Opinion ID: 1646864
Heading Depth: 1
Heading Rank: 6

Heading: Blue Cross also takes the position Hospital is estopped to have damages by reason of laches.

Text: At this point some repetition of the factual developments is unavoidable. Upon receiving notice of the proposed modification, about August 7, 1962, Hospital began protesting and thereafter repeatedly voiced opposition to the revision. Failing in these efforts it undertook an appeal March 17, 1964, to the Blue Cross Hospital Advisory Committee, which was denied May 23, 1964. July 1964, Hospital requested the insurance commissioner reconsider his prior action in connection with approval of the revised formula. October 27, 1964, Blue Cross board of directors reaffirmed its position on the changes to be made. February 5, 1965, the commissioner gave notice he elected to stand on the order previously issued. June 4, 1965, Hospital commenced the instant action. This court has previously held, laches is an equitable doctrine based on public policy. It relates to delay in the assertion or prosecution of a claim, working to the disadvantage or prejudice of another. See In re Estate of Shivvers, 240 Iowa 93, 103, 34 N.W.2d 632. To the same effect is Jennings v. Schmitz, 237 Iowa 580, 589, 20 N.W.2d 897, where we held the doctrine applicable only where it would be inequitable to permit recovery or it is clearly demanded in the interests of justice. And in an early case we said:    laches alone is not in itself a defense to an action on contract, unless of such duration as to cover the statutory period of limitation; but, if accompanied with other things, it may amount to an estoppel,   . State Sav. Bank v. Miller, 146 Iowa 83, 88, 124 N.W. 873. See also Boehnke v. Roenfanz, 246 Iowa 240, 248-249, 67 N.W.2d 585, 54 A.L.R.2d 1, and 17A C.J.S. Contracts § 531, pages 1025-1027. In addition it is generally understood that while delay in enforcing a right is an element of the doctrine, that alone does not constitute laches. 30A C.J.S. Equity § 116, page 45, and 27 Am.Jur.2d, Equity, sections 152-176, pages 687-723. Basically there can be no premise upon which the doctrine of laches may stand absent some wrong, such as a breach of contract, with a subsequent action for redress. As heretofore determined the attempt by Blue Cross to impose its modification proposal on Hospital constituted a unilateral attempt to modify the existing agreement. The question now to be resolved is whether the refusal by Blue Cross to reimburse Hospital pursuant to terms of the contract was in fact a breach. In that regard an unjustified failure to perform all or any part of what is promised in a contract is a breach, for which the aggrieved party is entitled to be compensated in damages. Restatement, Contracts, section 314; 17 Am.Jur.2d, Contracts, section 441, page 897; and Simpson, Law of Contracts, Hornbook Series, Second Ed., page 377. We are satisfied any failure by Blue Cross to pay in accord with the reimbursement cost formula contained in the original contract constituted a breach. Under the existing factual situation Hospital had the elective right to, (1) ask damages under the terms of the contract; (2) disaffirm the contract and ask for value of services performed; or (3) ask specific performance. See Shriver v. Cook, 256 Iowa 271, 278, 127 N.W.2d 102. Hospital, as aforesaid, elected to stand on the contract and seek compensatory damages. In support of its position to the effect Hospital is estopped to recover by virtue of the doctrine of laches, Blue Cross cites and relies in part on Sinclair v. Allender, 238 Iowa 212, 26 N.W.2d 320, but that case is not in point. There an action was brought more than ten years after delivery of deed to establish a resulting trust in real estate. In holding the doctrine of laches applicable this court pointed out that delay or postponement of action had been unfair to the opposing party, he had been damaged or prejudiced as a result, and it would be inequitable to force the claim at such a late date. Wokoun v. Jameson, 183 Iowa 956, 167 N.W. 676; State Bank of Iowa Falls v. Brown, 142 Iowa 190, 119 N.W. 81; and Moore v. Howe, 115 Iowa 62, 87 N.W. 750, also cited by Blue Cross, all deal with the matter of delay in attempting to assert rescission based on fraud or misrepresentation, and are therefore applicable. We are here dealing not with rescission, but rather with a damage action for breach of an executory agreement. In the instant case the contract called for continuing performance with periodic payments by Blue Cross to Hospital, and neither party elected to rescind or declare a termination. This then means, every time Blue Cross failed to remit the full amount due Hospital under the terms of the existing contract there was created a distinct and independent breach upon each of which an action would lie. But Hospital did not choose to pursue this course. It elected to continue performance, deferring any action until there had been several breaches. This it had the right to do. And in so doing it had not only the privilege but was in fact required to seek recovery for any and all breaches of the contract prior to commencement of the action. In support of the foregoing see 25A C.J.S. Damages § 193, page 256; 22 Am.Jur.2d, Damages, section 19, page 35; and Simpson, Law of Contracts, Hornbrook Series, Second Ed., section 188, page 380. Under the factual situation here disclosed there is no rational basis upon which to find the doctrine of laches bars Hospital's right of recovery. XI. We conclude the trial court erred in holding, (1) the contract was modified by mutual assent; and (2) Hospital's right to damages was limited to time of announcement by the insurance commissioner, he elected to stand on his original order of approval. By virtue of the foregoing there is no need to now consider other propositions urged on appeal by either party. Reversed on both appeals and remanded for further proceedings and judgment consistent with this opinion. All Justices concur, except LeGRAND J., who takes no part.