McAllen Hospitals, L.P. D/B/A McAllen Medical Center v. State Farm County Mutual Insurance Company of Texas, 433 S.W.3d 535

McAllen Medical Center (the Hospital) treated Jose Gil and Melinda Hernandez after a car accident caused by Carlos Benavidez; the Hospital filed valid hospital liens under Tex. Prop. Code ch. 55 to secure payment.
Gil and Hernandez settled with Benavidez; State Farm (Benavidez’s insurer) issued settlement checks payable jointly to each patient and the Hospital, then mailed the checks to the patients without notifying or obtaining endorsement from the Hospital.
The patients deposited the jointly payable checks without the Hospital’s endorsement; the Hospital never received payment and its charges remain unpaid.
The Hospital sued State Farm to enforce its liens and recover outstanding treatment costs up to the settlement amounts; State Farm moved for summary judgment claiming it satisfied its obligation by issuing checks naming the Hospital as copayee.
The trial court granted summary judgment for State Farm; the court of appeals affirmed. The Supreme Court of Texas granted review.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the Hospital’s charges were “paid” under Tex. Prop. Code §55.007(a)(2) when State Farm issued checks jointly payable to the patient and the Hospital and delivered them to the patient, who cashed without the Hospital’s endorsement	Hospital: No — because it never received payment or endorsement, its charges were not "paid" and the releases are invalid	State Farm: Yes — issuing checks to patient and Hospital and delivering them to the patient was a good-faith payment that discharged State Farm	Held: No — delivery to one nonalternative copayee is constructive delivery but not payment to a “holder”; payment to one copayee without the other’s endorsement does not discharge the drawer or underlying obligation, so the charges were not "paid" under §55.007(a)(2)
Whether a hospital has a separate cause of action under the Hospital Lien Statute against the negligent third party or that party’s insurer (i.e., can the Hospital sue State Farm directly)	Hospital: Implicitly argued that it may enforce its lien directly to recover unpaid charges	State Farm: Did not assert this ground in summary judgment (issue not litigated below)	Held: Not decided — the question was not preserved for review because it was not raised in the trial court or in State Farm’s summary judgment motion; remanded for further proceedings

Bashara v. Baptist Mem’l Hosp. Sys., 685 S.W.2d 307 (Tex. 1985) (describing purpose of Texas Hospital Lien Statute)
Benchmark Bank v. State Farm Lloyds, 893 S.W.2d 649 (Tex. App.—Dallas 1994, no writ) (held possession by one joint payee constitutes constructive possession by other; court read to hold drawer discharged when one payee cashed check)
General Motors Acceptance Corp. v. Abington Cas. Ins. Co., 602 N.E.2d 1085 (Mass. 1992) (held payment to one nonalternative copayee without the other’s endorsement does not discharge drawer’s liability; adopted as better view)
Baylor Univ. Med. Ctr. v. Borders, 581 S.W.2d 731 (Tex. Civ. App.—Dallas 1979, writ ref’d n.r.e.) (recognized by some courts to allow hospital a separate cause of action to enforce liens)
Prairie View A&M Univ. v. Chatha, 381 S.W.3d 500 (Tex. 2012) (conveys principle that statutory text governs legislative intent; used to question implying an unexpressed remedy)