Court Opinion

ID: 4264544
Source: CourtListenerOpinion
Date Created: 2018-04-17 12:09:24.115406+00
Date Added: 2024-06-11T07:49:15.316250
License: Public Domain

IN THE COURT OF APPEALS OF NORTH CAROLINA

                                   No. COA17-686

                                 Filed: 17 April 2018

Guilford County, No. 12 CVS 6126

CHRISTOPHER CHAMBERS, on behalf of himself and all others similarly situated,
Plaintiff,

             v.

THE MOSES H. CONE MEMORIAL HOSPITAL; THE MOSES H. CONE
MEMORIAL HOSPITAL OPERATING CORPORATION d/b/a MOSES CONE
HEALTH SYSTEM and d/b/a CONE HEALTH; and DOES 1 through 25, inclusive,
Defendants.

      Appeal by plaintiff from order entered 16 March 2017 by Chief Business Court

Judge James L. Gale in Guilford County Superior Court. Heard in the Court of

Appeals 30 January 2018.

      Higgins Benjamin, PLLC, by John F. Bloss, and Barry L. Kramer Law Offices,
      by Barry L. Kramer, Esq., admitted pro hac vice, for plaintiff-appellant.

      Womble Carlyle Sandridge & Rice, LLP, by Philip J. Mohr and Brent F. Powell,
      for defendant-appellees The Moses Cone Memorial Hospital and The Moses
      Cone Memorial Hospital Corporation.

      BRYANT, Judge.

      Where the sole representative in a class action lacked a genuine personal

interest in the outcome of the case and the unifying interests of the class was not

temporary or unlikely to be resolved before the claim was heard, we affirm the trial

court’s dismissal of the class action complaint.
                  CHAMBERS V. THE MOSES H. CONE MEM’L HOSPITAL

                                    Opinion of the Court

         On 23 August 2011, before receiving treatment for an emergency procedure at

Moses H. Cone Memorial Hospital (hereinafter “Moses Cone”), Christopher

Chambers (hereinafter “Chambers”) signed Moses Cone’s Patient Consent form. The

form stated “I understand that I am financially responsible for, guarantee and agree

to pay in full, in accordance with the regular rates and terms of [Moses Cone] at the

time of patient’s treatment, for charges for all services provided to me by [Moses

Cone] . . . .” (Emphasis added). Moses Cone billed Chambers $14,578.14 for services

rendered and materials provided during his stay at the hospital. When the bill went

uncollected, Moses Cone sued Chambers and his wife in Guilford County District

Court.

         Chambers filed a class action complaint against Moses Cone in Guilford

County Superior Court. Chambers alleged that Moses Cone charged inflated prices

for emergency care services provided to uninsured patients. Within the hospital

industry, a hospital’s list of gross billing rates for products and services is referred to

as a “chargemaster” list.     However, these rates can be negotiated by insurance

companies, managed care organizations, and uninsured patients seeking elective

treatments.     Chambers alleged that uninsured patients seeking emergency care

procedures were charged the chargemaster price for products and services.

Chambers argued that the Moses Cone emergency room Patient Consent Form’s

reference to “regular rates and terms” could not be made certain and were, therefore,

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                     CHAMBERS V. THE MOSES H. CONE MEM’L HOSPITAL

                                          Opinion of the Court

governed by contract principles allowing Moses Cone to recover no more than

“reasonable value” for its services and materials. Chambers contended that the

reasonable value of the services he received was less than one-half of the amount

Moses Cone charged.            Chambers sought relief from Moses Cone under several

theories, including: breach of contract, breach of covenant of good faith and fair

dealing, constructive trust, declaratory judgment, restitution, and injunction.

        Moses Cone answered Chambers’s class action complaint and counter claimed

against Chambers and his wife,1 as well as the putative class, seeking relief for

unrecovered balances for the cost of services rendered.

