Opinion
No. C7-90-2409.
Filed May 7, 1991.
Appeal from the District Court, Hennepin County.
Sharon L. Van Dyck, Schwebel, Goetz Sieben, P.A., for appellant.
Kay Nord Hunt, Gary Pontius, Patrick R. McDermott, Lommen, Nelson, Cole Stageberg, P.A., for respondent.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (1990).
UNPUBLISHED OPINION
David Jarosz appeals from the trial court's order denying his motion to modify an arbitration award, contending the trial court erred in (1) refusing to strike the arbitrator's statement that Jarosz's insurer would have no obligation to pay Jarosz's future chiropractic treatment and (2) refusing to modify the award to include statutory interest on overdue no-fault benefits. We affirm in part and reverse in part.
FACTS
David Jarosz was injured in an automobile accident in 1988. Jarosz's insurer, respondent Principal Financial Group, paid medical expense benefits.
Jarosz was examined in 1989 by Dr. Gilbert Westreich, who concluded Jarosz needed no further medical treatment. Based on Dr. Westreich's examination, Principal notified Jarosz that it would be discontinuing payment for medical treatment.
Jarosz filed for mandatory no-fault arbitration pursuant to Minn. Stat. § 65B.525 (1990). Jarosz sought payment of $3,605 in medical expense benefits. in an award dated February 20, 1990, the arbitrator awarded Jarosz $2,410 in medical expense benefits. The award further stated that Principal "shall have no further obligation for future chiropractic care." The arbitrator did not award interest on the award.
On March 30, 1990, Jarosz's attorney wrote to the arbitrator asking the arbitrator to delete the phrase regarding future chiropractic care. The arbitrator explained that in his opinion, Jarosz had reached maximum medical improvement and no further treatment of the complaints presented was necessary.
Jarosz then moved the district court for an order modifying the arbitration award pursuant to Minn. Stat. §§ 572.20 and 65B.54, subd. 2 (1990). Jarosz did not move to vacate the award. Jarosz requested the district court to delete the provision relating to future care and to award interest pursuant to Minn. Stat. § 65B.54. The trial court determined that it would not be possible to modify the arbitrator's award without affecting the merits of the award and that the appropriate vehicle for relief was a motion to vacate the award. As no motion to vacate had been brought, the trial court affirmed the arbitrator's award. This appeal followed.
DECISION
1. FUTURE BENEFITS
This court's power to modify an arbitration award is purely statutory.Minnesota Licensed Practical Nurses Ass'n v. Bemidji Clinic, Ltd., 352 N.W.2d 65, 67 (Minn. App. 1984). Under the Uniform Arbitration Act, a court may modify the arbitrator's award with respect to issues that were not submitted to arbitration so long as the award may be corrected without affecting the decision on issues which were properly submitted.See Minn. Stat. § 572.20, subd. 1(2) (1990).
Jarosz contends the question of future medical benefits was not submitted to the arbitrator and modification was appropriate pursuant to section 572.20, subd. 1(2). Before the award may be modified, it must be shown that both portions of subdivision 1(2) have been met; that is, that the arbitrator actually decided an issue not submitted and that the award can be corrected without affecting the merits of the decision on the issues which were submitted. International Union of Elec. Mach. Workers of America, Local No. 1140 v. Portec, Inc., 303 Minn. 341, 344, 228 N.W.2d 239, 242 (1975).
Under the No-Fault Act, an insurer must reimburse its insured for medical expenses incurred. Minn. Stat. § 65B.44, subd. 2 (1990). An insured has no right to medical expense benefits until the expense has been incurred. Minn. Stat. § 65B.54, subd. 1 (1990).
In the present case, Jarosz submitted to arbitration the question of the reasonableness of his medical expenses. By statute, Jarosz is entitled to recover only past medical expenses. Until medical expenses are incurred, Principal has no obligation to pay for such expenses. We conclude the arbitrator went beyond his power to decide an issue that could not be submitted to arbitration.
The arbitrator's ruling on the unsubmitted issue of future medical expenses can be stricken without affecting the merits of the decision on issues that were submitted. Jarosz's future medical expenses do not affect the arbitrator's decision on the necessity and reasonableness of the expenses submitted. We reverse the trial court's denial of Jarosz's motion to modify the award as it relates to future medical expenses.
2. INTEREST
Jarosz also contends the trial court erred in refusing to modify the arbitrator's award to include interest on overdue payments. Such interest is mandated by Minn. Stat. § 65B.54, subd. 2 (1990). Basic economic loss benefits, which include medical expense benefits, Minn. Stat. § 65B.44, subd. 1 (1990), are overdue if not paid within 30 days after the insurer receives reasonable proof of the fact and amount of loss. Minn. Stat. § 65B.54, subd. 1 (1990).
In the present case, there is no way to calculate the interest owed. The arbitrator did not specify which bills were reasonable; thus, there is no way to determine when the interest began to accrue on any specific amount. The arbitrator may have determined that a gradual phase-out of medical treatment was appropriate or may have determined that all of the treatment up to a certain date, and none afterward, was reasonable. As there is no way to decide the question without speculating as to what the arbitrator intended, modification is inappropriate. See Adler v. Safeco Ins. Co., 413 N.W.2d 566, 568 (Minn. App. 1987). We affirm the trial court's denial of Jarosz's motion to modify the arbitration award to include interest.
Affirmed in part, reversed in part and remanded.