Trail Clinic, Pc v. BlochTrail Clinic, Pc v. Bloch
This сase involves the alleged conversion of several checks which belonged to
Plaintiff in this action, Trail Clinic, P.C., is a health care provider that employed Dr. Lai Gopal Banerji, M.D., on or about April 14, 1976. Prior tо this time, Dr. Banerji had been an employee of Westminster Medical Clinic, a professional corporation which defendant Bernard Bloch helped organize and incorporate. Defendant Bloch and other doctors also incorporated Westminster Medical Management Corporation to manage the financial and аdministrative burdens of the medical clinic.
Cindy Thompson, clinic secretary for Trail Clinic, testified that physicians are issued "provider” identity numbers by Blue Cross-Blue Shield (hereinafter Blue Cross) so that the bills could be sent out to Blue Cross for services rendered by the physician. Without this provider number bills could not be sent to Blue Cross for payment. Clara Thompson, the Blue Cross supеrvisor for provider services, testified that Blue Cross received a payment authorization form from Dr. Banerji on February 2, 1976, and that it listed the payee’s address as 25501 Van Dyke Avenue, Centerline, Michigan. Clara Thompson further testified that Blue Cross received a letter from Westminster
When Dr. Banerji started to work for Trail Clinic, the latter tried to procure a new provider number from Blue Cross in order to receive payment from Blue Cross for work performed by Dr. Banerji at their clinic. It normally took Trail Clinic about one month to obtain a new "provider number” for physicians that it employed. However, due to administrative problems at Blue Cross, plaintiff was forced to use Dr. Banerji’s old "provider number”.
Despite Bloch’s claim of nonassociatiоn with the Westminster group, he wrote Blue Cross on May 3, 1976, to inform it of a change of address for payment of doctors employed by Westminster Clinic. In this letter Dr. Bloch referred to a list of doctors and their respective "provider numbers” and these doctors all were represented as being employed by Westminster Clinic. Dr. Banerji and his "provider number” were listed by Bloch as a doctor still employed by Westminster and who was affected by the change in payee address even though Dr. Banerji in fact had not been an employee of Westminster since April 14, 1976.
The Westminster Medical Clinic began receiving payments from Blue Cross for the services Dr. Banerji was rendering for Trail Clinic. Each check from Blue Cross was acсompanied by a computer printed stub with a detailed summary of when the reimbursal services were performed. Clara Thomp
Dr. Lawrence Baker, the sole shareholder of Trail Clinic, testified that his efforts to effect a recovery from defendant Bloch resulted in a proposed repayment schedule which was never honored by Bloch. Plaintiff’s unsuсcessful, informal efforts to effect a recovery resulted in the filing of a complaint against Westminster Clinic, Dr. Bloch, the other incorporators of the defendant clinic and Blue Cross.
Bloch’s first argument is that the trial judge clearly erred in finding that he actively participated in the conversion of the checks. We hold this argument to be without merit.
Conversion is any distinct act of dominion wrongfully exerted over another’s personal property. It occurs at the point that such wrongful dominion is asserted.
Thoma v Tracy Motor Sales, Inc,
In Gum, this Cоurt opined that a demand for return of the property is not necessary if a conversion has occurred. Gum, supra, 238. A demand is unnecessary where the act of the defendant amounts to a conversion regardless of whether a demand is made. However, if a demand is necessary for a conversion to exist, the demand may be made by a duly authorized agent of the person entitled to possession. 18 Am Jur 2d, Conversion, §§ 63, 65; pp 197-199. Furthermore, a person may be guilty of a conversion by actively aiding or abetting or conniving with another in such an act. Indeed, one may be liable for assisting another in a conversion though acting innocently. These rules are especially applicable where the defеndant received benefit from the conversion and subsequently approved and adopted it. 18 Am Jur 2d, Conversion, § 120, p 231.