        On 1 April 2016, Chambers filed an amended class action complaint seeking

only a declaratory judgment that Moses Cone’s Patient Consent form, obligating a

patient to pay Moses Cone “in accordance with the regular rates and terms” applicable

at the time of the patient’s treatment, entitled Moses Cone to no more than the

reasonable value of the treatment or services provided. Moses Cone subsequently

dismissed with prejudice its counterclaims against Chambers and his wife and also

dismissed its district court action against Chambers and his wife. Moses Cone then

moved to dismiss Chambers’s amended class action complaint with prejudice on the

basis of Rule 12(b)(1).

        1 N.C. Baptist Hosps. v. Harris, 319 N.C. 347, 349, 354 S.E.2d 471, 472 (1987) (“It is well settled
that ‘doctrine of necessaries’ applies to necessary medical expenses.” (citation omitted)); id. at 353, 354
S.E.2d at 474 (“hold[ing] that a wife is liable for the necessary medical expenses provided for her
husband”).

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                 CHAMBERS V. THE MOSES H. CONE MEM’L HOSPITAL

                                   Opinion of the Court

      In an order entered 16 March 2017, the trial court dismissed Chambers’s

amended complaint on the basis of mootness: There was no longer a controversy

between the parties, and the case did not fit within an exception that allowed a moot

claim to proceed. Chambers appeals.

                 ______________________________________________

      On appeal, Chambers argues that the trial court erred by concluding that

Moses Cone’s dismissal of its counterclaims defeated Chambers’s right to continue

prosecuting the putative class action. We disagree.

      Rule 23 of our Rules of Civil Procedure provides that “[i]f persons constituting

a class are so numerous as to make it impracticable to bring them all before the court,

such of them, one or more, as will fairly insure the adequate representation of all

may, on behalf of all, sue or be sued.” N.C. Gen. Stat. § 1A-1, Rule 23(a) (2017).

             [P]rerequisites for bringing a class action . . . [include] that
             . . . the named representatives must establish that they will
             fairly and adequately represent the interests of all
             members of the class; [and] . . . the named representatives
             must have a genuine personal interest, not a mere
             technical interest, in the outcome of the case . . . .

Faulkenbury v. Teachers' & State Emps' Ret. Sys. of N.C., 345 N.C. 683, 697, 483

S.E.2d 422, 431 (1997); see also Crow v. Citicorp Acceptance Co., 319 N.C. 274, 282–

83, 354 S.E.2d 459, 465 (1987); Harrison v. Wal-Mart Stores, Inc., 170 N.C. App. 545,

548, 613 S.E.2d 322, 325–26 (2005).

             The party seeking to bring a class action under Rule 23(a)

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                  CHAMBERS V. THE MOSES H. CONE MEM’L HOSPITAL

                                    Opinion of the Court

             has the burden of showing that the prerequisites to
             utilizing the class action procedure are present. . . .

             The named representatives also must establish that they
             will fairly and adequately represent the interests of all
             members of the class. This prerequisite is a requirement of
             due process. See Hansberry v. Lee, 311 U.S. 32, 45, 85 L.
             Ed. 22, 29 (1940) (discussing F. R. Civ. P. 23).

Crow, 319 N.C. at 282, 354 S.E.2d at 465.

      “Although North Carolina courts are not bound by the ‘case or controversy’

requirement of the United States Constitution with respect to the jurisdiction of

federal courts, similar ‘standing’ requirements apply ‘to refer generally to a party’s

right to have a court decide the merits of a dispute.’ ” Meadows v. Iredell Cty., 187

N.C. App. 785, 787, 653 S.E.2d 925, 927–28 (2007) (citation omitted). “As is obvious

from the wording of [Rule 23], one who is not a member of the represented class may

not bring a class action representing that class.” Id. at 788, 653 S.E.2d at 928

(citation omitted); see also id. at 789, 653 S.E.2d at 929 (affirming a trial court’s

dismissal of a class action in part because “[the] plaintiffs were not suitable to

represent the proposed class”); Laborers’ Int’l Union of N. Am., AFL-CIO v. Case

Farms, Inc., 127 N.C. App. 312, 315, 488 S.E.2d 633, 635 (1997) (“[Rule 23] does not

grant or deny standing to parties. Rather than providing a basis for standing, this

statute allows a party who is entitled to sue to bring suit on behalf of itself and other

parties in the form of a class action.” (citation omitted)).

