THE STATE OF SOUTH CAROLINA 

In The Court of Appeals 

Jeanne Beverly, individually and on behalf of others 

similarly situated, Appellant, 

v. 

Grand Strand Regional Medical Center, LLC, 

Respondent. 

Appellate Case No. 2016-001499 

Appeal From Horry County 

Benjamin H. Culbertson, Circuit Court Judge 

Opinion No. 5708 

Heard November 8, 2018 – Filed January 15, 2020 

AFFIRMED IN PART, REVERSED IN PART, AND 

REMANDED 

Sidney L. Major, Jr. and Roy F. Harmon, III, of Harmon 

& Major, PA, of Greenville; John Gressette Felder, Jr., of 

McGowan, Hood & Felder, LLC, of Columbia; Chad 

Alan McGowan and Jordan Christopher Calloway, both 

of McGowan, Hood & Felder, LLC, of Rock Hill; and 

Jeffrey Christopher Chandler, of Chandler Law Firm, of 

Myrtle Beach, for Appellant. 

James Lynn Werner, William R. Thomas, and Katon 

Edwards Dawson, Jr., all of Parker, Poe, Adams & 

Bernstein, LLP, of Columbia, for Respondent. 
 

 

MCDONALD, J.: Jeanne Beverly appeals the circuit court's order granting Grand 

Strand Medical Center, LLC's (Grand Strand's) motion to dismiss Beverly's claims 

for breach of contract, bad faith, and unjust enrichment. Beverly argues the circuit 

court erred in: (1) finding Beverly is not an intended third-party beneficiary of the 

preferred provider contract between Blue Cross Blue Shield (BCBS) of South 

Carolina and Grand Strand and (2) dismissing Beverly's claim for unjust 

enrichment, despite her complaint's allegation that Grand Strand impermissibly 

collected payments from Beverly and others "at a higher value than contracted for 

with BCBS." We affirm in part, reverse in part, and remand to the circuit court for 

further proceedings. 

Facts and Procedural History 

On April 29, 2005, Grand Strand contracted with BCBS of South Carolina to 

become a preferred provider within the BCBS preferred provider organization 

(PPO)1

. In exchange for this status and access to BCBS members (Members), 

Grand Strand promised to bill BCBS directly for certain medical services delivered 

to Members2

 and to accept a discounted reimbursement rate from BCBS for such 

services. Specifically, the Institutional Agreement (the Agreement) prohibits 

Grand Strand from "solicit[ing] any payment from Members"3

 and requires Grand 

Strand to "accept the reimbursement terms and rates" BCBS established for the 

PPO. After executing the Agreement, Grand Strand began marketing itself to 

Members as a BCBS preferred provider. 

1

 The PPO is a network of hospitals and medical practices marketed to Members as 

"preferred providers." 

2

 The contract defines "Member" as "anyone who is covered for health care 

services under the terms of a Benefits Contract or who is eligible for Covered 

Services as a result of an agreement between Plan and an Associate Plan." A 

"Benefits Contract" is defined, in pertinent part, as "any PPO contract between 

Plan and Member entitling the Member to receive Covered Services or other 

services as designated in the Benefits Contract." 

3

 Exceptions to this provision include: co-payments, deductibles, coinsurance, noncovered services rendered, covered services deemed to be not medically necessary, 

or covered services provided to Members who are unable to provide sufficient 

information regarding eligibility and coverage either prior to receiving service or 

following services rendered. 
On September 6, 2012, Beverly was injured in an automobile accident. That same 

day, she went to Grand Strand's emergency room, where she was evaluated and 

treated by an emergency room physician. Thereafter, Grand Strand sent Beverly a 

bill for $8,000.00.4

 Because Beverly had previously purchased a health insurance 

policy from BCBS—and thus became a Member with access to the PPO 

network—Beverly did not expect to receive such a bill. 

Beverly filed suit against Grand Strand, asserting claims for breach of contract, bad 

faith, and unjust enrichment. Beverly claimed Grand Strand breached its contract 

with BCBS and violated its contractual and fiduciary duties to her (and other 

Members who contracted for access to the PPO network) by billing her directly 

and charging her an amount exceeding the contractual reimbursement rate. 

Grand Strand moved to dismiss and, following a hearing, the circuit court 

dismissed Beverly's complaint. The circuit court denied Beverly's subsequent Rule 

59(e), SCRCP, motion to alter or amend. 

Standard of Review 

"On appeal from the dismissal of a case pursuant to Rule 12(b)(6), an appellate 

court applies the same standard of review as the trial court." Rydde v. Morris, 381 

S.C. 643, 646, 675 S.E.2d 431, 433 (2009). "In considering such a motion, the trial 

court must base its ruling solely on allegations set forth in the complaint." Spence 

v. Spence, 368 S.C. 106, 116, 628 S.E.2d 869, 874 (2006). "If the facts and 

inferences drawn from the facts alleged in the complaint, viewed in the light most 

favorable to the plaintiff, would entitle the plaintiff to relief on any theory, then the 

grant of a motion to dismiss for failure to state a claim is improper." Id. "At the 

Rule 12 stage, therefore, the first decision for the trial court is to decide only 

whether the pleading states a claim." Skydive Myrtle Beach, Inc. vs. Horry Cty., 

426 S.C. 175, 180, 826 S.E.2d 585, 588 (2019). 

Law and Analysis 

I. Third-Party Beneficiary 

Beverly argues the circuit court erred in finding a Member is not an intended third-

 

4

 Grand Strand billed Beverly $7,031.25 for the initial medical treatment and 

$968.75 for removal of staples. 
party beneficiary of the Institutional Agreement between BCBS and Grand Strand 

because the Agreement adds Grand Strand to a PPO network structured to provide 

direct benefits to Members. She further asserts the Agreement's purported 

"beneficiary disclaimer" does not bar her claims because the disclaimer's own 

language renders it inapplicable to "a Member's right to receive Covered Services." 

We agree. 

Under South Carolina law, it is well settled that a nonparty may enforce 

contractual terms that intentionally provide her direct benefits. See, e.g., Kingman 

v. Nationwide Mut. Ins. Co., 243 S.C. 405, 412, 134 S.E.2d 217, 221 (1964) ("We 

have held in numerous cases that a contract between two persons, for the benefit of 

a third, even though such third party be not named therein, can be enforced by such 

third party."); Jennings v. First of Ga. Underwriters Co., 283 S.C. 455, 457, 322 

S.E.2d 694, 695 (Ct. App. 1984) (explaining contracts between two persons for the 

benefit of a third can be enforced by the third person even though she is not named 

therein). "The presumption that [a] contract is not enforceable by [a nonparty] may 

be overcome by showing he was intended to be the direct beneficiary of the 

contract." Touchberry v. City of Florence, 295 S.C. 47, 48–49, 367 S.E.2d 149, 

150 (1988). 

"The cardinal rule of contract interpretation is to ascertain and give legal effect to 

the parties' intentions as determined by the contract language." Whitlock v. Stewart 

Title Guar. Co., 399 S.C. 610, 614, 732 S.E.2d 626, 628 (2012) (quoting McGill v. 

Moore, 381 S.C. 179, 185, 672 S.E.2d 571, 574 (2009)). "Courts must enforce, not 

write, contracts of insurance, and their language must be given its plain, ordinary 

and popular meaning." Id. (quoting USAA Prop. & Cas. Ins. Co. v. Clegg, 377 

S.C. 643, 655, 661 S.E.2d 791, 797 (2008)). "A contract is read as a whole 

document so that one may not create an ambiguity by pointing out a single 

sentence or clause." Williams v. Gov't Emps. Ins. Co. (GEICO), 409 S.C. 586, 595, 

762 S.E.2d 705, 710 (2014) (quoting McGill, 381 S.C. at 185, 672 S.E.2d at 574). 

"Whether a contract is ambiguous is to be determined from examining the entire 

contract, not by reviewing isolated portions of the contract." Id. 

The circuit court excluded Beverly as a third-party beneficiary based upon its 

examination of Section 16.16 of the Agreement, titled "No Third Party 

Beneficiaries," which states: 

This Agreement is not intended to, and shall not be 

construed to, make any person or entity a third party 

beneficiary. Notwithstanding the preceding, nothing in 
 

this section shall affect Plans rights under Article XV, or 

a Member's right to receive Covered Services[5] pursuant 

to the terms of this Agreement. 

Construing Section 16.16's first sentence in isolation, the circuit court concluded 

BCBS and Grand Strand disclaimed the possibility of any third-party beneficiary 

claim by Members. However, the provision's second sentence clarifies that despite 

this provision "nothing in this section shall affect . . . a Member's right to receive 

Covered Services pursuant to the terms of this Agreement." A similar phrase is 

found in the Agreement's recitals: "Whereas, [Grand Strand] desires to become a 

PPO provider to allow it to provide Covered Services under the terms of this 

Agreement." Grand Strand's refusal to submit Beverly's bill directly to BCBS is 

arguably actionable because the language of the Agreement requires Grand Strand 

to do just that. Likewise, Beverly's allegation that Grand Strand's billing her and 

demanding an undiscounted sum for covered services states a claim because, 

pursuant to the terms of the Agreement, Grand Strand agreed to bill BCBS and to 

accept a discounted reimbursement for Member Beverly's benefit. 

Moreover, the remaining twenty pages of the Agreement impose requirements on 

Grand Strand specifically intended to benefit Beverly and other Members. South 

Carolina courts have recognized that the parties' intent must be derived from the 

Agreement's language taken as a whole. This isolated sentence—when considered 

within the context of the entire Institutional Agreement—does not retract the 

benefits the Agreement repeatedly bestows upon BCBS PPO Members. 

Significantly, Section 16.16's second sentence recognizes a "Member's right to 

receive Covered Services pursuant to the Agreement," thus carving out related 

claims from any purported third-party beneficiary exclusion. 

Further, interpreting Section 16.16's language as a bar to Beverly's claims 

disregards expressions of the parties' intent set forth elsewhere in the contract. 

5

 The Agreement defines "Covered Services" as "those inpatient and outpatient 

hospital services, supplies, equipment, and/or items to be delivered by or through 

Institution to Members that are reimbursable under the applicable Member 

Benefits Contract. Certain services, supplies, equipment and/or items are not 

included under this Agreement as Covered Services, including but not limited to 

services provided by skilled nursing facilities, durable medical equipment 

suppliers, outpatient retail pharmacies, and physician services other than radiology, 

pathology, anesthesiology, and emergency room that are combined billed on [a 

certain form]." Article XV addresses Associate Plans and is inapplicable here. 
BCBS established its PPO "for the benefit of Members." The very first 

responsibility Grand Strand undertook in the "Institution Services and 

Responsibilities" section of the Agreement was to "provide Covered Services to 

any Member." Members are also direct beneficiaries of Grand Strand's promise to 

accept the negotiated reimbursement rate from BCBS as well as its promise to bill 

BCBS, not the Member, for covered services. 

Other jurisdictions have found a third-party beneficiary disclaimer may not apply 

when substantive provisions in the contract contradict the purported disclaimer. 

In a case similar to Beverly's, the Wisconsin Court of Appeals found an insured 

covered by a health maintenance organization (HMO) was a third-party beneficiary 

of her insurer's HMO provider contract with the hospital where she was treated 

following an automobile accident. Dorr v. Sacred Heart Hospital, 597 N.W.2d 

462, 475 (Wis. App. 1999). The contract's language expressing a general intent to 

disclaim third-party beneficiaries was ineffective as to the insured because it was 

inconsistent with other portions of the same contract protecting subscribers' rights. 

Id. (finding "hold harmless" provision's terms were "designed specifically for the 

purpose of protecting HMO subscribers"). Likewise, a federal district court in 

Pennsylvania applied similar principles to reject a third-party beneficiary exclusion 

offered to prevent a medical provider from enforcing a PPO contract between an 

insurer and a health insurance network. See Aetna Life Ins. Co. v. Huntingdon 

Valley Surgery Ctr., Civil Action No. 13-03101, 2015 WL 1954287 (E.D. Pa. Apr. 

30, 2015). Because the contract in question purported to exclude third-party 

beneficiaries while also granting specific benefits to nonparties, the contract was 

patently ambiguous and the third-party beneficiary claim could not be dismissed on 

a pre-answer motion. Id. at *10. Like the defendant in Huntingdon Valley, Grand 

Strand cannot selectively enjoy certain benefits of the Agreement while 

disregarding terms beneficial to Members. Id. 

The Tennessee Supreme Court addressed whether a patient was a third-party 

beneficiary entitled to enforce a similar institutional agreement between a 

Tennessee hospital and BCBS of Tennessee in Benton v. Vanderbilt University, 

137 S.W.3d 614 (Tenn. 2004). Benton involved an arbitration dispute, but the 

dispute arose in part because the court had recognized a BCBS insured was a thirdparty beneficiary of the hospital's agreement with BCBS of Tennessee. Id. at 620. 

The court explained: 

Applying these principles, we conclude that the Court of 

Appeals correctly held that Benton was bound by the 

arbitration provision contained in the contract between 
 

Vanderbilt and [BCBS]. Benton was a third-party 

beneficiary to the contract who filed an action seeking to 

enforce rights under the contract. Benton's claim was 

dependent on his status as a third-party beneficiary to the 

contract and Vanderbilt's alleged obligations under 

section 6.1 of the agreement. Accordingly, based on the 

general principle that a third-party beneficiary cannot 

enforce favorable terms of a contract while avoiding 

unfavorable terms, we conclude that Benton's claim 

seeking to enforce the contract is subject to the 

arbitration provision. 

Id.; see also West v. Shelby Cty. Healthcare Corp., 459 S.W.3d 33, 45 (Tenn. 

2014) (citing Benton and noting the court had "already held that persons insured by 

an insurance company are intended third-party beneficiaries of the contract 

between their insurance company and a hospital. Thus, with regard to an insurance 

company's customers, 'reasonable charges' are the charges agreed to by the 

insurance company and the hospital."). 

In another billing dispute between a Blue Cross insured and a hospital contracting 

with the insurer, an Arizona court found a provision requiring the hospital to 

accept a discounted reimbursement rate was "clearly a benefit to the subscriber; 

that benefit is both intentional and direct." Nahom v. Blue Cross & Blue Shield of 

Arizona, Inc., 885 P.2d 1113, 1117 (Ariz. App. 1994). As further evidence that the 

insured was an intended third-party beneficiary, Nahom noted the numerous times 

the class of Blue Cross subscribers was named in the contract. Id. at 1118. The 

South Dakota Supreme Court reached the same conclusion when construing a 

hospital's contract with a self-insured health plan. Jennings v. Rapid City Reg'l 

Hosp. Inc., 802 N.W.2d 918 (S.D. 2011). The health plan's members were thirdparty beneficiaries to the contract because "the contract language clearly expresses 

intent to benefit" the members. Id. at 922. The Jennings court made special note 

of the contract's recitals which, as in this case, identified the benefits to members 

the insurance plan expressly intended to provide. Id. Jennings rejected the notion 

that the members could not be third-party beneficiaries because the contract 

provided direct benefits to its parties, i.e. the hospital and insurer. Notwithstanding 

its benefits to the contracting parties, the contract also benefited the members, and 

as such, the members were permitted to protect those benefits by enforcing the 

contract's terms. Id. at 923 ("We look only at who was directly and primarily 

benefited. In this case, it is [the health plan's insured employees]."). 
Here, the Agreement's language, structure, and purpose directly benefit Members 

like Beverly. From its opening provision, the Agreement acknowledges its core 

objective is to support a PPO created "for the benefit of its Members." The 

Agreement defines a PPO as "a network of providers under contract with the Plan 

whereby Benefit Contracts contain financial incentives for Members to seek 

Covered Services from such providers." These financial incentives are made 

explicit later in the contract where Grand Strand agreed to accept reimbursement 

for its services for BCBS Members at a discounted rate. Beyond co-pays and 

deductibles, Grand Strand was prohibited from directly charging Members for 

covered services, even at the reduced rate. In clear terms, Grand Strand agreed it 

would not solicit any payment from Members. Indeed, the Agreement conferred 

an additional practical benefit on Members by placing on preferred providers such 

as Grand Strand the obligation to submit the Members' bills to BCBS. 

