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Magnetic Imaging Systems3/12/2003
er's payment of PIP benefits demanded by a medical provider assignee following commencement of arbitration constituted a settlement which "is equivalent to a confession of judgment," entitling the assignee to an award of attorney's fees as the prevailing party under section 627.736(5). This court also rejected the notion that an insurer could escape a fee award under 627.736(5) by holding out until an arbitration demand is made, and then paying benefits before action is taken in the arbitration proceeding:
An insurer cannot escape the penalty of attorney's fees simply by ignoring an outstanding medical bill, paying it when an arbitration demand is made and then arguing that arbitration was not held because full payment of benefits was subsequently made. Id. (citation omitted).
The fact that little occurred following referral of this case to arbitration did not, therefore, negate Magnetic's entitlement to a fee award. Moreover, Magnetic's entitlement to a fee award was not limited to recovering for services rendered only after arbitration was ordered. See Criterion Ins. Co. v. Gutierrez, 319 So. 2d 70 (Fla. 3d DCA 1975) (affirming an award of fees for services incurred both before an action to recover PIP benefits was filed and after an offer of judgment was made). Accordingly, Prudential's tender of payment entitled Magnetic to a fee award.
The Florida Supreme Court's invalidation of section 627.736(5), and its prevailing party fee provision, does not change this result. Section 627.428(1), Florida Statutes (2002), provides that in any dispute "which leads to judgment against the insurer in favor of the insured, attorney's fees shall be awarded to the insured." Ivey v. Allstate Ins. Co., 774 So. 2d 679, 684 (Fla. 2000). As the Florida Supreme Court has explained, current PIP law (as evidenced by sections 627.428(1) and 627.736(8)) "is outcome-oriented. If a dispute arises between an insurer and an insured, and judgment is entered in favor of the insured, he or she is entitled to attorney's fees." Id. at 684. Where an insurer makes payment of a claim after suit is filed, but before a judgment is rendered, such payment operates as a confession of judgment, entitling the insured to an attorney's fee award. See id. at 684-85. These general principles apply not only to disputes between insurers and their insureds, but also to disputes between insurers and those like Magnetic, to whom PIP benefits have been assigned. See ยง 627.736(8), Fla. Stat. (2001) (confirming that section 627.428 applies to disputes "between an assignee of an insured's rights and the insurer"); Superior Ins. Co. v. Libert, 776 So. 2d 360, 365-66 (Fla. 5th DCA 2001)(finding that an assignee of an insured's PIP benefits was entitled to attorney's fees under section 627.428(1), where the insurer paid the benefits after suit was filed); see also Roberts v. Carter, 350 So. 2d 78, 79 (Fla. 1977)(noting that attorney's fees are available under section 627.428(1) to assignees of an insured). Magnetic was entitled to a fee award.
We also find no merit in Prudential's argument that the forms executed by Magnetic's assignee did not constitute a valid assignment of benefits. This is especially so since Prudential obtained an order compelling Magnetic, as assignee, to arbitrate by affirmatively alleging that arbitration was mandatory "between the insurer and any person providing medical services . . . has agreed to accept assignment of benefits."
Accordingly, the summary judgment denying Magnetic a fee award is reversed and this cause remanded for further proceedings consistent with this opinion.
Reversed and remanded.
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