Shelby County Health Care Corporation v. Southern Farm Bureau Casualty Insurance Company et al

Filing 33

ORDER granting 18 Motion for Summary Judgment. Signed by Judge Billy Roy Wilson on 4/10/2014. (jak)

IN THE UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF ARKANSAS
JONESBORO DIVISION
SHELBY COUNTY HEALTH CARE
CORPORATION d/b/a Regional Medical
Center
V.

PLAINTIFF

3:13CV00194-BRW

SOUTHERN FARM BUREAU
CASUALTY INSURANCE CO., et al.

DEFENDANTS
ORDER

Pending is Defendant Barbara Ford’s Motion for Summary Judgment (Doc. No. 18).
Plaintiff has responded and Defendant Ford has replied.1 For the reasons set forth below,
Defendant Barbara Ford’s Motion for Summary Judgment (Doc. No. 18) is GRANTED.
I.

BACKGROUND2
John Smiley was involved in a motor-vehicle collision with Aaron Medford in Monroe

County, Arkansas, on February 18, 2009. That same day, he was admitted to the Regional
Medical Center (“The Med”), in Shelby County, Tennessee. He died on March 6, 2009 from the
injuries sustained in the accident. Barbara Ford was appointed Special Administratrix of the
Estate of John Smiley.
On March 23, 2009, The Med filed an Affidavit for Hospital Lien, under Tennessee Code
Annotated § 29-22-101 in the Circuit Court of Tennessee, in Memphis, for over $300,000 -- the
cost of the medical services provided to Mr. Smiley after the accident. An Amended Lien was

1

Doc. Nos. 23, 31.

2

Unless otherwise noted, the Background is taken from Plaintiff’s complaint (Doc. No. 1)
and the Statements of Material Fact Not in Dispute (Doc. Nos. 20, 24, 32).
1

filed on March 19, 2010. The Med mailed copies of these liens to the Estate’s lawyers on
April 16, 2009, March 25, 2010, January 14, 2010, and May 6, 2010.3
Southern Farm Bureau Casualty Insurance Company, Mr. Medford’s insurer, settled the
Estate’s potential personal-injury claims for $700,000. On September 13, 2010, the Probate
Division of the Circuit Court of Monroe County, Arkansas, authorized the Estate to accept the
settlement after noting that no medical liens had been filed in Monroe County and the “purported
medical lien filed in the State of Tennessee by [The Med]. . . is not enforceable and is void in
Arkansas and will not be considered” because The Med failed to follow the requirements of Ark.
Code Ann. §§ 18-46-101 et seq.4
On August 30, 2013, The Med filed a complaint against Southern Farm Bureau, Mr.
Medford, Mr. Medford’s employers, and Barbara Ford, as Administratrix of the Estate of John
Smiley. The Med alleges that Defendants improperly settled their personal injury claim “without
payment in honor of The Med’s Hospital lien and in violation of Tenn. Code Ann. § 29-22-104.”
It also contends that “Tennessee law applies to the adjudication of The Med’s hospital lien
entitlement against any recovery made by the Estate of John D. Smiley, and/or paid by
Defendants, Southern Farm, Aaron Medford, and Medford Farm Partnerships.”
II.

SUMMARY JUDGMENT STANDARD
Summary judgment is appropriate only when there is no genuine issue of material fact, so

that the dispute may be decided on purely legal grounds.5 The Supreme Court has established
guidelines to assist trial courts in determining whether this standard has been met:

3

Doc. No. 24-1, 24-3, 24-5.

4

Doc. No. 18-4.

