9 Fla. L. Weekly Supp. 152a

Insurance — Personal injury protection — Error to enter summary judgment in favor of medical provider based on insurer’s failure to pay or obtain reasonable proof for denial within thirty days of receiving provider’s bill — Standing — Assignment — “Appointment as Agent-in-Fact with full Power of Attorney” conferred standing on medical provider to maintain lawsuit against insurer

SUPERIOR INSURANCE COMPANY, Appellant, v. NU-BEST DIAGNOSTICS LABS, as assignee of RITHA CHARLES, Appellee. Circuit Court, 9th Judicial Circuit (Appellate) in and for Orange County. Case No. CVA1-00-75. L.C. Case No. SCO98-7274. December 18, 2001. Appeal from the County Court, Orange County, Jerry L. Brewer, Judge. Counsel: Michael R. D’Lugo, Wicker, Smith, Tutan, O’Hara, McCoy, Graham, & Ford, P.A., for Appellant. Stephen W. Carter, Vose, Blau & Hayes, P.A., for Appellee.

(Before Russell, Evans and Miller, JJ.)

FINAL ORDER AND OPINION

(PER CURIAM.) Appellant, Superior Insurance Company (“Superior”), seeks review of a Final Summary Judgment entered by the trial court in favor of Appellee, Nu-Best Diagnostic Labs (“Nu-Best”). This Court has jurisdiction pursuant to Florida Rule of Appellate Procedure 9.030(c)(1). For the reasons expressed below, the Final Judgment is affirmed in part and reversed in part.

On March 30, 1998, Ritha Charles was injured in an automobile accident. At the time of the accident, Charles was insured by Superior pursuant to an automobile insurance policy which provided personal injury protection benefits. On April 24, 1998, Nu-Best performed diagnostic testing on Charles. On the same date, Charles executed an “Appointment as Agent-in-Fact with Power of Attorney” in favor of Nu-Best. Nu-Best submitted a claim to Superior for services rendered to Charles in the amount of $1,300.00.

Nu-Best’s bill was received by Superior on June 18, 1998. On July 14, 1998, the bill was referred out by Superior for peer review. On July 14, 1998, Superior advised Nu-Best by letter that payment was not made because the bill was under review. On July 31, 1998, Superior received a peer review report from MTC, Inc. recommending denial of the claim based upon lack of necessity. On August 3, 1998, Superior notified Nu-Best of the denial of its claim.

On November 5, 1998, Nu-Best filed a Complaint against Superior for failure to pay within thirty days or provide reasonable proof for denial and non-payment. A First Amended Complaint and Second Amended Complaint were also filed on March 5, 1998 and April 19, 1998, respectively. An Answer and Affirmative Defenses to Second Amended Complaint was filed on June 21, 1999. Superior raised as affirmative defenses that: the diagnostic testing performed was not reasonable, related, and necessary; Charles failed to meet conditions precedent; that arbitration was required; and that Nu-Best failed to join an indispensable party.

On May 19, 2000, Nu-Best filed a Motion for Final Summary Judgment. In that Motion, Nu-Best argued that, pursuant to Perez v. State Farm Fire and Casualty Company, 746 So. 2d 1123 (Fla. 3d DCA 1999), Superior was required to pay Nu-Best’s claim. On June 21, 2000, Superior filed a Memorandum of Law in Opposition to Plaintiff’s Motion for Summary Judgment. On July 16, 2000, Superior filed a Supplemental Memorandum of Law in Opposition to Plaintiff’s Motion for Summary Judgment. Superior argued that it did not lose the right to contest the reasonableness, necessity or relatedness of Nu-Best’s bill simply because it did not have a report within thirty days. Superior also argued in its Supplemental Memorandum that Nu-Best did not have standing to maintain this action and that it was not an assignee of Charles.

A hearing on the Motion for Summary Judgment was held on July 10, 2000. On July 12, 2000, the trial court entered Final Judgment on Plaintiff’s Motion for Final Summary Judgment. On July 17, 2000, Superior filed a Motion for Rehearing. On July 28, 2000, the trial court entered an Order denying the Motion for Rehearing.

A Notice of Appeal was filed on August 28, 2000. On October 26, 2000, Nu-Best filed a Motion for Appellate Attorney Fees. An Initial Brief was filed on February 6, 2001. An Answer Brief was filed on April 5, 2001.

