4 Fla. L. Weekly Supp. 567a
Arbitration — Insurance — Personal injury protection — Statute requiring insurers to include within each PIP policy a provision offering arbitration as an option for dispute resolution does not require mandatory binding arbitration of all disputes between medical provider assignees and insurers — Assignee of PIP benefits may not be compelled to arbitrate dispute with insurer where assignee is neither party to insurance contract nor an intended third party beneficiary, unless insured has agreed to binding arbitration as condition to recovery — Motion to dismiss assignee’s suit and to compel arbitration is denied
O.G.D. DIAGNOSTIC AND REHABILITATIVE SERVICES, Plaintiff, v. FORTUNE INSURANCE COMPANY, Defendant. County Court, 15th Judicial Circuit, Palm Beach County, Civil Division. Case No. MC-96-13611-RF. September 27, 1996. Peter D. Blanc, Judge.
ORDER DENYING MOTION TO DISMISS AND
MOTION TO COMPEL ARBITRATION
THIS CAUSE came before the Court on Defendant’s Motion to Dismiss. Having heard argument of counsel and being duly advised in the premises, the Court finds as follows:
This action involves a dispute between an insurer and an assignee of personal injury protection (PIP) benefits. The Defendant maintains that both the insurance policy and §627.736(5) (Fla. Stat.) mandate that the assignee of PIP benefits submit to binding arbitration. In response, Plaintiff argues, inter alia, that (1) §627.736(5) does not require arbitration of disputes but merely requires that such a provision be included in the policy; (2) if §627.736(5) is to be construed as mandating arbitration, it violates the Plaintiff’s fundamental constitutional right of access to the Florida courts; and (3) Plaintiff is not bound by an agreement between the patient and the insurance company, absent some evidence of an agreement on the part of the Plaintiff to accept a duty to arbitrate.
The starting point in this analysis is Florida Statute §627.736(5) which states in relevant part:
“Every insurer shall include a provision in its policy for personal injury protection benefits for binding arbitration of any claims dispute involving medical benefits arising between the insurer and any person providing medical services or supplies if that person has agreed to accept assignment of personal injury protection benefits. The provision shall specify that the provisions of chapter 682 relating to arbitration shall apply. The prevailing party shall be entitled to attorney’s fees and costs.”
In support of its Motion to Dismiss, Defendant argues that §627.736(5) provides for binding arbitration. While this proposition is certainly true, it does not address the fundamental question of whether the binding arbitration provision in this section is mandatory or permissive. This distinction was highlighted by Judge Whittemore in his opinion in Advanced Orthopedic Institute v. Bankers Insurance Company, 3 Fla. L. Weekly Supp. 673 (Fla. 13th Cir. Ct. 1995):
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.
This Court is in agreement with Judge Whittemore’s opinion in Advanced Orthopedic that §627.736(5) is in fact ambiguous. It is unclear whether this section requires mandatory binding arbitration of all disputes between medical provider assignees and insurers or merely requires insurers to place an offer to arbitrate in their policies. 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). This Court therefore rejects the Defendant’s assertion that §627.736(5) mandates binding arbitration of the dispute in the case at bar. Having so construed this statute, Plaintiff’s constitutional argument related to access to the courts is rendered moot.
Notwithstanding this Court’s view that §627.736(5) is ambiguous and hence not mandatory, it remains necessary to address the effect of the purported contractual assignment of the duty to arbitrate. It is axiomatic that arbitration agreements are personal covenants, usually binding only upon the parties to the covenant. Federated Title Insurers, Inc. v. Ward, 538 So.2d 890 (Fla. 4th DCA 1989) citing Karlen v. Gulf & Western Industries, Inc., 336 So.2d 461 (Fla. 3rd DCA 1976). A party is never required to submit to arbitration any question which he has not agreed to submit. G & N Construction Co. v. Kirpatovsky, 181 So.2d 664 (Fla. 3rd DCA 1966).
In the case at hand, Plaintiff is not a party to the insurance contract nor is Plaintiff a third-party beneficiary thereof. See Caretta Trucking, Inc. v. Cheoy Lee Shipyards, Limited, 647 So.2d 1028, 1031 (Fla. 4th DCA 1994) (“A party is an intended beneficiary only if the parties to the contract clearly express, or the contract itself expresses, an intent to primarily and directly benefit the third party or a class of persons to which that party claims to belong.”). Since there is no evidence that Plaintiff ever agreed to arbitrate any dispute with the Defendant, the Defendant is left with the argument that Plaintiff assented to arbitration by virtue of accepting the assignment. This argument, however, overlooks a crucial aspect of contract law. As an assignee, Plaintiff succeeds to his assignor’s rights under the assignment and takes with it all the burdens to which it is subject in the hands of the assignor. Shreve Land Company, Inc. v. J & D Financial Corporation, 421 So.2d 722 (Fla. 3rd DCA 1982) (emphasis added). The assignment in the case at bar purports to impose a duty to arbitrate upon the assignee to which the assignor is not bound. As Shreve Land makes clear, an assignee cannot be subjected to a burden that the assignor itself is not subjected to unless the assignment itself is made conditional. Here, the duty to arbitrate would not have been a condition precedent for recovery under the contract in the hands of the insured and therefore cannot now be a condition precedent to recovery by the assignee.
In order for a dispute to 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 Construction Co. v. Stone Flex, Inc., 263 So.2d 607 (Fla. 4th DCA 1972). This Court is in agreement with the opinion in Advanced Orthopedics that a medical provider who is assigned PIP benefits may not be compelled to arbitrate a dispute with the insurer where the assignee is neither a party to the insurance contract nor an intended third party beneficiary unless the insured has agreed to bind itself to arbitration as a condition to recovery. But see Nu-Wave Diagnostics v. Fortune Insurance Co., No. MC 95-10128 RB (Fla. Palm Bch. Cty. Ct. 1995); U.S.A. Diagnostics, Inc. v. Fortune Insurance Co., No. 94-3615 (Fla. Broward Cty. Ct. 1994).
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 Insurance Co., 533 So.2d 279 (Fla. 1988). 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 Insurance Co., 343 So.2d 918 (Fla. 3rd DCA 1977). However, arbitration is strictly a matter of agreement or consent between parties. Hilton Oil Transport v. Oil Transport Co., S.A., 659 So.2d 1141 (Fla. 3rd DCA 1995). In this case, there was never an agreement between Plaintiff and Defendant to arbitrate their disputes and consequently Plaintiff cannot be forced to do so.
The Court notes that the Defendant has cited State Farm Mutual Automobile Insurance Co. v. Gonnella, 21 Fla. L. Weekly D1799 (5th DCA 1966) and U.S. Security Insurance Co. v. Magnetic Imaging Systems I, Ltd., (complete cite unavailable), case number 95-3316 (3rd DCA, July, 1996), in support of its argument to dismiss and/or compel arbitration. Although the cases cited accept the arbitration provisions in question, they do so more by assumption than by decision. The issues that form the basis for this Court’s decision to deny the motions to dismiss and compel are not specifically addressed. Since the cases cited do not overrule the familiar case of Advanced Orthopedic Institute v. Bankers Insurance, 3 Fla. L. Weekly Supp. 673 (13th Circuit, June 30, 1995), this Court will await additional authority on point before reconsidering its decision in these matters. Accordingly, it is
ORDERED AND ADJUDGED that the Defendant’s Motion to Dismiss and Motion to Compel Arbitration are DENIED.
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