COUNTY CIVIL COURT: Insurance—PIP Benefits—Section 222.18, Florida Statutes, does not protect PIP benefits that have been assigned—assignee does not qualify as creditor under § 222.18—Final Judgment affirmed.  Hays v. Progressive Express Ins. Co., No. 03-5043AP-88A (Fla. 6th Cir. Ct. App. Div. Jan. 25, 2005).


COUNTY CIVIL COURT: Attorney’s Fees—Trial court is not required to hold evidentiary hearing on whether sanctions are warranted under Section 57.105 so long as evidence is otherwise in the record—In absence of a transcript of relevant hearing, appellate court could not review whether trial court abused discretion in awarding sanctions—award affirmed.  Hays v. Progressive Express Ins. Co., No. 03-5043AP-88A (Fla. 6th Cir. Ct. App. Div. Jan. 25, 2005).









vs.                                                                                Appeal No. 03-5043AP-88A







Opinion Filed  ______________


Appeal from Final Judgment

Pinellas County Court

Judge William B. Blackwood


Arthur Liebling, Esq.

Attorney for Appellant


Valeria Hendricks, Esq.

Attorney for Appellee





            This matter is before the Court on an appeal filed by Heather Hays (Hays) from the Order and Summary Final Judgment entered on August 11, 2003, denying Hays’ motion for summary judgment, granting Progressive Express Insurance Company’s (Progressive) motion for summary judgment, and awarding attorney’s fees to Progressive as sanctions pursuant to Section 57.105, Florida Statutes.  Having fully reviewed the briefs, the record, and pertinent legal authority, this Court hereby affirms the Order.

            Hays had personal injury protection (PIP) benefits under an automobile insurance policy with Progressive.  While this policy was in force, Hays sustained injuries in an automobile accident.    Progressive acknowledges that on October 17, 2001, it received a letter from Hays instructing it to reserve all remaining PIP benefits for lost wages.

            However, Hays acknowledges that on October 26, 2001, Progressive received a bill from Armenia Spine Center (Armenia), one of Hays’ medical providers, for a sum in excess of her remaining PIP benefits.  Rather than reserving Hays’ benefits, Progressive paid the bill because Armenia had an assignment of benefits from Hays.  Hays has never contended that this assignment was not valid.

            There being no factual dispute in this matter, both parties filed motions for summary judgment.  Hays contended that her claim to the PIP benefits superseded Armenia’s claim because Section 222.18, Florida Statutes, protects PIP benefits from attachment, garnishment or legal process in favor of creditors.  However, Progressive contended that since Armenia was a valid assignee, rather than a creditor, Section 222.18 did not apply.

            The trial court agreed with Progressive, granting its motion and denying Hays’.   Further, the trial court granted Progressive’s request for attorney’s fees pursuant to Section 57.105, Florida Statutes, finding that “Plaintiff and/or Plaintiff’s attorney knew or should have known that the claim when initially presented to the Court was not supported by the material facts necessary to establish the claim nor was the claim supported by the application of the prevailing case law to those material facts.”

            On appeal, Hays raises three contentions: (1) that the trial court erroneously granted Progressive’s motion for summary judgment; (2) that the trial court had no basis to award Progressive attorney’s fees; and (3) that the trial court should have awarded her summary judgment.  This Court finds each of these contentions to be without merit.

Hays maintains that Section 222.18 bars Progressive from paying her PIP benefits to Armenia.  However, the plain language of this provision states only that it shields benefits from the claims of  “any creditor or creditors of the recipient of such . . . benefits.”   Progressive did not pay Hays’ benefits to a creditor, but rather to an assignee whose assignment Hays has never challenged. 

            Hays’ argument merely assumes that the term “creditor” in the statute covers assignees, without citing any authority for this proposition.[1]  Not only is Hays’ position contrary to the language of the statute, but it also ignores the fact that, unlike a creditor, an assignee receives all interest of the assignor under the assigned contract.  State Farm Fire & Casualty Co. v. Ray, 556 So. 2d 811, 813  (Fla. 5th DCA 1990).  Once the assignment is complete, “the assignee thereafter stands in the shoes of the assignor and may enforce the contract  . . . in his own name.”  Lauren Kyle Holdings, Inc. v. Heath-Peterson Constr. Corp., 864 So. 2d 55, 58 (Fla. 5th DCA 2003).  Further, since an assignment vests in the assignee the right to enforce a contract, the assignor retains no rights of enforcement.  Id.

            The Second District has also indicated that an assignee is not a creditor for purposes of Section 222.18.  In Crotts v. Bankers & Shippers Ins. Co., 476 So. 2d 1357 (Fla. 2d DCA 1985), Crotts twice assigned his PIP benefits to a hospital treating him for severe injuries incurred in a motorcycle accident.  Id. at 1358.  However, Crotts had no memory of making any assignments, and he later requested that his insurance company set aside his entire benefit for disability payments.  Id.