STANDARD OF REVIEW

Appellate review of a summary judgment is conducted de novo. See Volusia County v. Aberdeen at Ormond Beach, L.P., 760 So. 2d 126 (Fla. 2000); Krol v. City of Orlando, 778 So. 2d 490 (Fla. 5th DCA 2001). To determine the propriety of a summary judgment, this Court must determine whether any “genuine issues of material fact” remain and whether “the moving party is entitled to judgment as a matter of law.” Fla. R Civ. P. 1.510(c).DISCUSSION

Superior’s Right to Defend

In its Initial Brief, Superior argues that the trial court erred in entering summary judgment in favor of Nu-Best based on Perez. The underlying facts are undisputed and the only question is whether Superior is precluded from defending its denial on the basis of reasonableness, necessity, and relatedness. At the hearing, the trial court found that: “I think Perez and Viles make it imminently clear that any defense that the defendant would have under those circumstances would be deemed waived by failing to comply with the statute.” Section 627.736(4), Florida Statutes, provides, in pertinent part:

(4) BENEFITS; WHEN DUE. — Benefits due from an insurer under ss. 627.730-627.7405 shall be primary . . . and shall be due and payable as the loss accrued, upon reasonable proof of such loss and the amount of expenses and loss incurred which are covered by the policy issued . . . (b) Personal injury protection insurance benefits paid pursuant to this section shall be overdue if not paid within 30 days after the insurer is furnished written notice of the fact of a covered loss and of the amount of the same. . . . However, any payment shall not be deemed overdue when the insurer has reasonable proof to establish that the insurer is not responsible for the payment, notwithstanding that written notice has been furnished to the insurer. (c) All overdue payments shall bear simple interest at the rate of 10 percent per year.

Nu-Best argues that Superior is precluded from challenging the necessity, reasonableness and relatedness of testing because it did not receive a report to support its denial within thirty days of receipt of Nu-Best’s bill. Nu-Best argues that Superior must pay the bill and cannot contest it for any reason. In support of its argument, Nu-Best relies upon Perez v. State Farm Fire and Casualty Company, 746 So. 2d 1123 (Fla. 3d DCA 1999). In that case, the appellate court held that:

The insurers’ contention that while they failed to obtain a report within the statutory period, they can only be required to pay interest and attorney’s fees is not persuasive. Since 1974, Florida courts have uniformly held that the statutory language is clear and unambiguous. The insurance company has thirty days in which to verify the claim after receipt of an application for benefits. There is no provision in the statute to toll this time limitation. The burden is clearly upon the insurer to authenticate the claim within the statutory time period. To rule otherwise would render the recently enacted “no fault” insurance statute a “no pay” plan — a result we are sure was not intended by the legislature. Pacheco, 695 So. 2d at 395 [Fortune Ins. Co. v. Pacheco, 695 So. 2d 394 (Fla. 3d DCA 1997)].

Perez, at 1125, quoting Dunmore v. Interstate Fire Ins. Co., 301 So. 2d 502 (Fla. 1st DCA 1974).

Superior cites Jones v. State Farm Mutual Automobile Insurance Company, 694 So. 2d 165 (Fla. 5th DCA 1997), in support of its argument that it is still able to defend itself on certain grounds. In that case, the trial court entered summary judgment in favor of an insurer when the insured failed to attend an IME. In its opinion, the appellate court held that:

Although we cannot credit Jones’ contention that State Farm’s failure to pay Jones’ surgical bills within thirty days relieved him of any further obligation under the policy and requires that judgment be entered in his favor, we do agree that the summary judgment must be reversed. . . . [I]t is apparent that State Farm did not have reasonable proof that it was not responsible for payment of Jones’ surgical bills. . . . Thus, State Farm is exposed to the statutory penalties attendant to an “overdue” claim. State Farm does not, however, lose its right to contest the claim.

