PLAINTIFF’SCROSS-MOTION FOR SUMMARY JUDGMENTON “ACCORD AND SATISFACTION” DEFENSE

THIS CAUSE came before the Court on March 27, 2017, on the parties’ cross-motions for summary judgment on the Defendant’s “Accord and Satisfaction” defense, the Court having reviewed the cross-motions, having reviewed all pertinent documents, and having heard argument of counsel, DENIES Defendant’s Motion for Summary Judgment and GRANTS the Plaintiff’s Cross-Motion for Summary Judgment. Accordingly, it is hereby

ORDERED AND ADJUDGED:

that the Defendant’s Motion for Summary Judgment on its “Accord and Satisfaction” defense is DENIED; and, the Plaintiff’s Cross-Motion for Final Summary Judgment on the defense is hereby GRANTED. Defendant United Auto’s motion for sanctions is DENIED.

On October 27, 2016, the Court previously granted partial summary judgment in favor of the Plaintiff on its prima facie case of medical necessity, relatedness, and the reasonableness of charges [27 Fla. L. Weekly Supp. 423a]. The last remaining issue was Defendant United Auto’s “Accord and Satisfaction” defense.¹

This case involves Quality Medical Group’s claim for Personal Injury Protection (PIP) benefits, as the valid assignee of United Auto’s insured, Carlos Lucin.

United alleged a single affirmative defense, which stated:

As for its first affirmative defenses, Defendant states that prior to the lawsuit being filed, it has paid all of the medical bills at issue for all dates of service, 9/8/09 through 11/25/09, as a full and final payment in the amount of $3,545.09 in benefits and $108.25 in interest, and Plaintiff has cashed said payment in accord and satisfaction of subject claim. The amount paid was a lesser amount than was at issue and Plaintiff cashed the checks that were tendered and conspicuously marked as “full and final” on the from of the checks. Defendant’s adjuster issued checks for “full and final” payment of PIP benefits and interest for all dates of service with the intent that if Plaintiff cashed the checks it would be a complete satisfaction of the claim. Plaintiff, by endorsing and cashing the checks tendered by Defendant as full and final payment, has agreed in writing to the terms of the checks as being a full and final payment and is estopped from denying said checks are a full and final payment. As such, pursuant to Fla. Stats. 673.3111 and/or common law, this operates as an accord and satisfaction and Plaintiff is barred from bringing this action.

Undisputed Facts and Conclusions of Law

It is undisputed that Quality Medical rendered services to Mr. Lucin from September 8, 2009 to November 25, 2009, and submitted bills that totaled $7,117.00. United Auto unilaterally reduced the bills and sent a purported “full and final payment” in the amount of $3,545.09 (with a separate interest check), with no prior contact with Quality Medical.

Quality Medical sued for the difference.

The question of whether an accord and satisfaction has occurred is one of law.

An accord and satisfaction defense 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]; St. Mary’s Hospital, Inc. v. Schocoff, 725 So.2d 454, 457 (Fla. 4th DCA 1999) [24 Fla. L. Weekly D405a]; Chassan Prof. Wallcovering, Inc. v. Victor Frankel, Inc., 608 So.2d 91, 93 (Fla. 4th DCA 1992); Brewer v. Northgate of Orlando, Inc., 143 So.2d 358 (Fla. 2d DCA 1962).There Was No Bona Fide Preexisting Dispute Between the Parties

As for the first prong, nothing in the record demonstrates that there was any preexisting dispute between Quality Medical and United Auto. See St. Mary’s Hospital, Inc. v. Schocoff, 725 So.2d 454 (Fla. 4th DCA 1999) [24 Fla. L. Weekly D405a](“An accord and satisfaction results as a matter of law only when the creditor accepts payment tendered on the expressed condition that its receipt is deemed to be a complete satisfaction of a disputed issue.”); Best Amer. Diag. Center, Inc. (a/a/o Lenia Pineiro), 20 Fla. L. Weekly Supp. 447a (Broward Cty. Ct., January 4, 2013) (“There must be unequivocal evidence that a dispute existed prior to the issuance of the payment by the Defendant.”)(emphasis in original), affirmed, (Fla. 17th Jud. Cir., August 7, 2014); Miami Dade County MRI Corp. (a/a/o Maritza Borja) v. UAIC, Case No. 12-14886 SP 23 (01) (Miami-Dade Cty. Ct., August 22, 2014). (“There is no evidence that a dispute existed between the parties prior to the issuance of the check upon which the Defendant relies for its defense. … [T]he cashing of the check cannot constitute an accord and satisfaction absent all elements of the defense of accord and satisfaction.”)

