Title: BROADWAY CLINIC v. LIBERTY MUTUAL INSURANCE CO.

State: oklahoma

Issuer: Oklahoma Supreme Court

Document:

BROADWAY CLINIC v. LIBERTY MUTUAL INSURANCE CO.  BROADWAY CLINIC v. LIBERTY MUTUAL INSURANCE CO. 2006 OK 29 139 P.3d 873 Case Number: 101572 Decided: 05/09/2006 THE SUPREME COURT OF THE STATE OF OKLAHOMA BROADWAY CLINIC, Plaintiff/Appellant, v. LIBERTY MUTUAL INSURANCE COMPANY, Defendant/Appellee. ON APPEAL FROM THE DISTRICT COURT, OKLAHOMA COUNTY ¶0 Plaintiff brought a small-claim proceeding for a declaration that its statutory physician's lien attached to the proceeds of its patient's uninsured motorist coverage and to enforce the lien against defendant, the patient's uninsured motorist carrier. The district court, Roma M. McElwee, trial judge, concluded that a statutory physician's lien is not enforceable against the proceeds of uninsured motorist coverage and gave judgment to defendant. Plaintiff brought this appeal, which stands retained for this court's disposition. THE TRIAL COURT'S JUDGMENT IS REVERSED AND THE CAUSE IS REMANDED WITH DIRECTIONS TO PROCEED IN A MANNER CONSISTENT WITH TODAY'S PRONOUNCEMENT. Timothy A. Heefner and Jennifer A. Bruner, GOOLSBY, OLSON & PROCTOR, P.C., Oklahoma City, for plaintiff/appellant. Albert L. Tait, Jr. and J. Mark McAlester, FENTON, FENTON, SMITH, RENEAU & MOON, Oklahoma City, for defendant/appellee. OPALA, J. ¶1 The dispositive issue presented in this appeal is whether a statutory physician's lien attaches to the proceeds of a patient's uninsured motorist coverage. We answer in the affirmative. I THE ANATOMY OF LITIGATION ¶2 Tijuana Johnson (Johnson) was injured in an automobile accident in September 2001. After providing Johnson with accident-related medical treatment, the Broadway Clinic (Clinic or plaintiff) filed (in the office of the Oklahoma County Clerk) a 42 O.S. 2001 §46 lien2 [called a §46 physician's lien] against any payment Johnson might receive for her injuries from the tortfeasor or from an insurer.3 Johnson asserted a claim against her automobile insurer, Liberty Mutual Insurance Company (Liberty Mutual or defendant) to recover benefits under both the medical payments coverage and the uninsured/underinsured motorist (UM) coverage of her policy. ¶3 In April 2002, Liberty Mutual paid the Clinic $1,000.00 under Johnson's medical payments coverage, leaving an outstanding balance for medical services rendered to Johnson of $902.00. Later that same month, Liberty Mutual issued a check to Johnson alone in the amount of $4,200.00, representing proceeds from Johnson's UM coverage. In July 2002, Liberty Mutual informed the Clinic that it had settled Johnson's UM claim and had disbursed the funds to her. ¶4 The Clinic filed a small-claim proceeding against Liberty Mutual seeking a declaration that its lien attached to Johnson's UM benefits and to enforce the lien. At a hearing on 20 August 2004, the parties stipulated to the facts and presented their opposing legal arguments to Roma M. McElwee, trial judge, on the question of whether a §46(B) physician's lien is enforceable against UM indemnity. The trial judge ruled in the negative and pronounced judgment for defendant. Plaintiff brought this appeal, which stands retained for this court's disposition. ¶5 We now hold that the provisions of 42 O.S. 2001 §46(B), which authorize a lien in favor of a physician upon proceeds payable by an insurer, include within their ambit the proceeds of a patient's UM coverage. We hence reverse the trial court's judgment and direct the trial judge to proceed, upon remand, in a manner consistent with today's pronouncement. II STANDARD OF REVIEW ¶6 The facts relevant to this appeal are undisputed, having been submitted to the trial court by stipulation. The issue before us is one of law in which we must determine whether a statutory physician's lien is enforceable against UM indemnity. Contested issues of law stand before us for de novo review.4 When examining a trial court's legal rulings, an appellate court exercises plenary independent and non-deferential authority.5 III THE PARTIES' CONTENTIONS ¶7 Defendant urges us to sustain the trial court's construction of §46(B) to exclude a patient's UM carrier. Defendant contends that §46(A) creates a class of persons - tortfeasors - which controls and limits the persons to whom both §46(A) and §46(B) apply. Read in conjunction with §46(A), defendant asserts, it is clear that the legislature intended §46(B) to apply only to the tortfeasor's insurer, not to insurance purchased by the patient. ¶8 Defendant also argues that Oklahoma jurisprudence involving other types of statutory liens has consistently denied the lienholder access to the proceeds of UM coverage. In support of this contention, defendant cites this court's decision in Kratz v. Kratz,6 which held that a 42 O.S. 2001 §43 hospital lien does not attach to UM indemnity, as well as two decisions of our intermediate appellate courts holding that an employer's or workers compensation carrier's statutory right to subrogation does not extend to UM benefits.7 ¶9 Defendant further argues that to construe the words "an insurer" in §46(B) to include insurers generally and not just the tortfeasor's insurer