{ "id": 3556780, "name": "HEALTHCARE RECOVERIES, INC. As Agent for United Healthcare of Arkansas v. ARKANSAS CLIENT SECURITY FUND, Joann Maxey, Chair", "name_abbreviation": "Healthcare Recoveries, Inc. v. Arkansas Client Security Fund", "decision_date": "2005-06-30", "docket_number": "05-78", "first_page": "102", "last_page": "107", "citations": [ { "type": "official", "cite": "363 Ark. 102" }, { "type": "parallel", "cite": "211 S.W.3d 512" } ], "court": { "name_abbreviation": "Ark.", "id": 8808, "name": "Arkansas Supreme Court" }, "jurisdiction": { "id": 34, "name_long": "Arkansas", "name": "Ark." }, "cites_to": [ { "cite": "824 S.W.2d 383", "category": "reporters:state_regional", "reporter": "S.W.2d", "case_ids": [ 1904286, 1904310 ], "year": 1992, "pin_cites": [ { "parenthetical": "same" } ], "opinion_index": 0, "case_paths": [ "/ark/308/0364-01", "/ark/308/0301-01" ] }, { "cite": "308 Ark. 301", "category": "reporters:state", "reporter": "Ark.", "case_ids": [ 1904310 ], "year": 1992, "pin_cites": [ { "parenthetical": "same" } ], "opinion_index": 0, "case_paths": [ "/ark/308/0301-01" ] }, { "cite": "964 S.W.2d 199", "category": "reporters:state_regional", "reporter": "S.W.2d", "case_ids": [ 377627, 377623 ], "year": 1998, "pin_cites": [ { "parenthetical": "declining to address issue for first time on appeal following disbarment proceedings" } ], "opinion_index": 0, "case_paths": [ "/ark/332/0182-01", "/ark/332/0148-01" ] }, { "cite": "332 Ark. 148", "category": "reporters:state", "reporter": "Ark.", "case_ids": [ 377623 ], "year": 1998, "pin_cites": [ { "parenthetical": "declining to address issue for first time on appeal following disbarment proceedings" } ], "opinion_index": 0, "case_paths": [ "/ark/332/0148-01" ] }, { "cite": "761 S.W.2d 602", "category": "reporters:state_regional", "reporter": "S.W.2d", "case_ids": [ 6034995 ], "year": 1988, "opinion_index": 0, "case_paths": [ "/ark/297/154-A-01" ] }, { "cite": "297 Ark. 154", "category": "reporters:state", "reporter": "Ark.", "year": 1988, "opinion_index": 0 }, { "cite": "318 Ark. 727", "category": "reporters:state", "reporter": "Ark.", "case_ids": [ 1455680 ], "weight": 3, "year": 1994, "pin_cites": [ { "parenthetical": "citing Sexton v. Supreme Court Comm. on Professional Conduct, 297 Ark. 154-A, 761 S.W.2d 602 (1988)" }, { "parenthetical": "citing Sexton v. Supreme Court Comm. on Professional Conduct, 297 Ark. 154-A, 761 S.W.2d 602 (1988)" }, { "page": "731" } ], "opinion_index": 0, "case_paths": [ "/ark/318/0727-01" ] }, { "cite": "493 S.W.2d 422", "category": "reporters:state_regional", "reporter": "S.W.2d", "case_ids": [ 1624157 ], "year": 1973, "pin_cites": [ { "parenthetical": "per curiam" } ], "opinion_index": 0, "case_paths": [ "/ark/254/1075-01" ] }, { "cite": "254 Ark. 1975", "category": "reporters:state", "reporter": "Ark.", "year": 1973, "pin_cites": [ { "parenthetical": "per curiam" } ], "opinion_index": 0 } ], "analysis": { "cardinality": 521, "char_count": 9574, "ocr_confidence": 0.775, "pagerank": { "raw": 6.683060211305247e-08, "percentile": 0.4065721592262715 }, "sha256": "63c75bfe1ea5d0ce192a101180b41c909d9dc9a2d9665d51d9e74a4b73ddf31a", "simhash": "1:fe4ba314744c81b3", "word_count": 1589 }, "last_updated": "2023-07-14T22:29:41.293594+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [], "parties": [ "HEALTHCARE RECOVERIES, INC. As Agent for United Healthcare of Arkansas v. ARKANSAS CLIENT SECURITY FUND, Joann Maxey, Chair" ], "opinions": [ { "text": "Tom Glaze, Justice.\nIn June of 1997, Megan Ungerer, a minor, was injured in a car accident caused by Joann Jennings. After the accident, United Healthcare of Arkansas (\u201cUnited\u201d), provided her with health insurance and paid her medical bills. Megan\u2019s mother, Charann Ungerer Cooley, was appointed guardian of Megan\u2019s estate, and Cooley retained attorney Dennis Cameron to represent the estate. On November 17, 1998, Cameron filed a petition seeking authority to settle Megan\u2019s claim, asserting that Jennings had offered $300,000.00 to settle the claim. That same day, the Garland County Probate Court entered an order approving the proposed compromise. The order noted that, pursuant to the settlement agreement, the guardian was authorized to disburse funds as follows: $99,900.00 in attorney\u2019s fees; $2,100.00 in costs; and the balance, $198,000.00 to Megan, subject to payment of her medical bills. A handwritten notation on the order, initialed by the judge, stated: \u201cBalance to be placed in locked account(s) [;] withdrawal only by court order.