Quality Medical simply submitted its bills to United for payment. An insurer’s receipt of medical bills does not constitute a “preexisting dispute.” St. Mary’s, supra. See Best Amer. Diag. Center, Inc. (a/a/o Lenia Pineiro), 20 Fla. L. Weekly Supp. 447a (Broward Cty. Ct., January 4, 2013) (“An insurer, however, cannot create a dispute by making a payment in an amount it contends will fully satisfy its obligation.”), affirmed, (Fla. 17th Jud. Cir., August 7, 2014).

Without a preexisting dispute, there is nothing to settle by way of an accord and satisfaction. The Court finds that United failed to satisfy the first prong of an accord and satisfaction.United’s “Full & Final” Language is Not Conspicuous

Next, the Court finds that the language on the check upon which United relies to support its accord and satisfaction defense is not conspicuous as defined by law.

Whether a term is “conspicuous” is a question of law for the Court to decide. See Fla. Stat. §671.201(10)(a); see Dr. Alan R. Freedman (a/a/o Janette Westley) v. UAIC, 22 Fla. L. Weekly Supp. 397a (Broward Cty. Ct., Aug. 6, 2014); Atlantic Acu-Med Center Corp. (a/a/o Guillaume Baptiste v. UAIC, 16 Fla. L. Weekly Supp. 781a (Broward Cty. Ct., May 25, 2009).

The “Uniform Commercial Code” requires that full and final language on a negotiable instrument be “conspicuous.” See §673.3111(2) (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); Ennia Gen. Ins. Co., Ltd., v. Auld, 506 So.2d 62 (Fla. 4th DCA 1987)(draft sent to insured stated: “By endorsing the draft the payees accept same in full settlement and release of all claims . . .”.); Rudick v. Rudick, 403 So.2d 1091 (Fla. 3d DCA 1981)(check conspicuously stated “balance of all fees and costs”).

“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).

United checks do not satisfy the statutory requirement. The language on the face of United’s check is not set apart from language of similar font. Rather, the language on the check was included as part of “two other lines of similar font” and is not in a contrasting color. Nor is the language set off by any “symbols or marks that call attention to the language.” Fla. Stats. 671.201(10)(a) & (b).

Additionally, Fla. Stats. § 671.201(10)(a) requires a heading. United’s “Full and Final” language is not demarcated by any heading.

To the contrary, the language is located on the third line under the words “QUALITY MEDICAL GROUP, INC. F.A.O. CARLOS LUCIN//DOS: 09-0809-11/25/09” and contiguous with the redacted account number. The language is in letters no different than the name of the Payee, which gives no indication that any of the language below the Payee pertains to an accord and satisfaction. Therefore, in relation to the entire instrument, United’ s “full and final” language is not “conspicuous.”

Comment 4 to §673.3111, suggests that a claimant “ought to have noticed” a full and final statement only where the language appears above the space provided for endorsement.

United does not place its “full and final” language above the endorsement space of its checks. Rather, it places the language under the payee’s name on the front of the check and in the same type.

If an instrument itself does not contain conspicuous language, then the payor must accompany the instrument with a written communication that must, itself, contain conspicuous language. See Fla. Stat. §673.31111(2). See Yelen v. Cindy’s, Inc., 386 So.2d 1234 (Fla. 3d DCA 1980)(check sent with letter that stated: “The enclosed check is being tendered to you in full satisfaction of the current controversy existing, between you and [us]. . . Your acceptance and depositing of this check shall constitute your . . . acceptance of the terms of the release. If this is not acceptable, you should return the check to me.”); Mortell v. Keith, Mack, et al. 528 So.2d 1362 (Fla. 3d DCA 1988)(check marked “paid in full” was accompanied by a letter that clearly demonstrated that the amount tendered was in complete payment of the amounts due); McGhee v. Mata, 330 So.2d 248 (Fla. 3d DCA 1976)(check accompanied by a letter communicating that the cashing the check would settle the dispute); Martinez v. South Bayshore Tower, 979 So.2d 1023 (Fla. 3d DCA 2008)(developer returned the deposits with a letter staring that cashing the check would serve as an accord and satisfaction, terminating the parties’ rights and obligations under the contract).

