Commercial Banking, Collections, and Bankruptcy

Dist. Ct. erred in granting defendant’s motion for summary judgment in plaintiff-hospital’s action, alleging that defendant breached its contract with plaintiff by failing to appropriately handle plaintiff’s “revenue cycle” that required defendant to set up billing codes, bill patients/third-party payors, process paperwork and collect payments. While Dist. Ct. agreed with defendant’s argument that even if it breached said contract, plaintiff could not recover any damages, since plaintiff sought only consequential damages that were impermissible under terms of instant contract in absence of showing willful misconduct, Ct. of Appeals found that plaintiff could proceed on instant action, where lost revenue would have been direct and expected result of defendant’s failures to collect and process revenue as required under instant contract. Moreover, overall language of instant contract for revenue collection services made clear that parties did not intend to insulate defendant entirely from damages for its alleged breaches. Ct. of Appeals further held that: (1) jury could find that at least some of defendant’s alleged breaches amounted to willful misconduct to extent defendant made obviously inadequate efforts to perform on contract while trying to minimize its own out-of-pocket expenses; and (2) contract did not foreclose recovery of all lost revenue, but rather precluded recovery only of revenue that was lost as indirect result of defendant’s breach.

Dist. Ct. did not err in granting defendant-manufacturer’s motion for summary judgment in action by plaintiff-purchaser of recreational vehicle, alleging that defendant breached express and implied warranties under state law, as well as violated federal Magnuson-Moss Act, where defendant’s recreational vehicle had multiple defects. In order to make claim of breach of express warranty, purchaser must give warrantor reasonable opportunity to repair defects, and under Indiana law, purchaser must give warrantor more than two opportunities to repair defects. However, in instant case, although plaintiffs identified over 11 minor and major defects, record showed that plaintiff never allowed defendant more than two opportunities to repair said defects. Fact that recreational vehicle was out of service for total of 230 days did not require different result, where Ct. found that time that recreational vehicle spent in repair was not so excessive that warranty failed of its essential purpose.

In action alleging that defendant violated Telephone Consumer Protection Act by sending fax to plaintiff, Dist. Ct. did not err in dismissing complaint based upon arbitration clause contained in agreement that plaintiff-chiropractor had signed with third-party, even though defendant had not signed said agreement. Record showed that: (1) plaintiff entered into provider agreement with third-party (which was wholly owned subsidiary of defendant) in order to gain access to defendant’s network of patients, and that provider agreement allowed third-party to assign its obligations to others without approval from plaintiff; (2) once plaintiff had signed agreement, plaintiff submitted over 6,000 patient claims to defendant; and (3) third-party subsequently signed agreement with defendant that required that defendant provide administrative services required in plaintiff’s provider agreement with third-party. As such, Dist. Ct. could properly find that contractual theory of assumption applied, where defendant had assumed material obligations of third-party in provider agreement, such that defendant could enforce arbitration clause in provider agreement. Ct. further noted that plaintiff was aware that defendant was performing said services, and that plaintiff had essentially assented to defendant’s performance of said obligations.