5

Holloway v. Lockhart, 813 F.2d 874 (8th Cir. 1987); Fed. R. Civ. P. 56.
2

The inquiry performed is the threshold inquiry of determining whether there is the
need for a trial -- whether, in other words, there are any genuine factual issues that
properly can be resolved only by a finder of fact because they may reasonably be
resolved in favor of either party.6
The Court of Appeals for the Eighth Circuit has cautioned that summary judgment is an
extreme remedy that should be granted only when the movant has established a right to the
judgment beyond controversy.7 Nevertheless, summary judgment promotes judicial economy by
preventing trial when no genuine issue of fact remains.8 A court must view the facts in the light
most favorable to the party opposing the motion.9 The Eighth Circuit has also set out the burden
of the parties in connection with a summary judgment motion:
[T]he burden on the party moving for summary judgment is only to demonstrate,
i.e.,“[to point] out to the District Court,” that the record does not disclose a genuine
dispute on a material fact. It is enough for the movant to bring up the fact that the
record does not contain such an issue and to identify that part of the record which
bears out his assertion. Once this is done, his burden is discharged, and, if the record
in fact bears out the claim that no genuine dispute exists on any material fact, it is
then the respondent’s burden to set forth affirmative evidence, specific facts,
showing that there is a genuine dispute on that issue. If the respondent fails to carry
that burden, summary judgment should be granted.10
Only disputes over facts that may affect the outcome of the suit under governing law will
properly preclude the entry of summary judgment.11

6

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 (1986).

7

Inland Oil & Transport Co. v. United States, 600 F.2d 725, 727 (8th Cir. 1979).

8

Id. at 728.

9

Id. at 727-28.

10

Counts v. MK-Ferguson Co., 862 F.2d 1338, 1339 (8th Cir. 1988) (quoting City of Mt.
Pleasant v. Associated Elec. Coop., 838 F.2d 268, 273-74 (8th Cir. 1988) (citations omitted)).
11

Anderson, 477 U.S. at 248.
3

III.

DISCUSSION
The Med argues that this case involves a choice of law issue and that Tennessee law

applies; but it is much simpler than that. Even if I assume The Med properly perfected an
Affidavit for Hospital Lien under Tennessee law, it never obtained a judgment that could be
enforced in Arkansas against the Estate of John Smiley, which it knew, or reasonably should
have known, would be subject to probate in Arkansas. It also failed to file a lien in Arkansas.
To perfect the hospital’s lien under Tennessee law, the hospital must “file in the office of
the clerk of the circuit court of the county in which the hospital is located, and in the county
wherein the patient resides, if a resident” of Tennessee.12 However, the law does not set out the
process of perfecting a lien on out-of-state patients. Still, logic and The Med’s past practice of
filing notices of judgment in Arkansas,13 lead to only one conclusion: The Med should have filed
its judgment or lien in the court retaining jurisdiction over the Estate.
In fact, The Med was required to take action to enforce its lien in the court with
jurisdiction over the issues.14 This requirement is obvious from the fact that Tennessee law
requires the hospital to file the lien in the county in which the patient resides (if a Tennessee
resident), as well as where the hospital conducts business. Despite The Med’s argument of
nefarious activities by the Estate’s lawyers and the probate court, the issue remains: The Med
had a Tennessee lien but failed to properly enforce it in the court with jurisdiction over the Estate
of John Smiley.

12

Tenn. Code Ann. § 29-22-102.

13

Defendant provided two cases where The Med filed notice of judgment in Arkansas
courts in order to obtain relief. Doc. Nos. 31-5, 31-6.
14

Sears v. Burkeen, 237 S.W.3d 521 (Ark. App. 2006) (rejecting a party’s attempt to
enforce a Tennessee judgment when the party failed to take any action to enforce its lien in the
court with jurisdiction over the proceeding).
4

Even if the Med had taken the appropriate steps, it is clear that Arkansas law -- which is
appropriate in this case, since all other things being equal, Arkansas has a strong interest in
determining what damages its citizens may recover in personal injury suits -- would not permit
The Med to recover from the wrongful death proceeds of the beneficiaries. To find otherwise
would allow Tennessee court rulings and law to trump clearly established Arkansas law.15
Additionally, if I adopted The Med’s argument that the “recovery was plainly based upon
estate damages -- not wrongful death,” I would effectively be overruling the decision by the
circuit court. It seems to me that if this were The Med’s position, the proper legal course would
have been to raise the issue with the state circuit court, not after the fact in federal court.
CONCLUSION
Based on the findings of fact and conclusions of law above, Defendant Barbara Ford’s
Motion for Summary Judgment (Doc. No. 18) is GRANTED.
IT IS SO ORDERED this 10th day of April, 2013.

/s/ Billy Roy Wilson
UNITED STATES DISTRICT JUDGE

15

Mid-South Adjustment Co., Inc. v. Estate of Harris, 189 S.W.3d 518 (Ark. App. 2004).
Though The Med strongly encourages me to side with the dissenters in this case, the majority
decision remains the law in Arkansas.
5