IN THE COURT OF APPEALS OF TENNESSEE

AT NASHVILLE

December 2, 2020 Session 

MARK YOUNG ET AL. V. H & H TESTING, LLC ET AL.

Appeal from the Chancery Court for Montgomery County

No. CD-16-10 Laurence M. McMillan, Jr., Chancellor

No. M2020-00145-COA-R3-CV 

This appeal arises from a financial dispute between a drug testing laboratory, H & H

Testing, Inc. (“H & H Testing” or “H & H”), and Wesley Young, for whom H & H

performed 64 qualitative drug screens while Mr. Young was a client of Transcend 

Recovery Community (“Transcend”), which operates recovery communities nationwide. 

Upon commencing treatment for drug addiction at Transcend, Mr. Young agreed to adhere 

to treatment guidelines that included abstaining from drugs and alcohol and submitting to 

a rigorous drug screening protocol. Pursuant to this protocol, Transcend forwarded 64 of 

Mr. Young’s random urine samples to H & H Testing for comprehensive laboratory 

testing. After H & H performed each drug screen, it submitted a claim to Mr. Young’s 

health insurance provider, BlueCross BlueShield of Tennessee (“BlueCross” or 

“BCBST”). BlueCross approved each and every claim submitted by H & H Testing and 

remitted payment for the services rendered by H & H in the aggregate of $85,837.11. 

Because H & H Testing was an out-of-network provider, BlueCross remitted payment for 

the services rendered by H & H to its insured, Mr. Young, expecting he would forward the 

proceeds to H & H. Instead of remitting the funds to H & H Testing, Mr. Young entrusted 

the money to his parents, but they did not forward the proceeds to H & H. When H & H

Testing demanded payment, Mr. Young and his parents commenced this action to declare 

the rights of the parties to the funds. They contended that H & H Testing was not entitled 

to the insurance proceeds because Mr. Young did not have a contract with H & H Testing, 

its services were not medically necessary, and the charges were exorbitant. H & H Testing 

filed an answer and counterclaims for breach of contract, conversion, and unjust 

enrichment. Following a hearing on cross-motions for summary judgment, the trial court 

granted summary judgment in favor of H & H Testing without identifying the claims upon 

which the judgment was granted and imposed a constructive trust over the insurance 

proceeds. This appeal followed. We affirm the trial court’s decision to grant summary 

judgment in favor of H & H Testing based on its claims of conversion and unjust 

enrichment. But we vacate the trial court’s decision to impose a constructive trust over the 

proceeds because the parties failed to raise the issue in any of the pleadings.

05/14/2021
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Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Affirmed 

in part, Vacated in part, and Remanded

FRANK G. CLEMENT JR., P.J., M.S., delivered the opinion of the Court, in which ANDY D.

BENNETT and W. NEAL MCBRAYER, JJ., joined.

William B. Hubbard and William E. Young, Nashville, Tennessee, for the appellants, Mark 

Young, Karen Young, and Wesley Young. 

W. Brantley Phillips, Jr., Matthew J. Sinback, and Margaret V. Dotson, Nashville, 

Tennessee, for the appellees, H & H Testing, LLC and H & H Testing, Inc.

OPINION

Wesley Young, a resident of Tennessee, received drug treatment for opioid 

addiction at Transcend in Santa Monica, California, from June 2013 to November 2014.1

During this time, Mr. Young submitted 64 urine samples to Transcend, and Transcend sent 

those samples to H & H Testing to conduct qualitative drug screens.2 Acting pursuant to 

its standard practice, when Transcend collected each urine sample, Mr. Young signed a 

drug screen requisition form. Transcend used these forms to get the client’s consent for 

Transcend and third parties to screen the client’s urine for drugs and alcohol.

Acting in accordance with standard practices and Mr. Young’s written 

authorization, H & H Testing tested Mr. Young’s urine samples and reported the results to 

Transcend for its program-compliance efforts.3 H & H Testing then submitted its claims 

 

1 Mr. Young was 17 years old when he was admitted to the program and 18 when he completed the 

program at Transcend.

