NO. 94-452
IN THE SUPREME COURT OF THE STATE OF MONTANA
1995
KAPNER, WOLFBERG & ASSOCIATES,
INC., a California corporation,
Plaintiff and Respondent,
BLUE CROSS AND BLUE SHIELD OF
MONTANA,a Montana corporation,
Defendant and Appellant.
APPEAL FROM: District Court of the First Judicial District,
In and for the County of Lewis and Clark,
The Honorable Jeffrey Sherlock, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Stuart L. Kellner and John Alke, Hughes, Kellner,
Sullivan & Alke, Helena, Montana
For Respondent:
Peter Michael Meloy and John M. Morrison, Meloy &
Morrison, Helena, Montana
Submitted on Briefs: February 9, 1995
Decided: March 16, 1995
Filed:
Chief Justice J. A. Turnage delivered the Opinion of the Court.
Kapner, Wolfberg & Associates, Inc. (KWA), seeks to recover
monies due under a contract between Blue Cross and Blue Shield of
Montana (BCBS) and St. Peter's Community Hospital of Helena,
Montana. Upon a jury verdict in favor of KWA, the District Court
for the First Judicial District, Lewis and Clark County, entered
judgment of $144,968.64 plus interest and costs. BCBS appeals from
the District Court's denial of its post-trial motion for judgment
notwithstanding the verdict. We affirm.
BCBS states the issue as whether an indemnitor may be held
liable on claims for which its indemnitees had no liability. We
restate the issue as whether the District Court erred in failing to
enter judgment notwithstanding the verdict.
In June 1989, KWA contracted with St. Peter's Community
Hospital to analyze hospital patient accounts closed within the
previous eighteen months. Using the corresponding medical records,
KWA identified items not included in the original hospital bills
and issued rebills for those items. This process was undertaken
only in regard to accounts on which there was a third-party payor
other than Medicare or Medicaid. The rebills were sent only to the
insurer, not to the insured.
When BCBS became aware of this rebilling practice, it refused
to pay any more of the rebills and reversed payments it had already
made to the hospital on rebilled charges. BCBS advised the
hospital that it would no longer process bills for omitted charges
submitted as a result of KWA's analysis.
2
After negotiations between the hospital and BCBS on this
subject failed, the hospital assigned to KWA its right to recover
the charges in the rebills. KWA then commenced this action.
KWA presented evidence at trial that the contract between the
hospital and BCBS entitled it to recover the disputed amounts.
Additionally, it presented evidence that hospital patients who were
insured by BCBS routinely signed a form assigning to the hospital
the right to charge BCBS directly. KWA further argued that BCBS
was liable for tort damages for neglecting to attempt prompt, fair,
and equitable settlement of claims in which liability had become
reasonably clear.
BCBS argued that it was not liable to pay the claims in the
rebills because the rebills resulted in its insureds being charged
more than other hospital patients, which was prohibited in the
agreement between BCBS and the hospital. BCBS also argued that it
was not liable to pay the claims because its insureds were not sent
copies of or held liable for the rebilled charges.
The jury found for KWA on the contract claim and for BCBS on
the tort claim. BCBS appeals from the District Court's denial of
its post-trial motion for judgment notwithstanding the verdict.
Did the District Court err in failing to enter judgment
notwithstanding the verdict?
ITI considering a motion for judgment notwithstanding the
verdict (n.o.v.), the court must view the evidence in a light most
favorable to the opposing party and deny the motion if a prima
facie case is made. The court must decide whether substantial
3
credible evidence supports the jury verdict. Hash v. State (1991),
247 Mont. 497, 500, 807 P.2d 1363, 1365. Judgment n.o.v. may only
be granted when it appears as a matter of law that the nonmoving
party could not recover upon any view of the evidence, including
the legitimate inferences to be drawn from the evidence. Wilkerson
v. Sch. Dist. No. 15, Glacier Cty. (1985), 216 Mont. 203, 211, 700
P.2d 617, 622. This Court's standard of review of a ruling on a
motion for judgment n.o.v. is whether substantial evidence
supported submission to the jury. Gunlock v. Western Equipment Co.
(1985), 219 Mont. 112, 115, 710 P.2d 714, 716.
On appeal, BCBS cites statutory and case law for the proposi-
tion that an indemnitor is not liable on claims for which its
indemnitee has no liability. See 5 28-ll-314(2), MCA; see, e.q.,
St. Paul Fire and Marine Insurance Co. v. Thompson (1969), 152
Mont. 396, 403, 451 P.2d 98, 102. However, at trial, BCBS offered
no jury instructions on the indemnity theory and none were given.
BCBS did not request that the jury be asked to make a finding as to
whether BCBS's insureds had been released from liability.
Theories of law not presented at trial will not be heard on
appeal. Chamberlain v. Evans (1979), 180 Mont. 511, 517, 591 P.2d
237, 240. For example, where an asserted agency relationship was
not raised as an issue at the trial court level, this Court held
that the existence of that relationship could not be argued on
appeal to support a claim of breach of fiduciary duty. Service
Funding, Inc. v. Craft (1988), 234 Mont. 431, 434, 763 P.2d 1131,
1133. We will not further consider the indemnity argument.
4
BCBS asserts that the hospital admitted at trial it did not
plan to hold the insureds liable for the amounts rebilled.
However, a decision by the hospital not to pursue payment by the
patient does not necessarily translate into a release of liability.
KWA presented evidence justifying the decision not to bill patients
directly as a collection strategy.
After reviewing the record, we conclude that KWA presented
sufficient evidence to support submission to the jury of the
question of BCBS's liability for the rebills. We therefore hold
that the District Court did not err in denying the motion for
judgment n.o.v.
Affirmed.
We concur: