18 Fla. L. Weekly Supp. 956a
Online Reference: FLWSUPP 1810MORE
Insurance — Personal injury protection — Declaratory judgment — Insured may pursue declaratory judgment action to determine pure question of fact — However, declaratory judgment action determining insured’s right to reimbursement for unpaid medical bills is improper where no bona fide controversy exists since insured has never received bill from medical provider, provider has been administratively dissolved, and statute of limitations for any action by provider against insured or insurer has lapsed
UNITED AUTOMOBILE INSURANCE COMPANY, a Florida Corporation, Appellant, vs. JESUS MORENO, Appellee. Circuit Court, 11th Judicial Circuit (Appellate) in and for Miami-Dade County. Case No. 10-193 AP & 10-216 AP. L.C. Case No. 05-001501-SP 24. August 10, 2011. Counsel: Lara J. Edelstein, Office of General Counsel/Trial Division, Miami, for Appellant. Christian Carrazana, for Appellee.
(WALSH, Judge.) In this appeal from final declaratory judgment, Appellant United Automobile Insurance Company (“United”) challenges the trial court’s denial of its motion to dismiss and motion for final summary judgment. United argues that (1) the declaratory judgment statute may not be employed to determine the purely factual issue of whether a billed medical service was payable under the Florida No-Fault statute and a policy, (2) that a claim for declaratory relief does not lie where the claimant suffered no loss or damages and (3) that the statute of limitations for this declaratory judgment claim lapsed before the insured filed suit.1 Because there was no bona fide, actual present controversy between the parties, this declaratory judgment action was invalid, and accordingly, we reverse.
Factual Background
Jesus Moreno was injured in a motor vehicle accident on June 9, 2000. He sought medical treatment with PF Medical Center for his injuries from June 17, 2000 through October 14, 2000. United did not pay the medical bills for Mr. Moreno’s care.
For five years, Mr. Moreno never received a bill from PF Medical Center for his medical care. Neither was he contacted by PF Medical Center for payment. In fact, neither Mr. Moreno nor his mother, the named insured, have had any contact with PF Medical Center since Mr. Moreno’s last date of treatment in December, 2000. PF Medical Center was administratively dissolved. In short, Mr. Moreno has not and will not ever owe PF Medical Center any money for his medical care. Without dispute, PF Medical Center is well beyond any statute of limitations to file an action against Mr. Moreno to recover its costs for treating Mr. Moreno.
On July 7, 2005, Mr. Moreno filed this lawsuit for declaratory relief, alleging that his rights under his policy were in doubt, and seeking a declaratory judgment that his bills were reasonable, related and necessary and therefore covered by his policy with United.
United argued on summary judgment that a declaratory judgment action was unavailable to determine a pure question of fact and that where Mr. Moreno does not and will not owe any money to the medical provider, an award of money damages to him for his medical bills would be an unjust windfall. The case proceeded to jury trial. On motion for directed verdict, United renewed its argument raised on summary judgment.
Following a verdict in favor of the insured, the trial court entered final declaratory judgment finding (1) that Jesus Moreno is liable to PF Medical Center for eighty percent of $5,500 in reasonable, related and medically necessary expenses, minus his deductible, (2) that Mr. Moreno is entitled to a money judgment pursuant to Section 86.061, Florida Statutes as supplemental relief and (3) that Mr. Moreno is further entitled to attorneys fees and costs.
Standard of Review
This Court reviews summary judgment orders de novo. Harrington v. Citizens Property Insurance Corp., 54 So. 3d 999 (Fla. 4th DCA 2010) [35 Fla. L. Weekly D2838a]. More specifically, this Court must determine “whether there are genuine issues of material fact and whether the trial court applied the correct rule of law.” Volusia County v. Aberdeen at Ormond Beach, L.P., 760 So. 2d 126 (Fla. 2000) [25 Fla. L. Weekly S390a]; Futch v. Wal-Mart Stores, Inc., 988 So. 2d 687, 690 (Fla. 1st DCA 2008) [33 Fla. L. Weekly D1893a].
