Ateyeh v. Volkswagen of Florence, Inc.
| Decision Date | 21 January 1986 |
| Docket Number | No. 22494,22494 |
| Citation | 341 S.E.2d 378,288 S.C. 101 |
| Court | South Carolina Supreme Court |
| Parties | Carol ATEYEH, Appellant, v. VOLKSWAGEN OF FLORENCE, INC. and United of Omaha Life Insurance Company (formerly United Benefit Life Insurance Company), Defendants, of whom United of Omaha Life Insurance Company (formerly United Benefit Life Insurance Company) is the Respondent. . Heard |
Reginald C. Brown, Jr., of Hyman, Morgan, Brown, Jeffords, Rushton & Hatfield, and Eugene A. Fallon, Jr., of Fallon & Odom, Florence, for appellant.
George E. Lafaye, III, of McCants, Nelson, Green & LaFaye, Columbia, and J. Boone Aiken, III, of Coleman, Aiken & Chase, Florence, for United of Omaha Life Ins. Co.
Appellant Ateyeh brought suit against Volkswagen of Florence and respondent United of Omaha alleging five causes of action. The trial judge sustained United's demurrer of three of the causes of action. We reverse.
Ateyeh's husband Adnan was employed by Volkswagen and both were covered by a health insurance policy issued to Adnan by United. Adnan was hospitalized with an illness which eventually resulted in his death. During his hospitalization, United attempted to cancel the health insurance policy, and Adnan purchased a converted policy. It was later discovered that the converted policy provided substantially less benefits than the group policy. The group policy had provided $750,000 in major medical benefits and the converted policy paid benefits of $50 a day during hospitalization.
Ateyeh sued in her own name 1 alleging breach of contract, breach of contract accompanied by a fraudulent act, fraud, bad faith failure to pay insurance benefits, and outrage. The trial judge sustained the demurrers as to breach of contract, breach of contract accompanied by a fraudulent act and bad faith failure to pay insurance benefits on the grounds that Ateyeh was not a party to the insurance contract and lacked capacity to sue.
A cause of action for breach of a health insurance contract is an action for damages under the contract. The cause of action vests in the policyholder. Reserve Life Insurance Company v. Peavy, 94 Ga.App. 31, 93 S.E.2d 580 (1956). The right to a cause of action under a health insurance policy is in the insured until his death, and any remaining right vests in the insured's representative. Bailey v. Bankers Health & Life Insurance Company, 69 Ga.App. 71, 24 S.E.2d 740 (1943). Therefore, a decedent's estate is ordinarily the proper party to sue for damages on a health insurance policy.
However, when one spouse is individually liable for the medical expenses of the other spouse, he may be a proper party to sue for benefits under a health insurance policy. Kenelia v. Glens Falls Insurance Company, 171 N.J.Super., 144, 408 A.2d 144 (1979). In South Carolina, a husband or wife may be held individually liable for medical benefits furnished to the other spouse. Richland Memorial Hospital v. Burton, 282 S.C. 159, 318 S.E.2d 12 (1984); S.C.Code Ann. Section 20-5-60 (1976). Since Ateyeh may be held individually liable for her husband's medical expenses, she has a sufficient interest in enforcement of the health insurance policy to enable her to maintain a cause of action for breach of contract. The trial judge erred in sustaining the demurrer on the breach of contract action.
An action for breach of contract accompanied by a fraudulent act is an action in contract. Peeples v. Orkin Exterminating Company, Inc.,...
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Kleckley v. Northwestern Nat. Cas. Co.
...could not assert a claim for bad faith against an alleged tortfeasor's motor vehicle liability insurer. In Ateyeh v. Volkswagen of Florence, Inc., 288 S.C. 101, 341 S.E.2d 378 (1986), the South Carolina Supreme Court recognized a narrow exception to the "mutually binding insurance contract"......
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Brown v. Allstate Ins. Co.
...at law tried by a judge without a jury, we are bound by the factual findings of the trial judge. See Ateyeh v. Volkswagen of Florence, Inc., 288 S.C. 101, 341 S.E.2d 378 (1986) (a cause of action for breach of an insurance contract is an action for damages under the contract); Moore v. Crow......
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Trident Regional Medical Center v. Evans, 2290
...443 S.E.2d 399 (Ct.App.1994). Medical services are generally considered to be necessaries. See, e.g., Ateyeh v. Volkswagen of Florence, Inc., 288 S.C. 101, 341 S.E.2d 378 (1986). Thus, in the cases before us, the husbands may be held liable for the costs of the medical services provided to ......
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Kleckley v. Northwestern Nat. Cas. Co.
...to the rule that third parties can not recover for bad faith refusal to pay firstparty benefits. In Ateyeh v. Volkswagen of Florence, Inc., 288 S.C. 101, 341 S.E.2d 378 (1986), a widow brought a bad faith refusal to pay benefits action against her spouse's employer and health insurance carr......