Bloch, on appeal, argues that, because Dr. Banerji never made a demand for his money to him or Westminster Medical Clinic, plaintiff could not maintain an action for conversion. Bloch further argues that it was error for the trial cоurt to hold that he actively participated in a conversion because he did not possess, retain or refuse to deliver the checks and never attempted to convert the checks to his own use or to the use of Westminster Medical Clinic.
A demand is unnecessary where the conversion results from fraud or other wrongful conduct and the defendant denies possession of the property or where the property has been wrongfully appropriated by the defendant for his own use and benefit.
Even if a demand were required before a conversion can be said to have existed, the record indicates that such а demand was made. Dr. Lawrence Baker, sole stockholder of Trail Clinic,- P.C., testified that Dr. Banerji was paid a flat salary by Trail Clinic for the services he performed for it. Dr. Baker stated that checks that came into the clinic for services rendered by Dr. Banerji were directly deposited into Trail Clinic’s account, inasmuch as Dr. Banerji had signed an authorization form allowing Trail Clinic’s bank to accept Trail Clinic’s endorsement on his checks. Thus, these Blue Cross checks essentially were the property of Trail Clinic due to the financial arrangement between Banerji and Trail Clinic. Since Trail Clinic was entitled to possession of the Blue Cross checks, it was the proper party to make a demand for them. The record shows that Dr. Baker informed Bloch of these misdirected checks and that Dr. Bloch re
These facts establish a demand by Trail Clinic for the property and, since it was the entity entitled to possession, a conversion was established. The same result follows if Trail Clinic is treated as an agent authorized to collect checks for Dr. Banerji. See Am Jur 2d, Conversion, § 65, p 199.
Dr. Bloch next contends that he cannot be held liablе for conversion because the evidence elicited at trial revealed that he never received any money belonging to Dr. Banerji. According to Dr. Bloch, there was no evidence establishing that either he or Westminster Medical Clinic converted Dr. Banerji’s funds. Dr. Bloch contends that neither he nor the clinic exercised any dominion over the checks because there was no evidence of his or the clinic’s involvement with the checks in question. However, 10 of the 12 checks introduced into evidence, endorsed with Dr. Banerji’s name per the initials of another person, all were stamped with restrictive endorsements for deposit only to Westminster Medical Clinic’s account; the other two checks were endorsed "pay to the order of Westminster Management Corporation”. These endorsements establish the fact that the checks were not deposited to Banerji’s account, as Dr. Bloch maintains, but were in fact deposited to Westminster Clinic’s account or paid to Westminster Management. Dr. Bloch’s argument on appeal that the checks were deposited to Dr. Banerji’s checking account is not supported by the record. This Court is limited to the record developed by the trial court,
Burrill v
Although Bloch may not have had any direct contact with the converted сhecks, he may nonetheless be found guilty of conversion due to his letter of May 3 since this letter actively assisted with the conversion by Westminster. See 18 Am Jur 2d, Conversion, § 120, p 231. In April of 1976, Bloch was still a director and a shareholder in Westminster Medical Management Corporation. Money received from Blue Cross went to the Management Corporation which wоuld pay the doctors their prorated share. Dr. Baker testified that Bloch visited his clinic in June of 1976 (over a month after the May 3 letter) and told him that he was with Westminster Clinic. This evidence establishes that Bloch had acted either in behalf of one of the companies he was associated with or for his own interest. This Court has held that where a defendant aсts on his own behalf or as an officer or agent of a corporation he is personally liable for torts in which he actively participated.
Baranowski v Strating,
Bloch’s unverified claim of good faith or ignorance about the events which transpired is of no avail to him. Willis v Ed Hudson Towing, Inc, supra. The trial court’s finding that the tortious conduct of defendant amounted to a conversion is not clearly erroneous.
