Baker Family Chiropractic, LLC v. Liberty Mutual Insurance Company

Fifth DCA

Baker Family Chiropractic, LLC v. Liberty Mutual Insurance Company—(J. Edwards; 5DCA; 2/6/23).

This 27-page decision is shockingly long considering its first paragraph, which states:

  • The underlying litigation and this second appeal to the Court began as a dispute over how to calculate the amount of interest owed by an insurer for failing to timely pay a health care provider who treated an insured pursuant to a Personal Injury Protection (“PIP”) policy issued by Appellee, Liberty Mutual Insurance. The net difference between the interest calculated and paid by Liberty Mutual and the amount claimed by the health care provider, Baker Family Chiropractic, LLC, (“Baker Chiro”), Appellant, was $1.48.

That’s right, dear reader. The appeal was a fight over $1.48. Interest was owed because Liberty did not pay the medical bill within 30 days of submission. Liberty also failed to take advantage of a safe-harbor provision shielding them from litigation if they paid the amount, penalties, and interest within 30 days of the demand letter. They paid on the 41st day, and, of course, paid $1.48 less than demanded. Even if Liberty had just paid the principal within 30 days of the demand, it would have been shielded from attorney’s fees, though not shielded from a lawsuit to recover the penalties and interest. Baker won its argument in the trial court, and Liberty appealed, hoping the DCA would adopt its method of calculating PIP interest and reverse the $1.48 judgment. After Baker filed its answer brief, however, Liberty dismissed its appeal, “effectively conceding that it had lost the dispute.” The DCA granted attorney’s fees and costs and remanded to the county court.

On remand, the parties litigated entitlement to fees, and the county court, for some reason, found no entitlement to fees. Baker appealed. The DCA noted that Liberty paid too late for either safe harbor (the immunity from suit and the protection against attorney’s fees) by waiting until 41 days after the demand letter.

The DCA considered the notion that fees should simply not be awarded when the amount in controversy is de minimis (its examples were $4.17, $1.48, and 14 cents), but it countered that the PIP statutes are supposed to provide the quick and easy payment to injured insureds in a no-fault system. The point of fee awards is to balance the playing field between individuals and large and powerful insurance companies. No lawyer would take smaller cases without the prevailing party fees. The fee statute is meant to punish insurance companies who force people to litigate something that could have been easily solved. Litigating a small amount like $1.48 takes two to tango. Liberty could have avoided this whole thing by paying out the small amount, so it shouldn’t be able to complain that the fight was over a small amount now that they lost the fight they insisted upon. Also, insurers often pick these small fights because they try to create policy that will apply to a large number of claims. The legislature made it clear: an insured will get fees for winning “any dispute” outside the two safe-harbor protections. The court reversed and remanded instructing the lower court to

  • take evidence and consider those matters set forth in section 627.736(8) and all relevant factors discussed in controlling case law, including but not limited to, the result obtained, the certainty of payment, and whether the litigation was a test case. The amount of attorney’s fees may be nominal or substantial but must in all respects be reasonable based on the unique circumstances of this case.

JUDGE EVANDER CONCURRED SPECIALLY. He offered advice for the remand, stating that if the

  • lawsuit was filed without first making a request for the $1.48 and the ensuing litigation was the result of Baker Chiro’s insistence on the payment of attorney’s fees and costs incurred in the preparation and filing of the lawsuit, then I would suggest that, on remand, the trial court would likely be well within its discretion to award only nominal attorney’s fees to Baker Chiro.

On the other hand, if the hearing on remand shows that Liberty consciously decided to “go to the mat” after a demand for the additional $1.48 in interest, he opined that it would be entirely appropriate to order significant fees to discourage insurers from denying payments courts might find de minimis.

JUDGE MAKAR CONCURRED SPECIALLY, concurring fully Judge Edwards’ opinion for the court. He also agreed with Judge Evander’s concurrence, which appears to make the advice about remand binding even though it does not appear in the main opinion.

He agreed with the Fourth District, however, that interest payments are not an insurance benefits, so he disagreed that attorney’s fees would not be available in a case that was solely about interest, not principal benefits.

He found that the fees were owed because Liberty did not timely pay the benefits due and then appealed—and dismissed—the appeal of the judgment for $1.48.

He opined that a court could deny fees due over a de minimis amount of interest, but he declined to opine that the de minimis argument in this case because it wasn’t raised in the lower court, perhaps because the insurer wanted to use the case as a test case.

He called upon the legislature to clarify whether fees are available in disputes solely over interest payments.

Terry P. Roberts
Director of Appellate Practice Fischer Redavid PLLC
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