      Here, per the Amended Class Action Complaint,

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                 CHAMBERS V. THE MOSES H. CONE MEM’L HOSPITAL

                                   Opinion of the Court

             [Chambers] [brought] this action on behalf of himself and
             a class of all persons similarly situated, as defined as
             follows:
                    All     individuals    (or    their     guardians      or
                    representatives) who within four years of the date of
                    the filing of the Complaint in this action and through
                    the date that the [c]ourt certifies the action as a class
                    action (a) received emergency care medical
                    treatment at [Moses Cone] . . . ; (b) whose bills were
                    not paid in whole or in part by commercial insurance
                    or a governmental healthcare program; and (c) who
                    were not granted a full discount or waiver under
                    [Moses Cone’s] charity policies or otherwise had
                    their bills permanently waived or written off in full
                    by [Moses Cone].

      Chambers alleged that on 23 August 2011 he went to the emergency room at

Moses Cone for an emergency medical procedure; at the time, he was uninsured.

Chambers was subject to Moses Cone’s standard contract terms and provisions, which

stated that he was obligated to pay the hospital’s bill “in accordance with the regular

rates and terms of [Moses Cone].” The total payment billed to Chambers after his

discharge was $14,458.14 and “upon information and belief such amount was based

on 100% of the hospital’s Chargemaster rates. [Moses Cone] [has] not written off,

discounted or adjusted said billing.” Chambers alleged that his claims “are typical of

the claims of the [proposed] Class” and that “[he] is a member of the [proposed] Class

as defined.” Furthermore, Chambers alleged that he “will fairly and adequately

represent and protect the interest of the Class. He shares the same interests as all

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                  CHAMBERS V. THE MOSES H. CONE MEM’L HOSPITAL

                                    Opinion of the Court

Class members in having the Contract interpreted and in preventing [Moses Cone]

from pursuing collection of accounts based on billing at its Chargemaster rates.”

       However, after Chambers amended the proposed class complaint on 1 April

2016 to assert only one cause of action—declaratory judgment as to the interpretation

of an open price term contained in Moses Cone’s Patient Consent form signed by self-

pay emergency care patients—and removed all other previous claims, such as breach

of contract, breach of covenant of good faith and fair dealing, constructive trust,

restitution, and injunction, Moses Cone ceased its efforts to collect Chambers’s

outstanding balance. On 18 May 2016, Moses Cone dismissed with prejudice all

counterclaims against Chambers and his wife filed in response to the proposed class

action complaint as well as the District Court action against Chambers and his wife

for recovery of Chambers’s $14,358.14 outstanding balance due Moses Cone. Thus,

Chambers no longer has an individual claim against Moses Cone, and neither

Chambers nor his wife is subject to suit by Moses Cone for recovery of the outstanding

balance owed for emergency medical services provided 23 August 2011. Chambers’s

bill has effectively been permanently waived or written off, and thus, Chambers is no

longer a member of the proposed class he seeks to represent. See Faulkenbury, 345

N.C. at 697, 483 S.E.2d at 431 (“[P]rerequisites for bringing a class action . . . [include]

that . . . the named representatives must establish that they will fairly and

adequately represent the interests of all members of the class; [and] . . . the named

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                 CHAMBERS V. THE MOSES H. CONE MEM’L HOSPITAL

                                   Opinion of the Court

representatives must have a genuine personal interest, not a mere technical interest,

in the outcome of the case . . . .”); Meadows, 187 N.C. App. at 788, 653 S.E.2d at 928

(“As is obvious from the wording of [Rule 23], one who is not a member of the

represented class may not bring a class action representing that class.” (citation

omitted)). “The general rule is that an appeal presenting a question which has

become moot will be dismissed.” Thomas v. N.C. Dep't of Human Res., 124 N.C. App.