\u201d\nOn July 27, 2001, United\u2019s agent for collection, appellant Healthcare Resources, Inc. (\u201cHRI\u201d) wrote to attorney Cameron about United\u2019s \u201coutstanding subrogation and medical lien on the recovery obtained on behalf of Megan Ungerer.\u201d HRI informed Cameron that United was owed $41,781.07 out of the $300,000.00 recovery obtained. HRI contended that sum should be paid out of the $198,000.00 of the settlement proceeds that were ordered into a \u201clocked account\u201d by the probate court.\nHRI did not receive a response to the July 27, 2001, letter from Cameron, and contacted him again on August 16, 2001, and August 29, 2001. Cameron sent a letter back to HRI on September 5, 2001, stating that he would be \u201chappy to arrange a meeting\u201d to discuss the money, but would have to wait to do so due to his wife\u2019s upcoming surgery. On October 23, 2001, HRI wrote back to Cameron, stating that it had attempted to call to set up an appointment, but Cameron\u2019s phone had been disconnected. On November 29, 2001, HRI again wrote to Cameron, stating that United had instructed HRI to initiate legal proceedings for the enforcement of the court\u2019s orders concerning payment of the medical liens.\nWhen HRI received no response from Cameron, it filed a \u201cpetition for payment of medical bills subrogation\u201d in the Garland County Probate Court. In its petition, HRI asserted that United had paid $41,781.07 for medical services rendered to Megan Ungerer, and asked the court to order that sum to be paid to HRI, as agent for United, out of the $198,000.00 that had been ordered placed in a locked account. Cameron filed a response on March 15, 2002, denying that HRI was entitled to any subrogation on the grounds that HRI did not enter into any agreement with Megan, Megan\u2019s mother, or counsel to protect its rights as to payment for medical expenses.\u201d Further, Cameron alleged that Megan had not been \u201cmade whole\u201d by the settlement, and HRI was therefore not entitled to subrogation.\nOn July 1, 2002, the probate court entered an order directing Cameron to file an accounting with the court within thirty days, detailing the location of Megan\u2019s funds, along with all payments and disbursements from the account in which the money had been placed. Cameron filed a response in which he asserted that the funds were located at Malvern National Bank in Hot Springs. Cameron further claimed that there had been no payments or disbursements from the account since its inception.\nSome time after Cameron\u2019s response, it was discovered that the funds that had allegedly been deposited with Malvern National Bank had, in fact, never been deposited. On October 28, 2002, the Garland County Prosecuting Attorney charged Cameron with two counts of theft of property. In November of 2002, the Supreme Court Committee on Professional Conduct placed Cameron on interim suspension. In 2005, Cameron was convicted of theft, and on March 11, 2005, Cameron filed a petition to surrender his law license.\nOn June 23, 2004, HRI filed an application for relief with the Arkansas Client Security Fund, alleging that HRI, as agent for United, had sustained a loss as a result of Cameron\u2019s dishonest conduct. On October 11, 2004, the Client Security Fund denied HRI\u2019s claim. HRI filed a timely notice of appeal, and now argues to this court that the Client Security Fund abused its discretion in. denying HRI\u2019s claim for relief.\nThe Client Security Fund was created for the purpose of protecting clients from losses caused by the dishonest conduct of members of the Arkansas bar. See In re: Client Security Fund, 254 Ark. 1975, 493 S.W.2d 422 (1973) (per curiam). Under the Rules of the Client Security Fund Committee, a claim may be made with the Committee under the following circumstances:\nA. The loss must be caused by the dishonest conduct of the lawyer and shall have arisen out of and by reason of a lawyer-client relationship or a fiduciary relationship between the lawyer and the claimant.\nB. The claim shall have been filed no later than three years after the claimant knew or should have known of the dishonest conduct of the lawyer.\nC. As used herein, \u201cdishonest conduct\u201d means wrongful acts committed by a lawyer in the nature of theft or embezzlement of money or the wrongful taking or conversion of money, property, or other things of value. A dispute over the reasonableness of a lawyer\u2019s fee is not an eligible claim.