WILHELMINA HENRY, APPELLANT,
v.
HALIFAX HOSPITAL DISTRICT, ETC., APPELLEE
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Henry appeals a declaratory judgment allowing Halifax Hospital to apply excess insurance proceeds from her 1976 hospitalization to pre-existing unpaid charges dating back ten years. The court reversed, holding that the hospital's authorization to apply benefits was limited to the specified hospitalization and excess funds must be refunded to the insured.
The hospital may not apply excess insurance proceeds to pre-existing debts. The authorization form limited application of benefits to charges for the specified hospitalization period, and excess monies must be refunded to the insured. Pre-existing charges barred by statute of limitations remain valid debts but are not collectable through legal action.
[1] A statute of limitations bars the remedy of legal action to collect a debt but does not extinguish the debt itself.
[2] An assignment of insurance benefits to a hospital for a specific period of hospitalization authorizes the hospital to apply those benefits only to the charges for that pe…
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Join FLexlaw to unlock all legal intelligence“the authorization signed on behalf of appellant Henry constituted a sufficient designation to the hospital with respect to the application of insurance funds paid on behalf of Henry. Where a debtor designates a certain debt or debts to which he wishes his forwarded funds to apply, the creditor must apply the funds as directed or return the money.”
Establishes the core legal principle that creditors must honor a debtor's designation of how funds should be applied and cannot redirect them to other debts.
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Join FLexlaw to unlock all legal intelligenceHenry was admitted to Halifax Hospital in June 1976 for treatment of automobile accident injuries. Upon admission, her husband signed an Assignment of…
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BOOTH, Judge.
This cause is before us on appeal from a final judgment of the Circuit Court entered in favor of defendant Halifax Hospital in a suit for declaratory relief. The judgment sought to be reviewed holds that appellant Henry may not recover from the hospital the amounts paid by Henry’s insurance company to Halifax which exceed the charges resulting from Henry’s latest hospitalization.
The facts are that Henry was admitted to the hospital in June of 1976, for treatment of injuries sustained in an automobile accident. At the time of Mrs. Henry’s admission, her husband signed an Assignment of Benefits form provided by the hospital, which form states in part that Henry does:
“HEREBY AUTHORIZE PAYMENT directly to the below named hospital of the hospital insurance benefits otherwise payable to me but not to exceed the balance due of the hospital’s regular charges for this period of hospitalization. I understand I am financially responsible for charges not covered by this authorization.” (e. s.)
Pursuant to the foregoing authorization, two insurance companies paid the charges due, resulting in an overpayment as to the latest hospitalization. The hospital thereupon undertook to apply the excess insurance proceeds to preexisting unpaid charges owed to the hospital by appellant and members of her family going back over a ten-year period.
In her suit for declaratory relief, Henry contended: (1) That the prior charges were barred by the statute of limitations and (2) That the hospital could not apply the funds to pre-existing debts in the absence of an express authorization by the insured. The trial court rejected both arguments and ruled in favor of the hospital.
The law is clear that the expiration of the period of time prescribed by a statute of limitations does not extinguish the debt itself but only precludes the bringing of legal action to collect that debt. Hoagland v. Railway Express Agency, 75 So. 2d 822 (Fla.1954); 21 Fla.Jur., Limitations of Action, section 4 at 168; Danielson v. Line, 135 Fla. 585, 185 So. 332 (1938).
We find that as to the second point, the authorization signed on behalf of appellant Henry constituted a sufficient designation to the hospital with respect to the application of insurance funds paid on behalf of Henry. Where a debtor designates a certain debt or debts to which he wishes his forwarded funds to apply, the creditor must apply the funds as directed or return the money. The creditor is not privileged to apply the fund to other claimed debts contrary to the debtor’s instruction. All Cargo Transport Inc. v. Florida East Coast Railway Co., 355 So. 2d 178, 179 (Fla.3d DCA 1978), and cases cited therein.
In this case the hospital obtained Henry’s signature on its form assigning medical insurance benefits to the hospital for services provided beginning June 11, 1976. The insurance proceeds paid on behalf of Henry are to be applied to the amounts owing for the hospital services specified, and excess monies must be refunded to the insured, Henry.
Accordingly, the judgment below is REVERSED and the cause REMANDED for further proceedings consistent herewith.
McCORD, C. J., and MILLS, J., concur.
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Allie v. Ionata, 503 So. 2d 1237 (Fla. 1987)…iration does not affect the underlying substantive rights of the parties involved. See Piazza Properties, Ltd. v. State Department of Motor Vehicles, 71 Cal.App.3d 622, 628, 138 Cal.Rptr. 357, 360 (1977). See also Henry v. Halifax Hospital District, 368 So. 2d 432, 433 (Fla. 1st DCA 1979). It necessarily follows from these two principles, Ionata contends, that a judgment dismissing a claim as barred by a statute of limitation determines procedural matters only, and cannot be deemed an adjudication on the meri…
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Parkway Gen. Hosp., Inc. v. Allstate Ins. Co., 393 So. 2d 1171 (Fla. 3d DCA 1981)…y the insured to a third party. Nationwide Mutual Insurance Company v. McNulty, 229 So. 2d 585 (Fla.1969); W. Fla. Groc. Co. and H. T. Reddick v. Teutina Fire Ins. Co., 74 Fla. 220, 224, 77 So. 209, 210-11 (1917); Henry v. Halifax Hospital District, 368 So. 2d 432 (Fla. 1st DCA 1979). Allstate’s second argument in support of its motion to dismiss is that no copy of the insurance policy was appended to the complaint as required by Fla.R.Civ.P. 1.130. In Count V of its complaint, however, Parkway alleges that…
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Planes v. Marianthi Planes, 468 So. 2d 366 (Fla. 3d DCA 1985)…on December 31, 1982 per marital settlement agreement dated October 15, 1980.”1 Having cashed these checks, Ms. Planes may not now claim that they are not to be applied to reduce the designated obligation. Henry v. Halifax [*368] Hospital District, 368 So. 2d 432 (Fla. 1st DCA 1979); see Pino v. Lopez, 361 So. 2d 192 (Fla. 3d DCA 1978), cert. dismissed, 365 So. 2d 714 (Fla.1978). Accordingly, the orders under review are affirmed as modified by reducing the $50,000 obligation to $35,-798.20, plus interest fro…
Previewing 3 of 4 citing cases — full citator treatment, depth of discussion, and citing context are member features.
Join FLexlaw to unlock all legal intelligenceAuthorities Cited
- ALL Cargo Transp., Inc. v. Fla. E. Coast Ry. Co., 355 So. 2d 178 (Fla. 3d DCA 1978)
- Hoagland v. Ry. Express Agency, Inc., 75 So. 2d 822 (Fla. 1954)
- Danielson v. Line, 135 Fla. 585 (Fla. 1938)