            Before the benefits were exhausted, the insurance company received a claim from the hospital, based upon the assignments, for the remainder of the proceeds.  Id.  The insurance company eventually issued a check for the remainder of the proceeds paid jointly to Crotts and the hospital.  Crotts then sued the insurance company for the benefits.  Id.[2]

            In determining that the trial court had not erred in denying Crotts attorney’s fees even though it had awarded him the benefits, the Second District noted that fees are warranted only when the insurance company wrongfully pushes the parties into litigation by not resolving the conflict when it could reasonably have done so.  Id.   The court continued that since Crotts’ situation involved the resolution of legal and factual issues that the insurance company could not have resolved on its own in any reasonable fashion, the insurance company did not act wrongfully in forcing the case into court.  Id. at 1359.

            In particular, the Second District noted that the key factual issue was whether the assignments Crotts made to the hospital were valid such that they would “divest the insured of his privilege under the policy to request that the insurance proceeds be paid as disability . . . benefits.”  Id.  The court continued that the legal question concerned the “effect of section 222.18, Florida Statutes (1983), which exempts disability payments from legal process.”  Id.

            While not directly ruling on the scope of Section 222.18, the court in Crotts indicated that if Crotts’ assignments were valid, he would be unable to claim the PIP benefits as disability payments.  This interpretation is in accordance with the plain language of Section 222.18 as well as the exclusive rights which an assignee enjoys.  Therefore, this Court finds that the trial court properly granted Progressive’s motion for summary judgment.  For the same reasons, this Court also finds that the trial court properly denied Hays’ motion for summary judgment.

            Regarding the attorney’s fees that were awarded to Progressive as sanctions, Section 57.105, Florida Statutes, provides that such fees are warranted when

the court finds that the losing party or the losing party's attorney knew or should have known that a claim or defense when initially presented to the court or at any time before trial:
(a) Was not supported by the material facts necessary to establish the claim or defense; or
(b) Would not be supported by the application of then-existing law to those material facts.
. . . .


(2) Paragraph [b] does not apply if the court determines that the claim or defense was initially presented to the court as a good faith argument for the extension, modification, or reversal of existing law or the establishment of new law, as it applied to the material facts, with a reasonable expectation of success.


§ 57.105(1)-(2), Fla. Stat. (2004).  Appellate courts review a trial court’s determination under this statute for abuse of discretion.   Gahn v. Holiday Property Bond, Ltd., 826 So. 2d 423, 425-26 (Fla. 2d DCA 2002).

            In the present matter, Hays argues that the trial court was required to hold an evidentiary hearing regarding whether her claim presented a good faith argument under Section 57.105(2).  However, while a court must base its award of fees on substantial competent evidence, this evidence may be presented “at the hearing on attorney’s fees or otherwise before the court and in the record.”  Cooke v. Custom Crete , 833 So. 2d 315, 316 (Fla. 2d DCA 2003) (emphasis added). 

            Therefore, the trial court was not required to hold an evidentiary hearing.  Further, this Court cannot review whether the trial court had substantial, competent evidence justifying the award of fees because Hays has not presented this Court with a transcript of the summary judgment hearing or a statement of evidence pursuant to Fla. R. App. P. 9.200(b)(4).  See Perlman v. Abel & Zimmerman, 881 So. 2d 1156, 1156-57 (Fla. 4th DCA 2004) (per curiam) (award of fees affirmed where court could not determine whether trial court erred in its underlying reasoning, particularly where “we have not been furnished with a copy of the transcript of the trial”).[3]   Accordingly, this Court cannot conclude that the trial court abused its discretion in awarding Progressive attorney’s fees.

            Therefore, it is

            ORDERED AND ADJUDGED that the Order and Summary Final Judgment entered on August 11, 2003, is hereby AFFIRMED. 

            It is further

            ORDERED AND ADJUDGED that Appellee’s Motion for Appellate Attorney’s Fees is DENIED.

            It is further

            ORDERED AND ADJUDGED that Appellant’s Motion for Appellate Attorney’s Fees is DENIED.

            DONE AND ORDERED in Chambers, at Clearwater, Pinellas County, Florida, this ___ day of January, 2005.



                                                                        JOHN A. SCHAEFER

                                                                        Circuit Judge, Appellate Division


Copies to:


Judge William B. Blackwood


Arthur Liebling, Esq.

146 8th Ave. N.

Safety Harbor, FL  34695


Valeria Hendricks, Esq.

Davis & Harmon, P.A.

100 N. Tampa St., Suite 2950

Tampa, FL  33602      

[1] While Hays does contend that Section 222.18 will be rendered meaningless if it does not extend to assignees, this Court finds it quite logical that the legislature would choose to protect disability benefits from creditors having nothing to do with the underlying automobile accident while allowing parties to whom the insured has specifically assigned those benefits the right to claim them.

[2] Other claims not relevant to this discussion were also filed.

[3] Hays also argues that the trial court’s finding that her claim was “frivolous” was erroneous because Section 57.105 no longer uses the “frivolous” standard as the basis for an award.  However, the trial court did not base the award on that finding; instead, it specifically based the award of attorney’s fees on a finding that Hays’ claim was not supported by either the material facts necessary to establish the claim or the application of then-existing law to those material facts.