Case Study

Topics: Third party beneficiary, Contract law, Law Pages: 3 (785 words) Published: November 1, 2012
studySisters of ST Joseph of Peace health, and hospital services v. Russell
-Nature of case: appeal from judgment granting insurer's motion for directed verdict in action to recover cost of hospital care.

-Fact summary: Sisters of St. Joseph of Peace, Health, and Hospital Services (P) sued Aetna (D) to recover payment for medical care provided to Russell (D) based on its right as a third-party beneficiary of an agreement between Aetna (D) and Russell (D).

-Concise rule of law: A creditor beneficiary may directly enforce a contractual promise intended for its benefit, even though it is a stranger to the contract.

-Fact: Russell (D) was severely injured at work, and Sacred Heart General Hospital (P) provided medical treatment. Russell, uncertain who his employer was at the time of the injury, filed workers; compensation claims against each purported employer. The four purported employers and their insurers, including Aetna (D), subsequently entered into a Disputed Claim Settelement (DCS) agreement with Russell (D). The DCS agreement provided the certain sums and expenses would be the sole responsibility of Aetna (D), while Russell (D) would be responsible for his own temporary and permanent disability plus future medical expenses. The Hospital (P), then, brought sult to recover payment for Russell's (D), medical care, claiming an implied-in-fact contract and account stated against Russell (D), and third party beneficiary status under the DCS agreement against Aetna (D). At the close of evidence, Aetna (D) made a motion for a directed verdict, which was denied. The jury relieved Russell (D) of the claim against him, but rendered judgment against Aetna (D). Aetna (D) appealed, claiming it was error to...
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