Progressive Cas. Ins. v. All Care, Inc.
| Decision Date | 07 June 2005 |
| Docket Number | No. 2003-CA-01197-COA.,2003-CA-01197-COA. |
| Citation | 914 So.2d 214 |
| Court | Mississippi Supreme Court |
| Parties | PROGRESSIVE CASUALTY INSURANCE Company and Progressive Gulf Insurance Company, Appellants v. ALL CARE, INC. d/b/a Jackson Physical Medicine & Rehabilitation, Appellee. |
W. Wayne Drinkwater, Margaret Oertling Cupples, attorneys for appellants.
William P. Featherston, Linley Jones, attorneys for appellee.
EN BANC.
BRIDGES, P.J., for the Court.
BACKGROUND
¶ 1. All Care, Inc. (All Care) sued Progressive Gulf Insurance Company (Progressive) in Hinds County Circuit Court. All Care sought damages based on the assertion that Progressive engaged in tortious interference with All Care's business relations. Following trial, the jury returned a verdict for All Care and awarded $1,436,000 in actual business losses. Post trial, Progressive filed an unsuccessful motion for judgment notwithstanding the verdict. Progressive appeals the circuit court's denial of its motion for judgment notwithstanding the verdict and asserts the following allegations of error, listed verbatim:
I. WHETHER ALL CARE FAILED TO PROVE THAT PROGRESSIVE DEFENDANTS ACTED WITH A MALICIOUS INTENT TO HARM ALL CARE'S BUSINESS, AND WITHOUT A LEGITIMATE PURPOSE OR JUSTIFIABLE CAUSES.
II. WHETHER ALL CARE FAILED TO PROVE THAT THE PROGRESSIVE DEFENDANTS PROXIMATELY CAUSED QUANTIFIABLE DAMAGES TO ALL CARE.
III. WHETHER THE TRIAL COURT ERRED IN ALLOWING THE DAMAGES TESTIMONY OF DR. STAN SMITH TO BE HEARD BY THE JURY.
Finding no error, we affirm.
FACTS
¶ 2. Between July of 1994 and August of 1997, All Care owned and operated a medical clinic in Jackson, Mississippi. All Care treated minor soft tissue injuries, exclusively. The majority of All Care's patients were client referrals from personal injury attorneys. Personal injury attorneys tended to refer their clients to All Care because All Care utilized a "lien billing system."
¶ 3. According to All Care's lien billing system, when a personal injury attorney referred a client to All Care, All Care would provide treatment to that client and would forego payment at that time. If a patient collected on his personal injury claim, All Care was paid from the proceeds. If a patient did not collect on his personal injury claim, the patient was held personally responsible for All Care's medical bills. At the end of 1995, All Care experienced a drop in the number of referrals. As a result, All Care's earnings dropped.
¶ 4. During All Care's existence, Progressive employed an insurance adjuster named Michael Muench. In his role as an adjuster, Muench frequently engaged in conflicts with various personal injury attorneys over the amount and propriety of All Care's medical fees. All Care believed that Muench targeted All Care and waged an inappropriate war of attrition against All Care's reputation and billing practices. All Care felt that Muench ultimately bullied numerous personal injury attorneys into sending their clientele to competing medical clinics. All Care eventually became increasingly unprofitable and blamed Muench and Progressive for its decline in earnings. Accordingly, All Care filed suit against Progressive, from which the present action arises.
ANALYSIS
¶ 5. Broadly speaking, Progressive asserts that All Care failed to prove the prima facie elements of a claim of tortious interference with business relations. Tortious interference with a business relationship occurs when "a wrongdoer unlawfully diverts prospective customers away from one's business, thereby encouraging customers to trade with another." Cenac v. Murry, 609 So.2d 1257, 1268 (Miss.1992) (internal quotations omitted). To prove a prima facie claim of tortious interference with a business relationship, a plaintiff must prove that:
(1) the acts were intentional and willful;
(2) the acts were calculated to cause damage to a plaintiff in its lawful business;
(3) the acts were done with the unlawful purpose of causing damage and loss, without right or justifiable cause on the part of the defendant (which constitutes malice); and
(4) actual damage and loss resulted.
MBF Corp. v. Century Bus. Communications, Inc., 663 So.2d 595, 598 (Miss.1995).
