3 Fla. L. Weekly Supp. 673a

Appeals — Circuit court has jurisdiction to review county court’s non-final order compelling arbitration — Insurance — Personal injury protection — Provision in automobile insurance policy requiring binding arbitration of any PIP claims dispute involving medical benefits between insurer and medical provider once the provider has accepted an assignment of benefits is not enforceable against medical provider who was neither party to arbitration agreement nor intended third-party beneficiary — Arbitration provision in policy did not contain personal covenant on part of insured to arbitrate PIP claims disputes — Medical provider did not assent to arbitration or waive its right to jury trial by virtue of accepting assignment from insured — To extent policy incorporated section 627.736(5), statute merely requires insurers to provide for binding arbitration in their PIP policies, but does not mandate arbitration of all PIP disputes between medical providers and PIP carriers

ADVANCED ORTHOPEDIC INSTITUTE, Appellant, v. BANKERS INSURANCE COMPANY, Appellee. 13th Judicial Circuit in and for Hillsborough County. Case No. 94-1931. June 30, 1995. James D. Whittemore, Circuit Judge. Counsel: Mark T. Tischhauser for Appellant. Bryan W. Reynolds, for Appellee.

In this appeal, Advanced Orthopedic Institute (hereinafter “AOI”) seeks review of the County Court’s Order Granting Bankers Insurance Company’s (hereinafter “Bankers”) Motion to Compel Arbitration. In its Order, the County Court determined that the “statutory mandatory arbitration requirement under Fla.Stat. 627.736(5) . . .” was constitutionally reasonable and that the statute was not facially unconstitutional.¹

Bankers challenges this Court’s jurisdiction to review the lower court’s Order, contending that the Order is a nonappealable, non-final order. Rule 9.130(a)(3)(C)(v), Fla.R.App.P. expressly provides for appellate review of a non-final order determining a party’s entitlement to arbitration. See, also: Carpet Concept of St. Petersburg, Inc. v. Architectural Concepts, Inc., 559 So.2d 303 (Fla. 2nd DCA 1990). This Court has jurisdiction to review the lower court’s Order compelling arbitration.

AOI contends that Fla.Stat. 627.736(5), to the extent that it requires binding arbitration of any claims dispute between medical providers and PIP carriers, is violative of Article I, Sections 21 and 22 of the Florida Constitution, which guarantees the right of access to the courts and the right to trial by jury. The Court finds it unnecessary to address the constitutionality of the statute.²

In accordance with Fla.Stat. 627.736, Bankers issued a policy of automobile insurance to Salvatore Termini that provided PIP benefits to the insured, Marta Termini. Following an automobile accident, AOI provided medical treatment to Marta Termini. In order to secure direct payments from Bankers for medical services rendered to Marta Termini, AOI accepted an assignment from Marta Termini of “any cause of action I may have against any insurance company obligated to me . . . for payment for such services and treatment.”³ As a result of Bankers’ failure to pay AOI, AOI filed suit to recover payment for services. Bankers moved to dismiss, contending that pursuant to Fla.Stat. 627.736(5) the policy requires binding arbitration of any PIP claims dispute involving medical benefits between Bankers and a medical provider once the provider has accepted an assignment of benefits.⁴

The policy’s arbitration provision upon which Bankers relies is unenforceable against AOI. As there is no evidence in the record evidencing an intent or agreement on the part of AOI to accept a duty to arbitrate any dispute with the insurance company (Bankers), AOI may not be compelled to arbitrate pursuant to the terms of the policy to which it was not a party or intended third party beneficiary, notwithstanding the provisions of Fla.Stat. 627.736(5).

