A Florida court has reversed a previous ruling that awarded attorney's fees to Garrison Property & Casualty Insurance Company in a case involving Bain Complete Wellness, LLC. This decision affects how attorney fees are determined in insurance disputes and clarifies the requirements for pre-suit demand letters. The case, Bain Complete Wellness, LLC, A/A/O Kerri McDougald v. Garrison Property & Casualty Insurance Company, was filed under docket number 2D21-0259.
The dispute began when Kerri McDougald was injured in a car accident in 2015 and received medical care from Bain Complete Wellness. McDougald had an insurance policy with USAA, but Garrison was responsible for reimbursing claims under her policy. After McDougald assigned her claim for Personal Injury Protection (PIP) benefits to Bain, the company submitted bills for medical services. Garrison did not pay all of Bain's claims, stating that McDougald's PIP benefits had been exhausted.
On May 6, 2016, Bain's attorney, Xavier J. Jackman, sent a presuit demand letter to USAA instead of Garrison, claiming that $36,215.09 was owed for medical benefits. Garrison responded by informing Bain that the demand was sent to the wrong insurer and that the PIP benefits had already been exhausted. Bain later filed a lawsuit against Garrison, alleging breach of contract for failing to pay the overdue claims.
As the case progressed, Garrison filed a motion for summary judgment, arguing that Bain's demand letter was deficient because it did not specify the exact amounts owed as required by Florida law. Garrison also claimed that the demand letter was misleading and addressed to the wrong insurer. In response, Garrison sent a safe harbor letter to Bain, warning that if the lawsuit was not dismissed, it would seek sanctions.
In a ruling on the case, the trial court found in favor of Garrison and awarded it attorney's fees as sanctions, stating that Bain's counsel should have known the demand letter was deficient. The court also ordered Jackman to pay the entire award. Bain appealed the decision, leading to the recent ruling from the District Court of Appeal of Florida.
The court ruled that the trial court erred in imposing sanctions against Jackman because there was no evidence that he knew or should have known that the demand letter was statutorily deficient. The court stated, "We reverse the portion of the judgment in which the trial court imposed sanctions against Mr. Jackman because the trial court erred by concluding that Mr. Jackman knew or should have known that the demand letter was statutorily deficient."
Additionally, the court reversed the award of expert witness costs to Garrison, stating that Garrison's motions for costs were untimely. However, the court affirmed the portion of the trial court's judgment that awarded Garrison court reporter costs.
This ruling has significant implications for future cases involving insurance claims and the requirements for demand letters. It clarifies that a demand letter does not need to include a precise aggregated amount demanded, as long as it specifies each exact amount related to the treatment or services provided. This decision may influence how attorneys approach pre-suit demand letters in insurance disputes, as it sets a precedent for what constitutes a compliant demand.
Moving forward, the ruling may encourage insurance companies and claimants to ensure that demand letters are properly addressed and contain the necessary details to avoid disputes. It also highlights the importance of understanding the statutory requirements for PIP claims in Florida.
As for what’s next, it remains unclear if Garrison will appeal this decision. There is no related case pending at this time. The ruling stands as a reminder for legal professionals to carefully prepare demand letters to avoid potential sanctions and to ensure compliance with Florida law.