2 H & H Testing operates a qualitative drug screening laboratory in Los Angeles, California, which 

is licensed and accredited by the Clinical Laboratory Improvement Amendments, the Commission on 

Office Laboratory Accreditation and the California Department of Health.

3 At Transcend’s direction, after conducting the qualitative drug screens, H & H Testing sent each 

urine sample to unaffiliated laboratories for “confirmatory” screening. Between June 2013 and October 

2014, H & H sent the urine samples to Avee Laboratories (“Avee”). Between October 2014 to November 

2014, H & H sent all urine samples received from Transcend to Millennium Laboratories, LLC 

(“Millennium”) for confirmatory screening. As H & H states in its brief,

In contrast to the qualitative screening that H & H Testing performed, Avee and 

Millennium performed confirmatory or “quantitative” screening—a type of testing that can 

determine the specific amounts of individual drugs in a client’s system and can detect the 

presence of certain substances, such as synthetic drugs, that qualitative screens typically 

cannot detect. . . . Avee’s and Millennium’s billing for confirmatory screens and the costs 

of these screens were not included in H & H Testing’s qualitative drug screening charges.
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for payment to BlueCross, Mr. Young’s health insurance provider. BlueCross approved 

H & H Testing’s claims but, because H & H Testing was out-of-network, BlueCross 

remitted payment to its insured, Mr. Young.4 Believing the payments were reimbursement 

for his treatment at Transcend, Mr. Young gave the money to his parents. Thereafter, 

H & H Testing sent letters to Mr. Young dated November 4, 2015, January 19, 2016, and 

March 15, 2016, asking Mr. Young to forward the insurance proceeds. 

On April 8, 2016, Mr. Young and his parents, Mark and Karen Young, (collectively, 

“Petitioners”) filed a Petition for Declaratory Judgment in Montgomery County Chancery 

Court, claiming H & H Testing was not entitled to the insurance proceeds because Mr. 

Young never contracted with H & H Testing to perform laboratory services, the claims 

submitted to BlueCross were fraudulent, the charges were exorbitant, and the services were 

not medically necessary. In the alternative, Petitioners claimed H & H Testing was only 

entitled to quantum meruit relief in the amount of $1,152 based on what the State of 

Tennessee paid for similar services.5

H & H Testing filed an answer denying Petitioners’ allegations and counterclaimed 

for breach of contract, conversion, unjust enrichment, and declaratory judgment. H & H

Testing alleged that each time Mr. Young submitted a urine sample for testing, he signed 

a “requisition form” authorizing it to conduct the tests and expressly assigning his right to 

any insurance proceeds to H & H Testing. Further, H & H Testing alleged that it billed 

BlueCross for its services, and BlueCross sent $85,837.11 to Mr. Young to satisfy its 

claims; however, Mr. Young failed to forward the payment to H & H Testing following 

multiple requests that he do so.

Petitioners filed an answer denying H & H Testing’s counterclaims, and, following 

discovery, the parties filed cross-motions for summary judgment. However, the trial court 

denied the motions because BlueCross was an indispensable party. As such, the court 

ordered Petitioners to add BlueCross as a party-defendant.

 

4 BlueCross’s practice of sending the payment for an out-of-network-provider’s services directly 

to the patient is a controversial one and has resulted in a number of lawsuits. Critics of the practice contend 

it is “a revenge tactic against doctors, hospitals, treatment facilities, and other medical providers that don’t 

agree to insurance companies’ demands to be ‘in network,’ by making them chase down money.” Wayne 

Drash, Insurer Skips Doctors and Sends Massive Checks to Patients, Prompting Million-Dollar Lawsuit, 

CNN Health (March 1, 2019), https://www.cnn.com/2019/03/01/health/anthem-insurance-paymentspatients-eprise/index.html. Insurance companies dispute these claims. Id.; see Martin Luther King, Jr.

Cmty. Hosp. v. Cmty. Ins. Co., No. 2:16-CV-03722-ODW(RAOx), 2018 WL 3830009, at *1 (C.D. Cal. 

July 5, 2018), aff’d 829 F. App’x 156 (9th Cir. 2020).

