Universal MRI and Diagnostics Inc. v. Medical Lien Management Inc. D/B/A Bridgewell
497 S.W.3d 653
Tex. App.2016Background
- Universal MRI & Diagnostics assigned three patient accounts (Rigsby, Gonzalez, Lashkari) to A/R Net, which assigned them to Medical Lien Management, Inc. d/b/a BridgeWell (MLM). Assignments stated they were “without recourse.”
- Total billed for the three patients was $7,700; MLM paid consideration for the assignments and recorded financing statements.
- After assignment, Universal accepted payments/settlements on those accounts ($1,150 and a $4,500 check covering multiple plaintiffs), which MLM later learned about when collecting from attorneys.
- MLM sued Universal for fraud, breach of contract, and money had and received; moved for traditional summary judgment and produced assignments, account statements, settlement documents, and affidavits.
- Trial court granted summary judgment for MLM, awarding damages for fraud ($208,030 total including exemplary/consequential), breach of contract ($52,018 plus fees/costs), and money had and received ($49,918 plus fees/costs); Universal appealed.
- The court of appeals: reversed fraud liability and related damages; affirmed breach-of-contract liability and damages; reversed money-had-and-received award and attorneys’ fees; remanded for further proceedings on fraud and fees.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Fraud (intent/knowledge at time of assignment) | MLM: Universal knowingly or recklessly assigned accounts while intending to collect later or without basis for the stated balances | Universal: No evidence it intended to renege at assignment; later settlements show breach, not preexisting intent | Reversed — MLM failed to conclusively prove Universal had no intent to perform or acted recklessly when assigning |
| Breach of contract (effect of “without recourse”) | MLM: Universal breached by collecting/accepting payments after assigning rights; MLM as assignee entitled to recover | Universal: “Without recourse” bars assignee’s recovery for assignor’s collection | Affirmed — “without recourse” does not bar MLM’s suit to recover payments Universal accepted after assignment |
| Money had and received (quasi-contract damages) | MLM: Universal received funds that belong to MLM and should be returned | Universal: Express contract covers dispute; quasi-contract recovery barred; also disputed allocation of aggregate settlement check | Reversed — quasi-contract generally unavailable where express contract exists; MLM did not conclusively prove allocation/amounts |
| Attorneys’ fees (lodestar proof) | MLM: Submitted affidavit stating hourly rate range and total fees; fees are reasonable and necessary | Universal: Proof insufficient under El Apple/lodestar—no time records or task-level breakdown | Reversed — fee affidavit lacked required detail (hours by task and who performed); remanded for further proceedings |
Key Cases Cited
- Valence Operating Co. v. Dorsett, 164 S.W.3d 656 (discussion of de novo review of summary judgment)
- Exxon Corp. v. Emerald Oil & Gas Co., L.C., 348 S.W.3d 194 (elements of common-law fraud)
- Johnson & Higgins of Tex., Inc. v. Kenneco Energy, Inc., 962 S.W.2d 507 (definition of reckless misrepresentation)
- Crim Truck & Tractor Co. v. Navistar Int’l Transp. Corp., 823 S.W.2d 591 (breach-of-contract vs. tort distinction when intent to never perform is alleged)
- Daniel v. Universal CIT Credit Corp., 238 S.W.2d 727 (assignment without recourse context; court distinguishes its application here)
- Fortune Prod. Co. v. Conoco, Inc., 52 S.W.3d 671 (quasi-contract barred where express contract covers the subject)
- El Apple I, Ltd. v. Olivas, 370 S.W.3d 757 (lodestar proof requirements for attorney’s fees)