United Automobile Insurance Company v. Coral Gables Chiropractic PLLC, a/a/o Johander Santa C. Hernandez, No. 3D23-0935 (Fla. 3d DCA Oct. 30, 2024)
Facts Johander Santa C. Hernandez was injured in a March 2012 automobile accident and received medical treatment from Coral Gables Chiropractic PLLC (Provider), who obtained an assignment of benefits. Provider submitted PIP bills to United Auto (the insurer). United Auto paid some but not all of the bills. On October 15, 2012, Provider sent United Auto a pre-suit demand letter under § 627.736(10)(a) requesting payment of the unpaid bills, accrued statutory interest, postage, and a 10% penalty.
On November 8, 2012 (within 30 days), United Auto tendered payment of the full overdue bills plus interest and penalty, but underpaid the statutory interest by $104.55. Provider then filed a small-claims PIP action alleging non-payment of the proper overdue amount and seeking attorney’s fees under § 627.428 (made applicable to PIP by § 627.736(8)). After years of litigation, the parties filed cross-motions for summary judgment. Provider conceded that United Auto had paid the correct principal amounts on the bills; United Auto conceded it had underpaid the statutory interest. The trial court entered partial summary judgment for Provider on liability for the $104.55 interest, followed by a final judgment for that amount. Over United Auto’s objection, the trial court awarded Provider $124,000 in attorney’s fees. United Auto appealed the fee judgment.
Issue Whether, as a matter of statutory construction under § 627.736(10)(d), Florida Statutes (2012), an insurer’s payment—made within 30 days of the provider’s pre-suit demand letter—of all but $104.55 in statutory interest on the overdue PIP claim constitutes payment of the “claim” and therefore precludes the provider from recovering attorney’s fees in an action seeking only the unpaid statutory interest.
Rule Section 627.736(10)(d), Florida Statutes (2012), provides in relevant part:
(d) If, within 30 days after receipt of notice by the insurer, the overdue claim specified in the notice is paid by the insurer together with applicable interest and a penalty of 10 percent of the overdue amount paid by the insurer, subject to a maximum penalty of $250, no action may be brought against the insurer. . . . The insurer is not obligated to pay any attorney’s fees if the insurer pays the claim . . . within the time prescribed by this subsection.
(Emphasis added by the court.) The statute distinguishes the “overdue claim” (the principal PIP medical bills) from the interest and penalty that must also be paid to avoid suit. Section 627.428(1) (pre-repeal) generally awards reasonable attorney’s fees to a prevailing insured/beneficiary in a successful action against the insurer.
Analysis The Third DCA applied de novo review to the pure question of statutory interpretation. The court held that the plain and unambiguous language of § 627.736(10)(d) controls: the word “claim” refers only to the overdue PIP benefits (i.e., the medical bills), not to the statutory interest or 10% penalty.
The statute creates a safe-harbor mechanism. If the insurer pays the overdue claim (bills) plus interest and penalty within 30 days of the demand letter, no lawsuit may be filed. If the insurer fails to pay any of those three items, suit may be brought. However, when the insurer timely pays the claim (bills) but fails to pay the full interest and/or penalty, and the provider later prevails in a suit limited to recovering the unpaid interest/penalty, the insurer is not liable for the provider’s attorney’s fees.
The court rejected the provider’s broader reading (that “claim” includes interest and penalty) as illogical and contrary to the statute’s text and purpose. The holding is consistent with the Fourth DCA’s decision in South Florida Pain & Rehab of W. Dade v. Infinity Auto Ins. Co., 318 So. 3d 6 (Fla. 4th DCA 2021), which reached the same result in a similar action to recover unpaid penalty and postage.
Conclusion The Third District Court of Appeal reversed the trial court’s $124,000 attorney’s fee judgment. Because United Auto paid the “claim” (the overdue PIP medical bills) within 30 days of the pre-suit demand letter, it was not obligated to pay Provider’s attorney’s fees in the subsequent action seeking only the unpaid statutory interest. The fee judgment was reversed.