Midtown Chiropractic v. Illinois Farmers Insurance Co.

847 N.E.2d 942, 2006 Ind. LEXIS 422
CourtIndiana Supreme Court
DecidedMay 23, 2006
Docket49S02-0503-CV-96
StatusPublished
Cited by22 cases

This text of 847 N.E.2d 942 (Midtown Chiropractic v. Illinois Farmers Insurance Co.) is published on Counsel Stack Legal Research, covering Indiana Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Midtown Chiropractic v. Illinois Farmers Insurance Co., 847 N.E.2d 942, 2006 Ind. LEXIS 422 (Ind. 2006).

Opinions

DICKSON, Justice.

In this appeal, a chiropractic clinic seeks to assert an assignment signed by its patient to collect from a liability insurance company that paid the patient's personal injury tort claim not-withstanding the clinic's notice to the company of the assignment. The trial court granted summary judgment to the defendant, Illinois Farmers Insurance Company, and the Court of Appeals reversed, Midtown Chiropractic v. Illinois Farmers Ins., 812 N.E.2d 851 (Ind.Ct.App.2004). We granted transfer and affirm the trial court's grant of summary judgment to Illinois Farmers.

The plaintiff-appellant, Midtown Chiropractic, seeks to collect directly from the defendant-appellee, Illinois Farmers Insurance Company, charges of $3,010 for chiropractic care for a patient injured in a collision with an automobile driven by a person insured by Illinois Farmers. Midtown had obtained its patient's signature on an "Assignment of Right to Receive Benefits and/or Proceeds of Settlement or Judgment," sent notice of the assignment to Illinois Farmers, and asked to be included "as a named co-endorser on any disbursement check." Appellant's App'x. at 13-14. But Illinois Farmers later settled the patient's lability claim for $9,000 and paid the full amount directly to the patient. Midtown filed an action against Illinois Farmers on the assignment, seeking damages of $3,010. Illinois Farmers responded with a motion for summary judgment asserting that the assignment was not valid and, alternatively, that as a liability insurer, it was not subject to a direct action by a tort claimant or the claimant's assignee. The trial court granted the motion without specifying any findings of fact or conclusions of law.

Appealing from the trial court's grant of summary judgment for Illinois Farmers, Midtown asserts that the assignment it obtained from its patient is valid and may [944]*944be enforced directly against Illinois Farmers. 'We find the determinative issue to be whether this particular assignment constitutes an assignment of a personal injury tort cause of action, which is prohibited under Indiana common law.

Whether the grant of summary judgment to the defendant was proper is determined using the same standard as that used by the trial court, which provides that "summary judgment is appropriate only where the evidence shows that there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law." Reeder v. Harper, 788 N.E.2d 1236, 1240 (Ind.2003); see also Ind. Trial Rule 56(C). All facts and reasonable inferences from them are construed in favor of the non-moving party. Worman Enter., Inc. v. Boone County Solid Waste Mgmt. Dist, 805 N.E.2d 369, 373 (Ind. 2004). There are no factual disputes in this case related to whether a valid assignment was made. Its resolution is a matter of law.

Midtown contends that the assignment of proceeds from the personal injury claim is enforceable as an equitable assignment. It argues that the assignment it received from its patient is not of the claim itself, but of any proceeds from the claim. Midtown urges that the property interest transferred to it under the assignment is "an immediate and existing right to share in the proceeds of any settlement or the recovery of any judgment to the extent of its fees for the chiropractic treatment," Appellant's Br. at 6, 9-10, and it cites cases from other jurisdictions where assignments of similar interests have been upheld.

Midtown asserts that Indiana courts have long recognized similar assignments of choses in action, as well as contingent interests and expectancies that rest only in mere possibility. According to Midtown, therefore, the Court should recognize the equitable assignment in this case as an enforceable one, given the "long and distinguished history in Indiana" in support of the doctrine of equitable assignment. Id. at 8. Midtown also asserts that the assignment in this case does not infringe upon public policy interests that have led courts in the past to prohibit assignments of personal injury claims.