A Claim May be Brought as a Declaratory Judgment Action to Determine Whether Medical Services are Covered Under an Unambiguous No-Fault Policy
The issue submitted to the jury below was whether medical services provided to the plaintiff were reasonable, related to an automobile accident and medically necessary and therefore covered by the no-fault policy in place. Citing, inter alia, Cruz v. Union General Insurance, 586 So. 2d 91 (Fla. 3d DCA 1991) and Columbia Casualty Co. v. Zimmerman, 62 So. 2d 338 (Fla. 1952), United argues that pure questions of fact will not support a declaratory judgment action. In Cruz, as in Mr. Moreno’s case, the complaint for declaratory judgment concerned whether medical services provided to a patient were covered as reasonable, related to an accident and medically necessary. Relying upon the Supreme Court’s opinion in Columbia Casualty, the Third District held in Cruz that the trial court correctly dismissed the complaint “which required a purely factual determination.” 586 So. 2d at 91.
In Higgins v. State Farm Fire and Casualty Company, 894 So. 2d 5 (Fla. 2005) [29 Fla. L. Weekly S533a], the Supreme Court of Florida expressly overruled its prior conclusion in Columbia Casualty that purely factual determinations within an unambiguous insurance policy may not be determined by declaratory judgment. In Higgins, the insurer filed a declaratory judgment action seeking a determination whether it had a duty to defend and indemnify an insured for a tort where the alleged conduct on the insured’s property appeared to fall within a policy exclusion. 894 So. 2d at 7. The Supreme Court considered the following certified question:
MAY THE INSURER PURSUE A DECLARATORY ACTION IN ORDER TO HAVE DECLARED ITS OBLIGATION UNDER AN UNAMBIGUOUS POLICY EVEN IF THE COURT MUST DETERMINE THE EXISTENCE OF A FACT IN ORDER TO DETERMINE THE INSURER’S RESPONSIBILITY?
894 So. 2d at 8-9. Turning to the statute, the Court explained that the Legislature expressly permits a determination of fact within a declaratory judgment action:
86.011. Jurisdiction of trial court. — The circuit and county courts have jurisdiction within their respective jurisdictional amounts to declare rights, status, and other equitable or legal relations whether or not further relief is or could be claimed. . . . The court may render declaratory judgments on the existence or nonexistence:
(1) of any immunity, power, privilege, or right; or
(2) Of any fact upon which the existence or nonexistence of such immunity power, privilege or right does or may depend, whether such immunity, power, privilege or right now exists or will arise in the future . . .
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86.051 Enumeration not exclusive. — The enumeration in ss. 86.021, 86.031 and 86.041 does not limit or restrict the exercise of the general powers conferred in s. 86.011 in any action where declaratory relief is sought . . .
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86.071 Jury trials. — When an action under this chapter concerns the determination of an issue of fact, the issue may be tried as issues of fact are tried in other civil actions in the court in which the proceeding is pending. To settle questions of fact necessary to be determined before judgment can be rendered, the court may direct their submission to a jury . . .
* * *
86.101 Construction of Law. — This chapter is declared to be substantive and remedial. Its purpose is to settle and to afford relief from insecurity and uncertainty with respect to rights, status, and other equitable or legal relations and is to be liberally administered and construed.
Higgins, 894 So. 2d at 10 (emphasis in original). Based upon the statutory language, the Court held “that an insurer may pursue a declaratory action which requires a determination of the existence or nonexistence of a fact upon which the insurer’s obligations under an insurance policy depend.” Higgins, 894 So. 2d at 12. The Court noted that Section 86.071 grants entitlement to jury trial to determine factual issues, and thus, the Legislature clearly contemplated that declaratory judgment actions could entail fact-finding. The Court further noted that the declaratory judgment statute is to be “ ‘liberally administered and construed.’ ” Id. at 12 (quoting Section 86.101, Florida Statutes).
Thus, the Third District’s holding in Cruz that “questions of fact will not support a declaratory relief action” has been overruled by the Supreme Court’s decision in Higgins. An insured may file a declaratory judgment suit to determine the insurer’s obligation under an otherwise unambiguous policy.
Where no “Bona Fide Actual Controversy” Exists, Declaratory Judgment Action is Improper
Although an insured may pursue a declaratory judgment action to determine a pure question of fact, we reverse the trial court’s order denying summary judgment because Mr. Moreno’s case presented no bona fide controversy, no actual and present need for the trial court to make a declaration of right, and was therefore insufficient.
