Livingston v. State Farm Mut. Auto. Ins. Co.

• Decision Date: 03 March 2000
• Docket Number: No. 2D98-3490.,2D98-3490.
• Citation: 774 So.2d 716
• Parties: Cecelia Watkins LIVINGSTON, Appellant, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Appellee.
• Court: Florida District Court of Appeals

774 So.2d 716

Cecelia Watkins LIVINGSTON, Appellant, v.STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Appellee.

No. 2D98-3490.

District Court of Appeal of Florida, Second District.

March 3, 2000.

Rehearing Denied April 7, 2000.

Arthur Liebling of Arthur Liebling, P.A., Clearwater, for Appellant.Anthony J. Parrino of Reynolds & Stowell, P.A., St. Petersburg, for Appellee.

ALTENBERND, Acting Chief Judge.

Cecelia Watkins Livingston appeals a final summary judgment entered in favor of State Farm Mutual Automobile Insurance Company("State Farm") in county court.The county court certified a question to this court and we accepted jurisdiction.SeeFla. R.App. P. 9.160.We affirm the summary judgment.As a general rule, if an insured has assigned her right to receive personal injury protection (PIP) benefits to a health care provider, the insured may not file a lawsuit to collect the assigned benefits.The insured would only have a claim to pursue against the insurance company if the health care provider were permitted to rescind the assignment.

I.THE FACTS

Ms. Livingston filed a typical complaint for PIP benefits in county court.The complaint contains few factual allegations.Ms. Livingston alleged she was involved in an automobile accident on December 29, 1994.She was injured and received medical treatment.At that time, she had automobile insurance with State Farm.Although the insurance policy is not in the record, the complaint alleges that the policy provided applicable personal injury protection coverage.The complaint alleges without any factual specificity that Ms. Livingston had executed an application for benefits, which State Farm had declined to pay.

State Farm filed a motion for summary judgment supported by an affidavit of a claims adjuster.The affidavit establishes that the only benefits at issue in this case involve treatment provided by a chiropractor and $1200 for services provided by Advantage Medical Diagnostics.State Farm's affidavit establishes that each health care provider had accepted an assignment of benefits from Ms. Livingston.Advantage Medical Diagnostics had demanded arbitration before State Farm filed the motion for summary judgment.

The trial court granted the summary judgment on the theory that Ms. Livingston had assigned her rights concerning all the benefits in controversy and that she no longer had a claim against State Farm.The county court certified to this court the question of whether the execution of the assignment to the health care provider bars this action.We conclude that the assignment either bars the lawsuit or renders it premature.

II.THE LAW

This case involves the controversial statutory mechanism created to streamline the resolution of disputed PIP claims.Under section 627.736(5), Florida Statutes(1993), a health care provider may "charge only a reasonable amount" for its services.In order to minimize the impact upon the insured patient of disputes over the reasonableness of the health care provider's charges, the statute further provides:

Every insurer shall include a provision in its policy for personal injury protection benefits for binding arbitration of any claims dispute involving medical benefits arising between the insurer and any person providing medical services or supplies if that person has agreed to accept assignment of personal injury protection benefits.The provision shall specify that the provisions of chapter 682 relating to arbitration shall apply.The prevailing party shall be entitled to attorney's fees and costs.

Even though a health care provider's decision to use a statutory assignment is voluntary, the Florida Supreme Court recently declared unconstitutional the portions of this statute requiring mandatory arbitration and imposing a prevailing party standard with regard to attorneys' fees.SeeNationwide Mutual Fire Ins. Co. v. Pinnacle Medical, Inc.,753 So.2d 55(Fla.2000).Pinnacle did not address whether a health care provider may agree to arbitration when it accepts an assignment.In this case, Advantage Medical Diagnostics accepted an assignment of Ms. Livingston's benefits and demanded arbitration.We do not know whether this arbitration has concluded.As a practical matter, the outcome of this appeal should be the same whether the health care providers arbitrate or litigate their assigned claims.

The dispositive issue in this case concerns the right of the insured to bring a lawsuit for claims that have been assigned to a health care provider.The Fifth District has held that an unqualified assignment transfers to the assignee all the interest of the assignor under the assigned contract, and that the assignor has no right to make any claim on the contract once the assignment is complete, unless authorized to do so by the assignee.SeeState Farm Mutual Auto. Ins. Co. v. Gonnella,677 So.2d 1355(Fla. 5th DCA1996);State Farm Fire & Casualty Co. v. Ray,556 So.2d 811, 813(Fla. 5th DCA1990).The supreme court's pronouncement in Pinnacle does not alter this general rule.

From our perspective, the outcome of this case depends largely upon whether the insured, after the assignment, retains any risk of loss or any contingent...