United’s position that the mere cashing of a check that contains “full and final” language effectuates an accord and satisfaction is not supported by the law. See Hannah v. James A. Ryder Corp., 380 So.2d 507 (Fla. 3d DCA 1980)(plaintiff’s mere negotiation of tendered checks did not constitute accord and satisfaction).

United Auto. Ins. Co. v. Palm Chiro. Center, Inc., 51 So.3d 506 (Fla. 4th DCA 2010) [35 Fla. L. Weekly D2686a], on which United relies, is distinguishable. See Health Diag. of Miami, LLC d/b/a Stand-Up MRI of Miami (a/a/o Casta Puello) v. UAIC, 19 Fla. L. Weekly Supp. 879b (Broward Cty. Ct., July 2, 2012), affirmed, cert denied, UAIC v. Health Diag. of Miami, LLC d/b/a Stand-Up MRI of Miami (a/a/o Casta Puello), Consolidated Case Nos. 4D13-4574 & 4D13-4575 (Fla. 4th DCA May 14, 2014).

In Palm Chiro. supra, the Fourth District denied second-tier certiorari finding that the circuit court did not depart from the requirements of law by applying St. Mary’s Hospital, Inc. v. Schocoff, 725 So.2d 454 (Fla. 4th DCA 1999) [24 Fla. L. Weekly D405a], which the Fourth District determined “did not involve a check with limiting language which made ‘explicit, without question, the insurer’s position [that] there are no further benefits due under the policy and it does not intend to make any further payments’.” Palm Chiro., supra at 509.

In this case, United’s check did not “explicitly, without question” demonstrate that no further payments would be due.

The Court takes notice of the myriad court orders in which multiple courts, both trial and appellate, have determined that the language on United Auto’s checks does not effectuate an “accord and satisfaction.”²

Finally, the Court denies United Auto’s motion for §57.105 sanctions, which motion is incorporated within United Auto’s Motion for Summary Judgment.

Accordingly, it is hereby

ORDERED AND ADJUDGED:

that the Defendant’s Motion for Summary Judgment on its “Accord and Satisfaction” defense is DENIED; and, the Plaintiff’s Cross-Motion for Final Summary Judgment on the defense is hereby GRANTED. Defendant United Auto’s motion for sanctions is DENIED.

Plaintiff will submit a final judgment for execution by the Court.

__________________

¹The parties agreed on the record that the Court could consider the issue on cross-motions at the same hearing, notwithstanding that Plaintiff’s motion was not set to be heard until March 29, 2017.