The court in Lutz v. Protective Life Insurance Company, 951 So. 2d 884, 889 (Fla. 4th DCA 2007) [32 Fla. L. Weekly D160a], explained that to establish a sufficient claim for declaratory judgment:
The test recognized in this state of whether or not a complaint will give rise to a proceeding under the Declaratory Judgment Act inquires whether or not the party seeking a declaration shows that he is in doubt or is uncertain as to the existence or non-existence of some right, status, immunity, power or privilege and has an actual, practical and present need for a declaration. There must be a bona fide controversy, justiciable in the sense that it flows out of some definite and concrete assertion of right, and there should be involved the legal or equitable relations of parties having adverse interests with respect to which the declaration is sought.
951 So. 2d at 889. (emphasis added) Stated another way, “a declaratory proceeding is proper where litigation seems unavoidable . . . .” and not being used to “foster frivolous or useless litigation, to satisfy idle curiosity or to answer abstract questions.” “X” Corporation v. “Y” Person, 622 So. 2d 1098, 1101-1102 (Fla. 2d DCA 1993). See also Martinez v. Scanlan, 582 So. 2d 1167, 1170 (Fla. 1991).
In the five years since he received care from the medical provider, Mr. Moreno has never received a bill. The medical provider has since been administratively dissolved. Any statute of limitations in which the medical provider could have pursued either the patient or the insurer for payment has long since lapsed. Accordingly, there was no actual need for the insured to determine his rights under the policy — he will never owe any money to his provider for the services he received.
The final declaratory judgment and the supplemental relief obtained by Mr. Moreno was no more than his windfall. He may pocket the money for the medical services rendered to him. United is therefore correct that the absence of a right to damages by Mr. Moreno precluded him from filing a declaratory judgment action.
The Court in Higgins, in justifying liberal application of the declaratory judgment statute, explained that allowing a determination of an insurer’s obligations will obviate unnecessary litigation between the parties. A declaratory judgment action is useful to avoid having an insurer unnecessarily pay a claim it does not owe or an insured incurring a substantial judgment unnecessarily before it can seek indemnification under a policy. 894 So. 2d at 15. None of these justifications apply here. In Mr. Moreno’s case, there is no impending litigation because there is no risk to Mr. Moreno that he will incur a judgment against him by the service provider. Simply put, under the statute, there is no “immunity, power, privilege, or right,” upon which the declaration depended, and therefore, the action was improper.
Mr. Moreno argues that this Court’s restriction of the application of the declaratory judgment statute in his case is improper under Allstate Insurance Company v. Kaklamanos, 843 So. 2d 885, 893 (Fla. 2003) [28 Fla. L. Weekly S287a]. In Kaklamanos, the insured challenged an insurance policy requirement that obligated him to either pay his medical bills or be sued by his provider to possess “standing” to sue his insurer. The Court explained that placing this restriction upon the insured creates a barrier between patient and doctor and invites the filing of unnecessary lawsuits into our courts. Id. at 893. The Court therefore held that an insured need not pay his bill or wait until a lawsuit was filed against him before he may sue his insurer for overdue bills. Id.
Kaklamanos is inapplicable. Disapproving the declaratory judgment action filed below does not mean that Mr. Moreno was obligated to be sued or pay his medical bills in order to have standing to sue. Mr. Moreno had no such obligation. Rather, because it was uncontroverted in this case that Mr. Moreno will not ever have to pay for his medical care, there was no present need for a declaration of rights and therefore, the declaratory judgment action was improper.
The trial court’s order denying summary judgment is reversed, the final judgment of declaratory judgment and order granting supplemental relief are vacated, and this matter is remanded to the trial court for an order granting final judgment for the defendant.
As the Appellant United is the prevailing party, the Appellee’s Motion for attorney’s fees is hereby denied.
This Court further grants the Appellant United’s motion to strike the Supplemental Answer Brief filed by the Appellee. (THORNTON, JR. AND FERNANDEZ, CONCUR.)
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1Finding this issue without merit, we decline to address it.