The focus of the assignment in this case, future proceeds from a possible settlement between the assignor and the defendant, describes a chose in action, which is a "proprietary right in personam, such as a debt owed by another person ... or a claim for damages in tort ... for al right to bring an action to recover a debt, money, or thing." BLACKS LAW DICTIONARY 258 (8th ed.2004). Midtown maintains that it has become well-established under Indiana law that such an interest is generally assignable. We discussed the law controlling the assignment of a chose in action in Picadilly, Inc. v. Raikos, 582 N.E.2d 338, 339-40 (Ind.1991), where we observed that hardly any chose in action was assignable under old common law because of concerns about champerty and maintenance.1 However, the assignment of such interests has gained gradual [945]*945acceptance over time, beginning with those interests based in contract, and later for torts against personal property. Id. at 340. "Today, the non-assignability of a chose in action has become so restricted that it is now the exception to the rule of free assignment." Id. (citing Essex v. Ryan, 446 N.E.2d 368, 374 (Ind.Ct.App.1983)). Thus a contract-based chose in action is considered assignable unless it is purely personal in nature, and one based in tort is assignable if it arises out of injuries to personal property. Picadilly, 582 N.E.2d at 340.

But it remains well-settled in Indiana law that a cause of action in tort to recover for personal injuries is not assignable. Id.; see also INS Investigations Bureau, Inc. v. Lee, 709 N.E.2d 736, 741 (Ind.Ct.App.1999); Allstate Ins. Co. v. Axsom, 696 N.E.2d 482, 485 (Ind.Ct.App.1998); Imel v. Travelers Indem. Co., 152 Ind.App. 75, 78-79, 281 N.E.2d 919, 920-21 (1972). In Picadilly, we declared that the assignment of a legal malpractice claim was invalid as against public policy, choosing not to "allow clients to sell off their claims for pursuit by others." Picadilly, 582 N.E.2d at 345.

Midtown argues that it is not seeking to enforce an assignment of a personal injury claim, but only the assignment of the proceeds from such a claim. The executed Assignment of Benefits states that the patient "irrevocably assigns [his] right to collect or receive payment in any form as and for compensation for any injuries for which [he] receive[s] treatment from Midtown Chiropractic." Appellant's App'x. at 38. The agreement also purports to direct payment to "Midtown Chiropractic directly the amount outstanding before making any payments" to the assignor. Id.

Acknowledging the general rule that assignments of personal injury claims are invalid, some jurisdictions have drawn the distinction that Midtown seeks here between assignments of personal injury actions and assignments of the proceeds recovered in such actions, finding the latter to be enforceable. Maryland's highest court has stated that it sees "no danger of champerty or maintenance, nor any other public policy reason to preclude the assignment of expected personal injury claim benefits to secure hospital or medical expenses already incurred." Hernandes v.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

U.S. Fid. & Guaranty Ins. Co. v. Crawfordsville Square, LLC
95 N.E.3d 219 (Indiana Court of Appeals, 2017)
Whitehaven S.F., LLC v. Spangler
45 F. Supp. 3d 333 (S.D. New York, 2014)
JPMCC 2006-CIBC14 Eads Parkway, LLC v. DBL Axel, LLC
977 N.E.2d 354 (Indiana Court of Appeals, 2012)
In re Fort Wayne Telsat, Inc.
665 F.3d 816 (Seventh Circuit, 2011)
Town of Avon v. West Central Conservancy District
957 N.E.2d 598 (Indiana Supreme Court, 2011)
A. Unruh Chiropractic Clinic v. De Smet Insurance Co.
2010 SD 36 (South Dakota Supreme Court, 2010)
West Broad Chiropractic v. American Family Insurance
2009 Ohio 3506 (Ohio Supreme Court, 2009)
Smith v. Indiana Department of Correction
883 N.E.2d 802 (Indiana Supreme Court, 2008)
Travelers Casualty & Surety Co. v. United States Filter Corp.
870 N.E.2d 529 (Indiana Court of Appeals, 2007)
Clarian Health Partners v. Evans
848 N.E.2d 763 (Indiana Court of Appeals, 2006)
Midtown Chiropractic v. Illinois Farmers Insurance Co.
847 N.E.2d 942 (Indiana Supreme Court, 2006)

Cite This Page — Counsel Stack

Bluebook (online)
847 N.E.2d 942, 2006 Ind. LEXIS 422, Counsel Stack Legal Research, https://law.counselstack.com/opinion/midtown-chiropractic-v-illinois-farmers-insurance-co-ind-2006.