698, 705, 478 S.E.2d 816, 820 (1996), aff’d, 346 N.C. 268, 485 S.E.2d 295 (1997).

      Chambers contends that there are at least three exceptions to the mootness

doctrine which preclude dismissal of his action: “cases in which termination of a class

representative’s claim does not moot the claims of the unnamed members of the

class,” id. at 706, 478 S.E.2d at 821 (quoting Simeon v. Hardin, 339 N.C. 358, 371,

451 S.E.2d 858, 867 (1994)), “a defendant’s voluntary cessation of a challenged

practice does not deprive a . . . court of its power to determine the legality of the

practice,” id. at 705, 478 S.E.2d at 820 (alteration in original) (quoting City of

Mesquite v. Aladdin's Castle, Inc., 455 U.S. 283, 289, 71 L. Ed. 2d 152, 159 (1982)),

and “the court has a ‘duty’ to address an otherwise moot case when the ‘question

involved is a matter of public interest,’ ” id. at 705, 478 S.E.2d at 821 (citing Matthews

v. Dept. of Transp., 35 N.C. App. 768, 770, 242 S.E.2d 653, 654 (1978)). We hold these

exceptions do not apply in the instant case.

                                          -8-
                  CHAMBERS V. THE MOSES H. CONE MEM’L HOSPITAL

                                   Opinion of the Court

        Where our Supreme Court stated in Simeon that it believed the case before it

belonged “to that narrow class of cases in which the termination of a class

representative’s claim does not moot the claims of the unnamed members of the

class,” Simeon, 339 N.C. at 371, 451 S.E.2d at 867 (citation omitted), the Court

acknowledged there that the named plaintiff’s challenged harm was “by nature

temporary, and it [was] most unlikely that any given individual could have his . . .

claim decided . . . before [his challenge was resolved].” Id. Here, Chambers does not

raise a challenge that is by nature temporary or likely to be resolved before the claim

could be heard. Therefore, this exception to the mootness doctrine is not applicable.

        As to the remaining grounds raised as exceptions to the basis for holding

Chambers’s action moot, we note that each is an exception to holding the class action

moot.    See Thomas, 124 N.C. App. at 705, 478 S.E.2d at 820 (“[A] defendant’s

voluntary cessation of a challenged practice does not deprive a . . . court of its power

to determine the legality of the practice.” (citation omitted)); id. at 705, 478 S.E.2d at

821 (“[T]he court has a ‘duty’ to address an otherwise moot case when the ‘question

involved is a matter of public interest.’ ” (citation omitted)). We need not determine

if the class action is now moot based on the conduct of Moses Cone or the public

interest. The proposed class has but one representative—Chambers. And the sole

class representative lacks a genuine personal interest in the outcome of the case. See

Faulkenbury, 345 N.C. at 697, 483 S.E.2d at 431 (requiring that a class representative

                                          -9-
                 CHAMBERS V. THE MOSES H. CONE MEM’L HOSPITAL

                                  Opinion of the Court

have “a genuine personal interest . . . in the outcome of the case”). Furthermore,

Chambers has provided no authority which would allow the class action to proceed

despite his lack of individual standing as class representative. See N.C. Gen. Stat. §

1A-1, Rule 23(a) (“[O]ne or more, as will fairly insure the adequate representation of

all may, on behalf of all, sue or be sued.”). Accordingly, we affirm the trial court’s

dismissal of Chambers’s amended class action complaint.

      AFFIRMED.

      Judges DIETZ and BERGER concur.

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