St. Vincent Hospital & Health Care Center, Inc. v. Steele

766 N.E.2d 699, 2002 Ind. LEXIS 324, 2002 WL 654077
CourtIndiana Supreme Court
DecidedApril 22, 2002
Docket34S02-0107-CV-329
StatusPublished
Cited by126 cases

This text of 766 N.E.2d 699 (St. Vincent Hospital & Health Care Center, Inc. v. Steele) 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
St. Vincent Hospital & Health Care Center, Inc. v. Steele, 766 N.E.2d 699, 2002 Ind. LEXIS 324, 2002 WL 654077 (Ind. 2002).

Opinions

ON PETITION TO TRANSFER

RUCKER, Justice.

We grant transfer to resolve a conflict of authority in the Court of Appeals concerning Indiana's Wage Payment Statute. We conclude the statute governs both the frequency and amount an employer must pay its employee.

. Facts and Procedural History

The facts of this case are undisputed. Robert Steele is a practicing physician in Kokomo who is board certified in internal medicine and oncology. On April 6, 1995, Dr. Steele and the St. Vincent Hospital and Health Care Center, Inc. ("St. Vincent") entered into an employment agreement that extended from April 1, 1995, through March 31, 2000. The agreement provided for the‘bi—Weekly payment of compensation as follows:

For the first year of this Agreement, Hospital shall compensate Physician the greater of Five Hundred Twenty-Five Thousand Dollars ($525,000) per annum or fifty-six percent (56%) of Collections . resulting from Physician's provision of Professional Services at the Practice Site.
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For years of this Agreement subsequent to its first year, Physician's compensation each year shall be Base Compensation or fifty-six percent (56%) of Collec[701]*701tions for that current year or fifty-six percent (56%) of Collections from the previous year, whichever is greater.

R. at 159. The agreement defined "Collections" as:

[TJhat cash actually received, during the applicable year, from standard medical office operations performed by Physician at the Practice Site, including physician charges for offices visits, Hospital visits, insurance receipts, revenue received from laboratory and radiology services except for revenue for these services received from Medicare or Medicaid, and other billed services for which income is received at the Practice Site.

R. at 160.

During the first two years, St. Vincent compensated Dr. Steele according to the terms of the agreement. However, in 1998, the third year of the agreement, St. Vincent began excluding from Collections any monies Dr. Steele received from Medicare and Medicaid for the administration of chemotherapy and other medications. In so doing, St. Vincent relied on a proposed regulation issued by the federal Health Care Financing Administration in January 1998. The proposed regulation interpreted congressional legislation known as Stark II. Among other things, Stark II prohibited physicians from referring Medicare and Medicaid patients, for certain prescription drugs, to a clinical laboratory in which the physician had a financial interest.1

Dr. Steele filed a complaint against St. Vincent alleging breach of contract for failure to pay the full amount of compensation due under the terms of the agreement and for violation of Indiana's Wage Payment Statute. He subsequently filed a motion for summary judgment, and St. Vincent filed a cross-motion contending that it could not pay the full amount due under the terms of the agreement because of the proposed federal regulation and thus there was no violation of the Wage Payment Statute. Ruling that St. Vincent breached the agreement and violated the statute, the trial court entered summary judgment in favor of Dr. Steele. After a series of hearings on damages, the trial court ordered St. Vincent to pay $277,823.92 in unpaid wages, $555,625.84 in liquidated damages, and $48,000.00 in attorney fees.

St. Vincent appealed contending the trial court erred in awarding liquidated damages and attorney fees. Citing Court of Appeals authority in support of its position, St. Vincent argued that the Wage Payment Statute governs only the frequency with which an employer must pay its employee. Thus, the argument continued, there was no violation of the statute here because the dispute between the parties concerned only the amount of wages due. Relying on contrary authority, Dr. Steele insisted the statute governs both the frequency 'as well as the amount due. Acknowledging the conflict of authority on the issue, the Court of Appeals affirmed the trial court ruling that the statute governs both the frequency and amount an employer must pay its employee. St Vincent Hosp. & Health Care Ctr., Inc. v. Steele, 742 N.E.2d 1029, 1035 (Ind.Ct.App.2001). St. Vincent seeks transfer2 Al[702]*702though we reach the same conclusion as the Court of Appeals, we grant transfer to resolve the conflicting opinions on the question of whether the Wage Payment Statute governs both the frequency and amount an employer must pay its employee.

Standard of Review

Summary judgment is proper if 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. Ind. Trial Rule 56(C); Felsher v. Univ. of Evansville, 755 N.E.2d 589, 592 (Ind.2001). On appeal, we construe all facts and reasonable inferences drawn from those facts in a light most favorable to the nonmoving party. Felsher, 755 N.E.2d at 592. We carefully review the trial court's decision to ensure that the responding party was not improperly denied its day in court. Id.

Discussion

I.

The Wage Payment Statute

Indiana Code section 22-2-5, commonly referred to as the Wage Payment Statute, provides:

(2) Every person, firm, corporation, limited liability company, or association, their trustees, lessees, or receivers appointed by any court, doing business in Indiana, shall pay each employee at least semimonthly or biweekly, if requested, the amount due the employee. The payment shall be made in lawful money of the United States, by negotiable check, draft, or money order, or by electronic transfer to the financial institution designated by the employee. Any contract in violation of this subsection is void.
(b) Payment shall be made for all wages earned to a date not more than ten (10) days prior to the date of payment. However, this subsection does not prevent payments being made at shorter intervals than specified in this subsection, nor repeal any law providing for payments at shorter intervals. However, if an employee voluntarily leaves employment, either permanently or temporarily, the employer shall not be required to pay the employee an amount due the employee until the next usual and regular day for payment of wages, as established by the employer. If an employee leaves employment voluntarily, and without the employee's whereabouts or address being known to the employer, the employer is not subject to section 2 of this chapter until:
(1) ten (10) days have elapsed after the employee has made a demand for the wages due the employee; or
(2) the employee has furnished the employer with the employee's address where the wages may be sent or forwarded.

Ind.Code § 22-2-5-1. If an employer fails to make payment of wages in accordance with this section, then the employer:

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Bluebook (online)
766 N.E.2d 699, 2002 Ind. LEXIS 324, 2002 WL 654077, Counsel Stack Legal Research, https://law.counselstack.com/opinion/st-vincent-hospital-health-care-center-inc-v-steele-ind-2002.