Printable Format40-3111. Lawful charges for treatment or occupational training of injured person; action to recover overdue benefits; allowance of attorney's fee. (a) A physician, hospital, clinic or other person or institution lawfully rendering treatment to an injured person for an injury covered by personal injury protection benefits and a person or institution providing rehabilitative occupational training following the injury, may charge a reasonable amount for the products, services and accommodations rendered. The charge shall not exceed the amount the person or institution customarily charges for like products, services and accommodations in cases not involving insurance, and allowances for medical benefits under this act do not include that portion of the charge for a room in any hospital, clinic, convalescent or nursing home, extended care facility or any similar facility in excess of the reasonable and customary charge for semiprivate accommodations unless intensive care is medically required.
(b) An attorney is entitled to a reasonable fee for advising and representing a claimant in an action for personal injury protection benefits which are overdue. The attorney's fee shall be a charge against the insurer or self-insurer in addition to the benefits recovered, if the court finds that the insurer or self-insurer unreasonably refused to pay the claim or unreasonably delayed in making proper payment.
Within the discretion of the court, an insurer or self-insurer may be allowed an award of a reasonable sum as attorney's fee, based upon actual time expended, and all reasonable costs of suit for its defense against a person making claim against such insurer or self-insurer where such claim was fraudulent, excessive or frivolous, and such attorney's fee and all such reasonable costs of suit so awarded may be treated as an offset against any benefits due or to become due to such person.
History: L. 1974, ch. 193, § 11; February 22.
Source or prior law:
L. 1973, ch. 198, § 11.
Cross References to Related Sections:
Allowance of attorney fees in other insurance cases, see 40-256, 40-908, 40-3113a, 40-3114.
Law Review and Bar Journal References:
"Recovery of Attorney Fees in Kansas," Mark A. Furney, 18 W.L.J. 535, 550, 559 (1979).
"Insurer's Bad Faith: A New Tort for Kansas?" Janet Amerine and Jan E. Montgomery, 19 W.L.J. 467, 485 (1980).
"Torts—Insurance—First Party Bad Faith—Is There an Adequate Remedy in Kansas After Spencer v. Aetna Life & Casualty Insurance Co.?" Karen S. Kressin, 29 K.L.R. 277, 281, 285 (1981).
"Unfair Claims Settlements—A Suggested Approach to a Potential Cause of Action," Gene E. Schroer and Paul H. Hulsey, 5 J.K.T.L.A. No. 4, 8, 13 (1982).
"Don't Forget the PIP," Steven M. Dickson, J.K.T.L.A. Vol. XV, No. 6, 9 (1992).
"Plaintiff's Guide To Court Awarded Attorney Fees," Gerald W. Scott and Mark A. Scott, J.K.T.L.A. Vol. XVII, No. 6, 4, 5 (1994).
"Kansas's Conflict of Laws Rules for Insurance Contract Cases: It's Time to Change Policies," Jason E. Pepe, 46 K.L.R. 819 (1998).
"Settlements and Verdicts," Robin Maxon, Editor, J.K.T.L.A. Vol. 27, No. 3, 24 (2004).
CASE ANNOTATIONS
1. Applied in construing K.S.A. 40-3113; insurer's right to full reimbursement of PIP benefits paid to insured determined. Easom v. Farmers Insurance Co., 221 Kan. 415, 429, 431, 560 P.2d 117.
2. Construed; K.S.A. 40-256 held relevant authority; denial of recovery of attorney fees affirmed. Hand v. State Farm Mut. Auto. Ins. Co., 2 Kan. App. 2d 253, 261, 577 P.2d 1202.
3. Tort of bad faith not recognized in Kansas. Spencer v. Aetna Life & Casualty Ins. Co., 227 Kan. 914, 923, 611 P.2d 149.
4. Applied in holding no recovery of attorney fees. Coe v. Security National Ins. Co., 228 Kan. 624, 631, 620 P.2d 1108.
5. In exercise of inherent powers, trial court did not abuse discretion in refusing deposition of out-of-state physician in action for overdue personal injury protection (PIP) benefits, attorney fees and interest. Wilson v. American Fidelity Ins. Co., 229 Kan. 416, 421, 625 P.2d 1117.
6. Where personal injury protection benefits properly denied and there is no obligation for payment of disability benefits, insurer not liable for attorney fees. Morgan v. State Farm Mut. Auto. Ins. Co., 5 Kan. App. 2d 135, 142, 143, 613 P.2d 684.
7. Plaintiff not entitled to attorney fees; good-faith controversy. Armacost v. State Farm Mut. Auto. Ins. Co., 231 Kan. 276, 279, 280, 644 P.2d 403 (1982).
8. Comparison of language of section with K.S.A. 40-256; construction of K.S.A. 40-256 applied. DiBassie v. American Standard Ins. Co. of Wisconsin, 8 Kan. App. 2d 515, 661 P.2d 812 (1983).
9. Within letter and spirit of statute to award attorney fees only for work while PIP benefits overdue. Dewey v. Allstate Ins. Co., 588 F. Supp. 479, 482 (1984).
10. Furnishing gross earnings in cattle business bore no relationship to value of services; not sufficient to trigger overdue provisions of (b). Dewey v. Allstate Ins. Co., 739 F.2d 1494, 1496 (1984).
11. Presence of genuine issue raised in good faith bars an award of attorney fees. Whitaker v. State Farm Mut. Auto Ins. Co., 13 Kan. App. 2d 279, 285, 768 P.2d 320 (1989).
12. What constitutes unreasonable refusal to pay PIP claim or unreasonable delay in making payment examined. Miner v. Farm Bur. Mut. Ins. Co., Inc., 17 Kan. App. 2d 598, 619, 841 P.2d 1093 (1992).
13. Subsection (b) cited; unreasonably refused standard very similar to without reasonable proof standard of K.S.A. 40-3110 and just cause standard of K.S.A. 40-256. Scott v. State Farm Mut. Auto. Ins. Co., 18 Kan. App. 2d 93, 100, 850 P.2d 262 (1992).
14. Nonresident self-insurers duty to defend and pay employee vehicle defense costs, including attorney fees examined. Overbaugh v. Strange, 254 Kan. 605, 615, 867 P.2d 1016 (1994).
15. Whether attorney fees may be awarded where issues of first impression are raised in good faith in insurance coverage case examined. Garrison v. State Farm Mut. Auto. Ins. Co., 20 Kan. App. 2d 918, 931, 894 P.2d 226 (1995).
16. In case involving payment of PIP benefits held: Trial court did not error in refusing to award attorney fees and in finding insurance company's refusal to pay all of medical bills was not without just cause. Moore v. Dudley, 31 Kan. App. 2d 184, 64 P.3d 429 (2002).
17. Servicing carrier under KAACP entitled to recover from primary insurer PIP benefits paid but is not entitled to prejudgment interest or attorney fees as insurer had reasonable belief it was not liable for PIP payments. Farmers Alliance Mut. Ins. Co. v. Garcia, 33 Kan. App. 2d 90, 97 P.3d 501 (2004).
18. Trial court abused its discretion by entering default judgment; award of attorney fees is reversed. Lara v. Vasquez, 33 Kan. App. 2d 128, 98 P.3d 660 (2004).
19. Assignee's rights are derivative, once insured settled with tortfeasor, assignee must look to insured for payment. Chamberlain v. Farm Bureau Mut. Ins. Co., 36 Kan. App. 2d 163, 175, 176, 137 P.3d 1081 (2006).