Gabrielson v. Healthcorp of Eufaula, Inc.

• Decision Date: 27 August 1993
• Citation: 628 So.2d 411
• Parties: Glen Alan GABRIELSON v. HEALTHCORP OF EUFAULA, INC., and National Healthcare, Inc. 1920600.
• Court: Alabama Supreme Court

Page 411

628 So.2d 411

Glen Alan GABRIELSON v. HEALTHCORP OF EUFAULA, INC., and National Healthcare, Inc.

1920600.

Supreme Court of Alabama.

Aug. 27, 1993.

James W. Parkman III of Parkman, Brantley & Lamere, Dothan, for appellant.

William V. Neville, Jr., Eufaula, for Healthcorp. of Eufaula, Inc.

Alan C. Livingston of Lee & McInish, Dothan, for National Healthcare, Inc.

ADAMS, Justice.

Glen Alan Gabrielson appeals from a summary judgment entered in favor of Healthcorp of Eufaula, Inc., on conversion and breach of contract claims and in favor of National Healthcare, Inc., on a fraud claim. We affirm.

On August 19, 1985, Gabrielson entered into a contract with National Healthcare, Inc. During the negotiations, Joe Gribbin, the administrator of Lakeview Community Hospital, told Gabrielson that the hospital, operated by National Healthcare, was a full service hospital providing general services, including obstetrics and pediatrics, that it was well supported by the community, and that it enjoyed a 50% to 60% occupancy rating. Under the terms of the contract, Gabrielson was to relocate from Madison, Iowa, to Eufaula, Alabama, to practice medicine. The contract terms were set for a one-year initial period and provided for the following: the payment of professional fees; an income guaranty; the payment of relocation expenses; leave time for vacation and continuing education requirements; office personnel; an agreement that Gabrielson would be licensed to practice in Alabama and would comply with the laws of the State of Alabama and with the Standards of the Joint Commission on Accreditation of Hospitals; insurance Gabrielson opened his medical practice in January 1986, in Eufaula. Immediately upon his arrival in Eufaula, he was informed by Gribbin that the staff pediatrician had resigned. A month and a half after his arrival, he learned that the obstetrics services at the hospital were being discontinued because the staff obstetricians were resigning.

repayment of monies paid to Gabrielson in the event he ceased to practice medicine in Eufaula; that Lakeview Community Hospital would be the hospital of preference in Gabrielson's practice; that Gabrielson was to operate as an independent contractor and not as an employee of Lakeview Community Hospital; and agreed-upon access to medical records in accordance with § 952 of the Omnibus Reconciliation Act.

On April 24, 1986, National Healthcare and Gabrielson entered into an addendum to the 1985 contract. Under the terms of the agreement, National Healthcare lent Gabrielson $25,000 in order for him to purchase the medical assets of a deceased physician's practice, and National Healthcare was to purchase the deceased physician's medical records for $25,000. Gabrielson signed a promissory note for the $25,000. The addendum also required Gabrielson to store and maintain a log of the whereabouts of the medical records, and to return the records to National Healthcare if Gabrielson discontinued his medical practice in Eufaula. Gabrielson made a lump sum payment of $2,083.35 on the promissory note for the months of January through May 1987, and he made additional payments through April 1, 1988. On July 1, 1987, National Healthcare, Inc., sold Lakeview Community Hospital to Healthcorp of Eufaula, Inc. As a part of the transaction, the note from Gabrielson to National Healthcare was assigned to Healthcorp.

On March 29, 1989, Gabrielson, at his request, was placed on courtesy staff at Lakeview Community Hospital, and shortly thereafter he closed his practice in Eufaula. He opened a new practice in Dothan in July 1989. In November 1989, Steve Arnold, the new administrator of Lakeview Community Hospital, requested that Gabrielson return the medical records to Healthcorp, as provided by the 1986 addendum. Gabrielson did not return them before leaving Eufaula in 1989, but placed them on the third floor of the building that housed his office. Gabrielson and Arnold exchanged letters concerning the return of the records; however, they were never returned to Healthcorp.

On September 7, 1990, Healthcorp sued Gabrielson, alleging conversion of the medical records and breach of contract. On June 19, 1991, Gabrielson answered and counterclaimed, alleging fraudulent misrepresentation on the part of Healthcorp. On the same day, Gabrielson filed a third-party complaint against National Healthcare, alleging that it had made certain misrepresentations during the 1985 and 1986 contract negotiations. National Healthcare moved to dismiss on the ground that the fraudulent misrepresentation claim was barred by the applicable statute of limitations; Healthcorp moved to dismiss the counterclaim on the same ground. Neither motion to dismiss was ruled on by the trial court.

National Healthcare and Healthcorp filed separate motions for summary judgment based on the pleadings, the discovery, and the deposition of Alan Gabrielson. After a hearing, the court entered a summary judgment in favor of National Healthcare and Healthcorp. The judgment awarded Healthcorp $10,000 in damages on the conversion claim and $33,720.62 on the breach of contract claim. The judgment held in favor of Healthcorp and National Healthcare on the counterclaim and the third-party complaint, respectively, on the ground that those claims were barred by the statute of limitations.

A summary judgment is proper when there exists no genuine issue of material fact and the moving party is entitled to a judgment as a matter of law. Rule 56, A.R.Civ.P.; King v. Breen, 560 So.2d 186 (Ala.1990). In determining whether a summary judgment was properly entered, this Court will view the evidence in a light most favorable to the nonmovant and will resolve all reasonable doubts concerning the existence of a genuine issue of material fact against the moving party. Fincher v. Robinson Bros. Lincoln-Mercury, Inc., 583 So.2d 256 (Ala.1991). In determining the existence or absence of a genuine issue of material fact Once the moving party makes a prima facie showing that no genuine issue of material fact exists, then the burden of going forward with evidence demonstrating the existence of a genuine issue of material fact shifts to the nonmovant. Grider v. Grider, 555 So.2d 104 (Ala.1989). Because this action was filed after June 11, 1987, the nonmovant must meet this burden by "substantial evidence." Ala.Code 1975, § 12-21-12; Bass v. SouthTrust Bank of Baldwin County, 538 So.2d 794, 797-98 (Ala.1989). Under the substantial evidence test, the nonmovant must present "evidence of such weight and quality that fair-minded persons in the exercise of impartial judgment can reasonably infer the existence of the fact sought to be proved." West v. Founders Life Assurance Co. of Florida, 547 So.2d 870, 871 (Ala.1989); § 12-21-12(d).

this Court is limited to a consideration of the factors that were before the trial court when it ruled on the summary judgment motion. Broadmoor Realty, Inc. v. First Nationwide Bank, 568 So.2d 779 (Ala.1990). However, this Court's reasoning is not limited to that applied by the trial court. Hill v. Talladega College, 502 So.2d 735 (Ala.1987).

CONVERSION

Gabrielson argues that Healthcorp was not entitled to a summary judgment on its conversion claim because, he says, he demonstrated that he had rightful possession of the medical records and Healthcorp knew that the records were being stored in his office in Eufaula. However, we conclude that the evidence conclusively shows...