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Magnetic Imaging Systems3/12/2003
Magnetic Imaging Systems I, Ltd. ("Magnetic") appeals a final summary judgment in favor of Prudential Property & Casualty Insurance Company ("Prudential") in which the lower court found that Magnetic was not entitled to a fee award. We disagree and reverse.
Magnetic is a medical service provider that accepts assignment of PIP insurance benefits from its patients. As the assignee of such benefits, Magnetic is entitled to receive PIP payments directly from insurers. On April 18, 1995, Magnetic filed suit against Prudential Insurance Corporation of America ("Prudential of America"), alleging that the insurer had regularly failed to pay interest on late-paid PIP benefits as required by sections 627.736(4)(b) and (c), Florida Statutes (1995).
Magnetic brought suit as the assignee of one of its patients and, as a putative class representative, sought to certify a class consisting of two subgroups: (1) individual insureds to whom interest on late PIP benefits had not been paid; and (2) medical-provider assignees (like itself) to which interest on late PIP benefits had not been paid. After a little more than a year of litigation, Prudential of America moved for summary judgment, arguing that Prudential, not Prudential of America, had issued the insurance policy involved in the action, and that Prudential had timely paid the patient-assignor's benefits as mandated by section 627.736(4)(b). Rather than ruling on the motion for summary judgment, the lower court permitted Magnetic to amend its complaint to substitute Prudential for Prudential of America and to substitute a different patient-assignor, Felix Gentile (whose PIP benefits presumably had not been timely paid), for the patient-assignor named in the original complaint.
Upon substitution, Prudential promptly moved to compel arbitration claiming that disputes "between the insurer and any person providing medical services . . . has agreed to accept assignment of benefits" had to be arbitrated under section 627.736(5), Florida Statutes (1995). The request was granted; but, before arbitration could begin, two things occurred. First, in August 1998, Prudential tendered a check for $22.12, the amount purportedly due as interest on Mr. Gentile's late-paid benefits. Second, in February 2000, the Florida Supreme Court held that the provision pursuant to which the action had been referred to arbitration, section 627.736(5), was unconstitutional. See Nationwide Mut. Fire Ins. v. Pinnacle Med., Inc., 753 So. 2d 55 (Fla. 2000). Consequently, and at Magnetic's request, the trial court's previous orders compelling arbitration were vacated, and the matter was returned to circuit court.
Following a skirmish over whether the action should be dismissed for lack of prosecution while the arbitration was pending, Prudential moved for summary judgment claiming that the forms executed by Magnetic's assignor did not constitute a valid assignment. Prudential also argued that its tender of payment extinguished the entire claim.
On February 27, 2002, the lower court entered final summary judgment in Prudential's favor, concluding that the action should have been dismissed following Prudential's tender of interest due on the late-paid benefits without provision for payment of Magnetic's attorney's fees, because: (1) Magnetic had inappropriately sought to litigate rather than arbitrate as mandated by section 627.736(5); and (2) Magnetic had incurred no fees between the time arbitration was ordered and the time payment was tendered. For the following reasons, we disagree and reverse.
In Central Magnetic Imaging v. State Farm Mut. Auto. Ins. Co., 745 So. 2d 405, 407 (Fla. 3d DCA 1999), this court held that an insur
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