State Farm Fire and Cas. Co. v. Ray

• Decision Date: 15 February 1990
• Docket Number: No. 89-210,89-210
• Citation: State Farm Fire and Cas. Co. v. Ray, 556 So.2d 811 (Fla. App. 1990)
• Parties: 15 Fla. L. Weekly D461 STATE FARM FIRE AND CASUALTY COMPANY, Appellant, v. Alan RAY, Appellee.
• Court: Florida District Court of Appeals

Page 811

556 So.2d 811

15 Fla. L. Weekly D461

STATE FARM FIRE AND CASUALTY COMPANY, Appellant, v.Alan RAY, Appellee.

No. 89-210.

District Court of Appeal of Florida Fifth District.

Feb. 15, 1990.

W.R. Armstrong, Daytona Beach, for appellant.

W.M. Chanfrau, Daytona Beach, for appellee.

William G. Crotty of Black, Crotty, Sims, Hubka, Burnett & Samuels, Daytona Beach, amicus curiae.

LEE, R.E., Jr., Associate Judge.

State Farm Fire and Casualty Company(State Farm), appeals from a final judgment awarding appellee, Alan Ray, $6,144.14.

Ray, injured in an auto accident on December 21, 1987, incurred medical expenses in excess of $13,000 and lost wages exceeding $12,375.At the time of the accident, he was covered by an insurance policy with State Farm containing both personal injury protection (PIP) and medical payments coverage.The policy provided benefits to the extent of 80% of Ray's medical bills up to $10,000 and 60% of lost wages up to $5,000.

On February 8, 1988, Ray's counsel wrote State Farm, instructing it to pay no more than 20% of the PIP benefits for medical expenses.This letter was received by State Farm on February 10, 1988.On February 17, 1988, State Farm received a letter from Halifax Medical Center, dated February 11th, informing State Farm that Ray had executed an irrevocable assignment of benefits sometime prior to February 10th, in favor of the hospital.On that same day, February 17, 1988, State Farm also received medical bills from the hospital totalling $9,126.95.State Farm made payments to the hospital under the policy for $6,997.94.Ray presented a claim for lost wages and was paid $3,476.36, thus exhausting the remainder of his coverage.

Ray then brought suit seeking the unpaid balance of his lost wages, a sum of $4,525.64, plus costs and attorney's fees, claiming State Farm received his instructions directing the apportionment of the proceeds before learning of the hospital assignment and should have honored the former first.Following a non-jury trial, the court awarded Ray the sum of $6,144.14, representing the lost wages claimed plus attorney's fees of $1,500, as well as costs of $118.50.Denying State Farm's motion for rehearing, the trial court stated:

ORDERED AND ADJUDGED that the defendant's receipt of the plaintiff's instructions to allocate insurance benefits prior to its receipt of the irrevocable assignment of benefits to the hospital is determinative of the appropriate payment of the PIP benefits, and the Defendant was obligated to pay such benefits in accordance with the Plaintiff's instructions to allocate.

The trial court thus treated Ray's instructions to allocate the benefits as an assignment, agreeing with Ray that the English Rule establishing the priority of assignments accorded to successive assignees governs.The English Rule, as set forth in Boulevard National Bank of Miami v. Air Metal Industries, Inc., 176 So.2d 94(Fla.1965), gives priority to the assignee first giving notice to the creditor.While we do not disagree with the English Rule, we disagree with its applicability here.

An assignment is defined as "a transfer or setting over of property or of some right or interest therein, from one person to another.It is the act by which one person transfers to another, or causes to vest in another, his right of property or interest therein."4 Fla.Jur.2d, Assignments§ 1(1978).Clearly, Ray's letter to State Farm instructing it not to pay more than 20% of the policy's PIP...