Beverly's third-party beneficiary status is also evident from the PPO's structure, 

which is established by the Agreement. As a South Carolina district court has 

explained: 

A PPO is a means of health insurance whereby the 

insurance company contracts with a network of health 

care providers, including hospitals. The insurer attempts 

to negotiate favorable rates of reimbursement for the cost 

of health care that reflects the volume of patients the 

insurer expects to deliver to the preferred health care 

provider. The insurer then passes through some of this 

cost saving to subscribers in the form of lower copayments and reduced deductibles, which creates the 

incentive for the patient to use the preferred providers 

and, in turn, creates the volume to support the "discount." 

Drs. Steuer & Latham, P.A. v. Nat'l Med. Enters., Inc., 672 F. Supp. 1489, 1513 

(D.S.C. 1987). 

Beverly argues and we agree the PPO here is intended to benefit its participants. 

Grand Strand gained access to BCBS's expansive membership along with 

guaranteed reimbursements from BCBS in exchange for accepting both reduced 

payments as well as the responsibility of submitting Members' claims to BCBS. 

BCBS gained greater cost control in exchange for promising prompt payment for 

Grand Strand's services and touting Grand Strand's PPO provider status to 

Members. Beverly's allegations that Grand Strand's failure to submit Beverly's bill 
 

to BCBS and refusal to bill her at the reduced reimbursement rate state a claim that 

Grand Strand breached its contract in denying Beverly benefits arising from the 

Agreement. Therefore, the circuit court erred in dismissing Beverly's breach of 

contract claim. 

II. Fiduciary Relationship 

The circuit court dismissed Beverly's breach of fiduciary duty claims against Grand 

Strand as based on duties arising from a contract Beverly lacked standing to 

enforce. However, as discussed above, a nonparty may enforce a contract that 

intentionally provides her direct benefits. 

Although Beverly's complaint alleges certain required elements of a breach of 

fiduciary duty claim, the circuit court concluded Beverly and Grand Strand did not 

have a relationship from which a fiduciary duty arose. Beverly claims Grand 

Strand and Beverly created a relationship of trust when Grand Strand became a 

PPO preferred provider and accepted the Agreement's terms, and Beverly sought 

out Grand Strand for medical services because it was a part of the BCBS PPO. By 

providing Grand Strand with her BCBS PPO insurance identification card, Beverly 

contends she met the requirements for Grand Strand to fulfill the duties arising 

from its relationship with BCBS. Thus, Beverly claims Grand Strand breached its 

duty of trust. 

While South Carolina courts have recognized fiduciary relationships between 

agents and principals, attorneys and clients, the administrator and beneficiaries of 

an estate, business partners, officers and shareholders of a corporation, and doctors 

and their patients, there is no authority to support the proposition that a fiduciary 

relationship exists between a hospital and patient with respect to a hospital's 

contractual duty to submit an insurance claim. See Wogan v. Kunze, 366 S.C. 583, 

605, 623 S.E.2d 107, 119 (Ct. App. 2005), affd as modified, 379 S.C. 581, 666 

S.E.2d 901 (2008) ("[T]his state has not found that medical negligence or 

malpractice will support a cause of action for breach of fiduciary duty. Nor have 

our courts found the failure of a doctor to offer assistance in filing a Medicare 

claim or other claim is a breach of fiduciary duty."); see also Burton v. William 

Beaumont Hosp., 373 F. Supp. 2d 707, 723-24 (E.D. Mich. 2005) (finding 

Michigan law does not authorize the imposition of a fiduciary duty related to a 

hospital's billing practices); DiCarlo v. St. Mary Hosp., 530 F.3d 255, 269 (3d Cir. 

2008) ("It is clear, however, that in general New Jersey does not find fiduciary 

duty in the debtor-creditor context, and, given that the cases cited by both sides 

relate only to the provision of care and not the payment therefor, it is unlikely that 
 

 

the New Jersey courts would expand a hospital's fiduciary duty to its billing 

practices. In the absence of a fiduciary duty, no cause of action exists for its 

alleged breach, and [the breach of fiduciary duty claim] will therefore be 

dismissed."). 

Here, Beverly does not challenge the quality of the medical care she received. 

