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Irvington Physical Therapy v. Shapiro & Berezin


April 26, 2010


On appeal from the Superior Court of New Jersey, Law Division, Special Civil Part, Essex County, Docket No. DC-020165-08.

Per curiam.


Submitted January 13, 2010

Before Judges Fisher and Sapp-Peterson.

In this appeal, the complaint of plaintiffs, Irvington Physical Therapy, North Jersey Health Center, and Shan Sivendra, M.D., seeking to recover fees incurred for medical services provided, was dismissed at trial after plaintiffs failed to produce the doctor who performed the services. We reverse and remand for a new trial.

The services were provided to defendant, Audrey Parker, who was injured in a slip and fall accident. Parker commenced litigation to recover damages resulting from her injuries. She retained defendants, Shapiro & Berezin, P.C. (defendants), to represent her in the litigation, who in turn referred her to plaintiffs for treatment. Defendants agreed to pay the medical bills out of the proceeds from any settlement. The matter settled, but defendants failed to take care of the medical bills. Plaintiffs commenced an action in the Law Division, Special Civil Part, against Parker and defendants. Parker did not file an answer and the court entered a default judgment against her.

A bench trial commenced on February 21, 2009. Plaintiffs produced one witness, Thomas George, their office manager. In addition to George's testimony, plaintiffs marked as exhibits the following documents: (1) a ledger bill of the medical treatment provided; (2) three prescriptions for physical therapy treatments; (3) medical progress notes; (4) letters of protection from the law firm; (5) some fax transmissions; and (6) Dr. Sivendra's final report. At the conclusion of George's testimony, plaintiffs made a motion to admit all of the exhibits into evidence. In response, defense counsel moved to strike George's testimony on the grounds that he is not a licensed physical therapist or physician and also admitted that he knew nothing about Current Procedural Terminology (C.P.T.) codes. The trial court never ruled upon plaintiffs' motion. Rather, the court agreed with defense counsel that Dr. Sivendra should have been produced because the court did not believe that George was "competent to testify as to the codes involved here, the charges, the reasonableness of same." The court granted defendants' motion and entered judgment dismissing plaintiffs' complaint. The ensuing appeal followed.

On appeal, plaintiffs urge that the matter before the court was a collection matter on a book account for which proof beyond establishing that medical treatment was provided and that an outstanding balance for treatment exists is all that is required in order to establish a prima facie case of entitlement to recover the outstanding monies owed. We agree.

In Ladenheim v. Klein, 330 N.J. Super. 219, 223 (App. Div. 2000), we held that a letter written by an attorney to his client's doctor, assuring the doctor that he would protect the doctor's outstanding medical bill from any settlement, created an equitable lien in favor of the doctor, which attached to his client's settlement proceeds. Here, there is no dispute that plaintiffs marked as exhibits letters dated November 17, 2004 and January 25, 2005, from defendants requesting that plaintiffs provide their narrative report which was to include the "nature and number of treatments rendered" and plaintiffs' "itemized bill for medical treatment indicating the dates of service, amount charged, amount paid by other sources including Medicare, major medical/health insurance, dates of payment and balance owed." In both letters, defense counsel stated:

Please accept this letter as my written representation that any amount of your bill not paid by other insurance or by Medicare will be PROTECTED AND PAID from any settlement or jury verdict recovered on behalf of your patient, Audrey Parker.

I hope this letter satisfies your requirements and you forward me your narrative medical report together with itemized bill for medical treatment at your earliest convenience.

In addition to the letters of protection, plaintiffs proffered evidence which also included numerous treatment and billing records. Plaintiffs were entitled to a ruling on the admissibility of these documents. We are certain that absent some valid objection, the letters of protection would have been admissible as a statement by a party opponent under N.J.R.E. 803(b)(1) and the treatment and billing records would have been admissible as business records under N.J.R.E. 803(c)(6).

In moving to strike George's testimony, defense counsel argued that George "doesn't know anything about C.P.T. codes, the part of the body and how much is able to be charged for the treatment." This, however, was not George's testimony. He testified that he was not familiar with two particular C.P.T. Codes, 847.0 and 844.9, which did not have a corresponding description of the particular body part that was treated on the exhibit marked P-1. George indicated that he did not have the book to convert those codes. Later in his testimony, while attempting to explain why a total bill is compromised when it involved a "no[-]fault fee schedule and Medicare fee schedule," his attorney elicited the following testimony from George:

A: Usually when we generate the bill, it comes on a total bill. When you fee schedule it looking at the no fault fee schedule and the Medicare fee schedule --

[DEFENSE COUNSEL]: Objection, Judge. I don't think he's competent to testify. There's been no foundation laid that he can testify about things like that.

THE COURT: Yeah. Just lay some foundation as to his experience with regard to that.


Q: Do you -- do you normally do the billing for Irvington Physical Therapy?

A: Yes.

Q: Yes.

And even though you don't know all the C.P.T. codes, you're . . . familiar with billing practices and --

A: Yes.

Q: -- the amounts received for . . . the company's services, correct?

A: Yes.

Q: And typically, when you send bills to attorneys for litigation cases, do you compromise those bills?

A: Yes. All the time.

Q: Okay. So that's a standard practice then?

A: Yes.

Q: Okay. And in this case, was . . . the bill paid?

A: No.

We note before moving to admit exhibits at the conclusion of George's testimony, plaintiffs, midway through George's testimony, moved to admit the ledger of treatment, physical therapy prescriptions, progress notes, doctor's bill and notes, and the letters of protection from defendants. Defense counsel objected to the admissibility of the documents into evidence "until [George is] qualified or competent about the bills. I'd like to cross examine him about that." Defense counsel never cross-examined him on this issue but instead moved to strike George's testimony in its entirety.

We are satisfied that George, as the office manager, was competent to testify as to what services were provided, the cost of those services, the payments received and the balance owed.

The trial court therefore erred in dismissing plaintiffs' complaint at this stage of the proceedings.

In reaching our decision, however, we do not hold that defendants are precluded from challenging the "value of the services" rendered as they argued in seeking to strike George's testimony. Hackensack Hospital v. Tiajoloff, 85 N.J. Super. 417, 420-21 (App. Div. 1964), certif. denied, 44 N.J. 396 (1965) (noting "when the reasonable value of those services is placed in issue . . . the books of account alone usually cannot supply that proof). Rather, in failing to cross-examine George on this issue, they were left to challenge the value of the services rendered through whatever evidence they would proffer in defending against plaintiffs' claim.

Reversed and remanded for a new trial. We do not retain jurisdiction.


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