¶ 6. In this issue, Progressive asserts that All Care failed to prove that Progressive's actions were calculated to cause All Care to suffer damage and loss. Additionally, Progressive asserts that All Care failed to prove that Muench's actions were without right or justifiable cause. If Progressive is correct in either assertion, this Court must reverse and render judgment for Progressive. Conveniently, we can address both contentions in a single analysis.
¶ 7. Progressive maintains that the jury could not have found malicious intent due to Muench's criticisms of All Care's business practices. Further, Progressive asserts that Muench had a justifiable interest in and reason for scrutinizing All Care's billing and treatment practices. Truly, conduct related to a legitimate, employment-related objective constitutes justifiable acts, which cannot "give rise to an inference of malice." Hopewell Enter., Inc. v. Trustmark, 680 So.2d 812, 818-19 (Miss.1996). Accordingly, tortious interference requires "intermeddling ... without sufficient reason." Morrison v. Mississippi Enter. for Tech., Inc., 798 So.2d 567(¶ 28) (Miss.Ct.App.2001). Progressive claims Muench was fully justified in his comments to personal injury attorneys. According to Progressive, since Muench's comments were justified, Progressive is immune from liability.
¶ 8. Progressive argues that All Care did not present any evidence from which a jury could find that Muench acted in a malicious manner. That is, Progressive argues that Muench's job as an insurance adjuster was to scrutinize All Care's bills for errors and to challenge those errors. Progressive points to testimony from All Care's witnesses that, of the twenty-four All Care claims Muench was associated with, he never failed to settle a single claim for a fair value. Progressive asserts that Muench's actions may have inconvenienced All Care, or cost All Care money, but that does not make Muench's actions unlawful. Hall v. Mid-America Dairymen, Inc., 727 So.2d 776(¶ 12) (Miss.Ct.App.1999); Vestal v. Oden, 500 So.2d 954, 956-57 (Miss.1986).
¶ 9. Muench, an insurance adjuster, no doubt had a justifiable reason for negotiating with personal injury attorneys over All Care's fees. Muench's employer, Progressive, had an obvious reason to encourage Muench to seek lower fees. It requires no speculation to recognize that Progressive would prefer to retain money, rather than pay it to All Care. Progressive would cease to operate if it did not scrutinize claims. However, it is not Muench's scrutiny of treatment fees that is problematic.
¶ 10. The evidence showed Muench made comments well beyond his role as an insurance adjuster. Muench alleged that All Care was under investigation by the state attorney general. All Care was not under investigation by the state attorney general. Muench commented that All Care was under investigation by the state medical licensure board. All Care was not under investigation by the state medical licensure board. Muench told an attorney that All Care illegally practiced physical therapy. All Care did not practice physical therapy at all. Muench mailed an attorney a letter indicating that All Care was unlawfully billing for physical therapy. All Care did not bill for physical therapy. Muench told an attorney that All Care employed physicians that were unqualified to practice medicine. The physicians that All Care employed were all licensed to practice medicine. What was Muench's purpose in advancing these repetitive misstatements? How did Muench advance his employer's interest in stating his unfounded allegations? How did Muench justify his actions in light of his role as an insurance adjuster? Would an allegation that All Care employed unqualified physicians somehow lead to a decreased fee for All Care's services?
¶ 11. The standard attached to Progressive's assertion requires this Court to accept that evidence as true where that evidence supports the verdict. Herrington v. Spell, 692 So.2d 93, 103 (Miss.1997). The verdict suggests that Muench had no justifiable employment-related purpose in communicating allegations that did not serve any purpose connected to his role as an insurance adjuster. Muench could only arrive at his conclusions through some misunderstanding or an unfounded interpretation, as all of the relevant statements were false. It is not beyond the realm of possibility to conclude that Muench completely fabricated his allegations and lied to the attorneys he dealt with. It is clear that the jury could have concluded that Muench's comments were intended to cause All Care to suffer loss. It is equally clear that the jury could have determined that Muench did not have justifiable or legitimate cause to communicate numerous unfounded allegations, completely unrelated to his duties as an insurance adjuster. Because Muench communicated falsehoods to the largest group of All Care's clientele, which caused those clients to take their business elsewhere, the evidence in the light most favorable to the verdict suggests that the circuit court's decision on this issue is correct. Accordingly, we affirm the decision of the circuit court.
¶ 12. Similar to the first issue, Progressive asserts that All Care failed to prove the prima facie elements of a claim of tortious interference with business relations. In this issue, Progressive asserts that...
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