5 On August 16, 2013, after learning that H & H Testing, LLC, had converted to H & H Testing 

Inc., Petitioners filed an amended petition noting that H & H Testing converted to a corporation and 

attaching relevant documents from the California Secretary of State.
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BlueCross filed a statement6 with the court in which it explained its policy of 

remitting payment for out-of-network providers to the insured subscriber. Because H & H

Testing was an out-of-network provider, BlueCross sent payment for H & H Testing’s 

claims to Mr. Young with the expectation that Mr. Young would forward the payment to 

H & H Testing. BlueCross further explained that, because neither party was asserting any 

claims against it and because BlueCross did not intend to assert any claims against either 

party or to the funds, BlueCross was “not affected by the resolution of any issue before the 

Court.” Thereafter, the parties filed renewed cross-motions for summary judgment 

supported by statements of disputed and undisputed facts.

For its part, H & H Testing contended it was entitled to judgment as a matter of law 

on its claims for breach of contract or, in the alternative, for unjust enrichment and 

conversion. In its statement of undisputed facts, H & H Testing relied on, inter alia, the 

affidavit of Asher Gottesman, Founder and Chief Executive Officer of Transcend; the 

affidavit of David Kalish, Director of H & H Testing; and documentation that included a 

copy of two requisition forms signed by Mr. Young and an Explanation of Benefits that 

BlueCross sent to Mr. Young regarding H & H Testing’s claims.

H & H Testing also relied on BlueCross’s statement declarations that (1) the 

$85,837.11 payment was for covered services performed by H & H Testing; (2) BlueCross 

has a policy of paying out‐of‐network providers like H & H Testing by sending payment 

to the insured with the expectation that the insured will forward the funds to the provider;

and (3) BlueCross followed that policy here. Yet, according to H & H Testing, instead of 

remitting these funds to H & H Testing, as BlueCross intended and as he was obligated to 

do, Mr. Young gave the money to his parents. H & H Testing contended that, during Mr. 

Young’s treatment at Transcend, Mr. Young submitted 64 urine samples for testing, and 

each time, he signed a requisition form authorizing third-party laboratories to perform the 

tests. Moreover, H & H Testing claimed that, by signing the form, Mr. Young expressly 

assigned his right to the insurance proceeds for such testing to these third-party 

laboratories. 

Based on these and other facts identified in its statement of undisputed facts, H & H

argued that (1) Mr. Young agreed for a testing laboratory, such as H & H Testing, to 

provide qualitative drug screens as part of his treatment for drug abuse; (2) Mr. Young 

assigned his rights to the insurance proceeds—the $85,837.11 he received from 

BlueCross—to H & H as payment for the testing services; and (3) Mr. Young failed to 

remit the $85,837.11 to H & H in breach of the agreement. Alternatively, H & H argued 

the parties had a contract implied in law because H & H provided a valuable service to Mr. 

Young, the parties understood that H & H expected to be compensated, and it would be 

 

6 BlueCross claimed that it had not yet been served with an amended petition adding it as a party 

but was provided with the trial court’s order. The statement provided by BlueCross was not a sworn 

statement.
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unjust for Mr. Young to retain the benefits of these services without providing 

compensation. As for the conversion claim, H & H contended Mr. Young and his parents 

exercised dominion and control over the insurance proceeds that BlueCross intended for 

H & H in defiance of H & H Testing’s right to the proceeds.

In Petitioners’ response to H & H Testing’s summary judgment motion and in their 

cross-motion for summary judgment, Petitioners submitted the affidavit of Mr. Young, 

who stated that he agreed to twice-weekly drug tests but that Transcend used a test that 

provided instant results. Thus, while he signed a requisition form each time, Mr. Young

believed the form was only to acknowledge the results of the instant drug test, not to 

authorize H & H Testing to conduct further tests. Mr. Young claimed that, because the 

print on the requisition form was illegible, it was disputed whether he contractually agreed 

to further testing.7 Petitioners also claimed that the EOBs listed the service as “Hospital 

Outpatient Services,” not laboratory services; thus, Petitioners believed the money paid to 

Mr. Young by BlueCross was for Transcend’s services. Mr. Young also contended that, 

because his results were negative for illicit substances in every instance, it was unnecessary 

to send the samples to H & H Testing for further tests.8

Based on the foregoing, Petitioners argued (1) Mr. Young did not have a contract 

with H & H Testing to pay for its laboratory services; (2) because H & H Testing did not 

perform a valuable, medically necessary service, it was not entitled to quantum meruit 

relief; and (3) given that H & H Testing did not have a right to the insurance proceeds, 

Petitioners were not liable for conversion. H & H Testing filed a response contending the 

court should deny Petitioners’ motion for summary judgment and grant its motion for the 

reasons stated in its motion for summary judgment.