²See UAIC v. A-1 Open MRI, Inc. (a/a/o Olga Mederos), 11-7709 COCE (Broward Cty. Ct., December 12, 2012) [22 Fla. L. Weekly Supp. 796c], affirmed, Case No. 12-35806 CACE (Fla. 17th Jud. Cir., Jan. 22, 2015); Miami Dade County MRI Corp. (a/a/o Maritza Borja), Case No. 12-14886 (Miami-Dade Cty. Ct., Aug. 22, 2014); MR Services I, Inc. (a/a/o Kevin Henderson) v. UAIC, FLWSUPP 2207HEND (Broward Cty. Ct., January 14, 2015) [22 Fla. L. Weekly Supp. 856a](granting summary judgment for plaintiff upon finding that “notation added to the top of the letter accompanying the tendered check … fails as a matter of law as if fails to meet the conspicuousness requirement set forth in the statute for tender of a negotiable instrument”); Care Plus Med. Ctr of Westchester, Inc. (a/a/o Maria Del R. Ladines) v. UAIC, 24 Fla. L. Weekly Supp. 156b (Miami-Dade Cty, Ct., Dec. 5, 2014); Best Amer. Diag. Center, Inc. (a/a/o Lenia Pineiro), 20 Fla. L. Weekly Supp. 447a (Broward Cty. Ct., Jan. 4, 2013)(“There must be unequivocal evidence that a dispute existed prior to the issuance of the payment by the Defendant.”)(emphasis in original), affirmed, (Fla. 17th Jud. Cir., Aug. 7, 2014); Miami Dade County MRI, Corp. v. UAIC, Case No. 12-14886 SP 23 (01)(Miami-Dade Cty. Ct., Aug. 22, 2014)(“There is no evidence that a dispute existed between the parties prior to the issuance of the check upon the Defendant relies for its defense. . . . [T]he cashing of the check cannot constitute an accord and satisfaction absent all elements of the defense of accord and satisfaction”); Hallandale Open MRI, LLC (a/a/o Jonathan Bailey) v. UAIC, FLWSUPP 2201BAIL (Broward Cty. Ct., Aug. 14, 2014) [22 Fla. L. Weekly Supp. 162a]; Dr. Alan R. Freedman (a/a/o Janette Westley) v. UAIC, Case No. 11-3383 COCE (55) (Broward Cty. Ct., August 6, 2014) [22 Fla. L. Weekly Supp. 397a]; Health Diag. of Miami, LLC d/b/a Stand-Up MRI of Miami (a/a/o Casta Puello) v. UAIC, 19 Fla. L. Weekly Supp. 879b (Broward Cty. Ct., July 2, 2012, affirmed, cent. den., Case No. 41D13-4574 & 4D13-4575 (Fla. 4th DCA May 14, 2014); Complete Rehab & Med. Centers (a/a/o Miyerlandy Martinez) v. UAIC, Case No. 09-7320 COCE (53) [16 Fla. L. Weekly Supp. 1171a] (determining that United Auto’s purported “Full & Final” checks did not constitute an accord and satisfaction), affirmed, (Fla. 17th Jud. Cir., Oct. 24, 2013); Doctor Rehab Center, Inc, (a/a/o Fernando Chamorro) v. UAIC, Case No. 11-1888 SP 26 (03) (Miami-Dade Cry. Ct., Jan, 9, 2013); Progressive Rehab. and Ortho. Svcs., LLC (a/a/o Victor Bure-Figueroa) v. UAIC, Case No. 12-01316 SP 26 (03) (Miami-Dade Cty. Ct., Jan. 9, 2013) [20 Fla. L. Weekly Supp. 438a]; Best Amer. Diag. Center, Inc. (a/a/o Obdulia Romaguera) v. UAIC, 21 Fla. L. Weekly Supp. 270c (Miami-Dade Cty. Ct., Oct. 17, 2013); Miami Dade County MRI, Corp, (a/a/o Maria Gonzalez) v. UAIC, Case No. 12-15317 SP 23 (06) (Miami-Dade Cty. Ct., Aug. 30, 2013): Sunshine Health Group (a/a/o Rosa Castro) v. UAIC, 20 Fla. L. Weekly. Supp. 603a (Miami-Dade Cty. Ct., Jan. 9, 2013) (“ Defendant has offered no evidence of a “bona fide” dispute existing between the parties. . . . Defendant has provide no evidence that the payment tendered to Plaintiff contained a “conspicuous statement” as required to perfect a statutory accord and satisfaction. . . .”); Best Amer. Diag. Center (a/a/o Georgina Perez v. UAIC, 20 Fla. L. Weekly Supp. D163b (Miami-Dade Cty. Ct., Oct. 5, 2012); Pembroke Pines MRI d/b/a DPI of Pembroke Pines (a/a/o Daisy Fernandez), Case No. 11-016381 COCE (50)(Broward Cty. Ct., Apr. 24, 2012); Michael J. Delesparra DC, PA (a/a/o Michelle Petit-Jean) v. UAIC, 19 Fla. L. Weekly Supp. 214a (Broward Cty. Ct., December 8, 2011); Ann K Medical Office, Inc. (a/a/o Rosa Delgado) v. UAIC, 17 Fla. L. Weekly Supp. 684a (Miami-Dade Cty. Ct., May 21, 2010).