In the recent case of
Bergy Brothers, Inc v Zeeland Feeder Pig, Inc,
"An appellate court will set aside the findings of fact of a trial court sitting without a jury only when such findings are clearly erroneous. A finding is clearly erroneous when, although there is evidence to support it, the reviewing court on the entire evidence is left with a definite and firm conviction that a mistake has been committed. Smith v Michigan State Acccident Fund,403 Mich 201 ;267 NW2d 909 (1978). In making this determination, regard should be given to the special opportunity of the trial court to judge the credibility of those witnesses who appear before it. Ford v Howard,59 Mich App 548 ;229 NW2d 841 (1975).”
The trial judge stated in his findings of fact that Bloch had participated, by his letter of May 3, 1976, in the conversion of property that rightfully belonged to the plaintiff. This evidence, when combined with the testimony given at trial and discussed above, supports the finding by the trial judge that Bloch participated in the conversion. Giving due deference to the trial сourt’s superior position to judge credibility, we find that the trial judge’s determination holding Bloch liable was not erroneous. Because a review of the entire record does not leave us with a firm conviction that a mistake has been made, we hold that the judge did not err in finding Bloch liable.
Bloch’s contention that the trial judge made
Bloch’s third allegation of error is that the trial court erred when it failed to find the plaintiff, Trail Clinic, contributorily negligent. Bloch also contends that Blue Cross was negligent as well as Dr. Banerji and that, but for this negligence, the checks would not have been sent to Westminster and deposited in its account.
As a general rule, the appellate courts of this state will not consider an issue raised for the first time on appeal.
National Bank of Royal Oak v Frydlewicz,
"It is well established that an issue may not bе preserved for appeal if it is not raised at trial, Hayes vBooth Newspapers, Inc, 97 Mich App 758 , 773;295 NW2d 858 (1980), unless the claim is 'necessary to a proper determination of the case’, Prudential Ins Co of America v Cusick,369 Mich 269 , 290;120 NW2d 1 (1963), the claim involves a question of law for which all facts have been presented, Kahn-Reiss, Inc v Detroit & Northern Savings & Loan Ass’n,59 Mich App 1 ;228 NW2d 816 (1975), or a manifest injustice would result, People v Snow,386 Mich 586 , 591;194 NW2d 314 (1972). Review of the instant proceeding suggests no such special circumstances relieving the plaintiffs of their burden to raise аll applicable issues below. Thus, this issue was not properly preserved for our review.”
In
Kahn-Reiss, Inc v Detroit & Northern Savings & Loan Ass’n,
Bloch failed at trial to raise the issue of the alleged contributory negligence of Trail Clinic, negligence or conversion by Blue Cross and negligence of Dr. Banerji. The trial record indicates that the affirmative defense of contributory negligence was neither pled nor discussed by Bloch and that Bloch did not file cross-claims against Blue Cross or Dr. Banerji. A review of the record also reveals that all of the facts necessary to determine these claims raised on appeal for the first time are not documented or verified so as to facilitate review of these issues.
These claims are nоt necessary for a proper determination of this case as there was sufficient evidence produced at trial to substantiate the con
Bloch’s last two claims of error are groundless. Bloch maintains that the trial judge erred in not finding defendant Blue Cross liable for conversion and that the plaintiff sued the wrong corporation, officers and directors when it sued Westminster Clinic.
Bloch has raised the claim of Blue Cross’s liability on appeal for the first time. Bloch did not сross-claim against Blue Cross pursuant to GCR 1963, 203.3. Therefore, this issue will not be considered.
Defendant Bloch’s claim that plaintiff should have sued Westminster Medical Management, its officers and directors and not Westminster Medical Clinic is also raised for the first time on appeal without any cited authority for the claim. Therefore, appellate review of this issue is not appropriate. However, even if review were proper, Bloch has not stated a claim warranting relief. Bloch has referred to facts which are unverified and not found anywhere in the lower court record. In short, none of the evidence presented at trial supports the claim that plaintiff sued the wrong party. A party may not expand the record on appeal, as this Court is limited to the record established by the trial court.
The decision of the lower court is affirmed.