The court held a hearing on December 13, 2019, and entered an order on January 2, 

2020, granting H & H Testing’s motion for summary judgment and denying Petitioners’ 

motion based on the following findings:

 

7 The smaller print in the requisition forms, as they appear in the record before this court, is 

illegible. This may be the result of repeated acts of photocopying photocopies. Thus, we are unable to 

decipher what was agreed to and authorized based on the requisition forms.

8 This assertion was supported by the affidavit of Kevin Scarborough, Contracts Manager for

Community Rehabilitation Agencies of Tennessee. He claimed that it was industry practice, when 

conducting an instant drug test, to send only positive findings to laboratories for further drug testing. 

Therefore, based on Mr. Scarborough’s affidavit, Petitioners argued H & H Testing was not entitled 

quantum meruit relief because H & H Testing did not perform a valuable, medically necessary service. Mr. 

Scarborough also stated that the State of Tennessee contracted to pay $19 for the type of test performed by 

H & H Testing, which was significantly less than what H & H Testing charged. Therefore, Petitioners 

disputed H & H Testing’s contention that $85,837.11 represented the reasonable value of its services.
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As grounds for its ruling, the Court finds that, during his treatment at 

Transcend Recovery Community, Petitioner/Counter-Respondent Wesley 

Young signed at least sixty-four (64) requisition forms that assigned his 

rights to any insurance proceeds for laboratory drug screening to the 

rendering provider—here, H & H Testing. The Court further finds that Mr. 

Young’s insurer, BlueCross BlueShield of Tennessee (“BCBST”), paid 

$85,837.11 in insurance proceeds on the basis of claims submitted in 

connection with drug screening services rendered by H & H Testing for the 

benefit of Mr. Young. Further, the Court finds that BCBST paid the 

$85,837.11 to Mr. Young on the expectation that Mr. Young would remit 

that payment to H & [H] Testing. Instead, Mr. Young gave the $85,837.11 

to his parents.

The court also imposed a constructive trust over the insurance proceeds in the amount of 

$85,837.11 in favor of H & H Testing.

This appeal followed.

STANDARD OF REVIEW

This court reviews a trial court’s decision on a motion for summary judgment de 

novo without a presumption of correctness. Rye v. Women’s Care Ctr. of Memphis, 

MPLLC, 477 S.W.3d 235, 250 (Tenn. 2015). Accordingly, this court must make a fresh 

determination of whether the requirements of Tenn. R. Civ. P. 56 have been satisfied. Id.; 

Hunter v. Brown, 955 S.W.2d 49, 50 (Tenn. 1997). In so doing, we consider the evidence 

in the light most favorable to the nonmoving party and draw all reasonable inferences in 

that party’s favor. Godfrey v. Ruiz, 90 S.W.3d 692, 695 (Tenn. 2002).

Summary judgment should be granted when “the pleadings, depositions, answers to 

interrogatories, and admissions on file, together with the affidavits, if any, show that there 

is no genuine issue as to any material fact and that the moving party is entitled to a judgment 

as a matter of law.” Tenn. R. Civ. P. 56.04. When the party moving for summary judgment 

does not bear the burden of proof at trial, it may satisfy its burden of production “either (1) 

by affirmatively negating an essential element of the nonmoving party’s claim or (2) by 

demonstrating that the nonmoving party’s evidence at the summary judgment stage is 

insufficient to establish the nonmoving party’s claim or defense.” Rye, 477 S.W.3d at 264 

(emphasis in original).

When a motion for summary judgment is made and supported as provided in Tenn. 

