7 Fla. L. Weekly Supp. 91d
Attorney’s fees — Justiciable issues — Insurance — Personal injury protection — Dispute between medical provider and insurer arising from insurer’s withholding of percentage of amounts due pursuant to federal law because of provider’s failure to supply completed W-9 form — Applicability of IRS regulations and justification for insurer’s noncompliance with express provisions of state statute requiring it to pay provider’s invoice, even though ultimately resolved by county court in favor of insurer, were justiciable issues of law precluding a finding that action was frivolous — Alternatively, provider correctly argued to county court that insurer had failed to plead entitlement to fees
CONNECTICUT INDEMNITY COMPANY, Appellant/Defendant(s), vs. BAYSIDE CHIROPRACTIC CENTER, (as attorney-in-fact for Dayana Gonzalez), Appellee/Plaintiff(s). 13th Judicial Circuit in and for Hillsborough County, Civil Division. Appellate Case No. 97-7654, Division “G”. County Case No. 96-18431. CONNECTICUT INDEMNITY COMPANY, Appellant/Defendant(s), vs. BAYSIDE CHIROPRACTIC CENTER, (as attorney-in-fact for William Gonzalez), Appellee/Plaintiff(s). Appellate Case No. 97-7653, Division “G” (consolidated). County Case No. 96-78430. Opinion filed November 18, 1999. Appeal from the County Court for Hillsborough County; Charlotte Anderson, Judge. Counsel: Deborah Schmitt, for Appellant, Connecticut Indemnity Company. Timothy Patrick, for Appellee, Bayside Chiropractic Center.
(WHITTEMORE, J., JUDGE.) APPELLANT appeals the county court’s Order Denying Defendant’s Motion for Attorney’s Fees filed pursuant to §57.105, Fla. Stat. (1997). In this action, Bayside brought suit against Connecticut Indemnity seeking damages in Count I for failure to make timely payment of no-fault benefits as required by §627.736(4)(b), Fla. Stat. (1997) and in Count II, for declaratory relief, asserting doubt as to its rights under the policy, based on Connecticut Indemnity’s denial of coverage on the basis that “the medical treatment rendered was not reasonable and/or necessary”. In its Answer and Defenses, Connecticut Indemnity denied the material allegations of the Complaint and defended, on the basis that the medical expenses billed by Bayside were excessive, that Bayside had failed to comply with conditions precedent to coverage and/or payment and that the expenses billed by Bayside were not reasonable and necessary.1
The dispute between the parties arose, not from the fact that Connecticut Indemnity had not paid Bayside for services rendered, but because Connecticut Indemnity withheld 31% of the amounts due pursuant to Bayside’s invoices “pursuant to federal law due to Bayside’s failure to supply a completed W-9 form”. (See Affidavit of Jim White, filed in support of Connecticut Indemnity’s Motion for Summary Judgment.) Based on White’s affidavit, Connecticut Indemnity obtained summary judgment. Bayside filed no affidavits in opposition to summary judgment, hence there was no issue of material fact raised as to the propriety of Connecticut Indemnity’s withholding pursuant to I.R.S. regulations. Connecticut Indemnity contends that there was a “complete absence of justiciable issue of law or fact” raised by the Complaint and that it was entitled to attorney’s fees pursuant to §57.105, Fla. Stat. (1997).
A review of this record supports the county court’s denial of Connecticut Indemnity’s Motion for Attorney’s Fees. Section 627.736, Fla. Stat. (1997) required Connecticut Indemnity to pay Bayside’s invoice (80% of PIP benefits due under the policy) which Connecticut Indemnity, by all accounts, had not done. Notwithstanding the I.R.S. regulations relied on by Connecticut Indemnity supported withholding 31% of the amounts due on Bayside’s invoice, it cannot be said, at the time suit was filed, that Bayside’s suit was devoid of merit or that its Complaint revealed a “total or absolute lack of justiciable issue”, tantamount to being frivolous or was so “clearly devoid of merit both on the facts and the law as to be completely untenable”.2 Bay Financial Savings Bank v. Hook, 648 So.2d 305 (Fla. 2d DCA 1995).
The applicability of I.R.S. regulations and the justification for Connecticut Indemnity’s non-compliance with the express provisions of §627.736, even though ultimately resolved by the county court in favor of Connecticut Indemnity, were justiciable issues of law precluding a finding that the action was frivolous. Moreover, at the hearing on Connecticut Indemnity’s Motion for Attorney’s Fees, Bayside’s argument suggested there was a question, although unsubstantiated in the record, as to whether Bayside had in fact provided Connecticut Indemnity with the taxpayer’s identification number in accordance with I.R.S. regulations. That fact, in and of itself, would constitute a justiciable issue of fact precluding a determination that Bayside’s initial Complaint was frivolous on its face, although mere argument would not have precluded summary judgment on the merits.
Finally, Bayside correctly argues that Connecticut Indemnity did not, in its Answer and Defenses, raise as a defense the applicability of I.R.S. regulations as support for withholding 31% of the amounts due under Bayside’s invoices. Moreover, Connecticut Indemnity did not plead entitlement to attorney’s fees pursuant to §57.105 in its pleadings until the last paragraph of its Memorandum in Support of Summary Judgment (at p. 18). It cannot be said, therefore, that Bayside was put on notice by pleading or otherwise that Connecticut Indemnity was seeking entitlement to attorney’s fees pursuant to §57.105. See Stockman v. Downs, 573 So. 2d 835 (Fla. 1991). Accordingly, even though the county court did not base its ruling on this issue, Bayside correctly argued to the county court as an alternative ground for denial of Connecticut Indemnity’s Motion for Attorney’s Fees that Connecticut Indemnity had failed to plead entitlement. (See p. 19 of transcript of proceedings on July 3, 1997). Accordingly, the county court’s Order Denying Connecticut Indemnity’s Motion for Attorney’s Fees is AFFIRMED.
________
1At oral argument, counsel for both Appellant and Appellee acknowledged that the Complaint and the Answer and Affirmative Defenses could have been more accurately tailored to reflect the actual issues giving rise to the dispute between the parties.
2The lower court was required to predicate any finding that Bayside’s position was frivolous upon “substantial competent evidence” presented at the hearing on Connecticut Indemnity’s Motion for Attorney’s Fees, or otherwise from the record. Strothman v. Henderson Mental Health Centers, Inc., 425 So.2d 1185 (Fla. 4th DCA 1983). A determination that an action is frivolous must be made as of the time the claim was initiated. Carnival Leisure Industries, Ltd. v. Holzman, 660 So.2d 410 (Fla. 4th DCA 1995).
* * *
