Day Cruises Maritime v. Christus Spohn

• Decision Date: 17 April 2008
• Docket Number: No. 13-06-471-CV.,13-06-471-CV.
• Citation: 267 S.W.3d 42
• Parties: DAY CRUISES MARITIME, L.L.C. and Corpus Christi Day Cruise, L.L.C., Appellants, v. CHRISTUS SPOHN HEALTH SYSTEM d/b/a Christus Spohn Hospital Memorial, Appellee.
• Court: Texas Court of Appeals

267 S.W.3d 42

DAY CRUISES MARITIME, L.L.C. and Corpus Christi Day Cruise, L.L.C., Appellants, v. CHRISTUS SPOHN HEALTH SYSTEM d/b/a Christus Spohn Hospital Memorial, Appellee.

No. 13-06-471-CV.

Court of Appeals of Texas, Corpus Christi-Edinburg.

April 17, 2008.

Rehearing Overruled October 2, 2008.

James F. Buchanan, Dabney Welsh Pettus, Welder Leshin LLP, Corpus Christi, for appellants.

Steven L. Roberts, Warren Szutse Huang, Robert J. Swift, Fulbright & Jaworski L.L.P., Houston, Ben A. Donnell, Donnell & Abernethy, John S. Langley, Donnell Abernethy & Kieschnick, Corpus Christi, for appellee.

Before Chief Justice VALDEZ and Justices RODRIGUEZ and GARZA.

OPINION

Opinion by Justice GARZA.

Appellants Day Cruises Maritime, L.L.C. and Corpus Christi Day Cruise, L.L.C. appeal from summary judgments granted in favor of appellee Christus Spohn Health System d/b/a Christus Spohn Hospital Memorial ("Christus"). By three issues, appellants contend that the trial court erred. For purposes of organization, appellants' issues will be reordered and referred to as follows: (1) the trial court erred in granting Christus's motion for summary judgment on Christus's counterclaim; (2) the trial court erred in granting Christus's motion for summary judgment, and denying appellants' motion for summary judgment, on appellant's plea in intervention; and (3) the trial court deprived appellants of due process of law. We affirm the trial court's judgment in part, reverse in part, and remand for further proceedings.

I. BACKGROUND

Judy Ann Lanado, a citizen of the Philippines, was employed as a card dealer on the "M/V TEXAS TREASURE," a casino vessel operating out of Port Aransas, Texas. Day Cruises Maritime, L.L.C. was the disponent owner of the vessel.¹ The vessel was jointly managed and operated by Florida Day Cruises, Inc. and Corpus Christi Day Cruise, L.L.C. While working on the vessel in August of 2002, Lanado, who was pregnant at the time, became ill. She was first taken to a hospital in Aransas Pass, Texas, and was then moved to Christus in Corpus Christi on August 21, 2002, and admitted there with a diagnosis of cholelithiasis, or stones in the gall bladder. Upon her admission to Christus, Lanado signed a document entitled "Release of Information and Assignment of Health Insurance Benefits" that provided as follows:

1. I authorize CHRISTUS Spohn to a) submit this claim on my behalf and b) receive payment of any authorized benefits, including benefits payable for any physician(s) services due those physicians under contract to the hospital.

2. I certify that the information I have furnished to the Registration Office is correct.

3. I guarantee payment for all services, including those not covered by insurance, Medicaid or Medicare.

4. I hereby authorize my insurance benefits to be paid directly to the physician rendering care of above named patient, for their professional services, and I am financially responsible for non-covered services.

5. I authorize the physician or supplier of care to release any or all of the patient's medical record required for payment. This includes the ordering and results of HIV testing and/or the diagnosis of AIDS, and psychiatric disorders or treatment.

On August 23, 2002, Paula E. Coots, a "human resource assistant" for Texas Treasure, signed a document entitled "Guarantee of Payment (Under Section 253 of the Immigration and Nationality Act)." The form stated as follows:

I, Paula E. Coots, as Human Resource Assistant of the vessel or aircraft MV TEXAS TREASURE employing the alien crewman LANADO, JUDY ANN who upon arrival at the port of PT. ARANSAS, TX on 21 AUGUST 02 was found to be afflicted with, or suspected of being afflicted with GALL BLADDER. I hereby guarantee to pay any and all expenses incurred or to be incurred for the hospitalization, care, and treatment, and for burial in the event of death, of the said alien crewman.

Following surgery at Christus to treat her gall bladder condition, Lanado developed internal bleeding in her abdomen that led to tachycardia and hypotension. As a result of these complications, the fetus died and Lanado suffered severe brain damage due to lack of oxygen. On or about September 27, 2002, she lapsed into a cerebral coma. Although she recovered from her cholelithiasis condition, the cerebral coma left Lanado in a permanent vegetative state. Lanado remained at Christus until her transfer to Avalon Place, a nursing home, on October 1, 2003. Her treatment at Christus lasted over thirteen months and resulted in total medical charges of $1,089,959.82.

