6 Fla. L. Weekly Supp. 403a
Attorney’s fees — Insurance — Personal injury protection — Where insurer made payments to various medical providers after insured’s suit against insurer had been dismissed, and trial court entered nunc pro tunc order vacating dismissal, insured was entitled to recover attorney’s fees and costs pursuant to section 627.428
WILLIAM MORALES, Appellant, vs. ALLSTATE INSURANCE COMPANY, Appellee. 11th Judicial Circuit in and for Miami-Dade County, Appellate Division. Case No. 98-083 AP. Lower Court Case No. 96-4081 SP 05. Opinion filed March 26, 1999. An Appeal from County Court for Miami-Dade County, Florida, Shelley J. Kravitz, Judge. Counsel: Angel L. Gimenez, for appellant. Richard A. Sherman and Frank S. Goldman, for appellee.
(Before AMY STEELE DONNER, GISELA CARDONNE and JOSEPH P. FARINA.)
(DONNER, J.) Appellant, WILLIAM MORALES (“Morales”), seeks reversal of lower court order denying Plaintiff’s Motion for Entitlement to Attorney’s Fees. We find that the lower court erred in denying this motion.
“The award of attorneys’ fees is within the sound discretion of the trial judge and, in the absence of a clear showing of an abuse of such discretion, an appellate court will not substitute its judgment for that of the trial judge.” All-Star Ins. Corp. v. Scandia, Inc., 353 So. 2d 171, 172 (Fla. 3rd DCA 1977). Further, in an appellate proceeding the decision of a trial court has the presumption of correctness and the burden is on the appellant to demonstrate error. See Sorrels v. Rebecca’s Ice Cream, Inc., 696 So. 2d 1313, 1315 (Fla. 2d DCA 1997), see also, Applegate v. Barnett Bank of Tallahassee, 377 So. 2d 1150, 1152 (Fla. 1979). We find that Morales met his burden of showing an abuse of discretion by establishing an entitlement to attorney’s fees pursuant to § 627.428, Fla. Stat. (1996).
Morales filed suit on March 20, 1996, against Allstate Insurance Company (“Allstate”) seeking PIP benefits allegedly due under Morales’ Allstate insurance policy as the result of an automobile accident. On April 8, 1997, the lower court dismissed the action for failure to prosecute. Subsequently, in June 1997, Allstate made payments pursuant to the PIP policy to various medical providers. On July 11, 1997, Morales filed a Motion to Vacate the lower court’s dismissal. The lower court vacated this dismissal nunc-pro-tunc. On December 1, 1997, Morales filed a Motion for Entitlement to Attorney’s Fees pursuant to §§ 627.428, 627.736(8), 57.041 and 57.104 Fla. Stat. (1996). The lower court denied this motion for attorney’s fees.
“[A]ttorney’s fees may be awarded by a court only when authorized by statute or by agreement of the parties.” State Farm Fire & Cas. Co. v. Palma, 629 So. 2d 830, 832 (Fla. 1993), citing, Florida Patient’s Compensation Fund v. Rowe, 472 So. 2d 1145, 1148 (Fla. 1985), modified, Standard Guar. Ins. Co. v. Quanstrom, 555 So. 2d 828 (Fla. 1990). Section 627.428, Fla. Stat. (1996) provides in part that:
(1) 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 or, in the event of an appeal in which the insured or beneficiary prevails, the appellate 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 the recovery is had.
Section 627.428, Fla. Stat. (1996). Based upon the reasons presented below, we find that Morales established an entitlement to attorney’s fees pursuant to § 627.428, Fla. Stat. (1996).
“Where an insurer has agreed to settle a disputed case, it has, in effect declined to defend its position in the pending suit. The insurer’s payment of the claim has been deemed the functional equivalent of a confession of judgment or a verdict in favor of the insured. Such settlement furnishes the basis for an award of attorney’s fees to the insured.” Avila v. Latin American Property and Cas. Ins. Co., 548 So. 2d 894, 895 (Fla. 3rd DCA 1989), citing, Wollard v. Lloyd’s and Companies of Lloyd’s, 439 So. 2d 217 (Fla. 1983); Fortune Insurance Company v. Brito, 522 So. 2d 1028 (Fla. 3d DCA 1988), see United States Fidelity Guar. Co. v. Murray, 671 So. 2d 812 (Fla. 4th DCA 1996). After suit was filed against Allstate and subsequently dismissed, Allstate made payments pursuant to the PIP policy to various medical providers. Because the dismissal of the action was vacated nunc-pro-tunc, the dismissal is deemed to have never occurred.
“An order entered nunc pro tunc means `now for then’ and refers to a judicial act which memorializes a previously taken judicial act. When applied to the entry of a legal order, it normally refers, not to a new or de novo decision, but to the trial judge’s previous action of which there is not a sufficient record.” Whack v. Seminole Memorial Hosp., Inc., 456 So. 2d 561, 563-64 (Fla. 5th DCA 1984). Accordingly, because the medical payments by Allstate were made during the pendency of the litigation, they had the effect of a confession of judgment, thus entitling Morales to attorney’s fees pursuant to § 627.428, Fla. Stat. (1996).
Further, the purpose of § 627.428, Fla. Stat. (1996) “is to discourage the contesting of valid claims against insurance companies and to reimburse successful insureds for their attorney’s fees when they are compelled to defend or sue to enforce their insurance contracts.” Clay v. Prudential Ins. Co. of America, 617 So. 2d 433, 436 (Fla. 4th DCA 1993), citing, Insurance Co. of North America v. Lexow, 602 So. 2d 528, 531 (Fla.1992) (If the dispute is within the scope of section 627.428 and the insurer loses, the insurer is always obligated for attorney’s fees.) Morales was compelled to retain legal counsel to seek PIP benefits from Allstate. Additionally, Allstate’s payment of PIP benefits to various medical providers indicates that Morales had a valid claim against Allstate. Therefore, we find that the purpose of the statute provides another basis establishing Morales’ entitlement to reimbursement for these fees.
Accordingly, because Morales met his burden of showing an abuse of discretion by establishing an entitlement to attorney’s fees pursuant to § 627.428, Fla. Stat. (1996), the decision of the lower court denying Plaintiff’s Motion For Entitlement to Attorney’s Fees is REVERSED. Morales having established entitlement to attorney’s fees, the Court finds that Morales is the prevailing party on appeal and entitled to fees and costs pursuant to § 627.428, Fla. Stat. (1996) and Fla. R. App. P. 9.400. See Florida Power & Light Co. v. Polackwich, 705 So. 2d 23, 25 (Fla. 2d DCA 1997). Therefore, this matter is REMANDED to the lower tribunal for a determination of the appropriate fees and costs.
REVERSED AND REMANDED. (CARDONNE, FARINA, JJ. CONCUR.)
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