would lead to the absurd result that any insurance available to the patient would become fair game for a physician's lien, including such other first-party insurance as collision coverage. This would impair the contract of insurance between the insurer and its insured, which contemplates payment of benefits to the insured only. ¶10 Finally, defendant contends that the exemption from attachment and execution created by the provisions of 31 O.S. 2001 §1.A.21 for a person's interest in "a claim for personal bodily injury" in an amount not to exceed $50,000.00 places Johnson's UM benefits out of the reach of the Clinic's lien. ¶11 Plaintiff contends that the trial court erred in construing §46(B) to exclude the patient's UM carrier. The terms of §46(B), plaintiff urges, are clear and unambiguous and devoid of any language suggesting that the legislature intended to confine §46(B) to the tortfeasor's insurer. In the absence of such limiting language or any other textual indication that the legislature intended to restrict §46(B) in the way defendant advocates, plaintiff argues the statute must be construed as written - to apply to any insurer, including a patient's own UM carrier. ¶12 Plaintiff further argues that defendant's restrictive approach to the meaning of §46(B) is inconsistent with the legislature's intent in enacting the statute. The purpose of the lien is to encourage physicians to provide medical treatment to injured persons without regard to their ability to pay at the time the services are rendered. Plaintiff argues that removing UM proceeds as a source of payment would thwart the statute's purpose. ¶13 Plaintiff also asserts that defendant's reliance on Kratz is misplaced. Plaintiff points out that statutory hospital liens are governed by the provisions of 42 O.S. 2001 §43, while the lien it asserts falls under the provisions of §46(B). Plaintiff argues that critical differences between the language used in §43 and §46(B) preclude application of the reasoning in Kratz to a lien that comes within the terms of §46(B). IV THE PROCEEDS OF UM COVERAGE ARE SUBJECT TO A §46(B) PHYSICIAN'S LIEN ¶14 A statutory lien such as that accorded by §46 to a physician stands in derogation of the common law.8 As a remedial device that owes its existence to a legislative enactment, the text of the physician's lien statute is the measure of both the right and the remedy it creates.9 A statutory lien must be strictly confined within the ambit of legislation giving it birth.10 Hence, the funds upon which a physician's lien may be impressed are only those that come within the express terms of the statute. Once it becomes clearly established that the lien right attaches, the statute's enforcement provisions are to be accorded a liberal construction.11 ¶15 In the absence of ambiguity or conflict with another enactment, our task is limited to applying a statute according to the plain meaning of the words chosen by the legislature, which presumptively express that body's intent.12 The provisions of §46(B) are neither ambiguous nor in conflict with another enactment. While we agree with defendant that §46(B)'s express terms do not clearly define the outer boundaries of the physician's lien right,13 the enactment's plain language leaves no doubt that the insurance coverage at issue in this case - the patient's UM benefits - falls squarely within the statute's intended domain. The legislature enacted §46 to encourage physicians to provide medical treatment to accident victims with insufficient funds or insurance to pay for their treatment at the time of delivery.14 It is designed to ensure that physicians are paid for their services once their patients are compensated for their injuries.15 ¶16 The purpose of UM coverage in a policy of automobile insurance is to protect the insured from the effects of personal injury resulting from an accident with another motorist who carries no insurance or is underinsured. ¶17 Defendant's argument that §46(A) restricts the application of §46(B) to the tortfeasor's insurer has no textual support in the enactment. The plain language of §46(B),which begins with the words, "In addition to the lien provided in [§46(A)]" and proceeds to use the unqualified phrase "claim against an insurer" indicates that the two provisions operate independently. ¶18 The dissenter finds ambiguity in §46(B) and would employ the canons of statutory construction known as noscitur a sociis and ejusdem generis to restrict its reach to the tortfeasor's insurer. Neither doctrine is applicable. Noscitur a sociis asserts that the meaning of an unclear or ambiguous word or phrase "should be determined by the words immediately surrounding it." ¶19 Ejusdem generis is equally inapplicable. We have held that the doctrine of ejusdem generis applies when (1) a statute contains a specific enumeration; (2) the members of the enumeration suggest a class; (3) the class is not exhausted by the enumeration; (4) a general reference supplementing the enumeration is made, usually following the enumeration; and (5) there is not clearly manifested an intent that the general term be given a broader meaning than the doctrine requires. ¶20 The dissenter would have us treat the words