Arbitration agreements are personal covenants usually binding only upon parties to the covenant. Federated Title Insurers, Inc. v. Ward, 538 So.2d 890 (Fla. 4th DCA 1989); Karlen v. Gulf & Western Indus., Inc., 336 So.2d 461 (Fla. 3d DCA 1976). In this case, the arbitration provision in the policy did not contain a personal covenant on the part of the insured to arbitrate PIP claims disputes. The subject provision, rather than containing a personal covenant on the part of the insured to arbitrate, purportedly covenants on behalf of unknown assignees to commit them to binding arbitration. This Court finds no authority under which one who is not a party to a contract can be bound by the promise of another to arbitrate. There is nothing in writing evidencing an agreement or intent to arbitrate on the part of AOI. In order that a dispute can be arbitrated, the written agreement must evidence the parties’ intent and must otherwise fulfill the requirements of a valid and enforceable contract. See, e.g., Wiggs & Maale Constr. Co. v. Stone Flex, Inc., 263 So.2d 607 (Fla. 4th DCA 1972) (Error to grant application for arbitration under Florida Arbitration Code where parties do not agree in writing to arbitrate); Eugene W. Kelsey & Son, Inc. v. Architectural Openings, Inc., 484 So.2d 610 (Fla. 5th DCA 1986), rev. denied 492 So.2d 1330 (Fla. 1986).

It cannot be said that AOI assented to arbitration by virtue of accepting the assignment from Marta Termini or that AOI waived its right to a jury trial by virtue of the assignment. AOI received nothing more than the right to pursue benefits under the terms of the policy and to file suit or engage in arbitration in the name of its assignor. To the extent that Bankers relies on this assignment as evidence of AOI’s intent to be bound to arbitrate, this reliance is misplaced. Contracts providing for arbitration will be construed so as not to force a party to arbitrate a dispute it does not intend to arbitrate. See, e.g., PaineWebber, Inc. v. Hess, 497 So.2d 1323 (Fla. 3d DCA 1986).

Nor can it be concluded that AOI was an intended third party beneficiary of the policy and should thereby be bound by the arbitration provision. As previously noted, the arbitration provision does not contain a personal covenant on the part of the insured to arbitrate. It purports only to bind unknown assignees to arbitrate their disputes. Moreover, it cannot be said that AOI was an intended third party beneficiary of the policy. A third party is an intended beneficiary only when the parties to the contract intend to primarily and directly benefit the third party. Maryland Casualty Co. v. State of Florida Dep’t of Gen. Serv., 489 So.2d 57 (Fla. 2d DCA 1986).

There is no question that the public policy of this State promotes arbitration as an alternative dispute resolution. See, e.g., Roe v. Amica Mutual Ins. Co., 533 So.2d 279 (Fla. 1988); Lake Plumbing, Inc. v. Seabreeze Constr. Corp., 493 So.2d 1100 (Fla. 2d DCA 1986). Agreements to arbitrate are generally looked upon with favor when the subject matter of the agreement is within legally permissible limits. See, e.g., Arrieta v. Volkswagen Ins. Co., 343 So.2d 918 (Fla. 3d DCA 1977). That is not to say, however, that a contract may be construed so as to force a party to arbitrate a dispute it did not intend to arbitrate. PaineWebber, Inc. v. Hess, supra.

As is obvious, there is nothing to prevent AOI and Bankers from agreeing to submit to binding arbitration consistent with the public policy of the State and the intent of the Legislature in promoting arbitration of insurance disputes. See, e.g., U.S. Fire Ins. Co. v. Franko, 443 So.2d 170 (Fla. 1st DCA 1983). For that matter, there is nothing to prevent an insured and its insurer from agreeing to arbitrate PIP disputes and expressly binding the insured’s assigns to that covenant. For example, Bankers and its insured in the instant policy provided for voluntary binding arbitration in part D of its Uninsured Motorist Coverage. However, absent an agreement to arbitrate to which AOI is a party or language binding AOI as an assignee or third party beneficiary to the insured’s personal covenant to arbitrate, AOI may not be compelled to arbitrate its dispute with Bankers.

