I have written before, here, about why it is difficult to sue PIP carriers who fail to pay claims. PIP claims are by their nature small: generally not more than $2000 and never more than $8000. The PIP statute provides that the insurer must pay the claimant's attorney's fees if a judgment against the carrier enters. Up until now, an insurer could avoid paying those fees if it forced a claimant to file suit, conduct discovery and go to trial and then, minutes before judgment enters, paid the claim. Of course if the claimant proved bad faith in the insurer's actions then attorney's fees were available under Mass. Gen. Laws ch. 93A, but bad faith is harder to prove than mere failure to pay a claim when due. Although some wiggle room was found by various decisions of the Massachusetts Appellate Division (a court that does not set precedent), see here and here, PIP cases in general were simply a bad risk.
The Supreme Judicial Court of Massachusetts has changed all that.
In Barron Chiropractic & Rehabilitation, P.C. v. Norfolk & Dedham Group, 469 Mass. 800 (2014), the SJC has held that an unpaid party who has brought suit may refuse the insurer's tender of PIP amounts due, proceed with suit, and obtain a judgment for those amounts as well as its costs and attorney's fees.
The plaintiff, Barron Chiropractic & Rehabilitation, provided chiropractic services to Nicole Jean-Pierre after an auto accident. Jean-Pierre's PIP carrier was Norfolk & Dedham.
Jean Pierre's chiropractor at Barron and Norfolk & Dedham disagreed about the length of treatment made necessary by the accident and about the proper price for her treatment. The disputed amount was $1,544.05.
Barron sued Norfolk & Dedham in District Court. Norfolk & Dedham determined that its anticipated litigation costs would substantially exceed the amount of the disputed medical fees. Six days prior to trial it sent Barron a check for the disputed amount with an attached check stub that stated "full and final settlement." Barron's counsel returned the check to Norfolk's counsel with a letter stating that its offer of settlement was rejected.
The SJC held that under contract law Barron was not required to accept the tender of settlement for the amount due after the time for payment under the PIP statute had passed. It also held that it would be unfair and against the purpose of the PIP statute to allow the insurer to escape costs and attorney's fees by paying the PIP amount that was due after forcing the claimant to file suit.