Provident Life and Acc. Ins. Co. v. Prichard By and Through Midatlantic Nat. Bank and Trust Company/Florida

• Decision Date: 01 September 1993
• Docket Number: No. 92-0551,92-0551
• Citation: 636 So.2d 731
• Parties: 18 Fla. L. Weekly D1918 PROVIDENT LIFE AND ACCIDENT INSURANCE COMPANY, Appellant, v. James William Merle PRICHARD, By and Through MIDATLANTIC NATIONAL BANK AND TRUST COMPANY/FLORIDA, as Guardian of the Property of James William Merle Prichard, a minor, and William Lewis, Appellees.
• Court: Florida District Court of Appeals

Page 731

636 So.2d 731

18 Fla. L. Weekly D1918

PROVIDENT LIFE AND ACCIDENT INSURANCE COMPANY, Appellant, v. James William Merle PRICHARD, By and Through MIDATLANTIC NATIONAL BANK AND TRUST COMPANY/FLORIDA, as Guardian of the Property of James William Merle Prichard, a minor, and William Lewis, Appellees.

No. 92-0551.

District Court of Appeal of Florida Fourth District.

Sept. 1, 1993.

Order Denying Rehearing Feb. 23, 1994.

Love Phipps of Corlett, Killian, Ober & Levi, P.A., Miami, for appellant.

Christopher Lynch of Angones, Hunter, McClure, Lynch & Williams, P.A., Miami, Warner B. Miller of Law Offices of Warner B. Miller, and Jack Whitelock, Jr., Fort Lauderdale, for appellees.

WARNER, Judge.

Provident Life and Accident Insurance Company appeals a trial court's order denying intervention in personal injury litigation involving the child of its insured and a tort-feasor. Improvidently, the order was handed down two days prior to the issuance of Union Central Life Ins. Co. v. Carlisle, 593 So.2d 505 (Fla.1992), which held that an insurance company could intervene under certain conditions in its insured's tort litigation in order to protect its subrogation interest. Based on Union Central, we reverse.

Provident's motion to intervene arose out of a personal injury claim filed by the minor plaintiff James Prichard, Jr. James sustained irreversible brain damage when he was playing at his grandparents' home and fell into the swimming pool. Provident paid James, Jr.'s medical expenses under the health insurance policy issued to James, Sr. James' father sued the grandparents on behalf of his son and for himself individually. Count I sought damages on behalf of the minor for his personal injuries and the cost of his medical treatment. Count II sought recovery by the father of his medical bills and services. In answering the complaint, the grandparents raised comparative negligence as a defense.

By the time the case came to trial, the father had voluntarily dropped his individual claim which we are told was to avoid the comparative negligence defense being asserted. Nevertheless, at trial the minor's counsel (who also had represented the parents) introduced the minor's past medical bills into evidence, and the jury was instructed to consider as damages the reasonable value of past medical care. It does not appear that defendant raised any objection to this. The jury awarded the minor $7,146,000, which included $980,000 in past medical bills.

A final judgment was entered reflecting the verdict. However, both parties timely moved for new trials. Before the initial motions were heard, the defendant moved to amend his motion for new trial to assert that it was fundamental error to include in the award the amount of past medical expenses In Union Central Life Ins. Co., the court held that an insurance company could not be permitted to interfere with or even participate in a trial between a claimant and the tortfeasor, but that it must be given a meaningful opportunity to assert and protect its interests. To resolve the conflict between these two demands the court established a two step process.

since that amount could be recovered solely by the parents, who had voluntarily dismissed their claim. Two days later, Provident filed its motion to intervene claiming that its interest in the pending proceeding arose from its payment of past medical bills on behalf of the minor in an amount in excess of $800,000. It alleged that it had not become aware of the pending litigation until after the trial, but that it had both contractual and equitable rights of subrogation. Five days later, after a hearing called both on the motions for new trial and the motion to intervene, the trial court denied the motion to intervene, granted the motion for new trial in that it deleted the past medical expenses, signed an amended final judgment to that effect, and then approved a settlement between plaintiff and defendant for $3,000,000. Provident filed a notice of appeal from the order denying the motion to intervene.

First, the court should determine that the interest asserted is appropriate to support the intervention. Then the court must determine the parameters of the intervention. In applying that analysis to the facts of the case the court stated that Union Central had established its right of intervention:

Under the facts of this case, including, among other things, the contractual language requiring repayment of medical expenses recovered from the lawsuits as well as the substantial amount of those expenses, Union Central has demonstrated the requisite interest entitling it to intervene. Because the right to intervene is limited only to the extent of that interest, Union Central may monitor the trial as a spectator, but it cannot participate in any way other than to make appropriate motions to protect its interests (footnote omitted). Union Central also has the right to be heard prior to the distribution of any judgment or settlement proceeds and may appeal the trial court's decision on this point.

Id. at 508. We will analyze Provident's right of intervention using the Union Central analysis.

The appellees first claim that intervention was inappropriate because it was requested post-judgment. However, the request to intervene was made while timely motions for new trial were pending. Therefore, the judgment was not final, in that both parties had requested a new trial. See Hardwick v. Metropolitan Dade County, 256 So.2d 387 (Fla. 3d DCA 1972). Moreover, Provident's interest had been protected by the plaintiff obtaining a judgment for past medical expenses, and it was only the post-judgment efforts of plaintiff and defendant to delete that award which threatened Provident's interests. Finally, Provident alleged that it did not know about the suit until after the final judgment was entered. If so, it would be a harsh rule to fail to consider its intervention motion. See e.g., Kearney v. Saline, 208 So.2d 650 (Fla. 1st DCA 1968). Therefore, the motion should have been considered on its merits.

The dispute in this case turns on the first step of the analysis, namely whether Provident had a sufficient interest to protect to support intervention. We think it did. Provident had paid out over $800,000 in medical expenses incurred by the minor child under the father's health insurance policy. That policy provided that:

Medical care benefits are not payable to or for a person covered under this Plan when the Injury or Illness to the covered person occurs through the act or omission of another person. However, the Provident may elect to advance payment for medical care expenses incurred for an Injury or Illness in which a third party may be liable. For this to happen, the covered person must sign an agreement with Provident to pay the Provident in full any sums advanced to cover such medical expenses from the judgment or settlement he or she receives.

While it is undisputed that Provident did not obtain such agreement from the minor's father, it nevertheless paid out benefits on behalf of the minor. In Provident Life & Accident Ins. Co. v. Waller, 906 F.2d 985 (4th Cir.), cert. denied, 498 U.S. 982, 111 S.Ct. 512, 112 L.Ed.2d 524 (1990), the Fourth Circuit interpreted a comparable policy provision and determined that the equitable theory of unjust enrichment applied to effectuate the clear intent of Provident's policy to avoid the insured's receipt of a double recovery.

Here, however, it was the minor's guardian, not the parent and insured, who recovered the past medical expenses from the tort-feasor. Appellee contends...