To the extent that Bankers’ PIP policy incorporated Fla.Stat. 627.736(5), which purports to mandate binding arbitration, that statute merely requires insurers to provide for binding arbitration in their PIP policies in disputes arising between medical providers and insurance companies. The policy did not mandate arbitration of all PIP disputes between medical providers and PIP carriers. This is a subtle yet significant distinction. Both parties have assumed that the statute mandates binding arbitration in this instance. However, the statute is ambiguous, as it cannot be ascertained from the plain language of the statute or its legislative history whether the “binding arbitration” to be provided in policies was intended by the Legislature to be voluntary or mandatory binding arbitration.⁵

If ambiguous, binding arbitration provisions will be construed as not requiring arbitration of disputes arising out of a contract or its performance. Wood-Hopkins Contracting Co. v. C.H. Barco Contracting Co., Inc., 301 So.2d 479 (Fla. 1st DCA 1974). Therefore, to the extent that Fla.Stat. 627.736(5) is incorporated into Bankers’ PIP policy, the Court finds the arbitration provision to be ambiguous as to the nature of the “binding arbitration” intended, rendering it unenforceable as to AOI even if AOI can be said to be bound by the insured’s agreement or to be a third party beneficiary of the policy.

Accordingly, this cause is REVERSED and REMANDED to the County Court for proceedings consistent with this opinion.

— — — —

¹As to AOI’s argument that the trial court applied the incorrect standard for determining the constitutionality of the statute, the trial court properly applied Dealer’s Insurance Company, Inc. v. Jon Hall Chevrolet Company, Inc., 547 So.2d 325 (Fla. 5th DCA 1989) to the equal protection challenge of AOI. There is no indication in the record that the trial court did not consider and apply the standard set forth in Kluger v. White, 281 So.2d 1 (Fla. 1973) to AOI’s access challenge, as Kluger was extensively argued to the County Court.

²AOI challenges Fla.Stat. 627.736(5), as amended by Chapter 90-119, with an effective date of October 1, 1990. Notwithstanding the extensive arguments directed to the constitutionality of the statute, this case may be properly decided on other grounds and accordingly, this Court will not pass upon the constitutionality of the statute. See: State ex rel. Bankers Life & Casualty Co. v. Village of North Palm Beach, 138 So.2d 378 (Fla. 2d DCA 1962).

³For purposes of this appeal, it is not necessary that the Court construe the effect of the “assignment of cause of action”, other than to construe Plaintiff’s Complaint as a cause of action seeking damages “for payments up to the limits of the plaintiff’s personal injury protection policy”. (See WHEREFORE clause of Complaint).

⁴The policy provides:

“6. ARBITRATION: Florida Statute 627.736 requires binding arbitration of any claims dispute involving medical benefits under your Personal Injury Protection coverage arising between insurer and and (sic) person providing medical services or supplies if that person has agreed to accept assignment of Personal Injury Benefits.”

⁵Generally, it is incumbent on a court, when reasonably possible and consistent with constitutional rights, to resolve all doubts as to the validity of a statute in favor of its constitutional validity and if possible, a statute should be construed in such a manner as would be consistent with the Constitution. Carter v. Sparkman, 335 So.2d 802 (Fla. 1976), cert. denied, 429 U.S. 1041 (1977). Where a statute is ambiguous, the court has a duty, if reasonably possible, to resolve all doubts concerning validity of a statute in favor of its constitutionality and to ascertain legislative intent and to effectuate it. McKibben v. Mallory, 293 So.2d 48 (Fla. 1974).

Although this Court has not construed the statute or addressed its constitutionality, if the Legislature intended to mandate binding arbitration of all PIP disputes between providers and insurers, that would be tantamount to closing the courthouse doors to those disputes. Such a statutory mandate would not likely pass constitutional muster under Kluger v. White, 281 So.2d 1 (Fla. 1973), because it would deprive medical providers and insurers alike of their constitutional right of access to the courts and the right to trial by jury, as guaranteed by Article I, Sections 21 and 22, Fla.Const.

* * *