Opinion ID: 1632186
Heading Depth: 2
Heading Rank: 3

Heading: Impairment of a Hospital Lien

Text: Once a hospital has perfected its lien, the lien is protected from impairment. The pertinent portion of § 35-11-372 provides: During the period of time allowed by section 35-11-371 for perfecting the lien provided for by this division [10 days] and also after the lien provided for by this division has been perfected, as provided in this division, by any lienholder entitled thereto, no release or satisfaction of any action, claim, counterclaim, demand, judgment, settlement or settlement agreement, or of any of them, shall be valid or effectual as against such lien unless such lienholder shall join therein or execute a release of such lien. Any acceptance of a release or satisfaction of any such action, claim, counterclaim, demand or judgment and any settlement of any of the foregoing in the absence of a release or satisfaction of the lien referred to in this division shall prima facie constitute an impairment of such lien, and the lienholder shall be entitled to a civil action for damages on account of such impairment, and in such action may recover from the one accepting such release or satisfaction or making such settlement the reasonable cost of such hospital care, treatment and maintenance. Thus, under § 35-11-372, once a hospital has perfected its lien, no settlement is valid against that lien unless the hospital consents to the settlement. The statute further provides the hospital with a cause of action if its lien is, in fact, impaired. The Gann parties argue that even if the hospitals' liens were perfected, the entry of a summary judgment in their favor was nonetheless proper because, they argue, Gann is the master of his lawsuit and was therefore entitled to choose to dismiss his personal-injury claims and to pursue only his wrongful-death claim. [16] Under the facts of this case, we disagree. Although this Court has determined that a hospital lien does not attach to the proceeds of a wrongful-death claim, Jones, supra, the hospitals' liens did, in fact, attach to the personal-injury claims. See § 35-11-370 (Any . . . hospital authority or corporation operating a hospital in this state shall have a lien for all reasonable charges for hospital care . . . of an injured person . . . upon any and all actions [and] claims . . . accruing to the person to whom such care . . . was furnished, or accruing to the legal representatives of such person.). The hospitals' liens were perfected by actual knowledge; therefore, no release or satisfaction of any action, claim, counterclaim, demand, judgment, settlement or settlement agreement, or any of them, [is] valid or effectual as against [the hospitals' liens] unless the hospitals joined the settlement or executed a release of the liens. § 35-11-372, Ala.Code 1975. The Gann parties settled not only the wrongful-death claim, but also the personal-injury claims. Pursuant to the settlement, Gann dismissed the personal-injury claims and released the Etowah defendants from any and all present and future claims, demands, actions, causes of action, suits, damages, loss and expenses, of whatever kind or nature, for or on account of anything relating in any manner whatsoever to the May 22, 2004, accident. The settlement is broad enough to encompass the personal-injury claims, and the fact that it was made in the absence of a release or satisfaction of [a hospital] lien constitutes a prima facie case of impairment of the hospitals' liens; thus, the hospitals are entitled to institute a civil action for damages on account of such impairment. Ex parte Infinity Southern Ins. Co., 737 So.2d at 464; § 35-11-372, Ala. Code 1975. The hospitals' civil action must be commenced against the person liable for such damages within one year after the date such liability shall be finally determined by a settlement[,] release[,] covenant not to sue[,] or by the judgment of a court of competent jurisdiction. [17] § 35-11-372, Ala.Code 1975. The settlement was signed on January 16, 2006, and the hospitals did not file their impairment claim against Cory Watson and Gann until January 17, 2007; therefore, the summary judgment in favor of these two defendants is due to be affirmed because the hospitals' impairment claim against them was not filed within one year after the date such liability [was] finally determined by [the] settlement[,] release[,] covenant not to sue[,] or by judgment of a court . . . . § 35-11-372, Ala.Code 1975.