R. Civ. P. 56, the nonmoving party may not rest on the allegations or denials in its 

pleadings. Id. at 265. Instead, the nonmoving party must respond with specific facts 

showing that there is a genuine issue for trial. Id. A fact is material “if it must be decided 

in order to resolve the substantive claim or defense at which the motion is directed.” Byrd 
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v. Hall, 847 S.W.2d 208, 215 (Tenn. 1993). A “genuine issue” exists if “a reasonable jury 

could legitimately resolve that fact in favor of one side or the other.” Id.

When the moving party is also the party that bears the burden of proof, in order to 

satisfy the requirements of Rule 56, the movant must allege undisputed facts establishing 

the elements of his claim, which would entitle the plaintiff to judgment as a matter of law. 

Hannan v. Alltel Publ’g Co., 270 S.W.3d 1, 9 n.6 (Tenn. 2008), overruled on other grounds 

by Rye, 477 S.W.3d 235.

ISSUES

Petitioners raise the following issues:

I. Did the trial court err in failing to recognize that Mr. Young was the assignee 

of the proceeds from BlueCross?

II. Did the trial court err in granting H & H Testing’s motion for summary 

judgment?

III. Did the trial court err by imposing a constructive trust in favor of H & H

Testing when this issue had not been raised and argued by the parties and no 

grounds existed for a constructive trust? 

Additionally, H & H Testing asks whether it is entitled to post-judgment interest. 

We will consider each issue in turn.

ANALYSIS

I. ASSIGNMENT OF PROCEEDS

Petitioners’ primary argument is that “[o]nce BCBST sent the proceeds at issue 

directly to its insured, [Mr. Young], then [he] as the assignee of these proceeds obtained 

all the rights and liabilities held by the assignor BCBST.” We find this argument is waived 

because it is being raised for the first time on appeal.

In its brief on appeal, H & H Testing states that Petitioners “never argued” that 

BlueCross assigned the insurance proceeds and its rights and liabilities to Wesley Young. 

As it asserts in its brief,

[r]ather, [Petitioners] made the baseless accusation that H & H Testing—

apparently at the direction of Transcend—had developed a scheme to defraud 

drug addicts. They then argued only that there was no contract between Mr. 

Young and H & H Testing, and H & H Testing was either not entitled to 
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quantum meruit recovery or was limited to a recovery of just $1,216. 

Moreover, the Youngs never explained why they had the right to retain for 

themselves the $85,837 windfall received from BCBST to pay for H & H

Testing’s services.

(Citations and footnote omitted).

In their reply brief, Petitioners fail to cite facts in the record that identify when and 

in what manner the issue was raised in the trial court. Further, they merely state “[t]he 

Defendants were fully aware of the Plaintiffs’ assertion of these defenses.” Such vagueness 

fails to comply with Rule 27(a)(6) of the Tennessee Rules of Appellate Procedure 

(requiring the appellant’s brief to include “[a] statement of facts, setting forth the facts 

relevant to the issues presented for review with appropriate references to the record”). 

Petitioners also failed to comply with Rule 6(b) of the Rules of the Court of Appeals (“No 

complaint of or reliance upon action by the trial court will be considered on appeal unless 

the argument contains a specific reference to the page or pages of the record where such 

action is recorded. No assertion of fact will be considered on appeal unless the argument 

contains a reference to the page or pages of the record where evidence of such fact is 

recorded.”). Therefore, Petitioners have failed to establish that the issue was properly raised 

in the trial court.

“[A] party who fails to raise an issue in the trial court waives its right to raise that 

issue on appeal.” Waters v. Farr, 291 S.W.3d 873, 918 (Tenn. 2009).9

II. SUMMARY JUDGMENT 

In granting H & H Testing’s motion for summary judgment, the court did not

specify whether it granted summary judgment based on the breach of contract, conversion,

or unjust-enrichment claim. Accordingly, we analyze the record to determine whether, as

Petitioners allege, the trial court erred in granting H & H Testing’s motion for summary 

judgment on any of its claims. Having done so, we have concluded that the undisputed 

facts establish all the elements of H & H Testing’s conversion and unjust enrichment 

claims.