Id. at 166. Superior also cites to AIU Insurance Company v. Daidone, 760 So. 2d 1110 (Fla. 4th DCA 2000). In that case, the Fourth District Court relied on its earlier decision in Fortune Insurance Company v. Everglades Diagnostics, Inc., 721 So. 2d 384 (Fla. 4th DCA 1998), wherein it construed subsection (4)(b) and (c) of section 627.736 as “merely” making the insurer liable for interest if payment was not made within thirty days from the notice of medical bills. The Court in Daidone held that:

We interpret section 627.736(4) to mean that if PIP benefits are payable, they are due within thirty days after notice. If the insurer has refused to pay the bill within thirty days and does not have reasonable proof to establish that it is not responsible, then the insurer is liable for ten percent interest when the bill is paid. Failing to obtain proof that it is not responsible for payment, however, does not deprive the insurer of its right to contest payment.

Id. at 1111. The court cited Jones with approval and certified conflict with Perez.

Recently, the Fifth District Court of Appeal issued an opinion in Gurney v. State Farm Mutual Automobile Insurance Company, 2001 WL 1174849 (Fla. 5th DCA) [26 Fla. L. Weekly D2408]. In that case, the question of whether an insurer can challenge the necessity, reasonableness and relatedness of a claim beyond thirty days was addressed. The Fifth District Court held that:

The circuit court panel interpreted section 627.736(4)(b), Florida Statutes (1995) to mean that, if PIP benefits are payable then they are due within thirty days of the date the bills are received, and if they are not paid or contested within that thirty-day time period then the insurer is liable for paying ten percent interest when the bill is paid. However, the failure to pay within that thirty-day time period does not deprive the insurer of the right to contest payment. We agree with this ruling while acknowledging that a split of opinion exists in Florida on this issue.

Id. at 2. The Fifth District Court recognized and certified conflict with the Third District Court’s opinion in Perez. Id. at 3; see also State Farm Mutual Automobile Insurance Company v. Jones, 789 So. 2d 504 (Fla. 1st DCA 2001) (agreeing with the reasoning expressed by the Fourth and Fifth District Courts of Appeal and certifying conflict with Perez).

This Court finds that the trial court erred in entering summary judgment in favor of Nu-Best based on Superior’s failure to pay or obtain reasonable proof for denial within thirty days of receiving Nu-Best’s bill.

Nu-Best’s Standing

Superior also argues that the trial court erred in refusing to find that the “Appointment as Agent-in-Fact with Power of Attorney” executed by Charles in favor of Nu-Best failed to adequately confer standing upon Nu-Best. Superior argues that, without a proper assignment, Nu-Best would not have standing to maintain the instant lawsuit.

The Appointment provides, in pertinent part:

I hereby appoint NU-BEST TO BE PAID DIRECTLY BY MY INSURANCE CARRIER and to act as my Attorney-in-Fact with Power of Attorney to act on my behalf with regard to payments of medical services rendered to me by said provider. This includes the authority to act as my Agent-in-Fact with full Power of Attorney to act in my behalf and with full authority to take any necessary action on my behalf in order to obtain payment from any insurance company for medical services rendered to me. If legal action is brought on my behalf . . . said medical provider . . . will be entitled to recover [attorney’s] fees and costs on my behalf pursuant to Florida Statutes §627.428 . . . .

In Superior Insurance Company v. Libert, 776 So. 2d 360 (Fla. 5th DCA 2001), the appellate court addressed the standing of a medical provider based upon a similar document. In that case, the court held that:

The [Power of Attorney] gives Libert the power to collect payment for medical services rendered by Libert and the right to sue Superior on Chew’s behalf for any unpaid medical bills. The document also confers upon Libert the “power to act as [Chew’s] agent-in-fact with full power of attorney.” The power conferred upon Libert included the right to collect all attorney’s fees on Chew’s behalf. . . . Because section 627.428(1) allows attorney’s fees for the insured, attorney’s fees should also be recoverable by an agent acting in behalf of the insured. . . . A person who is named an agent for the purpose of collecting money and who is authorized to commence legal action to collect has standing to appeal the matter. (Internal citations omitted).

Libert, at 364-65. Thus, this Court finds that Nu-Best had standing to maintain this action against Superior.

Accordingly, it is hereby

ORDERED AND ADJUDGED that the Final Judgment on Plaintiff’s Motion for Final Summary Judgment is AFFIRMED IN PART and REVERSED IN PART.

This matter is remanded to the trial court for further proceedings consistent with this opinion. (RUSSELL, EVANS, and MILLER, JJ., concur.)

* * *