Rather, she complains only of Grand Strand's billing practices and its breach of the 

BCBS Agreement. Beverly attempts to expand the fiduciary relationship that may 

in certain circumstances exist between a doctor and patient to encompass a 

hospital's billing practices for medical services rendered. In essence, Beverly is 

asking the court to impose a fiduciary duty on a creditor-debtor relationship; South 

Carolina law does not impose such a duty in the absence of some special trust 

reposed in the creditor. See Regions Bank v. Schmauch, 354 S.C. 648, 671, 582 

S.E.2d 432, 444 (Ct. App. 2003) ("South Carolina holds the normal relationship 

between a bank and its customer is one of creditor-debtor and not fiduciary in 

nature." (citing Burwell v. South Carolina Nat'l Bank, 288 S.C. 34, 40, 340 S.E.2d 

786, 790 (1986)). The circuit court properly found South Carolina does not 

recognize a fiduciary duty related to a hospital's billing practices. Accordingly, we 

affirm the circuit court's dismissal of Beverly's claim for breach of fiduciary duty. 

III. Unjust Enrichment/Quantum Meruit 

Beverly argues the circuit court essentially found it equitable for Grand Strand to 

charge a Member in violation of its agreement with BCBS. While we disagree the 

circuit court's order so finds, we agree with Beverly's contention that the court 

erred in dismissing her quantum meruit claim. See Columbia Wholesale Co. v. 

Scudder May N.V., 312 S.C. 259, 261, 440 S.E.2d 129, 130 (1994) ("Absent an 

express contract, recovery under quantum meruit is based on quasi-contract, the 

elements of which are: (1) a benefit conferred upon the defendant by the plaintiff; 

(2) realization of that benefit by the defendant; and (3) retention by the defendant 

of the benefit under conditions that make it unjust for him to retain it without 

paying its value."); Barnes v. Johnson, 402 S.C. 458, 466, 742 S.E.2d 6, 10 (Ct. 

App. 2013) (explaining quantum meruit is a remedy for unjust enrichment); 

Williams Carpet Contractors, Inc. v. Skelly, 400 S.C. 320, 327–28, 734 S.E.2d 177, 

181 (Ct. App. 2012) (allowing a party to allege an unjust enrichment cause of 

action as an alternative claim for breach of contract). 

Grand Strand argues Pitts v. Jackson National Life Insurance Co., 352 S.C. 319, 

574 S.E.2d 502 (Ct. App. 2002), supports the circuit court's dismissal. We 

disagree. The asserted wrong in Pitts was a breach of an alleged "duty of insurer to 
inform an applicant of the availability of an allegedly superior product." Id. at 338, 

574 S.E.2d at 512. However, the court found it was not inequitable for an insurer 

to retain the price of an insurance policy where the insurer could have offered a 

policy with similar coverage at a lesser price. There simply was no duty to provide 

such a notification. Id. at 339, 574 S.E.2d at 512. Pitts also relied on the fact that 

the alleged wrongdoing was performed when the plaintiff was a mere insurance 

applicant. Id. at 331, 574 S.E.2d at 508. At that point, there was no existing 

relationship on which to build a fiduciary duty or to impose liability for unjust 

enrichment. Id. 

But Beverly is not a mere insurance applicant; she is a defined Member in a PPO 

Agreement under which Grand Strand contracted to provide Covered Services. 

Additionally, Beverly's complaint does not allege a failure to inform; it alleges 

affirmative inequitable conduct seeking to deprive her of the benefit of her funds. 

While the Pitts defendant was permitted to refuse to offer a gratuitous discount, 

Grand Strand is not permitted to bill a Member for its services at a higher payment 

rate than it contractually agreed to accept. The complaint does not allege a mere 

matter of erroneous billing. When Grand Strand billed Beverly for covered 

services, it declined to bill her at the contracted for, discounted rate, and it sent her 

the bill in violation of its contract with BCBS. Accordingly, it was error for the 

circuit court to dismiss the quantum meruit claim at the 12(b)(6) stage. 

Conclusion 

We reverse the circuit court's dismissal of Beverly's breach of contract and 

quantum meruit claims. We affirm as to the dismissal of the claim for breach of 

fiduciary duty and remand this matter for further proceedings. 

AFFIRMED IN PART, REVERSED IN PART, AND REMANDED. 

KONDUROS and HILL, JJ., concur.