 

9

It is also relevant to note that BlueCross stated the following in its response to Petitioners’ 

amended petition:

BCBST remitted to Wesley Young all amounts and benefits owed under Mr. Young’s 

insurance coverage for the drug testing claims that had been submitted. When BCBST 

remits payment directly to an insured for an out-of-network claim in this way, the purpose 

for which it does so is for the insured, in turn, to remit that money to the provider in 

payment for the covered services.
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A. Conversion

The elements of conversion are “(1) an appropriation of another’s tangible property 

to one’s use and benefit; (2) an intentional exercise of dominion over the chattel alleged to 

have been converted; and (3) defiance of the true owner’s rights to the chattel.” White v. 

Empire Exp., Inc., 395 S.W.3d 696, 720 (Tenn. Ct. App. 2012). Though conversion is an 

intentional tort, the requisite intent “does not necessarily have to be a matter of conscious 

wrongdoing.” Cooley v. First Am. Bank, No. E2001-02185-COA-R3-CV, 2002 WL 

460270, at *3 (Tenn. Ct. App. Mar. 26, 2002) (quoting Gen. Elec. Credit Corp. of 

Tennessee v. Kelly & Dearing Aviation, 765 S.W.2d 750, 753–754 (Tenn. Ct. App. 1988)). 

Rather, “the defendant ‘need only have an intent to exercise dominion and control over the 

property that is in fact inconsistent with the plaintiff’s rights, and do so.’” Hanna v. Sheflin, 

275 S.W.3d 423, 427 (Tenn. Ct. App. 2008) (quoting Mammoth Cave Prod. Credit Ass’n 

v. Oldham, 569 S.W.2d 833, 836 (Tenn. Ct. App. 1977)). Pertinent here, the “plaintiff must 

demonstrate legal ownership or an immediate superior right of possession” to the property. 

7 Stuart M. Speiser et. al, American Law of Torts § 24:1 (March 2021 Update).

Petitioners conceded in their cross-motion for summary judgment and on appeal 

that BlueCross paid the claims submitted by H & H Testing directly to Mr. Young, and Mr. 

Young gave the money to his parents instead of forwarding the payment to H & H Testing. 

Mr. Young stated in his affidavit:

H & H submitted claims to my insurance carrier. The claims were for 

“Hospital Outpatient Services”, [sic] not laboratory testing. A copy of a 

typical Explanation of Benefit (EOB) from my insurance carrier is attached 

as Exhibit C. These EOBs were received with the payments from the 

insurance carrier. I believed that the payments from the insurance carrier 

were to reimburse me for the cost of my treatment. Because my parents paid 

for my treatment, I forwarded the payments to my parents, Petitioners Mark 

and Karen Young.

(Emphasis added). Likewise, Petitioners summarized the foregoing affidavit in their brief 

on appeal stating, “BCBST paid the full amount of the claims submitted by H & H directly 

to Wesley Young,” and “the funds were in turn given by him to his parents to help 

reimburse them for the cost of his treatment.” Thus, the undisputed facts established that

the insurance proceeds were intended for H & H Testing, and Mr. Young exercised 

dominion and control over the proceeds in defiance of H & H Testing’s right to them. See

Hanna, 275 S.W.3d at 427. 

The foregoing notwithstanding, Petitioners argue H & H Testing did not have a right 

to the insurance proceeds because Mr. Young did not have a contract with H & H Testing 

to perform the services, the services were not medically necessary, and the charges were 

excessive. In essence, Petitioners take issue with BlueCross’s decision to pay H & H
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Testing for its services. But it is not this court’s task to delve into BlueCross’s criteria for 

approving and paying claims. That is immaterial here. What is material to the conversion 

claim is the undisputed fact that the payment BlueCross sent to Mr. Young for $85,837.11 

was intended for H & H Testing. Thus, the funds belonged to H & H Testing. As 

previously stated, Petitioners conceded in their brief on appeal and in Mr. Young’s affidavit 

that the insurance proceeds were intended to satisfy H & H Testing’s claims. That fact is 

undisputed. 

Moreover, Mr. Young admitted in his supplemental affidavit that Petitioners did not 

have a right to retain those funds: “If the Court finds that H & H does not have a right to 

the insurance proceeds, then I am aware that my insurance carrier has a claim for a refund.” 

That said, BlueCross never asked for a refund, nor did it ask Petitioners to take up its cause. 

Simply put, it is undisputed that the funds belonged to BlueCross, only BlueCross had the 

right to decide who was entitled to the funds, and BlueCross decided who was entitled to 

the funds—H & H Testing. Thus, given that Petitioners concede that the money does not 

belong to them and given that the money was intended for H & H Testing, H & H Testing 

sufficiently demonstrated “an immediate superior right of possession.” Speiser, supra, at § 

24:1.

Therefore, we have determined the undisputed facts establish that H & H Testing 

was entitled to judgment as a matter of law based on its claim of conversion.

B. Unjust Enrichment

In the alternative to its claim based on an express or implied-in-fact contract, H & H

seeks to recover the funds at issue based on a contract implied in law, also referred to as 

quantum meruit or unjust enrichment.10 See Swafford v. Harris, 967 S.W.2d 319, 324

(Tenn. 1998). In Paschall’s, Inc. v. Dozier, the Supreme Court explained contracts implied 

in law as follows:

‘Contracts implied in law, or more appropriately, quasi or construction 

contracts, are a class of obligations which are imposed or created by law 

without the assent of the party bound, on the ground that they are dictated by 

reason and justice . . . .’

 

10 H & H also asserted claims based on an express contract and an implied-in-fact contract; 

however, the trial court did not make a specific finding that an express or implied-in-fact contract existed. 

Moreover, Petitioners insist they have no contract of any kind with H & H Testing, and the authorization 

forms, on which the contract claims are based, are so illegible, particularly the text directly above Mr. 

Young’s signature, that we find the proof insufficient to establish that an enforceable contract exists. 

Accordingly, H & H is permitted to pursue a quantum meruit claim as an equitable substitute for a contract 

claim. See Swafford v. Harris, 967 S.W.2d 319, 324 (Tenn. 1998).
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Actions brought upon theories of unjust enrichment, quasi contract, contracts 

implied in law, and quantum meruit are essentially the same. Courts 

frequently employ the various terminology interchangeably to describe that 

class of implied obligations where, on the basis of justice and equity, the law 

will impose a contractual relationship between parties, regardless of their 

assent thereto.

. . .

The apparent reason is that such contracts are not based upon the intention 

of the parties but are obligations created by law. They are founded on the 

principle that a party receiving a benefit desired by him, under circumstances 

rendering it inequitable to retain it without making compensation, must do 

so.

407 S.W.2d 150, 154 (Tenn. 1966) (quoting Weatherly v. Am. Agr. Chem. Co., 65 S.W.2d 

592, 598 (Tenn. Ct. App. 1933)).

As the affidavits of Mr. Kalish and Mr. Gottesman clearly reveal, the undisputed 

facts are that H & H Testing provided qualitative drug screens as a vital feature of Mr. 

Young’s drug treatment and as a mandatory condition for his treatment to continue. More 

specifically, H & H Testing performed the complex qualitative drug screens needed to 

accurately determine if Mr. Young was using drugs during his treatment at Transcend, and 

it is undisputed that H & H Testing, in fact, performed drug screens on Mr. Young’s urine 

samples. Further, whether “the instant tests” performed by Transcend or the confirmatory 

screens performed by Avee and Millennium were necessary is both irrelevant and 

immaterial to H & H’s claim for payment for its services. What is relevant, material, and 

undisputed is that Wesley Young would not have been permitted to remain in treatment at 

Transcend but for the testing performed by H & H, as mandated by Transcend and agreed 

to by Wesley Young. Moreover, and significantly, it is undisputed that Mr. Young received 

the benefit of H & H’s drug screens, H & H reasonably expected to be compensated for its 

services, and there is no evidence whatsoever that Petitioners made any out‐of‐pocket 

payments for any qualitative drug screening performed by H & H Testing. 

The material and undisputed facts also establish the final element of a contract 

implied in law claim—that is, whether it would be unjust for Mr. Young to receive the 

benefit of the qualitative drug screening services without H & H Testing being paid for its 

services. Simply stated, it would be unjust for the Youngs to retain these funds. See Bennett 

v. Visa U.S.A., Inc., 198 S.W.3d 747, 755 (Tenn. Ct. App. 2006) (setting forth the required 

elements of an unjust-enrichment claim as (1) a benefit conferred upon a party by the other; 

(2) appreciation by the recipient of such benefit and (3) acceptance of such benefit under 

such circumstances that it would be inequitable for the receiving party to retain the benefit 

without payment of the value thereof); see also Freeman Indus., LLC v. Eastman Chem. 
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Co., 172 S.W.3d 512, 525 (Tenn. 2005) (“[A] plaintiff need not establish that the defendant 

received a direct benefit from the plaintiff. Rather, a plaintiff may recover for unjust 

enrichment against a defendant who receives any benefit from the plaintiff if the 

defendant’s retention of the benefit would be unjust.”).

Based on these undisputed facts, Petitioners’ denial of the existence of an express 

contract with H & H, and there being insufficient proof to establish that an express contract 

exists between H & H Testing and Wesley Young or the Petitioners, H & H Testing is 

entitled to summary judgment based on quantum meruit. See Paschall’s, Inc., 407 S.W.2d 

at 154.

III. CONSTRUCTIVE TRUST

Petitioners also contend the trial court erred by imposing a constructive trust in 

favor of H & H Testing because this issue had not been raised in any of the pleadings nor 

argued by the parties. Our Supreme Court has explained that “the primary purpose of 

pleadings is to provide notice of the issues presented to the opposing party and court.” 

Webb v. Nashville Area Habitat for Humanity, Inc., 346 S.W.3d 422, 426 (Tenn. 2011). 

Therefore, “a judgment beyond the scope of the pleadings is beyond the notice given the 

parties and . . . should not be enforced.” Elec. Controls v. Ponderosa Fibres of Am., 19 

S.W.3d 222, 227 (Tenn. Ct. App. 1999) (quoting Brown v. Brown, 281 S.W.2d 492, 497 

(Tenn. 1955)). Accordingly, the trial court’s decision to impose a constructive trust on the 

proceeds is vacated.

IV. POST-JUDGMENT INTEREST 

As a precautionary move, H & H Testing asks us to determine whether it is entitled 

to post-judgment interest. This request is due to the fact that, after the December 2019 

summary judgment hearing, H & H Testing submitted a proposed final order that, among 

other things, specified that post‐judgment interest was awarded to H & H Testing; 

however, the Chancellor crossed through this text. Thus, H & H Testing contends, to the 

extent the Final Order can be construed as barring H & H Testing from collecting post‐

judgment interest, the trial court erred.

We find no error with the court striking through this portion of the proposed order 

because the court did not rule that H & H Testing was not entitled to post-judgment interest. 

An award of post-judgment interest is controlled by Tenn. Code Ann. § 47-14-122, which 

provides:

Interest shall be computed on every judgment from the day on which the jury 

or the court, sitting without a jury, returned the verdict without regard to a 

motion for a new trial.
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“The purpose of post-judgment interest is to compensate a successful plaintiff for 

being deprived of the compensation for its loss between the time of the entry of the 

judgment awarding the compensation until the payment of the judgment by the 

defendants.” State v. Thompson, 197 S.W.3d 685, 693 (Tenn. 2006) (quoting Varnadoe v. 

McGhee, 149 S.W.3d 644, 650 (Tenn. Ct. App. 2004)). Interest on judgments in Tennessee 

is statutorily mandated. See Tenn. Code Ann. § 47-14-121. “The failure of any court to 

expressly provide such interest in its judgment does not abrogate the statute.” Tallent v. 

Cates, 45 S.W.3d 556, 563 (Tenn. Ct. App. 2000) (citing Inman v. Inman, 840 S.W.2d 927, 

932 (Tenn. Ct. App. 1992)).

Accordingly, on remand, H & H Testing will be entitled to post-judgment interest 

computed from the day on which the court entered a judgment in its favor. See Tenn. Code 

Ann. § 47-14-122.

IN CONCLUSION

The judgment of the trial court is affirmed in part, vacated in part, and this matter is 

remanded with costs of appeal assessed against Mark Young, Karen Young, and Wesley 

Young jointly and severally.

________________________________

 FRANK G. CLEMENT JR., P.J., M.S.