A Victim was injured in a car accident, and he sought chiropractic services from the Plaintiff, Action Chiropractic Clinic. Prior to receiving the chiropractic services, the Victim signed a contract with an “Assignment of Rights” clause. In pertinent part, the Assignment of Rights clause stated:
For treatment provided, I hereby require my Health Insurance, Auto Insurance, or any other party involved to pay by check and mail directly to: ACTION CHIROPRACTIC
. . . .
For the medical expense benefits allowable, and otherwise payable to me under the current Insurance Policy, as payment toward the total charges for Professional Services rendered.
The Assignment of Rights clause specifically named Erie Insurance Exchange as the policy holder. Of note, however, Erie Insurance Exchange was not the Victim’s insurance company. Instead, Erie Insurance Exchange was the insurance provider for the driver who had injured the Victim in the car accident.
Action Chiropractic Clinic ultimately charged the Victim $5,010.00 for its chiropractic services. Shortly thereafter, Erie Insurance Exchange entered into a settlement with the Victim and paid him $8,510.00 for all claims relating to the car accident. However, neither the Victim nor Erie Insurance Exchange paid Action Chiropractic Clinic anything for the chiropractic services that it rendered to the Victim. As a result, Action Chiropractic Clinic sued both the Victim and Erie Insurance Exchange seeking payment, among other things, under the “Assignment of Rights” provision. Continue reading Tennessee Supreme Court holds that insurance assignment clause was ineffective.