There Must be an Offer, Acceptance & Consideration to Create a Contract

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Dr. Warned for Attempt to Practice Law Based on a Medical Lien

Every mother wants her son to be a doctor or lawyer. Some doctors wished they became lawyers and some lawyers wished they had become  doctors. Some even become both. The Plaintiff, Dr. Battersby, did not become both but tried to use contracts with his patients to practice law.

In Dr. Gregg N. Battersby v. Pamela Reid, State Farm Mutual Automobile Insurance Company and John Wiles, Of which State Farm Mutual Automobile Insurance Company and John Wiles, Appellate Case No. 2018-000943, Unpublished Opinion No. 2021-UP-044, State Of South Carolina In The Court of Appeals (February 10, 2021) dealt with his attempt that failed in the trial court.

FACTS

Pamela Reid was injured when her car was struck by one driven by William Calcutt, an insured of State Farm. Reid sought chiropractic treatment for her injuries from Dr. Gregg N. Battersby. Reid signed an array of documents Dr. Battersby presented, including: (1) an “Assignment of Proceeds, Contractual Lien, and Authorization,” which purported to grant Dr. Battersby a lien on the settlement of Reid’s personal injury claim, authorized insurance companies to pay him directly for his treatment, and—if an insurance company refused to pay him—assigned Reid’s right to sue the insurance company to him.

Dr. Battersby completed Reid’s treatment on August 14, 2017. His total bill was $5,010. The next day Dr. Battersby telephoned John Wiles, a claims specialist for State Farm, and recorded the conversation where Wiles stated State Farm would pay him directly if Reid asked them. However, Reid asked State Farm to pay the settlement funds directly to her, which it did. Reid did not pay Dr. Battersby.

Dr. Battersby sued as a pro se plaintiff against State Farm alleging (1) breach of contract against State Farm and Reid, (2) fraud against State Farm and Reid, and (3) negligence and negligent misrepresentation against State Farm. State Farm’s answer asserted various defenses, including the statute of frauds, lack of consideration, and lack of privity of contract. State Farm moved for summary judgment.

The trial court granted State Farm summary judgment, ruling Dr. Battersby’s contracts with Reid did not grant him any right to seek payment directly from State Farm, and any oral agreement he allegedly had with State Farm was unenforceable due to the Statute of Frauds, § 32-3-10(2) of the South Carolina Code (2007).

ANALYSIS

Dr. Battersby contends he had an oral contract with State Farm because Wiles stated State Farm would pay him directly for his treatment of Reid. According to Dr. Battersby, State Farm breached this oral contract when it paid the full settlement proceeds directly to Reid. Viewing the call transcript and other evidence in the light most favorable to Dr. Battersby, there is no genuine issue of material fact. There is no evidence State Farm agreed to pay Dr. Battersby directly without obtaining further consent from Reid. Dr. Battersby had no written contract with State Farm.

Reid assigned Dr. Battersby “all my rights, remedies, and benefits,” but she had no contractual relationship with or any right to sue State Farm. She only had a claim against State Farm’s insured and could not give Dr. Battersby any rights greater than her own.

Summary judgment to State Farm was also proper because the alleged oral contract lacked consideration. There was no right, interest, profit, or benefit that accrued to State Farm from the phone conversation to directly pay Dr. Battersby for Reid’s medical bills.

South Carolina Statute of Frauds, S.C. Code § 32-3-10(2)

State Farm alternatively asserted the alleged oral contract is unenforceable because it was not in writing. State Farm argued the alleged oral contract contemplated by Dr. Battersby fell within the statute of frauds because it concerned payment of Reid’s bills — which is a promise to answer for the debt of another.

The alleged oral contract was also unenforceable because it was not in writing and because the doctor failed to satisfy every essential element that is in a writing signed by the party to be compelled. Dr. Battersby theorizes he detrimentally relied on what he perceives was State Farm’s misrepresentation that it would pay him directly. When Reid settled her claim and State Farm paid the full settlement proceeds to her, Dr. Battersby argues State Farm deprived him of his right to “take over the claim and settle it as he saw fit.” State Farm contended that Dr. Battersby could not settle Reid’s claim because to do so would constitute the unauthorized practice of law.

The trial court cautioned Dr. Battersby that settlement of a third party’s personal injury claim may be the unauthorized practice of law and that this, his second failed attempt to do so was wrongful. Since Dr. Battersby had attempted, without a sound legal basis and without avail, to sue an insurer attempting to recoup treatment fees incurred by a patient.

The decision warned: “There may be no education in the second kick of a mule, but this opinion shall serve as fair notice to Dr. Battersby that further such unsupported attempts may result in appropriate sanctions.”

ZALMA OPINION

When Dr. Batterby was kicked in the head by the state court once he should have learned the lesson that he could not practice law by making patients sign useless assignments of rights against insurers that do not insure the patient. Trying a second time was an insult to the court, an attempt to practice law without a license and a criminal act. The warning should not have been to assess sanctions if he tried a third time, the warning should have been a referral to the local district attorney. The record did not reveal how many insurers and patients fell for his wrongful conduct and useless assignments.


© 2021 – Barry Zalma

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 52 years in the insurance business. He is available at http://www.zalma.com and zalma@zalma.com.

Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award.

Over the last 53 years Barry Zalma has dedicated his life to insurance, insurance claims and the need to defeat insurance fraud. He has created the following library of books and other materials to make it possible for insurers and their claims staff to become insurance claims professionals.

Go to the podcast Zalma On Insurance at https://anchor.fm/barry-zalma;  Follow Mr. Zalma on Twitter at https://twitter.com/bzalma; Go to Barry Zalma videos at Rumble.com at https://rumble.com/c/c-262921; Go to Barry Zalma on YouTube- https://www.youtube.com/channel/UCysiZklEtxZsSF9DfC0Expg; Go to the Insurance Claims Library – https://zalma.com/blog/insurance-claims-library/ Read posts from Barry Zalma at https://parler.com/profile/Zalma/posts; and Read last two issues of ZIFL here.

 

 

 

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