SELECT MEDICAL CORPORATION v. ALLEN
ORDER granting in part 8 Motion for Default Judgment.Ordered by Judge C. Ashley Royal on 11/21/12 (lap)
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF GEORGIA
SELECT MEDICAL CORPORATION
d/b/a REGENCY HOSPITAL COMPANY,
SHARON F. ALLEN,
Civil Action No.
ORDER ON MOTION FOR DEFAULT JUDGMENT
Currently before the Court is Plaintiff’s Motion for Default Judgment [Doc. 8].
On October 11, 2011, Plaintiff Select Medical Corporation d/b/a/ Regency Hospital
Company (the “Hospital”) filed a Complaint against Defendant Sharon F. Allen
asserting claims for breach of contract, unjust enrichment, conversion, punitive
damages, and attorney’s fees and costs. The Hospital seeks to recover amounts and
interest Defendant owes for medical treatment, services, and supplies Defendant
received while a patient at the Hospital. Defendant was served with process, but she
failed to answer or respond.
At Plaintiff’s request, the Clerk of Court entered a default against Defendant on
April 20, 2012. On August 2, 2012, the Hospital moved for default judgment.
Defendant has not appeared or filed a response, and the time for doing so has passed.
For the reasons set forth below, Plaintiff’s Motion [Doc. 8] is GRANTED IN PART, as
to liability only. As discussed below, the Court will hold a HEARING on damages on
November 29, 2012 at 3:00 p.m., in Courtroom D of the William A. Bootle Federal
Building, Third Floor, Macon, Georgia.
A. Default Judgment Standard
Prior to obtaining a default judgment, the party seeking judgment must first seek
an entry of default.1 Plaintiffs have satisfied this requirement. The mere entry of
default, however, does not mandate the entry of a default judgment. Instead, the Court
must find a sufficient basis in the pleadings for judgment to be entered.2 A default is
not an admission of liability, but it is an admission as to the well‐pleaded facts in the
complaint, and the defendant may not challenge those facts on appeal.3 Once a court
determines that default judgment should be entered, the court must then determine the
amount and character of the recovery for which a sufficient basis is asserted in the
Fed. R. Civ. P. 55(a).
Nishimatsu Constr. Co. Ltd. v. Houston Nat’l Bank, 515 F.2d 1200, 1206 (5th Cir. 1975) (In Bonner v. City of
Pritchard, 661 F.2d 1206, 1209 (11th Cir. 1981), the Eleventh Circuit adopted all cases decided by the
former Fifth Circuit before October 1, 1981.)
Eagle Hosp. Physicians, LLC v. SRG Consulting, Inc., 561 F.3d 1298, 1307 (11th Cir. 2009).
Buchanan v. Bowman, 820 F.2d 359, 361 (11th Cir. 1987).
In considering any default judgment, the Court must examine (1) jurisdiction, (2)
liability, and (3) damages.5 In this case, the Court has jurisdiction pursuant to 28 U.S.C.
§ 1332 (diversity jurisdiction). The remaining considerations are discussed below.
In its Complaint, the Hospital alleges that it provided medical treatment,
services, and supplies to Defendant from August 31, 2010, through October 5, 2010. On
September 23, 2010, Defendant, through her daughter who was her representative,
executed a Consent to Admission and Treatment, Authorization to Release Information
and Assignment of Insurance Benefits (the “Contract”). Pursuant to the Contract,
Defendant authorized and directed “any and all insurance companies . . . to make any
and all payments due under [her] insurance policies . . . for treatment provided by the
Hospital for application toward any outstanding balance owed to the Hospital for
services rendered therein.”6 Moreover, Defendant irrevocably assigned and transferred
the insurance benefits to the Hospital.7
The Hospital billed Defendant’s insurance company, Blue Cross/Blue Shield
(“BCBS”), for the medical treatment, services, and supplies provided to Defendant in
See Pitts v. Seneca Sports, Inc., 321 F. Supp. 2d 1353 (S.D. Ga. 2004).
Compl., Ex. A, para. 8 [Doc. 1‐1].
Id. at para. 9.
the total amount of $76,331.82.8 The Hospital maintains that the charges were
reasonable, customary, and medically necessary. On November 9, 2010, BCBS issued
check number 00012886169 in the amount of $54,250.00 to Defendant as partial payment
for the medical treatment, services, and supplies the Hospital provided to Defendant
On November 11, 2010, the Hospital wrote Defendant and requested the Check
be endorsed and sent to the Hospital as payment for the medical treatment, services,
and supplies provided to her.9 Defendant never remitted the Check to the Hospital.
The total sum of $76,331.82, plus interest, remains due and owing to the Hospital for her
Based on the above allegations, Plaintiff brings claims for (1) breach of contract
based on Defendant’s failure to pay the Hospital for the medical treatment, services,
and supplies she received; (2) unjust enrichment, based on Defendant’s failure to pay;
(3) conversion, based on Defendant’s conversion of the Check; and (4) punitive
damages based on the tort of conversion. Plaintiff demands judgment against
Defendant in the amount of $76,331.82 on the breach of contract and unjust enrichment
claims; $54,250.00 on the conversion claim; punitive damages in an amount to be
determined at trial; plus interest, attorneys’ fees, and costs.
Compl., Ex. B [Doc. 1‐2].
Compl., Ex. C [Doc. 1‐3].
Under Georgia law, a party asserting breach of contract has the burden of
pleading and proving (1) the subject matter of the contract, (2) consideration, and (3)
mutual assent by the parties to all of the contract terms.10 Once the party establishes a
valid contract existed, “the elements for a breach of contract claim in Georgia are the (1)
breach and the (2) resultant damages (3) to the party who has the right to complaint
about the contract being broken.”11 The Court finds that the well‐pleaded allegations of
Plaintiff’s Complaint set forth the required elements to establish Defendant’s liability
for breach of contract.12 Because Plaintiff prevails on its breach of contract claim, its
unjust enrichment claim fails. “‘An unjust enrichment theory does not lie where there is
an express contract.’”13
A party alleging the tort of conversion must “’show title to the property,
possession by the defendant, demand for possession, and refusal to surrender the
property, or an actual conversion prior to the filing of the suit. . . .’”14 Where a
defendant originally obtained lawful possession of property, the plaintiff must show
actual conversion or demand for the property’s return coupled with the defendant’s
O.C.G.A. § 13‐3‐1.
Duke Galish, LLC v. Manton, 308 Ga. App. 316, 320, 707 S.E.2d 555, 559 (2011) (citation omitted).
Because the Court grants default judgment as to the breach of contract claims, the Court does not need
to consider Plaintiffs’ alternative unjust enrichment and account stated claims. See Huddleston v. Smith,
Civil Action No. 1:09‐cv‐03669, 2010 WL 1410556 (N.D. Ga. Mar. 30, 2010) (declining to reach alternative
unjust enrichment claim after granting default judgment as to breach of contract claim).
Arko v. Cirou, 305 Ga. App. 790 (2010) (alterations omitted) (quoting Donchi, Inc. v. Robdol, LLC, 283 Ga.
App. 161 (2007)).
Stroman v. Bank of Am. Corp., 852 F. Supp. 2d 1366, 1379 (N.D. Ga. 2012) (quoting Taylor v. Powertel, Inc.,
250 Ga. App. 356 (2001)).
refusal to return the property.15 Actual conversion means “any distinct act of dominion
and control wrongfully asserted over another’s personal property” in denial of or
inconsistent with his right of ownership.16 The Court finds that the well‐pleaded
allegations of Plaintiffs’ Complaint also set forth the required elements to establish
Defendant’s liability for conversion. Because Plaintiff establishes liability for the tort of
conversion, it is entitled to punitive damages if the evidence supports such an award.17
Although the entry of default judgment is appropriate on Plaintiff’s claims for
breach of contract and conversion, the Court still has an obligation “to assure that there
is a legitimate basis for any damage award it enters.”18 The Court may only award
damages for default judgment without a hearing if “the amount claimed is a liquidated
sum or one capable of mathematical calculation.”19 Thus, [d]amages may be awarded
only if the record adequately reflects the basis for [the] award via a hearing or
demonstration by detailed affidavits establishing the necessary facts.”20
Williams v. Nat’l Auto Sales, Inc., 287 Ga. app. 283 (2007).
“Punitive damages may be awarded only in such tort actions in which it is proven by clear and
convincing evidence that the defendant’s actions showed willful misconduct, malice, fraud, wantonness,
oppression, or that entire want of care which would raise the presumption of conscious indifference to
consequences.” O.C.G.A. § 51‐12‐5.1(b).
Anheuser Busch, Inc. v. Philpot, 317 F.3d 1264, 1266 (11th Cir. 2003).
Adolph Coors Co. v. Movement Against Racism and the Klan, 777 F.2d 1538, 1543 (11th Cir. 1985).
Id. (citation omitted); see also S.E.C. v. Smyth, 420 F.3d 1225, 1232 (11th Cir. 2005) (noting that a hearing is
not required “where all essential evidence is already of record”).
On the record currently before the Court, Plaintiff has failed to adequately prove
the damages it seeks. For example, Plaintiff has failed to provide any admissible
evidence establishing Defendant received and converted the Check issued by BCBS.
Therefore, the Court will hold a hearing where Plaintiff will have the opportunity to
prove the damages it seeks, including punitive damages, and bring evidence
establishing attorneys’ fees and costs incurred.21
As explained herein, the Court GRANTS, IN PART, Plaintiff’s Motion for
Default Judgment [Doc. 8] as to liability only. The Court will hold a HEARING on
damages on November 29, 2012 at 3:00 p.m., in Courtroom D of the William A. Bootle
Federal Building, Third Floor, Macon, Georgia.
SO ORDERED, this 21st day of November, 2012.
S/ C. Ashley Royal
C. ASHLEY ROYAL, CHIEF JUDGE
UNITED STATES DISTRICT COURT
See Local Rule 54.1.
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