\nClient Sec. Fund Comm. R. 4.\nThe Rules further provide the following:\nThe Committee is authorized and empowered to admit or reject such claims in whole or in part to the extent that funds are available to it, and the Committee shall have complete discretion in determining the order and manner of payment of claims. No claim shall be allowed for an amount in excess of $40,000. All reimbursements shall be a matter of grace and not of right, and no client or member of the public shall have any right in the Client Security Fund as third-party beneficiary or otherwise. No attorney shall be compensated for prosecuting a claim against the Fund.\nRule 4(F).\nThis court has held that there is a right of appeal from a decision of the Client Security Fund Committee, although the Rules do not expressly provide for such a right. See Nosal v. Neal, 318 Ark. 727, 888 S.W.2d 634 (1994) (citing Sexton v. Supreme Court Comm. on Professional Conduct, 297 Ark. 154-A, 761 S.W.2d 602 (1988)). This court has further noted that, although reimbursement from the Fund is a matter of grace and not a matter of right, a client should be reimbursed when his or her claim validly comes within the provisions of the rules for reimbursement and the Client Security Fund Committee has sufficient funds to make the payment. Nosal, 318 Ark. at 731.\nOn appeal, HRI asserts that its claim came within the Rule\u2019s provisions because the probate court\u2019s order directing the money to be deposited into a locked account placed Cameron in a fiduciary relationship with HRI. HRI argues that the Fund thus abused its discretion in denying its claim because Cameron had, in effect, been \u201cappointed trustee over the $198,000.00 in settlement proceeds,\u201d and Cameron held the money in trust for the payment of Megan\u2019s medical bills. HRI acknowledges that the probate court never used the words \u201ctrust\u201d or \u201ctrustee,\u201d but contends that the directions to place the money into a locked account \u201cclearly created an implied trust, either a constructive trust or a resulting trust, by operation oflaw.\u201d Thus, because HRI and Cameron had a fiduciary relationship, HRI claims it was entitled to compensation for its loss.\nWe are unable to reach the merits of HRI\u2019s arguments, however, because HRI has raised these claims for the first time on appeal. In neither its petition for payment of medical bills nor in its application for relief filed with the Fund did HRI assert that a trust had been created by reason of the order directing the money to be deposited into a locked account. Although there are very few cases dealing with appeals from the actions of the Client Security Fund, and none that deal with the question of preserving issues for appeal, it is axiomatic that in any case, in order to preserve an argument for appeal, the argument must be made during the earlier stages of the proceedings. See, e.g., Wilson v. Neal, 332 Ark. 148, 964 S.W.2d 199 (1998) (declining to address issue for first time on appeal following disbarment proceedings); Dodrill v. Executive Director, Committee on Professional Conduct, 308 Ark. 301, 824 S.W.2d 383 (1992) (same); see also Nosal v. Neal, supra (analogizing appeals from Client Security Fund Committee decision to appeals from decisions by the Committee on Professional Conduct).\nScrutiny of HRI\u2019s petition for payment filed with the probate court reveals that HRI never raised the argument that the settlement funds were placed in trust by operation of the probate court\u2019s order, nor did HRI mention its fiduciary relationship theory in its application to the Client Security Fund Committee so that the Committee could consider the basis for HRI\u2019s request for reimbursement. Having failed to raise the argument anywhere below, HRI\u2019s sole argument on appeal is not preserved.", "type": "majority", "author": "Tom Glaze, Justice." } ], "attorneys": [ "Bailey, Trimble, Lowe, Sellars & Thomas, by: Peter O. Thomas, Jr., for appellant.", "Michael E. Harmon, for appellee." ], "corrections": "", "head_matter": "HEALTHCARE RECOVERIES, INC. As Agent for United Healthcare of Arkansas v. ARKANSAS CLIENT SECURITY FUND, Joann Maxey, Chair\n05-78\n211 S.W.3d 512\nSupreme Court of Arkansas\nOpinion delivered June 30, 2005\n[Rehearing denied September 8, 2005.]\nBailey, Trimble, Lowe, Sellars & Thomas, by: Peter O. Thomas, Jr., for appellant.\nMichael E. Harmon, for appellee." }, "file_name": "0102-01", "first_page_order": 126, "last_page_order": 131 }