in §46(A) referring to the tortfeasor as creating a class into which §46(B)'s words "an insurer" fall. Applying ejusdem generis, the dissenter would then define the words "an insurer" by reference to the "class of tortfeasor" resulting in the words "an insurer" becoming "the tortfeasor's insurer." We liken this to an attempt to fit a square peg into a round hole. The statute at issue does not lend itself to construction through ejusdem generis because it lacks most if not all of the characteristics necessary for the application of the doctrine. There is in §46 no enumeration or list of specific things, no class created by such an enumeration, and no general catchall reference. There is simply nothing in the statute upon which the doctrine of ejusdem generis can operate. ¶21 In evaluating whether the legislature intended for §46(A) to restrict the meaning of §46(B), it is important to recall that an injured party cannot "assert or maintain a claim against" the tortfeasor's liability insurer. ¶22 Defendant urges us to extend to this case our holding in Kratz (that a statutory hospital lien does not attach to UM benefits). Because the relevant statutes are dissimilar, we decline to do so. Hospital liens are governed by the terms of ¶23 Defendant's remaining contention is that the exemption from attachment and execution provided by 31 O.S. 2001 §1.A.21 for personal injury recoveries up to $50,000.00 negates the Clinic's lien against the proceeds of Johnson's UM recovery. We disagree. It is not unprecedented for us to hold that a lien is enforceable against exempt property. We have held that a statutory exemption from attachment or execution does not apply to certain consensual liens such as mortgages and security interests. ¶24 Because we are dealing here with a statutory lien's relationship to a statutory exemption, our task is to ascertain how the legislature intended for the two statutes to operate together. We start with the presumption that the legislature would not enact legislation that is incapable of functioning usefully. We hence decline to construe the exemption statute as defendant advocates because that construction effectively renders the lien statute a nullity. Instead, we construe the lien and exemption statutes to give effect to both. We therefore hold that the 31 O.S. 2001 §1.A.21 exemption notwithstanding, a statutory physician's lien is enforceable against personal injury proceeds of less than $50,000.00; the statutory exemption remains as a bar to attachment or execution by all other creditors. ¶25 The dissent would have us sua sponte assert that the small claims division lacks subject matter jurisdiction over this proceeding to enforce a lien and would have us declare the trial court's judgment a nullity. While an appellate court is duty-bound to inquire sua sponte into its own jurisdiction over any pending matter as well as that of the lower court whence the case came by appeal or on certiorari, ¶26 The dissent also contends that the physician's lien at issue here is invalid and hence unenforceable because it was not perfected as required by §46(C)(1) and (2). Compliance with the statutory requirements for perfection of the lien at issue was not raised in the trial court and was not the basis for the trial court's decision. It is not the function of this court to make first-instance determinations of fact or legal questions which have been neither raised nor assessed at nisi prius. ¶27 The facts pertinent to this appeal are not in dispute. The Clinic provided medical treatment to Johnson after she was injured in an automobile accident. Johnson asserted a claim against her UM carrier, Liberty Mutual, in connection with the accident. The Clinic filed a §46 physician's lien against any proceeds payable to Johnson by "an insurer." Because we hold today that UM indemnity stands subject to a §46(B) physician's lien, we reverse the trial court's judgment that placed Johnson's UM benefits beyond reach of the Clinic's lien and remand the cause with directions to proceed in a manner consistent with today's pronouncement. V SUMMARY ¶28 The provisions of §46(B) clearly and unambiguously authorize a physician to place a lien on proceeds to which a patient is entitled from a claim against an insurer. We have noted that "seeking hidden meaning at variance with the language used [in a statute] is a perilous undertaking which is quite as apt to lead to an amendment of a law by judicial construction as it is to arrive at the actual thought in the legislative mind."38 Where statutory language is plain and the legislative purpose evident, we will not interject into the statute a word or phrase that alters the choice the legislature has made. Such is the case here where the statute plainly authorizes a lien against proceeds derived from a claim against an insurer. The trial court erred in deciding otherwise. ¶29 THE TRIAL COURT'S JUDGMENT IS REVERSED AND THE CAUSE IS REMANDED WITH DIRECTIONS TO PROCEED IN A MANNER CONSISTENT WITH TODAY'S PRONOUNCEMENT. ¶30 WINCHESTER, V.C.J., and LAVENDER, HARGRAVE, OPALA, and TAYLOR, JJ., CONCUR. ¶31 KAUGER, J., CONCURS IN PART AND DISSENTS IN PART. ¶32 WATT, C.J., and EDMONDSON and COLBERT, JJ., DISSENT. FOOT