On December 31, 2002, Jasper Lanado, Judy's brother and permanent guardian, filed a health care liability claim against Christus alleging that Christus was negligent in its care of Judy.² Specifically, the Lanados asserted that, while Judy Ann Lanado was at Christus, she "was ignored by physicians and staff to a degree falling below the standard of care necessary as required by Texas law" and that "[t]hese acts and omissions proximately caused the injury to Plaintiffs." Christus filed its original answer to the Lanados' suit on January 31, 2003, denying all allegations.

On November 14, 2003, Day Cruises Maritime, L.L.C., Florida Day Cruises, Inc., and Corpus Christi Day Cruise, L.L.C. (collectively referred to as "Texas Treasure") filed a plea in intervention in the Lanados' lawsuit, stating first that under general maritime law it is potentially responsible as Judy's employer for paying her medical expenses, but that it was entitled to damages from the Lanados on the theory that it was equitably subrogated to the Lanados for those medical expenses. Texas Treasure filed an amended plea in intervention on November 21, 2003, adding a request for declaratory judgment that Texas Treasure was not obligated to pay Christus for Lanado's medical care. On November 25, 2003, Texas Treasure filed a traditional motion for summary judgment based on its plea in intervention.

Christus subsequently filed a counterclaim against Texas Treasure, contending that Texas Treasure was solely responsible for paying Lanado's hospital bill.³ Christus filed a motion for summary judgment on the counterclaim on October 14, 2005. The counterclaim and the motion for summary judgment asserted that Texas Treasure was responsible for the entirety of Lanado's hospital bill as a matter of law, for three reasons: (1) Christus had a valid suit on a sworn account and Texas Treasure had failed to file an effective verified denial, see Tex.R. Civ. P. 165; (2) Texas Treasure had executed a valid guarantee of payment with respect to Lanado's medical expenses; and (3) Texas Treasure had a duty of payment to Lanado as a matter of law, and Lanado had effectively assigned to Christus her rights corresponding to that duty.⁴

On or about December 2003, the Lanados settled their claim against Christus. As part of the settlement agreement, Christus agreed to pay a lump sum, and fund an annuity that would provide periodic payments to the Lanados.⁵ At a hearing on December 13, 2003, Jasper Lanado and the guardian ad litem for the two minor children testified that the settlement agreement was fair and in the best interests of Lanado and her family. The trial court entered an agreed judgment on April 7, 2004, approving the settlement agreement. Neither the settlement agreement nor the agreed judgment contained an admission of negligence or liability on the part of Christus. In fact, the agreed judgment stated specifically that "[t]he Court is further of the opinion that the liability of the Defendant [Christus] is uncertain, doubtful, indefinite, and disputed." As part of the settlement, the Lanados agreed to assign to Christus their right to seek recovery of Judy's medical expenses from her employer.⁶

Meanwhile, the claims between Texas Treasure and Christus remained pending in the trial court. Both Texas Treasure and Christus filed traditional motions for summary judgment with respect to the claims made by Texas Treasure in its plea in intervention. Texas Treasure argued that it was entitled to summary judgment on its plea in intervention because, as a matter of law, it was equitably subrogated to the amounts received by the Lanados under their settlement agreement; Christus argued that Texas law provides no such remedy and so those claims must fail as a matter of law. After a hearing on March 26, 2004, the trial court denied Texas Treasure's motion for summary judgment and granted Christus's motion for summary judgment as to Texas Treasure's claims in their plea in intervention.⁷

After a hearing on March 3, 2006, the trial court granted Christus's motion for summary judgment with respect to its counterclaim against Texas Treasure, finding in favor of Christus on all three grounds asserted in its counterclaim.

Prior to the March 3, 2006 hearing, however, Christus had filed a Supplemental Motion for Summary Judgment which included an attorney's fees affidavit that had not been filed with any previous motion. This Supplemental Motion for Summary Judgment was apparently not served upon Texas Treasure's trial counsel.⁸ After the March 3, 2006 hearing, having discovered that they were not served with Christus's Supplemental Motion for Summary Judgment, Texas Treasure filed a motion for sanctions and a motion for leave to file a response to the supplemental motion. After an additional hearing on May 3, 2006, the trial court denied Texas Treasure's motion for sanctions, but partially granted Texas Treasure's motion for leave to file a response to the Supplemental Motion for Summary Judgment, stating that it could file a response with regard to attorney's fees only.⁹

The trial court rendered its written final judgment on May 26, 2006, awarding Christus damages and pre-judgment interest in the sum of $1,272,714.68. Texas Treasure was also ordered to pay $49,518.68 to Christus in attorney's fees, along with another $25,000 in attorney's fees upon an...